The West Virginia Buying Process: A Summary
- In West Virginia, real estate transactions are closed by an attorney or a representative from a title company. This person will also prepare most of the documents.
- After an offer is accepted by the seller, there are details and negotiations to be completed.
- Although you may have been pre-qualified, you’ll need to finalize the mortgage for your West Virginia property.
- The final closing takes place with both the buyer and seller together at the same table.
- With the exception of a single county, the entire state of West Virginia is under the base limits or conforming loans. As of this writing, the conforming limit for a single-family home is $647,200.
Buying a Home, Phase 1: West Virginia Negotiations and Inspections
After searching for a home, visiting properties, and making offers, you have finally had an offer accepted by a West Virginia seller. Congratulations, this is a big step! However, there are many details to work out before the purchase is finalized.
- Once an offer is accepted, you’ll sign a contract that commits you and the seller to the transaction.
- The seller will stop actively marketing and negotiating with other buyers, and you will pay what is known as “earnest money,” which is held in escrow and shows your true intentions to make the purchase.
- A copy of the contract is sent to an attorney or title company. Preparations of all documents, including a title transfer, will begin.
- The seller will deliver disclosures. These are simply statements of known issues with the property, and may include needed repairs, maintenance, or environmental issues. You’ll need to review and sign off on these disclosures. (Also, keep these disclosures in mind when completing inspections.)
- You now have the chance to complete inspections. In West Virginia, as well as most of the country, it’s common to complete a general inspection, then, based on the results, complete a more specific or detailed inspection. Other inspections may include termite, mold, or radon inspections.
- If needed, a well test and a septic inspection will be completed.
- Once the results are in, you can ask the seller to make repairs or change the contract, including a reduction in price. Sellers can accept your request, decline any changes, or offer a modified solution. You and the seller will negotiate until an agreement is reached. (Although rare, sometimes an agreement cannot be reached. In this case, both parties are free to leave the transaction.)
- You can also request a home warranty. This covers repairs or replacement for home appliances for a certain period, such as 12 months.
Phase 2: The Mortgage Process in West Virginia
Although you have likely been pre-qualified for a mortgage in West Virginia, you still need to complete and finalize the application. Once Phase 2 is complete, you’ll be ready to close the purchase.
- The first step is to make a formal and official application for the mortgage. You can do this on your own, although many seek the help of a qualified professional.
- The lending company will send a “good faith estimate,” which is a breakdown of the estimated costs to close the transaction. Lenders do their best to make this number as accurate as possible, although the final tally may be different.
- The lender will eventually request a variety of documents, including:
- Pay stubs: These are used to verify your ongoing income.
- Tax returns: You may need tax returns for at least the past two years.
- Bank statements: These documents demonstrate your total savings, earnings, and expenses.
- Loan documents: If you have other debts, such as car loans, student debt, or credit card debt, make sure they are included.
- Financial disclosures: Anything that impacts your financial picture should be included. This may include alimony, child support, or legal judgements.
- Explanation on any credit inquiries: Credit inquiries statistically increase your chances of loan default, so lenders will need an explanation if there are many inquiries on your credit profile.
- Information on any large deposits: Any large deposit outside of your normal income should be documented.
- Gift letters: If you are using a large cash gift towards your downpayment, the lender may request a “gift letter.” This letter will state the nature of the gift, the purpose, the giver, and the sources. It should also include a statement that the money is a generous gift, not a debt that will need to be repaid.
- Repeat or updated information: Lenders want as much information as possible. Don’t be surprised if they request updated or recent information, as this is simply part of the loan-approval process.
4. Based on these documents, the lender will issue a decision. Assuming you are approved, you’ll receive a loan commitment letter, which verifies the lender’s intention to support your purchase. This commitment usually has contingencies, including the successful completion of a home appraisal.
5. You or your agent should now send a copy of the loan commitment letter to the seller (or seller’s agent). This will end the loan contingency, a phase of the purchase contract that essentially says you have to get moving on financing as soon as possible.
6. An appraisal will now be completed. This is usually ordered by the mortgage company. If the appraisal is low, certain changes may be needed to the purchase contract. However, if the appraisal comes back with a strong number, the purchase can move forward.
7. You will eventually need to order homeowner’s insurance. Proof of this insurance should be delivered to the mortgage company.
Remember, this process can be long and complicated, so it’s best to start as early as possible. Collect all your documents, and work with the lender so they have everything they need to approve your loan quickly. Also, avoid changes to your financial situation (new debt, new job, etc.), as these can disrupt your chances of approval.
Phase 3: Closing the West Virginia Purchase
Now it’s time to close the purchase! In West Virginia, the closing will take place with all parties together at the same table.
- Before the closing, an attorney or title professional will prepare documents for transferring title to a new owner. This will include a title search.
- A final number is calculated for closing the purchase. This is the amount you will need to complete the transaction, and may include closing costs, property taxes, and other expenses.
- A final walkthrough is often performed right before the final closing.
- You and the buyer, as well as agents and attorneys involved in the process, will meet to sign and finalize all documents.
- You will pay the remaining funds of your downpayment.
- The transaction is recorded with the city or county.
- You’ll receive the keys and can now move into your new West Virginia property!
West Virginia Conforming Loan Limits
Limits for conforming loans, which include mortgages like VA and FHA loans, are set by the Federal Housing Finance Agency. This group determines the maximum amounts that can be borrowed on most government-supported loans, using a county-by-county system to decide the limits.
In high-cost areas, the limits can be higher, but the entire state of West Virginia is under the base limit, which is currently $647,200 for a single-family home.
You can use a conforming loan to purchase a multiunit property. In the entire state of West Virginia, the limit for a two-unit property is $828,700, while the limit for a three-unit is $1,001,650. If you want to purchase a four-unit property, the limit for conforming loans in West Virginia is $1,244,850.
These are the limits for the entire state, from Brooke County in the far north to Mercer County in the south. They hold from Berkley County in the east to Wayne County, which borders Ohio and Kentucky.
The only county with higher limits is Jefferson County, which is part of the Washington D.C. metro area. In this county, the limits are $970,800 for a single-family home and $1,243,050 for a two-unit property. A three-unit has a limit of $1,502,475, while the conforming loan limit for a three-bedroom is $1,867,275.
These limits only apply to conforming loans. Larger limits are available, including jumbo loan in West Virginia.
Note: Limits are subject to change. Contact our staff for current and up-to-date conforming loan limits in West Virginia.
Downpayment Assistance Programs in West Virginia
A solid downpayment on a typical property can be tens of thousands of dollars. For this reason, many struggle to save for a purchase and never get to realize the benefits of homeownership.
Fortunately, there are numerous programs across the country that provide downpayment assistance. Many “DPA” programs are available in West Virginia.
Statewide West Virginia Programs
The largest organization for downpayment support in this state is the West Virginia Housing Development Fund (WVHDF), which offers help with down payments and closing costs through two unique programs.
WVHDF’s Homeownership Program
This program offers up to $10,000 in support for your purchase. The assistance comes as a loan that has a 15-year term with a 2% interest rate. Support can be as high as $10,000, but if you have a loan-to-value ratio higher than 90% (you’re financing 90% or more of the purchase) you can only qualify for $7,500 in assistance.
WVHDF’s Movin’ Up Program
This program is similar to the Homeownership option, although less funding is available. It also provides a 15-year loan for a downpayment, but borrowers can qualify for $5,000 or $8,000 depending on their loan-to-value ratio.
Important Local Programs in West Virginia
Eastern Panhandle HOME Consortium of West Virginia
In the western panhandle of West Virginia, homebuyers can receive downpayment support through the HOME Investment Partnership Program. This support is available in the counties of Berkeley, Jefferson, and Morgan.
Parkersburg
The city of Parkersburg, West Virginia offers downpayment assistance that is administered through the Parkersburg/Wood County HOME Consortium. Applicants can get as much as $10,000 in support through this program.
WVU Employee Down Payment Program
West Virginia University employs numerous academics, professionals, technicians, and staff members. Those working for the university may receive downpayment assistance equaling $5,000, which comes as a loan with no interest.
Common Requirements for West Virginia Downpayment Support
Downpayment assistance often comes with requirements and conditions. First of all, you need to meet the income restrictions. These programs are for people with low or moderate incomes, so if you have a large salary you may not qualify.
The programs also have limits on purchase price, and many have a credit-score requirement. Some also require that you are a first-time buyer, although this requirement can be waived if you have not owned in the past three years or if you are a veteran, firefighter, or police officer.
Each program is different. If you need more information on the latest programs, contact our team today and we’ll help you find the right West Virginia down payment assistance for your specific needs.
