It’s mailbag time! Every once in a while, we like to take questions from the community about what they’ve been wondering about. Markets move quickly, people have questions, and we’re here to provide some information and insight. Today, we’ll be answering some commonly asked crowdsourced questions about anything real estate!
What Do I Need to Apply for an Apartment in Philadelphia?
Great question! Generally, almost every landlord in the city of Philadelphia is going to require a few things before accepting an application for their unit.
- Completed Rental Application
- Credit Check (or Co-Signer)
- Pay Stubs (usually two months worth)
- Bank Statements (usually one or two months worth)
- Photo of Driver’s License or State ID
Why do landlords need that information? Before accepting an application, their job is to make sure that you, the prospective tenant, are able to pay the rent. That means making sure that you either have enough cash or have a high enough income, checking your credit and payment history, and verifying that you are whom you say you are. With these items, landlords can make an informed decision on any application that comes in.
What is an Escrow Account?
Simply put, escrow is a legal arrangement in which a third party holds money that is being used as part of a transaction to ensure it is kept safe until it is time to be paid out. Escrow is generally used in two scenarios.
- Protecting the good faith deposit in a purchase and sale transaction.
- Holding monthly payments made by the homeowner for their taxes and insurance.
In a sale, a separate escrow account is created for the duration of the transaction. When the escrow is used to accompany mortgage payments, the account is set to last for the life of the loan itself.
Do I Need to Put 20% Down to Own A Home?
Short answer, no. Long answer, no, but putting down 20% does help.
If you’re looking to purchase a home without making a standard 20% down payment, you have options. If you qualify, you can obtain either a FHA Loan or a VA Loan; in the case of the latter, you may be able to obtain a loan with no money down. If you put down under 20%, you can expect to pay private mortgage insurance, meaning your monthly payment will be more than it normally would, but even this still may be worth it for the aspiring homeowner.