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FAQ When Buying or Selling a Home in St. George, Utah

[toggle title=”How long will it take me to close on a home for sale in Utah?”]The typical real estate deal in Utah takes between 30 and 45 days.[/toggle]

[toggle title=”What is Earnest Money?”]Earnest money is a deposit delivered with your Utah Real Estate Purchase Contract, or your offer.  The deposit is held in a Trust account.  During the contract the money is held as “nobody’s money”.  When the Utah real estate is ‘closed on’ the money in the trust becomes part of the money that the buyer brings to closing.  If the deal does not close, the money is given back to the buyer or the seller, depending on how the contract was written and how the contract was ended. Yet another important reason to speak with a Red Rock Real Estate agent. [/toggle]

[toggle title=”What is the difference between a Utah ‘foreclosure’ and a Utah ‘short-sale’?”]A home in Utah that has been foreclosed on is now owned by the bank or whoever foreclosed on the property.  This is typically done by a bank.  In a short-sale the home has not been foreclosed on yet, the bank is agreeing to take less money than they are owed, or they are taking a “short on the sale”.  In a foreclosure you are dealing directly with the bank and the process is generally quick.  In a real estate short-sale you are dealing with a different department in the bank and the process can take much longer than other types of purchases.[/toggle]

[toggle title=”What makes real estate a good investment?”]Real estate has always been one of the best investments for your money.  One reason is Utah real estate has 2 exit strategies, you use your property as a rental investment or you can sell the property.[/toggle]

[toggle title=”How do I make an offer on a home?”]The best thing to do if you are new to the process is call to speak to a Red Rock Real Estate agent.  We are familiar with the process and the acceptable contracts that will help make your offer go smoothly.[/toggle]

[toggle title=”How long will it take to get an offer accepted?”]The length of time to get a property under contract depends on the seller.  In most cases a home can be under contract in a week or less.  If you are dealing with a bank the time frame may be 2 weeks or longer.  If you are dealing with a short sale it is difficult to say.[/toggle]

[toggle title=”How long will it take to finish my loan?”]A home loan application and approval process for a real estate purchase is typically  3-6 weeks.  The actual time it takes partly depends on the applicant and their responsiveness to the steps of the process.[/toggle]

[toggle title=”Why should I buy instead of rent?”] A home is an investment. When you rent, you write your monthly check and that money is gone forever. But when you own your home, you can deduct the cost of your mortgage loan interest from your federal income taxes, and usually from your state taxes. This will save you a lot each year, because the interest you pay will make up most of your monthly payment for most of the years of your mortgage. You can also deduct the property taxes you pay as a homeowner. In addition, the value of your home may go up over the years. Finally, you’ll enjoy having something that’s all yours – a home where your own personal style will tell the world who you are.[/toggle]

[toggle title=”Can I buy a home even if I have had bad credit?”] You may be a good candidate for one of the federal mortgage programs. Start by contacting one of the HUD-funded housing counseling agencies  that can help you sort through your options. Also, contact your local government to see if there are any local home buying programs that might work for you. Look in the blue pages of your phone directory for your local office of housing and community development or, if you can’t find it, contact your mayor’s office or your county executive’s office.[/toggle]

[toggle title=”How much money will I have to come up with to buy a home?”] Well, that depends on a number of factors, including the cost of the house and the type of mortgage you get. In general, you need to come up with enough money to cover three costs: earnest money– the deposit you make on the home when you submit your offer, to prove to the seller that you are serious about wanting to buy the house; the down payment, a percentage of the cost of the home that you must pay when you go to settlement; and closing costs, the costs associated with processing the paperwork to buy a house.

When you make an offer on a home, your real estate broker will put your earnest money into an escrow account. If the offer is accepted, your earnest money will be applied to the down payment or closing costs. If your offer is not accepted, your money will be returned to you. The amount of your earnest money varies. If you buy a HUD home, for example, your deposit generally will range from $500 – $2,000.

The more money you can put into your down payment, the lower your mortgage payments will be. Some types of loans require 10-20% of the purchase price. That’s why many first-time homebuyers turn to HUD’s FHA for help. FHA loans require only 3% down – and sometimes less.

Closing costs- which you will pay for at settlement on average is 3-4% of the price of your home. These costs cover various fees your lender charges and other processing expenses. When you apply for your loan, your lender will give you an estimate of the closing costs, so you won’t be caught by surprise. If you buy a HUD home, HUD may pay many of your closing costs.[/toggle]

[toggle title=”When I find a home how much should I offer?”] Your real estate broker can help you here. But there are several things you should consider: 1) Is the asking price in line with prices of similar homes in the area? 2) Is the home in good condition or will you have to spend a substantial amount of money making it the way you want it? You probably want to get a professional home inspection. Your real estate broker can help you arrange one if your offer is accepted. 3) How long has the home been on the market? If it’s been for sale for awhile, the seller may be more eager to accept a lower offer. 4) How much mortgage will be required? Make sure you really can afford whatever offer you make. 5) How much do you really want the home? The closer you are to the asking price, the more likely your offer will be accepted. In some cases, you may even want to offer more than the asking price, if you know you are competing with others for the house.[/toggle]

[toggle title=”What if my offer is rejected?”]They often are! But don’t let that stop you. Now you begin negotiating. Your broker will help you. You may have to offer more money, but you may ask the seller to cover some or all of your closing costs or to make repairs that wouldn’t normally be expected. Often, negotiations on a price go back and forth several times before a deal is made. Just remember – don’t get so caught up in negotiations that you lose sight of what you really want and can afford![/toggle]

[toggle title=”What happens at closing?”]Basically, you’ll sit at a table with your broker and a closing agent. The closing agent will have a stack of papers for you to sign. While he or she will give you a basic explanation of each paper, you may want to take the time to read each one and/or consult with your agent to make sure you know exactly what you’re signing. After all, this is a large amount of money you’re committing to pay for a lot of years! Before you go to closing, your lender is required to give you a booklet explaining the closing costs, a “good faith estimate” of how much cash you’ll have to supply at closing, and a list of documents you’ll need at closing. If you don’t get those items, be sure to call your lender BEFORE you go to closing. Don’t hesitate to ask questions.[/toggle]

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