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What are the steps to buying a home in Atlanta

steps to buying a house in atlanta

Buying a home in Atlanta is a big milestone and living here is a great experience for those looking for a big city with a small town feel. From Intown to OTP, there is something for everyone looking for that perfect home or condo to live in.

In this article, we are going to talk about taking the right steps to getting a mortgage, and connecting with right real estate professionals. Additionally, we’ll talk about how the real estate market is like in the metro Atlanta area so that you can have the right expectations when you start hunting your home.

Step 1 - Saving for a down payment

One of the most common questions we get is how much people need to save for a down payment. While there are many variables such as the type of loan you’re getting, generally, you should anticipate saving between 3.5% – 20% of the sales price of the home.

Here are some popular programs that are available in Atlanta and how much down payment you will need:

Conventional 97 Loan - 3% Down

The conventional 97 loan is a program that allows first time home buyers to purchase a home with a minimum 3% down payment. There are two types of Conventional 97 loans: The HomeReady program which is backed by Fannie Mae and the HomePossible program backed by Freddie Mac. Both programs were developed to encourage homeownership and make it easier for first time home buyer to qualify.

In order for buyers to qualify for either of these programs they must complete a homeownership education course and have a middle FICO score of at least 640.

If you are buying a home in Atlanta with a Conventional 97 loan, you can get a loan up to $715,000.

Conventional Loan - 5% Down

Conventional loans are often the best choice for borrowers with good credit and a down payment of at least 5 percent.

They offer competitive interest rates and terms, with the added benefit of flexible repayment options. For example, you may be able to choose a shorter loan term in order to pay off your mortgage faster, or if you choose to opt for a variable rate.

There are also conventional loans available for those who are buying a second home or investment property.

Borrowers with less than 20% down may also be required to pay private mortgage insurance (PMI).

FHA Loan - 3.5% Down

The Federal Housing Administration (FHA) offers a loan program that allows buyers to purchase a home with as little as 3.5% down.

To qualify, buyers must have a middle FICO score of at least 580 and meet debt to income ratios that are capped at 57%. The FHA loan program is perhaps the most popular home buying program among first-time home buyers or those with challenged credit. However, you do not have to be a first-time home buyer to qualify for this loan.

In metro Atlanta, the maximum loan amount for FHA loans is $471,500 for single-family homes but can go up to $906,750 for 4-unit properties.

VA Loan - 0% Down

For those that have served in the military, the Department of Veteran Affairs (VA) offers a loan program that allows veterans to purchase a home with no money down. This is an incredible benefit for those that have served our country and is one of the main reasons why the homeownership rate among veterans is so high.

In order to qualify, buyers must obtain a Certificate of Eligibility (COE) from the VA which can be done easily online. Additionally, buyers must meet debt-to-income ratios and have a satisfactory credit history.

There is no maximum loan amount for VA loans but the typical loan limits for Atlanta are $715,000 for a single-family home.

USDA Loan - 0% Down

The USDA Rural Development Loan is a mortgage loan offered to rural homeowners looking to purchase a home with no money down. In order for buyers to qualify, the home must be located in a designated USDA rural area and the buyers must meet maximum income restrictions.

Although buying a home in Atlanta with an USDA loan is not possible because of area restrictions, the good news is, some areas outside of Atlanta fall into USDA eligible areas. For instance, areas west of the city such as parts of Paulding county, Douglas county, and Carroll county qualify for USDA. North of 75, such as Bartow, Floyd and Gilmer are USDA eligible. South of Atlanta, areas such as parts of Henry County and Spalding also qualify for USDA. Last, some areas on the I-85 North corridor such as Jackson and Barrow counties qualify for USDA too.

Buying a home in Atlanta with Down Payment Assistance

There are several programs available to help buyers with their down payment. Perhaps the most popular program is the Georgia Dream Homeownership Program which offers up to $7,500 for a down payment. This program was very popular with homebuyers after recession of 2008 but it is still around to this day.

Other programs such as Invest Atlanta may be able to provide up to $15,000 towards a buyer’s down payment’s or closing costs. The Chenoa fund is also a popular down payment assistance for those looking to buy a home in Atlanta. This program offers different options up to 5% of down payment assistance.

Jumbo Loans in Atlanta

If you are needing for a loan that exceeds the conventional loan limit of $715,000 to buy a home in Atlanta, you need a jumbo loan.

In order to qualify for this type of loan, buyers must have excellent credit and higher income. Additionally, buyers should expect to make a down payment of at least 10% of the purchase price.

Some of the most expensive areas of Atlanta where most likely you will need a jumbo loan, are located Intown. In neighborhoods such as Ansley Park, Inman Park, Midtown, Virginia Highlands, Brookhaven and Buckhead, the average price of a home can easily start in the $1 million range. With a jumbo loan, you can typically get financing for up to $5 million.

Start your home purchase journey

Get answers to your questions and save thousands on your home loan by comparing different programs and interest rates. 

Finding a reputable real estate agent in Atlanta

One of the best ways to find a reputable real estate agent in Atlanta is by asking for referrals from friends and family. Once you have a few names, be sure to check out each agent’s online reviews.

But what if you don’t really have any friends or family who have bought a home or maybe you are relocating from another state? Another great way to find an excellent real estate agent is by looking for top producing agents in your desired neighborhood of choice.

For instance, if you are looking for an agent who specializes in the Intown Atlanta market, you can start by searching for agents who specialize in that market and have connections with other local agents in the area. Likewise, if you are looking to buy a house OTP (Outside the Perimeter), partnering with an agent who specializes in that market will be more beneficial.

Your real estate agent will help guide and support you through the entirety of the home buying process, from finding properties and making offers to negotiating contracts and closing on your new home. A good realtor will also suggest other service providers, such as lenders, title companies and inspectors, or contractors if needed, to assist you in buying a home in Atlanta.

Choosing a real estate agent is an important decision that should not be taken lightly. Make sure to interview multiple agents and don’t just choose one because he is a friend or family member.

We suggest that you pay attention to:

  • Other’s experiences (reviews)
  • Number of transactions in the last year (the more the better!)
  • Experience in your market
  • Experience in your desired property type (If you are looking for a condo, I suggest you look for a realtor who specializes in condo sales)
  • Years of experience
  • Experience in your price range
  • Individual reviews and complaints
  • How well you can connect with him/her

Where should you buy a home in Atlanta?

This question is pretty difficult to answer because where you choose to live should be based on your wants and needs.  Atlanta is a pretty big city and is divided up  many different neighborhoods, each with their own unique flair.

Here are some popular areas to live in Atlanta:

Fulton county

North Fulton: Roswell, Alpharetta, Milton

Intown – Midtown, Virginia Highlands, Poncey Highland, Buckhead, Brookhaven

Downtown – Castleberry Hill, Edgewood, Sweet Auburn, Grant Park, Ormewood Park

Westside – Home Park, Atlantic Station, West Midtown

Southside – College Park, East Point, Stockbridge

The Perimeter – Sandy Springs

In DeKalb County

Eastside – Reynoldstown, Kirkwood, Cabbagetown, Inman Park, East Atlanta, East Atlanta Village, Decatur, Candler Park, Lake Claire, Druid Hills

North – Brookhaven, Chamblee, Dunwoody, Tucker

South – Lithonia, Conyers, Stonecrest, Stone Mountain

Buying a home OTP

If you are new to Atlanta, you will hear the phrase “OTP” quite often. This stands for “Outside the Perimeter” or basically, anywhere outside of I-285. Cities located outside of 285, make up what we refer to as Metro Atlanta. 

And that’s a lot of cities to mention. But let’s talk about a few that are pretty popular anyways.

Cobb County: Marietta, Vinings, Smyrna, Kennesaw

Cherokee County: Acworth, Woodstock, Canton, Holly Springs

Paulding County: Dallas, Hiram

Gwinnett County: Doraville, Norcross, Peachtree Corners, Lawrenceville, Duluth, Lilburn, Suwannee, Lilburn, Buford, Grayson

Forsyth: Cumming

Henry County: Stockbridge, McDonough, Locust Grove

Coweta County: Newnan

Clayton County: Jonesboro, Forest Park, Morrow, Riverdale

Home values in Atlanta

To give you an idea of what to expect when you are buying a house in Atlanta, these are some stats you should keep in mind.

County

Median List Price

Value Change YoY

Fulton

$449,900

9.6%

DeKalb

$389,900

4%

Cobb

$425,000

11.8%

Cherokee

$465,000

13.4%

Gwinnett

$424,900

19.7%

Paulding

$383,600

19.9%

Henry

$388,000

19.4%

Forsyth

$590,000

19.2%

Clayton

$260,000

24.7%

Data provided by Realtor.com

Types of homes that you will find in Atlanta

Single family homes in Atlanta

This is your typical and most popular home that you will find in Atlanta.

Single family homes in Atlanta are situated in their own plot of land and usually feature front and backyards, fences or gates, and depending on your budget. You may be able to find homes with pools or a big yard space depending on your budget.

If you are looking for a big lot, buying a home in the suburbs will be the best bet for you. There, you will easily be able to find a single family home with 1, 2 acres or more of land.

Townhomes in Atlanta

While looking to buy house in Atlanta, you will come across a lot of townhomes.

These properties are attached to neighboring units and may have amenties such as pool or clubhouse. Buying a townhouse may be able to offer the space and overall vibe that single family homes do with a better entry price.

Condos in Atlanta

Buying a condo in Atlanta could be a great idea if you’re looking to live in an area that can be a little pricey or if you are looking for an easy to maintain property

In Atlanta, you will find a large inventory of condominium units. The more modern high rises in the city are located in Midtown, Downtown and Buckhead, featuring floor to ceiling windows and hotel-like amenities.

Multifamily homes in Atlanta

These types of properties could be great for those needing to buy home in Atlanta for investing reasons. These types of homes feature more than one individual unit. Each unit comes with its own bathroom and kitchen for its individual resident. 2-4 Unit multifamily properties are a great way to save money on mortgage payments as they allow you to live in one of the units while receiving rental income from the others. 

Unfortunately, 2-4 unit properties in Atlanta are far few and between. Although they are out there, there isn’t a big amount of inventory available making them very coveted by homebuyers.

Getting pre-approved

Before buying a home in Atlanta, getting pre-approved is the first step that you need to take. Although you may believe that you qualify for a home, it is important to consult with a lender to see how much you can afford.

Also, a pre-approval will give you an idea of your budget, the best loan for you and analyze any potential pitfalls you may face down the road.

At Andes Mortgage LLC, we have a team of experts that are ready to help you through the process of pre-approval. We understand that each customer has different needs and we will be by your side every step of the way, ensuring that you understand everything and are comfortable with the decisions that you make.

Start your home purchase journey

Get answers to your questions and save thousands on your home loan by comparing different programs and interest rates. 

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