Buying a home can bring about many questions. I have put together a series of answers to the most common questions that I have heard from my clients. If you have a question that’s not listed here, please don’t hesitate to ask. I am more than happy to answer your questions and provide the answer to you and in this section of the website to help everyone.
Question: Is there a difference in energy efficiency of a home built today versus a used home from 5-10 years ago?
Answer: Absolutely, construction codes change over time and typically become more stringent. This forces all home-builders to follow the latest California Residential Codes and guidelines with respect to energy efficiency as well as other matters. Not only do you save more on your utility bills with a newer homes, more than likely the home is also built stronger than previous years to meet stricter seismic requirements.
Question: If brand new homes are being built, do I have the ability to customize colors or the floorplan layout?
Answer: Depending on where in the construction process the homes is, yes! You can typically change layout such as add a loft or add another bedroom, change layout of the kitchen, or change color of the walls as you see fit.
Question: How much down-payment is needed to purchase a home if I’m obtaining a loan?
Answer: It all depends on whether you are purchasing this property as a primary residence (meaning you plan on physically living at the property), or you are purchasing this as an investment (not intending to physically live at the property). If you are purchasing as an investment property, then you will need a minimum of 20% as down-payment. Depending on your credit score, the bank can always ask for more. If you are purchasing as a primary residence however, you are allowed a lower down-payment. If you’re eligible for an FHA loan, the minimum down-payment required is 3.5%. If you are obtaining a conventional loan, the down-payment minimum is 5%.
Question: Should I purchase home warranty?
Answer: If its a brand new home, the home builder will typically provide full one year home warranty upfront along with staged warranty based on component ( For example warranty on electrical and mechanical defects up to 5 years, structural up to 15 years, …). Its a personal choice to have home warranty thereafter. Typically on newer homes, the premium for home warranty is very low given that the home warranty insurer is not expecting anything to break.
Question: When obtaining a loan, do I have to go with the home-builders lending company?
Answer: No, you do not have to. You can choose to go with them or shop around with as many banks, credit unions, mortgage companies, and loan brokers as you like. The goal is to obtain the most favorable terms meaning the lowest interest rate available at the least closing cost. Some lenders may offer you a very low interest rate, but make sure to obtain the full picture. They may be charging you through closing costs.
Question: Is flood insurance required in North Natomas?
Answer: At this time if obtaining a loan, yes the lender will require flood insurance. If you are purchasing the home as all-cash, then it is up to you whether to purchase it or not.