Frequently Asked Questions

• Why should I choose a Terry•Peterson Residential Companies' home?
• Why should I buy instead of rent?
• What are the different types of mortgages?
• What should I look for in a potential home?
• What should I look for when choosing a neighborhood?
• How much money do I need to have in order to purchase a home?
• What happens during closing?
• What is a home inspection and do I need one?
• What are PMI and MIP?
• What payments are included in my mortgage payment?
• Do I need an outside real estate agent and, if so, how do I select one?
• What is the sequence of events that occur in the construction of my home?

Why should I choose a Terry•Peterson Residential Companies' home?

We build wonderful, well-crafted homes that people love in communities that are designed to be truly welcoming. We believe in solid architectural details, quality materials and traditional neighborhood design. When you choose a Terry•Peterson Residential home, you know you are getting a great value for your money.

You can also count on our experience. We have built homes in the area for more than 25 years, and more than 10,000 people call our communities 'home.' We are a local family business being passed down from generation to generation. We've carefully refined our housing designs through years of customer input. And, you can depend on us for attentive customer service both before, and after, you close on your home. If you have questions, all you need to do is ask.

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Why should I buy instead of rent?

Buying a house is a big part of the American Dream, and if you're thinking of staying in an area for some time, it's nice to be able to put down roots. Home ownership really does give you a sense of pride and freedom.

A home is also an investment. When you rent, you're simply paying a landlord without getting anything in return. But when you buy, you're building equity in your home with every mortgage payment thus increasing your overall net worth. And as housing values increase, so does your investment.

Home ownership also provides certain tax advantages, because you can usually deduct your interest and real estate taxes (consult a tax expert for specifics). You can also protect yourself against rent increase, especially if you have a fixed-rate mortgage or a buydown mortgage with pre-determined increases and a cap rate for the life of the loan.

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What are the different types of mortgages?

All mortgages are basically a combination of three factors: rate, term and adjustability. For years, the traditional payment plan has included a 30-year term and a fixed rate—which means that you pay the same amount of money every single month for 30 years, regardless of inflation or market changes. If you'd like to pay off your mortgage more quickly, 15- and 20-year terms are available. Mortgages are usually provided under programs provided by the VA (Veteran's Administration), FHA (Federal Housing Administration) or are Conventional mortgages. Any one of our Approved Loan Officers can work with you to tailor the perfect mortgage for your particular situation!

There are many, many other mortgage alternatives to the fixed rate program: adjustable rate mortgages (ARMs), buy-downs (a 1-2 year buydown of the interest rate to help lower your payments in the first couple of years before leveling out to a pre-determined fixed rate for the life of the loan)and interest only loans. Each program has its advantages, and disadvantages. These can often be great programs for people who need a lower monthly payment in the early years but who see their income picture improving with time. Again, a mortgage expert can guide you through the myriad of choices and tailor a program custom-made for your situation.

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What should I look for in a potential home?

Everyone has his or her own individual idea of the perfect dream home—and we're sure there is a Terry•Peterson Residential house that will suit you perfectly.

When you tour a home, think about how it will fit your life, both now and in the future. Are there a certain number of bedrooms and bathrooms you'd like to have? Would you like an open floor plan, or a more traditional style? Is a two-car garage important? A yard? Once you start thinking, you might want to create a wish list of options. It's also a good idea to keep the list of 'like to haves' from the list of 'absolutely must haves.'

And perhaps most importantly, how does this house make you feel? If it makes you feel like you're home—well, that's definitely a good thing. Terry•Peterson is pleased to offer a wide complement of customizing options allowing you to select the structural and finishing options that best suit your lifestyle.

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What should I look for when choosing a neighborhood?

We find that many of our homeowners fall in love with a Terry•Peterson neighborhood even before they've settled on a specific home. They just know they've found a community where they feel welcome.

Choosing the right neighborhood really depends on a lot of factors — some of them practical. Is the community close to your job, churches, social outlets and friends? Is it close to good schools? Does it feel like the kind of place that fits your life?

We also put great care into designing our neighborhoods. We believe that by paying attention to landscaping, sidewalks, porches, open spaces and both active and passive amenities, we help create close-knit communities where neighbors can quickly become friends.

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How much money do I need to have in order to purchase a home?

Depending on the cost of the home and the type of mortgage you choose, the amount really can vary. Typically, you'll need funds to cover three different costs: the earnest money deposit, the down payment, and the closing costs.

For most people, the largest sum is the down payment. Although you can pay as much as you like, mortgages give you the option of paying only a small percentage of the purchase price. Some mortgages require only a 3% to 5% down payment (but typically need mortgage insurance), while many mortgages can require as much as a 20% down payment. But don't let that scare you! There are even down payment assistance programs where a non-profit foundation can provide the down payment for you. And FHA is working hard to develop programs to encourage home ownership that have very minimal down payment provisions.

Earnest money sounds like what it actually is—a sum of money that tells the seller you're earnestly interested in making a purchase. Think of it as a deposit that you submit when you send in your offer. If your offer is accepted, the earnest money is applied to the down payment or the closing costs. If it's not accepted, the money is returned to you. The earnest money deposit is usually modest and can range from $1,000 - $2,500 typically.

Finally there are closing costs, which typically cost 2% to 3% of the purchase price. This amount usually covers your initial insurance payments, plus a variety of fees (property taxes, the attorney's fee, a loan origination fee, other document preparation fees, and more). You'll pay this amount during the closing, at the very end of the buying process. Many Terry•Peterson neighborhoods offer substantial closing cost assistance when using one of their Preferred Loan Officers.

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What happens during closing?

Closing day is exciting, because that's when you finally take ownership of your new home. The property will be officially transferred to you. But before that happens, there are legal papers to sign and an orientation with the project superintendent to complete.

Some paperwork you'll receive prior to closing, and it's important that you look over these documents. These may include the good faith estimate which provides an full explanation of the closing costs involved in the transaction. Once closing day has arrived, you'll basically sit in a room with representatives from all interested parties, which may include the seller, the lender, the closing agent, the attorneys and the real estate agents and go over all the documents related to the transaction.

First, you're homeowner's insurance policy will be acknowledged with a paid receipt. The closing agent will utilize a HUD-1 settlement statement to list the money you owe the seller (such as the remainder of the down payment and any prepaid taxes) and other parties to the transaction, followed by the amounts the seller owes you (for prepaid rent or unpaid taxes). Inspection papers and warranties will also be shown.

After you've read through all of the documents and you know you understand them, you'll sign the mortgage instruments. This is your commitment where you agree to make all payments to your chosen lender in order to repay the loan. The seller will convey to you title to the home. You'll pay any necessary closing costs to the settlement agent. Then, your deed and mortgage will be recorded in the appropriate courthouse. And finally, you'll get the keys – congratulations! You are a homeowner!!

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What is a home inspection and do I need one?

Once you think you've decided on a home, it's never a bad idea to get a home inspection before signing the paperwork. This is especially true of older homes.

A home inspector will take a look at the safety of the house, carefully examining the structure and mechanical systems—from the foundation to the roof. If a repair is needed, he or she will give an estimate as to how much it will cost. At that point, you can decide if you'd like to proceed with the sale “as is” or attempt to negotiate with the Seller how these outstanding items will be addressed.

It's important to know that Terry•Peterson Residential properties are built to exacting industry-wide standards. Our thorough 300-point Construction Compliance Inspection checklist helps ensures that we deliver the quality you expect. Plus, each home comes with a Seller-paid 10-Year Home Warranty/Insurance policy—designed to cover defects in the mechanical and major structural elements after the builder's state-mandated warranty has expired.

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What are PMI and MIP?

Both Private Mortgage Insurance (PMI) and Mortgage Insurance Premium (MIP) are types of insurance programs designed to protect the lender. Depending on the amount of your down payment and the type of loan you choose, you may or may not be required to pay this insurance. Every situation varies, so you'll want to ask your lender for specific details.

Generally speaking, PMI applies to conventional loans where the homebuyer pays a down payment of less than 20% of the purchasing cost. The MIP typically applies to loans backed by the Federal Housing Administration or the Veterans Administration. These are insurance premiums that are paid either as cash up front at settlement or as part of the monthly mortgage payment to protect the lender in the event of a default on the mortgage payments.

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What payments are included in my mortgage payment?

There's more to your mortgage than meets the eye. With every monthly payment you make, you're not just paying off the balance of your loan but you are usually also paying for your homeowners insurance, local property taxes and interest.

A portion of your payment goes toward the principal, which is the actual loan amount. Another portion goes toward the interest payments. And still another amount goes toward your real estate taxes—both local and state. Your mortgage company automatically passes these funds on to the government.

Your payment also includes home insurance coverage, which protects you in the event of fire or other damages. You choose the insurance company; then the lender forwards your payment. If you pay less than a 20% down payment, your monthly check may also include private mortgage insurance (PMI).

It may seem odd to have all of these separate expenses lumped together in each mortgage payment. But in the long run, writing one simple check each month really does make life much easier for you.

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Do I need an outside real estate agent and, if so, how do I select one?

This is a great question. Terry•Peterson is proud of their reputation for working closely with the general brokerage community. No doubt in many cases an outside REALTOR® is engaged early by a potential buyer simply to help them locate appropriate properties and to consult throughout the transaction. However, with the advent of the Internet and the widely available information that is available on new home communities there and on builder websites, etc. you may be able to find the perfect community and home on your own.

A Terry•Peterson on-site agent, which representing the Seller, has a duty of honest and fair dealings with you and also owes you a fiduciary trust. Our on-site agents are experts in every facet of purchasing a Terry•Peterson home and can guide you through every step of the selection process. So whether you choose to work with an outside real estate agent (and we hope you choose a REALTOR®) or work directly with one of our on-site agents, you'll be dealt with honestly, fairly and will full information and assistance at every step!

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What is the sequence of events that occur in the construction of my home?

Terry•Peterson Residential homes are built with the utmost care and quality, and we've found that homeowners really enjoy getting an inside look at all of the hard work and attention to detail that goes into the homes they love.

If you'd like to learn more about the construction process, we offer an online tour to walk you through the steps involved in building a typical single-family home. From staking out the lot, to laying the foundation, to putting up the framing and finishing all of the finely crafted details, our slideshow covers it all step by step.

Awards

The results are in from our Customer Satisfaction Surveys.

Eliant, an independent company surveyed homeowners with the question: "How likely would you be to recommend Terry•Peterson Residential Companies to a friend or relative?".

For year-end 2007, Terry•Peterson Residential Companies scored an amazing 9.45 out of 10.0. This is one of the highest scores we have achieved and continues our 5th straight year with a "Would Refer" score above 90%.