Why should I buy, instead of rent?
There are many reasons to buy a home instead of rent. These reasons include:
- Pride of Ownership
- Mortgage Interest Deductions
- Property Tax Deductions
- Capital Gain Exclusion
- Preferential Tax Treatment
- Mortgage Reduction Builds Equity
- Equity Loans
- Please review our Marin County Buyers Guide for more information
Should I use a real estate broker? How do I find one?
Alamere Real Estate has created a dedicated section to this question. Many of your questions will be answered here: How to Choose a Realtor. For more detailed information, please contact us.
How do I find a lender?
Much like finding a real estate agent, finding a lender is an important step in buying your home. As with a real estate agent, it is best to use all of the resources available to you including:
- Friend recommendations
- Office awards and accolades
- Real estate agent recommendations
- Internet recommendations
- Contact us for a Marin County mortgage broker recommendation
How much home can I afford?
To determine your maximum mortgage amount, lenders look at:
- Your credit history
- Available cash for down payment and closing costs
- Your income
- Your existing debt and financial obligations
- Job History – 2 years in same line of work
- Your maximum mortgage amount, plus your planned down payment, equals your home-purchase price range.
How important is my credit?
A history of paying monthly payments on time indicates you are likely to make mortgage payments on time. Your credit score, (e.g., a FICO score) will be a factor in the kind of mortgage program for which you may qualify but historical credit problems does not always mean that you can’t get a mortgage.
Your credit history can also affect:
- The amount required for a down payment
- The amount of money you can borrow in relation to your income
- The interest rate you are offered
If you haven’t done so already, obtain a copy of your credit report through the free service AnnualCreditReport.com. Do not use services such as freecreditreport.com as they will sign you up for “hidden” monthly fees.
How much do I need for a down payment?
A typical down payment in Marin County is 20-25% of the homes value but in today’s environment some homebuyers bay be eligible for down payment assistance and you may be able to buy a home with very low or no down payment. However, loans with down payments of less than 20% typically require mortgage insurance.
Should I wait until the market goes down?
It may go down some more but there is no guarantee the home you like in the area you want will be available. Buy what you like and plan to keep it for 3 years and you will be ahead between the write-off on taxes and your peace of mind you receive from being settled.
What are and how much are closing costs in Marin County?
Generally, closing costs in Marin equal between 1%-2% of the home purchase price.
Closing costs vary based on a variety of factors, but they usually include the following:
- Lender fees: Your mortgage company may charge for expenses related to making the loan, including an appraisal fee, a credit report fee, origination points, and discount points.
- Third party fees: Charges for services not provided by your lender often include the settlement fee, title insurance, and attorney’s fees.
- Prepaid items: This is the largest closing cost. Certain mortgage costs must be paid to your lender in advance. The most common of these are pre-paid interest, hazard insurance, and deposits to set up an escrow account. Some of these fees can be financed.
How large a loan can I be approved for?
Lenders use a variety of items to determine your loan eligibility and your debt-to-income ratio, these factors include:
- Your income, the type and security of your job
- Whether you are borrowing on your own or with someone else
- Your savings and outstanding loans
- Your credit history
- Whether anyone will act as guarantor by agreeing to repay the loan if you are not able to
- The value of the property you want to buy.
Once you know your maximum loan amount, it’s up to you to decide if it’s right for you.
What is the average mortgage size and down payment in Marin County?
There is no typical amount of down payment. The mortgage amount that you qualify for and the monthly payments you feel comfortable with help to determine your down payment. Also, your current age and earning potential can be a factor. Currently at least 20-25% is what the banks like to see but many lenders will work with as little as 3%.
What will my mortgage payment include?
Usually your monthly mortgage payment is made up of four amounts – often referred to as PITI:
How does an escrow account typically work in Marin?
An escrow company is attached to a title company in this area and it is a neutral depository for your transaction. They are the third party who handles the legal transfer of all funds and loan documents associated with a transaction. Fees are on a sliding scale and first time home buyers receive a discount.
Which type of loan is right for me?
The best way to match your needs to the perfect loan is to work with an experienced mortgage specialist. Ask your advisor for a Good Faith Estimate (GFE) to get an idea of the type and amount of loans that they offer. Please contact us for a recommendation or review our [Mortgage Section] for clarification on different types of loans.
When I find the home I want, how much should I offer in this market?
There is no all-encompassing answer to this question. It is best to speak with your real estate professional regarding your specific situation. Please feel free to ask us our opinion about any specific home or area in Marin County. Our experience throughout previous Marin real estate home pricing cycles will help you in pricing your offer. When your agent or broker is pricing your home, make sure to ask the following questions:
- What are comparable homes asking price and historical selling prices?
- How is the condition of the home?
- How long the home has the home been on the market?
- Have there been any recent price reductions?
- How much you can afford?
- How much you really want the home?
What happens if my offer is rejected?
Offers are often rejected but a rejection is often an open invitation to negotiate. If you chose your real estate broker wisely they will be an enormous help here. More money is not always the only option; occasionally you can ask the seller to cover some of the expected repairs and closing costs and incorporate that into another offer. Negotiations often go back and fourth several times before a deal is made.
What is “Pre-Approval”?
“Pre-approval” means that you have met with a loan officer, your credit files have been reviewed and the loan officer believes that you can readily qualify for a given loan amount with one or more specific mortgage programs. The lender will them provide you with an approval letter which will show your buying power. See our section on “The Home Buying Process” for more information.
Will I have to pay for Private Mortgage Insurance (PMI)?
Private Mortgage Insurance (PMI) provides your lender with a way to recoup its investment if you are unable to repay your loan. PMI is usually required when the mortgage amount is higher than 80% of the home’s value.
Should I pay discount points / Should I “buy down” my rate?
Discount points are prepaid interest, which you can pay to your lender at closing in exchange for a lower interest rate on your mortgage. Your decision to pay discount points depends on two factors, how long you plan on living in your home and your current financial situation. Please discuss this with your mortgage broker, real estate broker or contact us for more information.
Should I choose a fixed-rate or adjustable-rate loan?
Most mortgage loans have either a fixed interest rate or an adjustable interest rate. Fixed-rate mortgages have an interest rate that never changes and your payments remain stable throughout life. As the name suggests, adjustable-rate mortgages (ARMs) have an interest rate that changes at regular intervals based on a predetermined formula that is based on a market index.
Generally it is best to select a fixed-rate mortgage when you plan to stay in your home long term and/or rates or low and it is best to select an ARM if you plan on staying in your home short-term and/or rates are relatively high.
For help deciding which option is right for you, check GMAC’s Fixed vs. Adjustable calculator
Should I lock my mortgage rate?
Locking in your interest rate depends largely on the market and where you think rates will go. If you are in a rising interest rate environment then it is usually a good idea to lock in your rates, but it is difficult to predict the market and no one knows for sure which direction interest rates will go at a given point in time. Make sure to keep track of announcements from the Federal Reserve Board as their monetary policies will effect mortgage rates. Please note that if rates drop during the lock-in period you are not allowed to switch to the lower rate.
Where can I search for a house?
This site has been created to make buying a home in Marin County easier. You can easily search local MLS listings or browse by community. We have the area’s most advanced search engine for Marin Real Estate. Our users also have the ability to create a login and password and save their searches and preferences. Sign up for your free account on the right hand side of this page. For a more customized search contact us and we can assist you with all of your search requests.
How long does it take to fix bad credit?
The type of negative credit records determines how long they will stay on your credit report. For example: a bankruptcy remains in your record for 10 years and bills that go to collections remain on your credit 7 years. However, their effect on your score decreases over time. So you don’t have to wait 10 years before considering home ownership. It is important to always think about your credit score and take steps to improve it in order to insure that you will get the best rate at a later date.
Can I get a loan right now?
Yes, even 100% financing is available.
Marin County Mortgage & Home Loan Information
Review of Online Lending and Mortgage Websites and Services
In the past 20 years, online lending has exploded and local mortgage brokers are now competing with online brokers. Getting a home mortgage or refinancing your is a major financial decision and should be treated as such. Online interest rates that seem “too good to be true” often are and one needs to navigate wisely to avoid scams.
marin_mortgage_300If you do insist on shopping for a mortgage/home loan online, then there are a few factors that you need to be aware of: First, when comparing loans, make sure that you’re comparing loans on an apples-to-apples basis. For example, you find that “Loan A” for a 30-year loan has a much lower interest rate than “Loan B” (also for 30 years). Upon further inspection, you find that “Loan A” is technically an adjustable rate mortgage. Its payment is based on a 30-year amortization, but becomes due through either payment or refinancing at the end of 5 or 7 years. These are frequently referred to as a 5-year or 7-year fixed-rate mortgage. While both said “30-year”, they are not the same type of loan.
Second, you should always ask the lender for a statement detailing all fees associated with the loan. Factors such as “points” (loan fee), interest rate and “garbage fees” (extra fees which some lenders charge) can vary greatly from one lender to another.