Orlando Real Estate News

Must-Know Real Estate Terms For First-Time Buyers In Orlando Florida 

If you're looking to buy a home in Orlando Florida or are applying for a mortgage, you may hear a few of the following real estate terms. Of course, we can't include everything you need to know here, so if you encounter other terms you're unsure about, please call us. We're your Orlando real estate experts, and we'll be happy to guide you and provide all the real estate information you need.

Amortization schedule - A payment plan by which a loan is reduced through monthly payments of principal and interest.
Appraisal - A paid evaluation to determine what a property is worth.
Closing (also called "settlement") - A meeting at which the seller transfers the property's title to the buyer.
Closing costs - Charges paid at settlement. These will vary from state to state, and are based on the purchase price of your home. Call us and we'll help calculate what they would be in Orlando Florida. 
Contingency - A provision in a contract that requires completion of an act or event before the contract is binding.
Down payment - The amount of cash a purchaser invests in the home.
Earnest money - Binds a sale of real estate and/or shows the seller that the buyer is serious about purchasing the home.
Equity - The difference between a home's value and what is owed on the home.
Escrow - The handling of funds and/or documents by a third party on behalf of the buyer and/or seller.
Good faith estimate - A written estimate of closing costs the borrower is likely to incur.
HUD-1 statement - An itemized listing of funds (real estate commissions, points, loan fees, etc.) that will be disbursed at the closing (settlement).
Interest-rate lock - A lender's written agreement that guarantees to provide a home buyer a specific interest rate and terms on a home loan.
Listing - An agreement between the property owner and a real estate broker authorizing the broker to market the home.
Point - An amount equal to 1% of the loan amount. Borrowers may decide to pay points in cash in order to lower their interest rate on a loan.
PMI (Private Mortgage Insurance) - Required by a lender when the borrower's down payment is less than 20% of the home's value. Protects the lender if the borrower defaults on the loan.
Principal - The amount of money originally borrowed, minus any payments made subsequently.
Real Estate Settlement Procedures Act (RESPA) - Federal law requiring lenders to provide home sellers and buyers a listing of settlement fees and other transaction-related costs.
Title insurance - A policy purchased by the buyer to protect the lender in case someone else claims ownership of the property after closing. A title policy may also be purchased to protect the owner's interests.
Walk-through - A final inspection of a property just before closing.
Warranty - A legally binding promise that certain stated facts are true.
Zoning - Regulations covering structures and uses of property within a designated area.

Read Also: 

• How can a real estate agent help a first time buyer?
  
  
• Guide for First-Time Homebuyers in Seminole & Orange County Florida - Part One of Two 
  
  
• Guide for First-Time Homebuyers in Seminole & Orange County Florida - Part Two of Two
  

INTERVIEWING A CONDOMINIUM BOARD

When you buy a condo, you will join the Home Owners Association.  An HOA is comprised of all the owners of the units who establish and administer the rules and regulations that will be observed.  These rules and regulations cover a variety of areas, but it is important for you do know from the beginning what they are and how they may affect you now and in the future.

When you have narrowed your condo choices down it is important that you take the time and effort to carefully review they by-laws and ask the necessary questions to determine which condo association fits your expectations.  It just may make that final decision an easier one to make.  Your lawyer can assist you if you have questions.

Condominiums can run into trouble if a number of units are facing foreclosure or there are members no paying the HOA dues.  When this happens financial reserves are depleted resulting in insufficient funds to finance the day-to day operation of the condo or complete important major upgrades that have been planned.  This has occurred in some areas across the country.

Read Also: Long Beach Condo Buyers Beware!

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If you've found your Orlando dream home, but don't have the money for a down payment, you may want to consider using a Central Florida down-payment assistance program to help make that dream come true.

What is down-payment assistance?

Down-Payment assistance is a program provided by non-profit organizations to help low-income families acquire the down payment, closing costs and other up-front expenses required to purchase a home. It may surprise you to know that almost one fifth of borrowers with an FHA mortgage utilize a down-payment assistance program.

The three most recognized non-profits offering down-payment assistance are AmeriDream Inc., Partners In Charity, and Nehemiah.

For first-time homebuyers, I should start at the beginning by explaining what a down payment is and why it is often required.  A down payment is money a home buyer must come up with out of his or her own pocket in order to qualify for a mortgage.  It is typically anywhere from 3% to 20% of the home's purchase price.  In the past, 20% was most commonly required, but to make home ownership more accessible, requirements have been relaxed.  Today with an FHA loan, the down payment can be as low as three percent.

Lenders require a down payment in order to reduce their risk of the borrower defaulting on the loan.  The more money someone has invested in their home, out of their own pocket, the less likely they are to just walk away.  Also, as we're currently seeing prices fall in many areas of Orlando, Central Florida and around the country, lenders want a down payment to ensure they are not lending more than what the home will be worth in 6 months.

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Is It the Right Time for You To Purchase a Home?

This seems to be a logical question, but many Orlando Homebuyers bypass this question and start the home search process without giving questioning if they are properly prepared.

Read Also: How do I know how much an Orlando home is worth?

There are questions you should address before you decide to embark on looking for a home.  Whether you are a first time home buyer or are thinking of purchasing your next home, it is a major decision.  Among the things you need consider when determining the right time to purchase an Orlando area home:

Financial Considerations

Read Also: Advice for Orlando Area First Time Buyers

Stable employment

Prospective buyers should realize that even though they may be able to afford to purchase a home this doesn't necessarily mean you should buy at this time or decide that it is ok not to purchase.  Some home owners have found themselves in financial difficulty because they have not considered how a worst case scenario would play out. 

The Real Estate Market In Your Area

Buyers should have an overall understanding of what is going on in the market they are looking at.  Do homes sell quickly or are on the market for a considerable time.  Your Realtor will have a good understanding of whether a home is over priced or fairly priced and can help you in deciding on an offer that will be accepted.

If you take the time to understand how timing can affect the home-buying process your journey to a successful transaction should hold no surprises or unexpected revelations.  You can enjoy selecting the right home for you and your family and be secure in the knowledge that you have.

Orlando Area Homes For Sale

• 9055 Heritage Bay Circle Orlando FL 32836
• 845 GALWAY BOULEVARD APOPKA FL 32703
• 1462 Travertine Terrace Sanford FL 32771
• 852 Abbott Ave Deltona FL 32725
• 3138 Bellingham Drive Orlando FL 32825

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Multiple Offer Situations

Calculating your Offer

Finding the right house is a hard work and then you find yourself in a situation where you have multiple offers to contend with.  This situation can be easier if you know what to expect and how to determine your offer.  It is important to your success to work with an experienced agent, craft your offer, and remember this is not the time to be faint of heart.  When you are in a multiple-offer situation you want to offer your best price first because you might not have the opportunity to make a counter offer.

Why does a home get multiple offers?

The home most likely is priced correctly for the market conditions.   Many buyers have been watching from the sidelines; they have done the homework and know the market conditions.   They are ready to move on a home that is correctly priced.

Read Also:  Advice for Orlando Area First Time Buyers

How to have the edge in a multiple offer situation

Preparation is the key to your success.   You need to be ready to hit the ground running and should have the following in place:

• An informed, experienced local Buyer's agent with a solid understanding of the market in your area.
• A Mortgage Pre-qualification from your lender, at the very least
• A Pre-approval from your lender is the better document have in place
• A Home Inspector in place
• Flexibility with your closing dates
• An attorney in place
• Enough cash in your checking account to cover the deposit
• An offer with as few contingencies as possible
• An offer that results in a high net for the seller

Read Also: How Do You Buy The Most Home For Your Money In Orlando Florida?

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