New construction home buyer questions

Question 1

What credit score do I need to buy a new construction home?

Accepted Answer

We can start from as low as 580. Most loan programs want 620, and at the highest 640. The higher your score, the more loans and builder deals you can pick from. 580 to 599: we can start here. An FHA loan is the usual fit. Fewer lenders work in this range, so a small boost to your score can open a lot of doors. 600 to 619: more lenders say yes, and FHA and VA loans are both in reach for people who qualify. 620 to 639: most loan programs open up, including most builders' own lenders and their deals. 640 and up: you can pick from almost every program, and you have the most room to compare lenders. Credit Karma and other apps do not check what a lender checks. Their score can be higher or lower than the one a lender pulls. We can tell you what your score really is. If it needs a boost, we can help with that too, for free.

Question 2

How much house can I afford?

Accepted Answer

About 40% of your total income can go to all your monthly debts, the new home included. How much is left for the home depends on the debts you already have. Lenders start from your income before taxes. Then they add up what you pay each month on a car, student loans, credit cards and any other loans. The home's payment has to fit in what is left. Say your family makes $60,000 a year before taxes. That is $5,000 each month. About 40% of that is $2,000 for all your debts. If $400 of it goes to a car, about $1,600 is left for the home. Paying off a small loan or card before you apply can raise what you can afford. We can tell you your real number on a short call.

Question 3

Do you have a new home in my price range?

Accepted Answer

Tell us what you can pay each month. We show you every new home that fits, with the whole bill on each one: the loan, taxes, insurance and fees. There are thousands of new homes for sale across Florida and Georgia, in a wide range of prices. Most people find more that fit than they expected. If nothing fits today, we show you the closest homes and what it would take: a bit more saved, a better credit score, or a different town.

Question 4

Why are new homes often cheaper than resale homes?

Accepted Answer

Builders can pay to lower your rate and pay your closing costs. A family selling their own home usually cannot. So a new home can cost less each month, even at a similar price. Builders have to keep selling to keep their crews busy. So they spend money to get homes sold, often through their own lender. A buyer's rate and closing costs are where that money usually goes. A new home can also save money after you move in. Insurance is often lower on a new roof built to today's code, and you are not paying to fix an old water heater or air conditioner. You are free to use any lender, so compare the builder's offer with another lender's.

Question 5

Why doesn't anyone know a new home can cost less than rent or an older home?

Accepted Answer

Because almost nobody shows you the whole monthly payment. Builders show prices, and most people think they need 20% down and perfect credit. A price does not tell you what you pay each month. The builder's deal on the rate and closing costs is what changes the payment, and you usually only hear about it once you walk into a model home. Many agents spend their time on older homes, because that is what most of their sellers have. New homes are sold from the builder's own office. We show the whole monthly bill on every new home, so you can put it next to your rent.

Question 6

How does $0 down on a new home work?

Accepted Answer

A few kinds of loans and programs need no down payment. You do not need to be a veteran or a first-time home buyer. VA loans need no down payment for veterans and service members who qualify. USDA loans need none for homes in places the USDA counts as rural, for families under its income limit. For everyone else, down payment help programs can pay the down payment for you. Many are a second loan you pay back when you sell or refinance, and some are forgiven over time. The deposit is as low as $1,000. You pay it after you are pre-approved and have found the home you want, and you get it back at closing. When the builder also pays your closing costs, you can move in with very little out of pocket.

Question 7

Do I need a realtor to buy a new construction home?

Accepted Answer

You do not need one, but it is smart to have one. The builder's sales office works for the builder. Your own agent works for you, and on a new home the builder pays the agent's fee. The people in the model home are nice, and they know the homes. But their job is to sell the builder's homes at the builder's price. Nobody in that office is there to tell you what to push back on. Your own agent compares homes and builders for you, checks the contract, asks for the builder's best deal, sets up your own inspection, and keeps the closing on track. The price of the home is the same with or without an agent. The builder sets aside the agent's fee either way.

Question 8

Who pays the realtor when you buy new construction?

Accepted Answer

On a new home, the builder pays our fee. You do not pay us, and the price is the same with or without us. Builders plan for an agent's fee when they set their prices. If you come in without an agent, you do not get that money off the price. It just stays with the builder. Our agreement with you says who pays our fee. If a builder or seller ever pays less, we never ask you to pay the rest. Your loan, deposit and other buying costs are separate from our fee.

Question 9

Does using an agent make a new home cost more?

Accepted Answer

No. The builder's price is the same with or without an agent. The builder pays the agent's fee out of money it already set aside. Some buyers think they will get a lower price by going in alone. In the deals we have seen, builders do not take the agent's fee off the price for buyers who come without one. What does change the deal is asking the right questions: which homes the builder most wants to sell, what it will pay toward your closing costs, and which upgrades it will add. That is what your agent is there for.

Question 10

Should I bring my agent to the model home the first time?

Accepted Answer

Yes. Many builders want your agent with you, or signed in for you, on your very first visit. If you go alone first, some builders will not work with your agent later. Each builder has its own rule. Some ask that your agent comes to the first visit. Some let your agent register you by email before you go. A few are more flexible. If you already visited a model home on your own, tell us anyway. We can ask the builder, and sometimes it is not too late.

Question 11

How much does 7Realty charge to help me buy a new home?

Accepted Answer

Nothing. On a new home the builder or seller pays our fee, and we never ask you to cover it. We are a real estate company licensed in Florida and Georgia. We help people buy new construction homes and we work for you, not the builder. We are not a lender. Your loan comes from the lender you choose, and you can compare as many as you like.

Question 12

Where does 7Realty help people buy homes?

Accepted Answer

All over Florida and Georgia, with local agents. You can see every new home we can help with, and the monthly payment on each, on our home search. Most of our buyers want a new construction home, so that is where we spend our time. We also help people buy any home in Florida and Georgia. Your first talk with us can be a phone call or a Zoom, wherever you are moving from.

Question 13

Is my Credit Karma score the score a mortgage lender sees?

Accepted Answer

Usually not. Credit apps show a different kind of score than the ones mortgage lenders use, so the numbers often do not match. Mortgage lenders use their own scoring models, from all three credit bureaus. The app on your phone may use one bureau and a different model. That is why someone who sees a low number in an app should still ask. The real score can be better than the app says. It can also be lower, which is good to know before you fall in love with a home.

Question 14

Will getting pre-approved hurt my credit?

Accepted Answer

A pre-approval pulls your credit, and that can move your score a few points for a short time. Shopping for a mortgage within a short window usually counts as one pull, not many. Credit scoring is built so that people can compare lenders. Several mortgage pulls close together are treated like one search for one loan. What hurts more is opening new cards or loans while you are buying a home. Wait until after closing for that new car or furniture account.

Question 15

Can I buy a new home with bad credit?

Accepted Answer

Often, yes. We can start from as low as 580, and if your score needs a boost, we can help with that for free. "Bad credit" means different things to different people. A score in the 500s, a late payment, or a collection does not end the talk. What matters is your score today, your recent history, and what the loan program allows. If you are not ready yet, we tell you what to fix and about how long it may take. Then the home search is waiting when you are.

Question 16

How long do I need to be at my job to buy a house?

Accepted Answer

Lenders like to see about two years of steady work. That does not have to be one job: a new job in the same line of work usually counts. A raise or a move to a better job in the same field is fine. A gap, a switch to a new kind of work, or a move to being paid by commission can need more paperwork. If you just started a new job, tell the lender up front. They can tell you what they need to see before you shop.

Question 17

Can I buy a new home if I am self-employed?

Accepted Answer

Yes. Most lenders ask for two years of tax returns. Some loans use your bank statements instead. When you work for yourself, lenders look at what your tax returns show you earned after write-offs. Big write-offs lower your taxes, but they can lower what you qualify for too. Bank statement loans look at the money coming into your account instead. They can cost more, so compare them with a regular loan.

Question 18

Can I buy a house after a bankruptcy?

Accepted Answer

Yes, after a waiting time. For FHA and VA loans it is often about two years after a Chapter 7 bankruptcy. For a regular loan it is often about four. A Chapter 13 bankruptcy can be shorter. Some lenders will look at your loan once you have made about a year of on-time plan payments, with the court's OK. Lenders also look at how you have handled credit since. A year or two of on-time payments helps a lot.

Question 19

How much do I need for a down payment on a new home?

Accepted Answer

It can be $0. You do not need to be a veteran or a first-time home buyer. There are loans with no down payment, loans with a small one, and programs that help pay it. Which one fits depends on your credit, your income and where the home is. Most people think they need 20% down. You do not. That number only matters for skipping mortgage insurance on a regular loan.

Question 20

How much is the deposit on a new construction home?

Accepted Answer

The deposit is as low as $1,000. You pay it after you are pre-approved and have found the home you want, and you get it back at closing. The deposit shows the builder you are serious, so it takes the home off the market for you. At closing, it counts toward what you owe. Read what the contract says about the deposit before you sign. We go over that part with you.

Question 21

Who pays closing costs on a new construction home?

Accepted Answer

Often the builder. When you use the builder's lender, the builder often pays your closing costs, so you keep your savings for the move. Closing costs are the fees to make the loan and the sale happen: the lender's fees, the title work, and money set aside for taxes and insurance. Ask what the builder will pay before you choose a home. The deal can be different from home to home in the same community. You are free to use any lender. Get a Loan Estimate from the builder's lender and from at least one other, and compare the whole cost.

Question 22

What will I spend on moving into a new home?

Accepted Answer

Plan for the move itself, first-month utility deposits, and things the home may not come with, like blinds, a fridge or a washer and dryer. Ask the builder what comes with the home. Some include a fridge, blinds and a washer and dryer. Some do not. When the builder pays your closing costs, you keep your savings for these things.

Question 23

Is there down payment help in Florida and Georgia?

Accepted Answer

Yes. Both states, and many counties and cities, have programs that help with the down payment or closing costs. In Georgia, the state's program is Georgia Dream. In Florida, the state's housing agency runs programs too, and some counties add their own. Each one has its own rules on income, price and who can apply. Some of these programs run out of money for the year, so it is worth asking early. We can tell you which ones fit the homes you like.

Question 24

Can I use a VA loan on a new construction home?

Accepted Answer

Yes. Most new homes in Florida and Georgia can be bought with a VA loan, and many builders work with VA buyers every day. A VA loan can mean no down payment and no monthly mortgage insurance. You need a Certificate of Eligibility, which your lender can usually get for you in minutes. There is a VA funding fee on most VA loans. Veterans who get VA disability pay usually do not pay it. Tell us you are a veteran on our first call. We show you the homes and builder deals that fit a VA loan.

Question 25

Can I use an FHA loan on a new construction home?

Accepted Answer

Yes. FHA loans are common on new homes, and they help buyers with lower credit scores or a small down payment. FHA loans have mortgage insurance, paid up front and each month. Ask the lender how long the monthly part lasts on your loan. The home must meet FHA's rules, which new homes in most communities do. Any FHA lender can check the home you pick.

Question 26

What is a USDA loan, and can I use it on a new home?

Accepted Answer

A USDA loan is a home loan with no down payment for homes in places the USDA counts as rural. Many new communities on the edge of town qualify. There is an income limit, set by the county and your family size. The home has to be in an area the USDA allows. Ask us about a home you like. We can check whether its address can use a USDA loan.

Question 27

Do I have to be a first-time home buyer to get a good loan?

Accepted Answer

No. Most loans, including low and no down payment loans, are open to people who have owned a home before. Some help programs are only for first-time buyers. Many of them count you as first-time if you have not owned a home in the last three years.

Question 28

Can I buy a new home before I sell the one I own?

Accepted Answer

Sometimes. The lender has to see that you can pay both homes, or that the old one will sell or rent. A new home that is still being built gives you time. You can sell your home while the new one goes up and close on both close together. We also help people sell the home they have now, in Florida and Georgia.

Question 29

Should I use the builder's lender?

Accepted Answer

Often it is worth a look, because the builder's best deals are usually tied to its own lender. You are free to use any lender, so compare them. Builders often pay to lower your rate or pay your closing costs, but only if you use the lender they own or pick. That deal can be worth more than a slightly better offer somewhere else. Get a Loan Estimate from the builder's lender and from at least one other. Put them side by side and compare the rate, the APR, the fees and the cash you bring to closing.

Question 30

Are interest rates too high to buy a home right now?

Accepted Answer

The builder buys your rate down. Their own lender offers a lower rate than most banks, and it is not a trick: the builder wants to sell the homes. This is one of the biggest reasons to look at a new home instead of an older one. A person selling their own home does not have that kind of money to spend on your rate. We show you both rates on every home, the builder's and the going rate, so you can see the difference in the payment. You are free to use any lender, so compare the builder's offer with another lender's.

Question 31

What is a rate buydown on a new home?

Accepted Answer

A buydown is money paid at closing to lower your interest rate. On a new home, the builder often pays it. Some buydowns lower the rate for the whole loan. Others lower it for the first year or two and then it goes up. Ask which kind you are getting, and what your payment will be after it ends. A builder buydown usually comes through the builder's lender. You are free to use any lender, so compare what each one offers.

Question 32

How long does it take to buy a new construction home?

Accepted Answer

A home that is already built can close in about 30 to 60 days. A home that is not built yet can take several months. Many builders have homes that are done or nearly done. Those are the fastest, and builders often put their best deals on them. A home built from the ground up takes longer, but you get to pick more things in it. It also gives you time if your lease ends later.

Question 33

What are the steps to buy a new construction home?

Accepted Answer

Talk to us, get pre-approved, pick your home, sign the contract and pay the deposit, get the home inspected, then close and get your keys. First we find out what you can pay each month and what you want in a home. Then you get pre-approved, so you know what the lender will lend. We show you every new home that fits and go see the ones you like. When you pick one, you sign the builder's contract and pay the deposit. Before closing, your own inspector checks the home, and the builder fixes what is on the list. At closing you sign the loan papers and get the keys.

Question 34

Do I need an inspection on a brand new home?

Accepted Answer

Yes. A new home can still have problems. Your own inspector finds them while the builder still has to fix them. The city or county inspection only checks that the home meets the building code. Your inspector looks at much more, from the roof to the outlets. If the home is still being built, an inspection before the walls go up can catch what will be hidden later. Another one before your warranty ends, near the 11-month mark, catches what showed up after you moved in. Get every repair the builder agrees to in writing.

Question 35

Can you negotiate with a home builder?

Accepted Answer

Yes, but usually not on the price. Builders more often give on closing costs, the rate, or upgrades. Builders protect their prices, because a lower price on one home lowers the value of every home around it. What they will give often shows up as money toward your closing costs or rate. Homes that are already built, or that have sat for a while, usually have the most room. Ask what the builder will add, and get it in writing. An extra is not a promise until it is in the contract.

Question 36

Are new construction homes already built, or do I wait?

Accepted Answer

Both. Builders sell homes that are ready now, homes that are being built, and homes that have not been started yet. A home that is ready now is called move-in ready. A home being built usually has a date it should be done. A home not started yet lets you pick more of the details. Our home search shows each home's status.

Question 37

Do new construction homes have an HOA?

Accepted Answer

Most new communities do. The HOA fee pays for shared things like the pool, the gates or the grass at the entrance. Ask what the HOA fee is, what it covers, and what the rules are on fences, parking and pets before you sign. Some new communities have no HOA. Tell us if that matters to you and we look for those.

Question 38

What is a CDD fee on a new home in Florida?

Accepted Answer

A CDD is a special district that paid to build the roads, water lines and other parts of a new community. Homeowners pay it back each year on their property tax bill. CDD stands for Community Development District. It is not the same as an HOA, and a home can have both. The CDD amount is part of your monthly cost, so it belongs in the payment you compare. Ask for it on every Florida home you look at.

Question 39

Why can property taxes go up the year after I buy a new home?

Accepted Answer

The first tax bill on a new home is often based on the land only, because the house was not finished when the county set the value. The next year's bill counts the house too. Ask the lender to set your tax money on the full value of the home, not the land-only bill. That way your payment does not jump later. If the home will be where you live, file for the homestead exemption. In Florida the deadline is March 1. In Georgia it is April 1.

Question 40

What warranty comes with a new construction home?

Accepted Answer

Most builders give a warranty. A common one covers workmanship for one year, the home's systems for two years, and the structure for ten. Every builder's warranty is a little different, so read the one for your home. Write down anything you find in the first year and send it in before the one-year mark. Have your own inspector look at the home near the 11-month mark, before that first part of the warranty ends.

Question 41

Is homeowners insurance cheaper on a new home in Florida?

Accepted Answer

It often is. A new roof and a home built to today's code are what insurers like to see. Get a quote on the actual home before you close, from more than one insurer. Your lender needs proof of insurance before closing. Ask the builder for the home's wind papers. They can lower what you pay.

Question 42

Can buying a new home cost less than my rent?

Accepted Answer

Sometimes, yes. It depends on the home, your loan and the deal the builder gives. We show you the whole monthly bill on every home, so you can compare it with your rent. The whole bill means the loan, taxes, insurance and fees, not just the loan. That is the number to put next to your rent. When you rent, the money is gone. When you own, part of each payment goes to paying off your home.

Question 43

My lease is not up yet. When should I start looking?

Accepted Answer

Now is a good time. Getting pre-approved and picking a home takes time, and a home still being built can be timed to finish when your lease ends. Tell us the month your lease ends. We look for homes that should be done around then. Starting early also gives you time to raise your credit score or save, if you need to.

Question 44

Do you help with rentals or rent-to-own homes?

Accepted Answer

No. We help people buy homes. Most builders do not offer rent-to-own, but many renters can buy sooner than they think. If you are renting now, a low or no down payment loan may mean you can own instead of rent. We can tell you on a short call.

New home buyer questions.

Most asked

Using an agent on a new home

Credit and getting approved

Down payment and costs

VA, FHA and other loans

Rates and the builder's lender

How buying a new home works

The home and the community

Renting now

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