Frequently Asked Questions
Got general questions? Here's some of the most common questions (and answers) we are asked. If your question isn't listed, be sure to contact us directly for answers. And don't worry - we've been asked everything in the book. There are no dumb questions in Real Estate!
Q: What's your commission/fee for being my agent?
Home shoppers typically pay no fees to an agent to buy a home.
For most home sales, there are two real estate agents involved in the deal: one that represents the seller and another who represents the buyer. Listing brokers represent sellers and charge a fee to represent them and market the property. Marketing may include advertising expenses such as digital ads, print ads, social media and internet ads. The property will also be placed in the local multiple listing service (MLS), where other agents in the area (and nationally) will be able to search and find the home for sale.
Agents who represent buyers (a.k.a. buyer’s agent) are compensated by the listing broker for bringing home-buyers to the table. When the home is sold, the listing broker splits the listing fee with the buyer’s agent. Thus, buyers don’t pay their agents.
Q: I keep hearing about fixed-fee brokerage services. Do you do that?
A: The short answer is No. Why? Because a discount broker = discount services. Anytime a broker or agent offers to cut their commission, ask yourself: What are they NOT doing for me that another broker/agent would? Our goal is to get you the highest price possible given the market conditions and to actively market your property to attract those buyers. We do whatever it takes.
Q: Can you help me find a home based on what I want to pay a month?
A: We absolutely can. Our first step is to get your Pre-Approved by a lender. You can choose your own lender or we can recommend a few that we work with regularly. Shop your loan! The lender will take down your income and your debts, run your credit score, talk with you about payment, and give us a number. That number is what we need to get the ball rolling. We often tell our buyers - you may be Pre-Approved for a million dollars but only want to spend $100k. You might also be Pre-Approved for $100k and want to look at million dollar homes. A Pre-Approval is the best way to determine what you can and want to spend on a home. That way we know how to tailor your search.
Q: I need to sell my home to buy my next home. How do I do that?
A: It's tricky. But not impossible. Many homeowners need to sell their current home to put their equity earned as a down payment on their next home. And you should, you earned it! Our goal at TXHR is to sell your home. Sell it. Not let it sit. That being said, the market is what it is - unpredictable at best. During our seller consultation, we will discuss your needs and tailor a timeline that works for you.
Q: How long does it take to buy a home?
A: Under normal market conditions, the average time from contract acceptance to completion of the sale of a home is 30 to 45 days. Market conditions are a major factor in how fast homes are sold. In hot markets with a lot of sales activity, buying a home may take a little longer than normal. That’s because several parties involved in the transaction get behind when business suddenly picks up. For example, a spike in home sales increases the demand for property appraisals and home inspections, yet there will be no increase in the number of appraisers and inspectors available to do the work. Lender turn-around times for loan underwriting can also slow down. If each party involved in a deal takes a day or two longer to get their work done, the entire process gets extended.
Q: What are my closing costs going to be?
For sellers, a common rule-of-thumb is to calculate closing costs as being 7.5% of the purchase price on the contract. This includes marketing the property.
Marketing may include advertising expenses such as digital ads, print ads, social media
and internet ads. The property will also be placed in the local multiple listing service (MLS), where other
agents in the area (and nationally) will be able to search and find the home for sale. Once in the MLS, the property is blasted to over 1,000 websites around the world
for maximum exposure. We provide comprehensive services including data and market analysis to adapt our strategy before and during marketing.
For buyers, there is no rule-of-thumb. Why? It varies by lender, loan and home. We work hand in hand with your lender to write your Purchase Contract in a way that benefits you.
Q: Is now a good time to buy/sell?
A: You might hear about it being a "Buyer's Market" or a "Seller's Market" when you start thinking about moving. What is it? Supply and Demand, folks. Economics. There isn't usually a set market favoring one side of the transaction. What you'll see instead is pockets of markets. A hot neighborhood that historically never has homes available to buy but all of a sudden has one - that's a Seller's market in that neighborhood. The neighborhood next door might have many homes on the market around the same price point. That's a Buyer's market. So many factors go in to market conditions that it really depends on your situation. Is now a good time? Call us.
Q: What credit score do I need to buy a home?
A: Many loan programs require a FICO score of 620 or better. Borrowers with higher credit scores represent less risk to the lender, often resulting in a lower the down payment requirement and better interest rate. Conversely, home shoppers with lower credit scores may need to bring more money to the table (or accept a higher interest rate) to offset the lender’s risk. TXHR works with a number of reputable lenders on a daily basis. Working alongside our lender friends, we work together to find you the right home and the right financing that works best for your situation.
Q: How much will my down payment be?
A: This varies on a case-by-case basis, your loan product/program and your lender. The FHA loan requires 3.5% down. Some programs require even less. VA loans and USDA loans can be made with zero down. However, these programs are more restrictive. VA loans are only made to former or current military servicemembers. USDA loans are only available to low to-middle income buyers in USDA-eligible rural areas. For many years, conventional loans required a 20% down payment. Newer conventional loan programs are available with only 3% down if the borrower carries private mortgage insurance (PMI). Some lenders allow down payment contributions from family members in the form of a gift of equity.
Q: What do I have to pay up front?
A: Your upfront costs are your Earnest Money and your Option Fee (if applicable). Your Earnest Money is made in good faith to demonstrate - to the seller - that the buyer’s offer is genuine. Earnest money essentially takes the home off the market to anyone else and reserves it for you. This is typically 1% to 2% of the purchase price but can vary with multiple offer situations. The Option Period is a specified time frame in a real estate contract which allows a buyer to terminate the contract for any reason. It creates the right to terminate within the specified number of days for a specified price. The specified price typically varies based on the price of the home and usually ranges from $25 - $250.
Q: Can I look at houses even if I'm not sure about moving?
A: Yes, you absolutely can. Many times buyers need to see what's out there and what other homes, neighborhoods and even cities have to offer. It's not uncommon to tour homes even if you're on the fence. Remember to be respectful of your agent - if you realize you're not ready, be sure to speak up.