Whether it is your first home, or your next dream home, following these Steps to Buying will make your buying experience more enjoyable. Let’s get started:
Getting Ready to Buy
So, you are ready to build the “American Dream”. Preparing to buy a home can be exciting and yet cause you to be nervous at the same time. Luckily, you are in good hands. I’ll lead you each step of the way. You first may want to ask yourself:
- What are you looking for in a new home?
- Do you have enough money to buy?
- How does your credit look?
- You may want to make a list or brainstorm about the features and amenities you find most appealing in a new home.
Finding a Realtor and Initial Consultation
When choosing a real estate agent, feel free to ask them the following questions:
- How many years of experience do you have in this industry?
- What is your selling experience in my community?
- What professional certifications do you hold such as ABR – Accredited Buyer Representative or CRS – Certified Residential Specialist?
- How will you represent me as a buyer?
- Can you provide as much information as I need about home in the area that fit into my price range?
- What is the fee for your services?
- Can you provide loan services and explain the paperwork I will need to sign?
Once you have chosen your agent, it is important to establish specific goals you would like to meet. It is important to communicate with your real estate agent and that, in turn, your real estate agent communicates with you. I look forward to discussing your needs and wishes to determine what type of homes will most likely meet your expectations and answer any questions you might have.
Prior to shopping for property, enhance your buying power by getting pre-approved or pre-qualified. The “pre-approval” process allows lenders to take a look at your finances and credit history in order to make a general assumption about your loan amount. It is when a loan officer looks at all of your finances and determines the amount you can afford for a mortgage and is probably the best advantage you can give yourself as a buyer. Most offers will not be considered without a pre-approval letter being submitted at the time the offer is made.
I can help you find a loan officer you feel comfortable with and that offers programs best suited to meet your needs. They will be able to educate you about different loans and can save you time and money. There are many loan options to choose from, but it is important to keep in mind several key factors that will help you along the way:
- How much money should I put down?
- How is your credit?
- Is this your first home?
Receiving a loan requires completion of a loan application and specific financial document including pay stubs, tax returns, bank statements etc.
Starting Your Search and Immediate Notifications
Now that your loan is pre-approved and you know what price range to search in, it is time to start the exciting search for homes! We will run and initial search and also set up an automated search of homes meeting your criteria so you are made aware of potential properties as soon as they hit the market. You may want to narrow your search by asking yourself the following questions:
- Where do you want to live?
- What is my price range?
- How many bedroom and baths do you want?
- What size and style of home are you attracted to?
- What amenities do you desire (i.e. pool, fenced-in yard)
- How far is this home from my job?
- Would I be moving into a good school district?
- Are there any zoning restrictions?
- Is there public sewer and water access or septic and well water?
- Is there room to expand if we would like to build an addition?
Looking for a home in an area where you feel comfortable is key. Searching for a home is becoming easier than years ago. We now have the Internet as a powerful “home finding tool”, as well as the MLS (Multiple Listing Service) and print advertising.
To save you time, I’ll make calls and research details of properties that catch your eye in advance to eliminate those that do not meet your requirements.
Tour of Homes
I map a tour of homes and set up showing appointments to allowing you plenty of time to view each home. In addition, I’ll schedule 2nd showings for homes that stand out as a real consideration.
To keep everything organized I’ll provide you with a notebook showing all of the properties you tour to allow you to record your pros and cons. This feedback will help you narrow your considerations to your favorite home.
Making an Offer to Purchase
After your financing is in order and you’ve decided on the right property, you’re ready for the next action step in the negotiating process – making an offer to purchase.
Communicating about the home you choose and how it makes you feel is important when making this decision. It is also important to be realistic when it comes to how much you can afford when selecting “your” home. I’ll help you in determining the best offer for a desired purchase and assist through every step of the purchase process.
Writing and Negotiating the Offer
I’ll assist you in preparing a negotiating strategy for purchasing your new home. Once you have chosen the property, I’ll explain and prepare a written offer on your behalf. This will address the terms of your offer including price, financing and inspection terms, closing and possession dates.
We will discuss the comparable sales in the area of the property you choose and review all of the disclosure statements. In addition, I’ll make sure you are provided with a written loan scenario of your estimated closing cost.
Your offer will either be:
- Accept as written
- Countered with the seller requesting you accept other terms
This is all part of the negotiation process. Depending on the response your offer receives, we will evaluate your best decision and respond accordingly. The goal is not to take advantage of the seller but to come to an agreement that is a win-win for both of you while working to get you the best value possible for your purchase.
Earnest Money Deposit
When you make an offer to purchase, you make a written offer accompanied by and “earnest” money deposit in the form of a check or money order. This is like good will which reflects the sincerity of your intentions to complete the purchase of the property. The amount is typically $500 to $2,000 depending on the purchase price. This amount is then given back to you as a credit on your closing documents.
An appraisal will determine how much the lender is willing to loan you to buy a particular piece of real estate. This all-important step in getting the financing you need will provide the expert opinion of a certified, state-licensed professional who determines the value of a piece of property.
A home appraisal is not the same thing as an inspection. If you’re buying a home, you’ll want to hire an experienced home inspector to point out any potential problems that could turn into costly nightmares in the future. Property appraisers will likely make note of any obvious issues, but they won’t test your heat and air, check the chimney, or determine if your plumbing is up to code. That’s the job of the inspector.
Inspections and Repairs
Once your offer is accepted you will want to move forward with inspections including but not limited to home, termite, septic, well, etc. depending on where your home is located and what inspections are repairs are recommended. It is very important for you to plan on having a home inspection and termite inspection. These are items that will need to be paid for when the inspections are made.
Often times needed repairs are discovered that are not seen from just a visual inspection of the property. A good home inspector will walk the roof, crawl in the attic and crawl space. They will thoroughly inspect the interior, exterior, heating, electrical, plumbing, etc. and then provide a written report of their findings. This information will be used to determine how you wish to negotiate repairs with the seller.
Termite clearance letters are required by lenders for loan approval to be made.
Insuring your home is like making an investment in your future. You work hard to have a home and homeowners insurance protects you and your family from someone or something from taking it all away. There are many different forms of insurance:
Title Insurance – which protects you in the event that the title on your property has a lien, unpaid taxes, or other legalities that would make it invalid.
Homeowners’ Insurance – which protects your home from fire, theft and other liable coverage.
Flood Insurance – This protects your home from flood damage.
Home Warranty – which offers buyers and sellers the piece of mind that should anything unexpected happen (due to normal, every day wear and tear) of the home’s appliances, heating, air conditioning, plumbing, and electrical systems, it will be repaired (or replaced in some cases) for you without costly fees. When a home warranty claim is made, you pay a minimal service fee for the warranty company to visit the home and evaluate the item(s) of concern.
Once an agreement is reached your contract is binded the process of moving toward closing begins. Your loan officer will need to collect detailed employment history information and financial records to complete the loan process. They will collect payment for and order your appraisal in addition to addressing all of the other details to fully process your loan. You will want to work hand in hand to ensure everything concerning your loan is addressed for your closing to take place on time.
Now you can relax while I work with your loan officer, inspectors, closing attorney etc. to manage your transaction. I’ll ensure you are up-to-date throughout the process and everything stays on track for you closing to take place as noted in your contract.
The closing process is always changing. It is even referred to “settlement” or “escrow” in different parts of the county. Most closings are handled in person but with increased technology, some are completely automated and both parties do not have to be present to sign.
Closing is usually scheduled within 30 days of the time you bind your contract. This mainly depends on the buyer’s financing availability, successful home inspection completion, and various lender conditions (i.e. title search, title insurance, termite inspections, surveys and appraisals). The actual signing of the buyer’s documents usually takes around 1 hour.
The closing process is the transfer of the title of the property from the seller to the buyer. The buyer will receive the keys to the home or the deed to the land, while the seller receives payment for the property.
The amount the seller receives is based upon the amount that is still owed on the mortgage, any outstanding fees or taxes and any additional closing costs. All legal papers are filed with the local record office.
It is important as the buyer to take a final walk through of the property prior to closing to make sure any required repairs have been made and the property’s condition as not changed. It is equally important for both the buyer and seller to make sure the paperwork they are signing reflects the agreement of the original sale.
You have unpacked boxes, arranged your furniture and feel complete with your moving task. What’s next? There is always an adjustment period when you move. It is important to understand that what you, your spouse and/or children may be feeling is completely normal.
Here is a list of a few things that may help:
- Urge everyone to talk about how they are feeling.
- It is important to get outside and tour the neighborhood or take a drive and visit some new places around the community.
- E-mail old friends and neighbors to let them know about your new home and community.
- Start a list about what you like about your new: Home, School, Neighborhood, Community, Church, Friends and Teachers.
Additionally I offer expert assistance in several other key areas of the home buying process, such as arranging your financing, new construction, home, termite and environmental inspections, title, survey, coordinate utility, etc.