After binge-watching reality shows where homes are bought and sold in a day, you might feel like you understand the process. Unfortunately, if you are buying your first home, you might come across a few surprises along the way. Here are two home buying myths debunked so that you don't have to worry:
1: "You get your keys the day you close."
Ah, closing day. After you finally sign that stack of papers, you might be ready to grab the keys to your new place and start moving in your furniture. Unfortunately, it doesn't always work that way. Although most buyers assume that their real estate agent will pass over the keys in the title office on closing day, you actually receive keys when the loan funds and records.
Unfortunately, this process can take a few days. If you have a wet closing, which is where the title company essentially trusts the lender to transfer the funds into escrow, you might be able to get the keys the same day. However, if you have a dry closing, the lender might have to carefully examine your paperwork and fund escrow before you gain possession—which could take a few days.
To ward off disappointment, take the time to talk with your real estate agent about what to expect. Try to avoid booking rental trucks, moving help, or carpet cleaners before you know when you will have possession of the house. It might be hard to wait, but it could save you from a frustrating hassle.
2: "Your loan will stay with your lender."
If you are like most first-time homebuyers, you probably thought long and hard about which lender to use. After you buy your home, it might feel like a slap in the face when you receive a letter stating that your loan was sold to a different lender. However, banks sell home loans all the time. Lenders typically sell mortgages to free up working capital to invest in other properties. In fact, around half of all mortgages are sold during their origination, which means that chances aren't high that you will be able to keep your favorite lender.
If your loan is sold, don't worry. Federal regulations state that all terms have to be identical to your original loan, including the interest rate, private mortgage insurance price, and even your repayment terms. You might be making payments on a different website or calling a different lender to ask questions, but your actual loan will be exactly the same.
By understanding the realities of real estate transactions, you might be able to keep calm and enjoy the process. Contact a company like Chris Calhoon Real Estate to learn more.