REAL ESTATE Q: We are currently renting and would like to own a home but are not sure if we can come up with necessary down payment, closing costs, or fees. Is there help available for these costs? Dick Phelps A: The leap from renting to home ownership can seem daunting. Your Realtor is available to sit down and explain how they, with your lender, can walk you through this process. In regards to costs, there are three so called "moneys" in the transaction. Here they are and possible ways to acquire them in order to purchase a home. The major portion of the "moneys" is covered by a mortgage from a local lending institution. This is loaned to you and set up on monthly payments to the lender for repayment with interest. Another of the "moneys" is the down payment. This amount is designed so you have "some skin in the game" meaning you are risking some of your money but is also important because the more down payment, the lower the monthly repayment. Traditionally lenders have wanted 20% of the sale price. This is the amount that often stalls the process and it shouldn't. Much less than 20% is the new norm. Saving money for a down payment can be difficult in these times of turmoil. Assistance is available though. There are programs designed to assist home buyers with the down payment. It is important you can show you have an income to repay the loan and good credit to show you are responsible. To find out about possible down payment assistance, ask you lender, your Realtor, or visit the Down Payment Resource website. The third "moneys" is the cost the lender charges for their services which is their closing cost. This can range from 3% to 6% of the loan value. This amount can be rolled over into the mortgage thusly freeing up your cash for other home buying costs. If you have questions, you are not alone. Start the process by contacting your Realtor or hometown lender to begin the process of becoming a homeowner. Centur For Questions Contact: Dick Phelps 218-766-5263 orphelps@century21dickinson.com DICKINSON REALTORS REAL ESTATE Q: We are currently renting and would like to own a home but are not sure if we can come up with necessary down payment, closing costs, or fees. Is there help available for these costs? Dick Phelps A: The leap from renting to home ownership can seem daunting. Your Realtor is available to sit down and explain how they, with your lender, can walk you through this process. In regards to costs, there are three so called "moneys" in the transaction. Here they are and possible ways to acquire them in order to purchase a home. The major portion of the "moneys" is covered by a mortgage from a local lending institution. This is loaned to you and set up on monthly payments to the lender for repayment with interest. Another of the "moneys" is the down payment. This amount is designed so you have "some skin in the game" meaning you are risking some of your money but is also important because the more down payment, the lower the monthly repayment. Traditionally lenders have wanted 20% of the sale price. This is the amount that often stalls the process and it shouldn't. Much less than 20% is the new norm. Saving money for a down payment can be difficult in these times of turmoil. Assistance is available though. There are programs designed to assist home buyers with the down payment. It is important you can show you have an income to repay the loan and good credit to show you are responsible. To find out about possible down payment assistance, ask you lender, your Realtor, or visit the Down Payment Resource website. The third "moneys" is the cost the lender charges for their services which is their closing cost. This can range from 3% to 6% of the loan value. This amount can be rolled over into the mortgage thusly freeing up your cash for other home buying costs. If you have questions, you are not alone. Start the process by contacting your Realtor or hometown lender to begin the process of becoming a homeowner. Centur For Questions Contact: Dick Phelps 218-766-5263 orphelps@century21dickinson.com DICKINSON REALTORS