Let’s talk knowing the costs, your numbers,

and the importance of pre-approvals with a

reputable & local lender.

KNOW HOW IMPORTANT YOUR LENDER IS


We strongly encourage (but never require) you to work with a local and reputable lender. Why local? In Iowa, we are an abstract state and many national or out of state lenders are unfamiliar with this, which means they may not give proper estimates on costs and can cause some added hurdles during the loan process. Why reputable? When negotiating, the lender (both the institution and/or the loan officer) can carry a lot of weight in a seller’s decision on what offer to accept and/or their motivation to work with a particular buyer.


KNOW HOW MUCH YOU CAN AFFORD


Many home buyers spend a lot of time researching homes - comparing kitchen layouts and backyard square footage- but very little time researching their financing options. One of the first things buyers should do is talk to a qualified, reputable lender and get pre-approved for a mortgage.


KNOW HOW MUCH IT COSTS TO OWN A HOME


Repairs & Upkeep: Whether its a rusty pipe or a leaky roof, things go wrong and need to be fixed. Be prepared to set aside a small percentage (1% at most) of the home’s purchase price annually for these items.


Property Taxes (and the likelihood that they will climb over the course of your time in the house): To get an idea of how much you’ll be paying, call the county assessor’s office and talk to people in the neighborhood(s) you are looking in.


KNOW HOW MUCH IT COSTS TO PURCHASE A HOME


Earnest Money: At the time you write the offer you will need to write a check for or pay Earnest Money electronicall (usually $500-$1000). This amount will go toward the purchase.


Inspection: It is highly recommended that you have professional inspector do the property inspection. This will run $350-$450. A radon test is $100-$125.


Down-Payment: Depending on the type of loan you are getting, some require the buyer to put down 3.5% of the cost of the home as a down payment at closing. Other loans may require more.


Closing Costs: This is the cost of obtaining a loan. It also includes pre-payment on tax, insurance and appraisal. It typically runs about about 3% of the purchase price.


Documents Requested by Most Lenders

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COPY OF most recent two yearS of w2 forms

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COPY OF most recent two yearS of TAX RETURNS

If self-employed, YTD Profit & Loss and Balance Sheet/ If using IFA, three years of signed tax returns and W2's

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COPY OF most recent 30 DAYS PAY CHECK STUBS

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COPY OF ALL PAGES LAST TWO MONTHS STATEMENTS

Checking, Savings, Investment, Mutual Funds & 401k

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CLEAR & LEGIBLE COPY OF DRIVER’S LICENSE

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COPY OF DIVORCE DECREE/CHILD SUPPORT ORDER

If Applicable

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COPY OF COMPLETE BANKRUPTCY PAPERS & LETTER OF EXPLANATION OF WHY IT WAS FILED

If Applicable