~Step-By-Step Home Buying Process~
Step 1: Confirm you’re ready to purchase
Do you have a stable job? Can see yourself living in same town for the next several years? Are you prepared for the extra work that comes with homeownership?
Request your credit report from all three credit bureaus (Equifax, Experian, and TransUnion) and start fixing any errors right away. Do not apply for any new credit cards or auto loans.
Step 2: Determine your budget and Start saving up for a down payment
A big part of your mortgage will be determined based on how much you pay upfront in the form of a down payment, which is typically 20% of the home’s final sale price, but you can also buy a home with less.
Generally, the higher the down payment, the better the interest rate will be. If you decide to put down less than 20%, you’ll likely need to pay private mortgage insurance (PMI). Your lender can help you better understand your options are determine the best down payment for you. We have great lender referrals when your ready for the next step.
Closing costs are fees paid at closing and are usually total 2% of the final sale price.
Step 3: Get pre-approved for a mortgage
Sellers are typically more willing to accept offers from pre-approved buyers, because it shows that the buyer has the financial resources available to make good on their offer.
Once you select a lender, apply for pre-approval. Your lender will check your credit and ask for all of your financial documents—tax returns, pay stubs, bank statements, credit card statements, student and auto loans, etc.—to accurately assess your financial situation.
Step 4: Team up with a buyer’s agent
Real estate agents are licensed professionals who have access to information that isn’t open to the public. A good buyer’s agent will be an expert on the home buying process, have strong knowledge on different neighborhoods, be familiar with local listing agents, and be a skilled at negotiating.
The seller pays all real estate commissions in a home sale, so working with a great buyer’s agent won’t cost you a thing.
Avoid dual agency, this occurs when the listing agent selling a home also serves as the buyer’s agent.
Step 5: Create your home wish list and start looking at homes
Once you’re pre-approved and have an agent, you’re ready to look for a home.
Narrow down your search. Determine your ideal neighborhoods, and make a list of must-haves vs. nice-to-haves.
We can tour as many homes as you want, at times that are most convenient for you (typically 9am - 8pm). We can also provide a list of weekend open houses. When visiting open houses be sure to tell the listing agent you have a buyer’s agent and avoid sharing any additional information that could affect negotiations.
During tours inspect each home carefully, note details like how strong the water pressure is, how much street noise you hear, how squeaky floors, and ask questions. You may also take photos for each home.
Step 6: Make an offer
When you’re ready, we will help you determine how much to offer and which contingencies to include. We can also create a comparative market analysis (CMA). A CMA will show the list and final sale prices for similar homes that recently sold in that area.
Once you submit your offer, the seller will review it with their agent and accept, decline, or submit a counteroffer.
Counter-offers are common and should even be expected. If you end up in a counter- offer situation, we’ll help you negotiate the best deal possible.
When negotiating, don’t focus only on your final offer price. Instead, look at the whole picture and consider raising your earnest money, waiving contingencies, or proposing an earlier closing date.
Step 7: Close
Once you and the seller agree on the terms, you’ll enter the closing process, which usually takes 30 to 60 days. You’ll be in very close communication with your agent, lender, and attorney during this time.
Closing Process Timeline
-Tender earnest money deposit within 1-2 days after offer is accepted.
-Conduct inspection shortly after the offer is accepted. We have great home inspectors to recommend. It’s best your present for the inspection, even if you just come towards the end. Usually takes about an hour and half. It’s a great time to ask questions and learn the ins and outs of your new home.
-Our attorney reviews the contract and communicates your inspection requests (in any) to the seller’s attorney, along with any contract modifications needed.
-When both parties reach agreement then the attorney review & inspection period is concluded.
-Additional earnest money is tendered.
-Lender orders the appraisal to confirm home value.
-Attorneys schedule closing.
-Set up utilities to begin service in your name beginning the day of closing.
-Final walk through of unit. This is done the day before close or right before the close, depending on what works best for you.
-Closing. Receive keys.