For many prospective homebuyers searching for new homes for sale in San Antonio, a new construction home is an appealing choice. With new construction, buyers have far more say into how their new house looks and functions.
But whether you’re looking to buy a new house, custom home or pre-owned home, there are a host of important home-buying terms that you should know. The process can be intimidating and confusing at times, especially for first-time buyers, so UrbanLUX Builders wants to provide you with all the resources you need to feel comfortable from start to finish.
As a premier home builder in San Antonio and the surrounding area, we’ve worked with hundreds of amazing homebuyers, helping them successfully navigate the home-buying process and move comfortably into their incredible new homes!
Today, we’ll go through a glossary of important home-buying terms you’ll encounter and should have a basic understanding of as you move through the home-buying process. To learn more, please don’t hesitate to contact us today.
Terms to Know
Appraisal: The process in which a real estate appraiser evaluates the market price of your new home.
Closing costs: Expenses incurred by buyers and sellers when a home is sold excluding the price of the home itself and the down payment. Common closing costs include points, prepaid interest, prorated property taxes (if any), escrow fees, title insurance fees, document recording fees and real estate commissions.
Closing Day: This is the most exciting part of the entire home-buying process! The title company and your closing coordinator walk you through signing the final paperwork and reviewing the closing book. At the end of this meeting, you receive the keys to your brand new home and can move in!
Contract: A written document in which the purchaser agrees to buy and the seller (UrbanLUX Builders) agrees to sell certain real estate under stated terms and conditions. Also called a sales contract, earnest money agreement or agreement for sale.
Debt-to-income ratio: The ratio of monthly debt payments to monthly gross income, which is used to qualify a buyer for a mortgage.
Down payment: The portion of a home’s purchase price paid by the buyer at closing. Often, the down payment is expressed as a percentage of the total purchase price.
Earnest money: The money paid by the buyer at the time of contract in “good faith” to assure the performance of the contract.
FHA loan: A mortgage insured by the Federal Housing Administration (FHA), which offers low down payment mortgages to buyers (terms vary county by county).
Floor plan: An architectural drawing picturing the layout of the home. Includes bedrooms, bathrooms, main living space, kitchen etc.
Framing: The construction of the skeleton structure, or framework, of a house.
Homeowner’s association: Also called an HOA. The homeowners’ association is responsible for enforcing the covenants, conditions and restrictions and rules of the community, and also for the maintenance and upkeep of any common areas such as parks and landscaping. A fee is paid by all homeowners in the community to pay for the activities of the HOA. This fee varies from community to community, depending on whether the community consists of single-family homes or attached condominiums and the extent of the community’s common areas.
Interest: The amount is added onto your loan (in dollars) to cover the cost of borrowing money to finance your new home. The interest payment is the portion of your monthly payment applied against the interest owed. At the beginning of your loan period, the majority of your monthly payment is applied against the interest. But over time, more and more of the payment is used to reduce the amount of principal owed.
Interest rate: The cost of borrowing, expressed as an annual percentage of the principal. Many factors influence the interest rate you will be charged, including the overall state of the economy, the lender’s costs etc.
Mortgage: A loan for the purchase of a home. Mortgages are available from banks, savings and loans, credit unions, mortgage companies etc.
Mortgage payment: The total amount of your monthly mortgage payment. Principal and Interest (P&I) are due on every loan. Taxes and insurance (T&I) are also included if the lender requires an impound account.
Pre-construction meeting: This meeting gives you the chance to finalize all the details of your new home before construction begins. Here’s what to expect: 1) You will receive and sign your unique plot plan for your new home. 2) We will review your foundation plan. 3) We will also review all of our selections in the home, to ensure paperwork accuracy. 4) Your rough timeline for your schedule and finally we will be able to finish with your construction related questions.
Standard features: Items that are included in the purchase price of the home.
Title: A legal document establishing the right of ownership of property.
Upgrade: An option that a buyer can select, at an additional cost. May include options such as upgraded hardwood floors, quartz countertops and more.
Warranty: A contract between the buyer and the seller (home warranty company) that agrees to provide repair and replacement services on a home’s major components such as the structure, plumbing, electrical, etc.
Contact UrbanLUX Builders Today!
We hope you found today’s post helpful and informative. We have a great selection of new homes available in the San Antonio area, and of course, would love the opportunity to discuss building a custom home just the way you want it. Simply contact us today to learn more about UrbanLUX Builders, our custom homes and anything else you would like to know!