I am a first time home buyer i never purchased a home it will be my first loan...?

Question

WHEN YOU GO THROUGH THE FIRST TIME HOME MORTAGE, HOW DO THEY GIVE YOU THE LOAN? FOR EXAMPLE I AM APPROVED FOR A FIRST TIME HOME BUYER LOAN, I TELL THEM WHAT I WANT MY LOAN AMOUNT TO BE, FOR EXAMPLE I WANT 180,000 AND I FIND A HOUSE AT 169,900. ANYWAY WHERE WOULD THEY SEND THE MONEY TO? THANKS

Answer 1

As housing market continues to slump, if you don't plan to delay your plan, please interview several and pick a good realtor or agent.

Bad ones will talk you into buying the largest property at your credit limit. Good ones will find you a good deal (Sellers are offering discount and incentives now).

Try to stay away from Adjustable Mortgage, because 30 year fix mortgage rate is very low right now. There is no reason to use Adjustable loans except fatter commission for loan agents.

Interests only loans are not good iether. Mortgage payment consists of two parts: interests and principal. Interests are like rent, which doesn't add to the equity to your house. It simply disappear as your pay it. If you want to use interests only loans, might as well rent, especially during market downturn, because housing price won't appreciate.

Finally, for tax benefits, talk to your CPA or tax accountant. Do not consult finance with realtors or agents. They get commissions when you sign the check!

Good luck!

http://biz.yahoo.com/brn/060909/19463.html

http://money.cnn.com/2006/09/08/real_estate/caught_in_the_bubble/index.htm?postversion=2006090814
http://money.cnn.com/2006/09/05/real_estate/Ofheo_home_prices/index.htm?postversion=2006090514

Answer 2

You don't actually see the money. The bank depending on the size may keep the loan there or they may sell your loan to a larger bank which happens all the time. The money for the loan goes directly to the bank where the loan is held. First Time Home Buyer option allows you to put little down. It's an incentive to get people to buy. You also have to get approved for a certain amount. Be careful about the loan amount it's better to figure your payments and how long you want to pay that'll figure out how much you can spend on a house. Remember because of interest you will probably pay much more for your home than what you bought it for. You have to think of property taxes, insurance, etc. and you can set those up in an escrow account where you make one payment for everything or you can choose to pay taxes and insurance one time per year and just make monthly payments on your house that way you have to make sure that you have the money set aside to pay it. If you get the house at closing you will be signing a lot, you almost feel like your signing your life away. Most likely everyone goes through, "What did I just do?" afterword. Good Luck.

Answer 3

You won't be approved for a 180,000 loan if the home price is 169,900. The money from the mortgage company goes to the seller to pay the purchase price of the home. More likely than not, the seller has a mortgage to pay off and most of the money will go to the seller's mortgage company. It's all done at your closing where the title company has prepared a voluminous amount of documents including the closing statement. In my state the buyer and seller are in the closing together but not all states work like that. I would suggest getting someone to help you with this process, perhaps a family member or trusted friend who has gone thru this.

Answer 4

A home loan, or mortgage, is most simply described as a loan taken out so that you can purchase a home. Here we’ll explain the very basics of home loans so that you can at least have a basic knowledge of mortgages and how they work.To obtain a home loan you will need to be at least 18 years old and have the income required to be able to easily afford the loan payments. While many mortgages are placed on existing homes, you can obtain a home loan based on units, condominiums, new construction or land packages.

Answer 5

Being approved for a 1st Time buyer loan, does not "preapprove" you for an amount. That will be based on your income and debt.

Your monthly payment will be for the mortgage, property taxes and homeowner's insurance. You also need to add in the monthy costs of homeownership. Take the monthly payment amount (i.e., $1500), divide by half ($750). You will need about $750 above the $1500 to pay for utilities, television, internet, association fees, upkeep. That will vary by your location of course but you need to plan this ahead of time.
Be very careful you are not "talked" into a home loan & lifestyle you can't afford. Do your homework - I recommend books by Robert Irwin...

Answer 6

The bank sends the money automatically to the house seller's lawyer on the closing date. The bank doesn't give you any money. You would probably have to get a separate loan if you wanted more than the purchase price of the house.

Answer 7

Well, it doesn't work like that. Once you find a home within your price range, the mortgage company will approve or disapprove your loan after the house is assessed and inspected. If you want a home for 169,900 then that's all you get from the mortgage company.

Answer 8

You don't get the money it goes directly into the house plus a broker helps you with this no bank will hand over that kind of money you get a loan to get the house & you make monthly payments on it that's how that works lol

Answer 9

The reason that residential home loans are lower rate than anything else is that they use the land for security. That land is not going anywhere. On the other hand, lenders will not loan more than that property is worth. There are some people out there who will counsel you to do it, but it is FRAUD.

Answer 10

You get pre-qualified for a maximum amount (not usually what you ask for), If you find a home up to that max. (169,000.00), they pay off the current mortgage (the current owner's mortgage). I don't really know if the mortgage lender will lend you more money than the house is appraised for (ie. repairs). Good Luck, quite a learning experience!