What is the difference between "pre-qualified" and "pre-approved"?
If you are "pre-qualified" you have determined, with a loan officer, what price you can afford based on the down payment, your debts and the amount the mortgage company will approve for your mortgage. Being "pre-qualified" is only a determination of your probable credit. If you are "pre-approved", your credit, employment and funds have been approved by the lender.
What are closing costs?
Closing costs are an accumulation of charges paid to different entities associated with the buying and selling of real estate. For buyers, they are usually about 4-6% of the total sales price of a property. Some of the closing costs you might encounter are: application fees, appraisal fee, Land Tansfer taxes, movers, documentation fee, homeowners' association fees, loan fees, mortgage insurance, origination fees, tax registration and title insurance premium.
What is a point?
One point is equal to 1% of the new loan amount. Whenever government regulation, province or state usury laws and/or competitive practices prohibit the lender from charging a rate of interest that would make the real estate loan competitive with other fields of investments, the lender must seek some method of increasing the yield for the investors. By charging "points", the lender can bring the real estate loan up to those other investments.
What is consideration?
When you make an offer, you will need to put up a currency deposit as a sign of good faith that you are seriously interested in buying a home. That deposit becomes a part of the purchase price and is held in a trust account until the all conditions are removed from the offer. Typically, a deposit is 1-3% of the offer amount.
What is title insurance?
Title insurance protects the named insured against loss because of defects, liens, encumbrances, adverse claims, violations of municipal zoning by-laws, encroachments or other matters not shown or disclosed to the new owner that attach before date of policy. Some forms of title insurance will also cover against losses arising from real estate title fraud, forgery and false impersonation. Title insurance is available for a low premium that is paid only once at the time of closing, adn coverage is valid for the entire time you own the property.