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A little bit about living in Germantown

Germantown is a rapidly growing town just 25-30 miles from our nation's capital, Washington, D.C. Germantown is the third most populous area in Maryland, offering its roughly 86,395 residents a wide array of amusements. From fine dining restaurants to the BlackRock Center For the Arts, a renowned arts complex in downtown Germantown, this community offers countless ways to enjoy artistic endeavors just outside of D.C.

Homeownership in Germantown is foolproof

Diversity and quality education make Germantown's' residents stand out

Germantown demonstrates its support of arts and culture with its many venues and annual festivals. With easy access to neighboring metropolises, the small-town appeal of Germantown allows residents to find the thrill of big city life at their fingertips while nestled in a warm and friendly community. The BlackRock Center For the Arts, the Maryland Soccerplex, the annual Germantown Oktoberfest celebration, and the bustling culinary culture of downtown are just some of the many offerings Germantown provides. Close proximity to several esteemed colleges and universities, such as Howard, Stratford, and American University, make Germantown a motivating place for young children to learn and grow.

Getting to know Germantown

Finding the right neighborhood for you in Germantown

Whether looking for an easy commute to D.C. or looking to start a family in a quaint city, Germantown offers a wide selection of applicable real estate. Earnest can help you narrow down your search based on your credit score, the loan size you require, your neighborhood preferences, and other determinants. Earnest makes homeownership feel effortless, as they use your buyer profile to find the best options for you.

Common Questions About Buying a Home in Germantown

All The Answers You Need to Settle Down Sooner

Should I choose a fixed or adjustable rate?

It depends how long you expect to stay in the home. Adjustable rates are good for people who may not be in the home long, whereas fixed rates are ideal for people who are confident of settling in.

Do I need a home appraisal?

Probably—in most cases, the homebuyer must use an appraiser to evaluate the value of the home. Appraisal costs vary depending on the value of the property, as well as the state the house is in. Buyers cannot choose their own appraiser—the bank makes the decision.

What is PMI?

Private mortgage insurance (PMI) is required when a homebuyer makes a down payment of less than 20%, or when a borrower refinances with less than 20% equity in the home. PMI fees vary according to your down payment and credit score, and adds a premium to your monthly mortgage payment. Please note, PMI is tax-deductible in 2015 and 2016 for certain income brackets.

What does Loan-to-Value mean?

Loan-to-Value (LTV) is the percentage of your home’s value that your loan represents. When refinancing, the calculation is simply the loan amount divided by the appraised value. When buying a home, the LTV is found by dividing by either the purchase price or appraised amount, whichever is lower. When the LTV is less than 80%, the lender generally requires PMI.

For example:

Purchase price: $100,000
Down payment: $15,000
Loan amount: $85,000
Appraised value: $110,000
LTV: $85,000/$100,000 = 85%

What are closing costs?

Closing costs are standard fees associated with a real estate transaction. You will typically pay about 2-5% of the purchase price in closing costs—the exact amount depends on where you are buying (or refinancing), as well as number of extra fees involved in your particular transaction. Earnest charges no lender fees, so the borrower is only responsible for 3rd-party fees.

What should I consider before refinancing my mortgage?

Refinancing your home loan is an attractive option when rates are low. A simple rate and term refinance can help you lower your monthly payment and potentially eliminate your PMI premium, as long as you have built up enough equity in the home. You might also use a cash-out refinance to access some of the equity you’ve built up in the home (which may result in a higher monthly payment on your new loan).

However, keep in mind that refinancing a mortgage does involve several fees (closing costs). Before refinancing, you should calculate the ‘break-even’ point at which your refinanced loan makes up for the closing costs. If you plan to leave your home before this time, it’s better to stay with your current mortgage.

Knowledge Is (Buying) Power

Further Resources from the Earnest Blog

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The intelligent home loan

When it comes to finding the right home loan, Earnest works hard to ensure that the process pain-free. We use an industry-leading and intuitive online-only application (meaning most times no scanner or fax machine required), a 5-star client service team, and a unique rolling pre-approval that stays current while you track down that perfect home. At Earnest, the home loan process is like no other.