Can someone tell me how this works in simple terms? I just want to buy a house for my soon to be family.

Asked by Bonnie Darnell, Ypsilanti, MI Fri Nov 14, 2008

I need details about downpayments, monthly payments, APR %, real estate companies, the difference between foreclosure, re-sale, and auction; home inspectors, and mortagae payments. This my first time looking.

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Renee Badall, Agent, Ann Arbor, MI
Sat Nov 15, 2008
Hello Bonnie,

First of all, congratulations on your forthcoming family and for doing your homework before taking this first big step towards home ownership.

Your down payment will vary depending upon the type of loan you get – FHA, MSHDA, Conventional, VA, etc. Your best course of action is to speak with a lender. They will match your individual circumstances with a loan program.

APR=annual percentage rate. This is the percentage rate that has all of the fees, etc. rolled in The lender, by law, is required to show this to you. It is not the interest rate you are paying year-after-year on your loan, but rather a rate computed based upon lender fees, appraisal fee, etc. that you are charged for that first year of the loan.

There are many real estate companies – commonly referred to as brokers. I work for a national company – Prudential Snyder & Company. I started my career at a local company, and it was fine, but I believe in the power and leverage that a national presence can give you in terms of exposure, relocation properties, internet presence, etc. I respect the answer that you were given to “interview” several realtors to determine what the best fit is for you for a buyer agent. I would be honored to be included.

A foreclosure is a bank-owned property. The purchase process is much the same as if you were buying a resale from an individual except the pricing is usually lower, and there is additional paperwork – called bank addendums – to sign. Don’t let this scare you. To throw another one in front of you—there are Short Sales! These are properties owned by an individual, but that individual’s property value has dropped below the amount of money they need to pay off their mortgage. The additional wrinkle involved in this sale is that the seller can accept your offering price, but it then has to be approved by the lender/bank.

An auction involves buying a home from an auction company. Basically, you bid on the house and highest bidder wins. When considering this, you should take a buyer agent with you who will have researched property values for the property being auctioned.

A home inspection comes into play after you have an offer accepted on a property. You hire a person called an Contractor Inspector and they go over the home in detail checking things that you may not have noticed on your preview of the home such as the furnace, appliances, water pressure . . . they poke their head into the attic and check the insulation quality, look for visible mold, etc.

And, of course, a mortgage payment is your monthly payment to the lender. Unless you are paying cash for the home, you will have to secure a loan – called a mortgage – from a bank or other type of lender. You pay this back over time . . . in monthly mortgage payments.

I hope that I have helped answer some of your questions, but there will always be more – especially since this is your first experience as a home buyer. I have a booklet for first time buyers which will walk you through the process [just let me know how I can get it to you], and I invite you to visit my website to see how I work with buyers. You can reach me on my cell at 734-754-3221. My website is
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Bob McClure, Other Pro, Walled Lake, MI
Fri Nov 21, 2008
good morning......get pre-approved you know how much home you can afford, the payments, how your offer needs to be needed to close..etc...etc...there is also a $7,500 federal tax credit available for first time homebuyers right now......over 14 years experience....i try to make things very simple and understandable...homebuying should be fun....not a hassle....also, i am available by cell days, weekends and evenings for questions.....i hope that helps...bob mcclure- mortgage now- farmington, michigan....
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smith3gary, Agent, White Lake, MI
Sat Nov 15, 2008

There's no shame in Kathy's game... of course I would recommend her teams services. LOL. Missy and her team also have a good reputation.
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Kathy Toth, , Ann Arbor, MI
Sat Nov 15, 2008
Bonnie, I would like to walk you through each question, Gary gave you some good links below. Missy is right in starting with a lender or two to get a good faith estimate in writing from each and then you , or we can compare them so you are looking at apples vs. apples, two reputable lenders - Bill Buchanan, Bank of America (734) 662-2137 and Dan Cornell (734) 395-9998. Buyers Agent Vicki Larmee is standing by 734-216-2172 to assist you through the steps. Ask her when the next FIRST TIME HOME BUYER SEMINAR is.
I know Gary Smith below would suggest you call us.
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smith3gary, Agent, White Lake, MI
Fri Nov 14, 2008

Glad to see you have lots of people wanting to help.

Information is available from the Federal Deposit Insurance Corporation (FDIC) about how to choose a lender, lender fees, fixed rate vs adjustable mortgage, APR, etc. The State of Michigan offers information at you would have to qualify for some programs.

There are several real estate companies in your area. I suggest reading these two documents, Real Estate Agency Disclosure and Agency Responsibility Act, both of which are available at There are several real estate business models, you need to verify what services your agent will do for you. I suggest getting this in writing from several agents and choosing the best for your needs.

There are two websites with a list of certified home inspectors in Michigan on the website above. Interview several and check their contracting or building experience.

If you have any other questions, feel free to send me an email, I will provide more choices and websites if needed.
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Vicky Chrisn…, Agent, Purcellvile, VA
Fri Nov 14, 2008
Bonnie... you do have many questions. They are all wonderful. Let's start here - find a buyer's agent you trust. Then, let them guide you through the process. Your questions are fabulous. Talk to 2 or 3 agents, and pick one - if you don't like any of them, then keep looking. Generally speaking you'll get a pretty good feel for experience level and personality with one good discussion.. make it face to face.

If you don't know any agents in your area, I'd be happy to check to see who I know in your area, and start the interview process for you. I refer agents across the country and beyond all the time; and I am happy to do it.

You can contact me at or 703-669-3142.

Also, for answers to some of your questions, feel free to check out my blog:
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Lisa Bender, , Howell, MI
Fri Nov 14, 2008
Hi Bonnie:

Are you a first time home buyer? If so, did you know about the first time home buyer tax credit of $7500. It's a great incentive to buying a home right now as well attractive interest rates. I'm very familiar will selling homes in Washtenaw County. I just sold a HUD home to someone and they got an excellent deal. HUD is also offering buyer incentives of $2500 to help with any repairs or even appliances that may be needed.

You have a lot of valid questions that I can help you with as well as a qualified lender. I have several excellent references if you need someone.

I'm certain I can help keep this process simple and stress free for you ... it's part of my job to consult with you and help make home buying a pleasant experience not a stressful one.

Please feel to visit my website and I'll provide you access to the same multi-list of homes that Realtors use to find homes for their clients homes. If you find something you like, I'm a quick email or phone call away. I do agree with Derek, a phone consulatation or meeting will better get your questions answered. It's all about finding out how I can best meet your needs.

Lisa Bender
Keller Williams Realty
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Missy Caulk, Agent, Saline, MI
Fri Nov 14, 2008
Hi Bonnie, Wow that is a lot of questions. First thing you need to do is get pre-approved so you know what price range you should be looking for in a home for your "soon to be family".

The down payment required will depend on your lender and what type of program they feel would best fit your financial situation. Feel free to call my lender Maria at 734-353-0505.

I could write a ton here but would you mind calling me and I will go over the first time home buyer process with you, no obligation at all to work with us. I would just like to explain the process 734-216-2822
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Derek Bauer, Agent, South Lyon, MI
Fri Nov 14, 2008
Good evening, Bonnie.

You ask all good questions! It would be easiest, and likely the most helpful and informative for you, to have this discussion live.

Could we schedule a time tomorrow to speak live? I would be more then happy to answer all of your questions ... which will spark more questions, and is why a live conversation would be best.

Feel free to email me at, or call me direct at 734.678.4745 and we can go into details.

Thank you!

Derek Bauer, Associate Broker / Realtor
Real Estate One
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