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Home Buyer Frequently Asked Questions


Buying a home can be a confusing process. Below are a few Frequently Asked Questions we’ve heard throughout the home buying process. Read on to learn how buying a house works and correct common misconceptions.

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Your Shine agent can also help answer any questions you may have or read our step-by-step guide to buying a home in Wisconsin.

1. What’s the First Step of the Home Buying Process?

You should find a good mortgage lender to get pre-approved for a loan before you start looking at homes if you don’t plan to pay with cash.

A good loan officer should help you figure out if you qualify for any programs that can help you make home ownership more affordable and find you the best loan terms for your financial situation. Then you will have an idea of the price of a house you can afford to buy.

For an easy way to see how home price, interest rate, taxes, and home insurance affect your buying budget, use our mortgage calculator.


2. Do I Need a 20% Down Payment?

No. There are many home loan programs that allow you to buy a house without having 20% for a down payment. It’s common to find mortgage options if you can pay 3-5% of the purchase price for a down payment. Some loan programs require 10% down, while a VA loan requires no money down.

Check out these 7 unique ways to save money when buying a house to see some of the grants, programs, and discounts available for home buyers in Wisconsin.


3. How Long Does it Take to Buy a Home?

Once you find a house and have an accepted offer, it usually takes 30-45 days to close. The timeline for finding a house varies greatly from person to person.


4. What Does a Realtor Do for Home Buyers?

A lot! A real estate agent is a valuable asset to have on your team when buying a home.

Realtors will:

  • find out your story and goals
  • educate you and inform you of your options
  • protect your interests
  • offer unique local insight
  • schedule showings and attend them with you
  • draft offer to purchase contracts
  • mediate and negotiate with the seller’s agent on your behalf
  • navigate with you counter offers, and contingencies involved in your purchase (such as inspections and financing)
  • help you sell your home if you must sell first before buying your next home
  • attend closing with you and ensure everything goes smoothly
  • hand you the keys to your new home!

While the general process is similar, every home buyer, house, and set of circumstances is unique. It’s wise to have a realtor you trust walk you through every high and low of the home buying process.

Keep in mind not all real estate agents are the same! This will help you evaluate if your realtor is good.


5. Do I Have to Pay a Realtor if I’m Buying a House?

It depends on how the house you ultimately choose to purchase is listed.

Every situation is different, so this is a great question to talk through with your Shine real estate agent.

Here are 40+ reasons to pick a local realtor to help you buy your next home.


6. Are there Other Fees Besides a Down Payment for Buying a House?

Yes. The downpayment is usually the largest expense, but there is also earnest money and closing costs. The amounts will vary depending on your lender and loan program, so check with a loan officer to help you estimate these fees.

You may also be responsible for home inspections or tests if that is part of your offer agreement.

Depending on your state and situation, other fees associated with buying a home could be state transfer tax, property taxes, home insurance, private mortgage insurance, and HOA fees.


7. What are Closing Costs? How Much are They?

Closing costs are fees you pay when finalizing a real estate transaction for things like:

  • Recording the deed
  • Applying for a mortgage
  • Appraising the property’s value
  • Originating and underwriting the loan
  • Searching property records to ensure a clean title

Closing costs can vary between 2-6% of the purchase price.


8. What is Earnest Money?

Earnest money is money paid to confirm a contract. It’s a good faith deposit to demonstrate your seriousness about buying a home.

In our area, 1% of the purchase price is a typical earnest money amount, and it is typically due within 5 days of an accepted offer. *Check your offer and consult your realtor to verify the date of your specific agreement, as this deadline is negotiable.

If the buyer decides to cancel the contract to purchase without valid reason or doesn’t stick to an agreed timeline, the seller typically gets to keep the earnest money.


9. Does a Home Inspection Guarantee a Home will have Zero Issues?

No. Home inspections can be useful for finding some of the potential small or big defects in a house. However, it is impossible, even for a licensed home inspector, to see and predict every home maintenance need that will arise after spending a few hours inspecting a home.

If you’re able, especially if you are first time home buyers, we recommend attending the home inspection for the best education on their findings.

Every house will need maintenance as things wear out, so it is wise to save money for things that arise after you become a homeowner.


10. Does a Home Warranty Cover Everything in the House?

No. Home warranties vary greatly depending on the company and terms. Typically, different tiers of home warranties will cover certain items and situations for a set time period.

If you use a home warranty for covered items, there is a service fee that you as the buyer will need to pay for. It usually ranges from $75-$125 per issue, as long as it’s covered.

Check out our Resources page for two Home Warranty companies that’ve been good to work with.


11. Can I Build a House on Any Land?

No. Land in Wisconsin is zoned and approved for different uses, such as Agriculture, Commercial, Single-Family Residential, and Multi-Family Residential.

In order to build a house, the land needs to be zoned appropriately. If it is not, you will need to go through a process to try and get approval to build a house on the land.

How much does it cost to build a house in Wisconsin?


12. Who Do I Contact about Land Use and Zoning Questions?

It is always best to talk directly with the Local Zoning Department for any questions about zoning and permitted land use.

Looking to buy land? Here are hundreds of pieces of land for sale in Wisconsin.


13. What are the Schools Like?

You can learn quantitative information about schools through the Wisconsin state report cards for public and private schools. You may also find qualitative information from locals in local Facebook groups. Finally, calling a school of interest and scheduling a visit is another way to meet staff and view learning environments.

Learn more about local communities on our Community Guide page.


14. How Do I Know if a Property is a Good Price?

Your realtor will ideally go with you to view a home in person before you make an offer, as we know pictures can be deceiving.

Your real estate agent should be knowledgeable in the current real estate market. Realtors have access to other properties currently on the market and those that have sold within the past few months to help educate you about a property’s price.


15. Are Appraisals and Assessments the Same?

No. An assessed value is used to determine property taxes. The larger your assessed value, the higher your property taxes. A home’s assessed value is usually less than market value.

A home’s appraised value represents a real estate appraiser’s opinion of the home’s value. Since appraisers look at past homes sold and don’t account for future prices or all local market conditions, appraisals will sometimes be lower than the selling price.

True market value of a property is decided by buyers, who value real estate based on how much they think the price of a property should be and are willing to pay for it.


Have a Different Question?

We’re happy to help!

Finding the right answers to your real estate questions can be a challenge, but the rewards of home ownership make the process worth it.

A good real estate agent is a valuable resource to have on your side. They will gladly answer your questions and inform you of your options through each step of the home buying process.

Tips for Home Buyers

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