When buying a home in Alaska—whether it’s your first time or your fifth—chances are you have heard industry terms that you are not familiar with. You may hear your real estate agent mention them, read them in your homebuyer research or see them included in real estate documents from your lender. Regardless, it’s time to get a firm handle on these terms so you can approach the process in Anchorage and the surrounding Mat-Su Valley as an informed buyer.
You can count on Northern Edge Real Estate to walk you through the homebuying process, from explaining the following important real estate terms to helping you find your Alaskan dream home and everything in between.
Otherwise known as Annual Percentage Rate, this term refers to the interest rate you pay each year.
This term stands for Private Mortgage Insurance and will apply to those buyers who put less than 20 percent down on an Alaskan home.
Known as the Multiple Listing Service, this allows real estate agents to view all homes currently on the market and the details associated with each property.
You may hear this term—which stands for Debt to Income Ratio—often from your Alaskan lender as it refers to the amount of debt you have in relation to your income. Lenders will use this factor among others in determining your eligibility for a mortgage.
This real estate term stands for Loan to Value Ratio and notes how much equity you have in your home. You can calculate this by looking at how much you owe as a percentage of the value of your Anchorage, Wasilla and Mat-Su Valley area home.
When purchasing a home, a third party may get involved to help manage the funds involved. A buyer’s money is held in an escrow account to show the seller that the funds are indeed available.
8. Closing Costs
You will hear this term often as you prepare to buy a home. These are the costs associated with buying a home in Alaska, including fees from the title, appraisal, loan origination, and escrow.
10. Earnest Money
To show you are serious about buying a home in Anchorage, Chugiak, Wasilla and the Mat-Su Valley, you will pay earnest money. This is often included along with your offer.
If you have questions about buying a home in Alaska, give Northern Edge Real Estate a call today! We’re here to help!