7 Terms Every Louisville Home Buyer Should Know
LOUISVILLE – Buying a Louisville Home is an exciting experience for sure but you will hear a lot of terms that might seem unfamiliar or strange to you if you’ve never heard them before.
In this post we will cover seven terms you need to know in order to be better educated when buying a Louisville Home.
#1 – Adjustable Rate Mortgage
Also known as ARM, an adjustable rate mortgage is a mortgage loan that has an interest rate which can change over a period of months or years depending on current economic conditions.
#2 – Closing Costs
These are the fees you can expect to pay when buying a home. You can expect to pay closing costs to your inspector, attorney, surveyor and title insurance company. Most closing costs will range anywhere from 3 percent to 6 percent of a Louisville home purchase price so it’s best to confirm all closing costs BEFORE you commit to purchasing a home.
#3 – Down Payment
This Real Estate term refers to the amount of money you are expected to put down when you buy a Louisville home. Most down payments range from 5 percent to 20 percent of a home’s purchase price.
#4 – Escrow
Your escrow will be a third party (account) which will protect money you have decided to use on your down payment rather than paying that money directly to the seller.
#5 – Principal
Principal is the money you are borrowing (mortgage loan) to buy the home. Your principal amount will end up being more over time due to interest.
#6 – Private Mortgage Insurance
Private Mortgage Insurance (PMI) is something you will have to deal with when you don’t put down 20 percent of a home’s purchase price. You can expect to pay private mortgage insurance as a monthly fee over time but the good news is that PMI will cancel once you have a specific amount of equity in your home.
#7 – Interest
Last of all, but most important, interest is defined as the charge which you can expect to pay for the money that you want to borrow.
You can expect higher or lower interest due to your credit and financial history.
Buy a Louisville Home
To get started with buying a Louisville Home, or to view Louisville Homes for sale, contact Family Reality, LLC today by calling us at (502) 458-4100 or CLICK HERE.