Frequently Asked Questions About Real Estate

The offer is the amount of money that the buyer agrees to pay for the home, plus any additional conditions in the contract. A “bid” on a house is another term for this.

An option period is a time outlined in the contract in which the buyer can cancel the contract without forfeiting their earnest money.

However long stated in the contract. Typically they range between 5 and 10 days. In general, a buyer wants the option period long enough to get a home inspection completed.

As agreed upon between the buyer and seller. This non-refundable fee typically ranges between $100 and $200 depending on the market.

This is a portion of the purchase price that is paid to the seller as an indication that the buyer intends to complete the purchase. It is typically paid with cash or a certified check and can be held by the title company until the home closes.

The amount of earnest money varies and is largely based on current market conditions, but a good rule of thumb is 1% of the sale of the home.

There are so many types of mortgages I don’t think I can list them all. The common types of mortgages I have worked within Central Texas have been VA loans, FHA loans, USDA loans, and conventional loans. My recommendation is to call a lender to see what type of home loan is best for your situation.

An FHA loan is a type of mortgage that is insured by the Federal Housing Administration. Another name for this type of mortgage is an FHA-insured mortgage. The minimum down payment requirement for this type of home loan is just 3.5%.

PMI stands for Private Mortgage Insurance. It is insurance that protects the lender in case you stop making your mortgage payments. The protection was created to cover the lender’s hazard of lending money on a property that could potentially be worth less than what they lent. PMI can sometimes be required by the lender.

A VA loan is a mortgage that is guaranteed by the U.S. Department of Veterans Affairs (VA), which places no restrictions on how much your down payment can be or what type of property you can purchase.

No minimum score is required for VA loans, however, most lenders require at least a 620.

Generally, you must have served in the military either on active duty, reserves, or national guard.  There are specific requirements for each situation, such as when and how long you served, which you can find out about here.

You can use a VA loan as many times as you would like. Keep in mind, however, there are different fees based on whether it is your first time using it or a subsequent time.

VA funding fees range from 1.4% to 3.6% depending on how much of a down payment you’re paying and if it’s your first time using a VA loan or subsequent use.

Yes. The new homebuyer must meet all of the VA loan requirements and pay a funding fee to do so.