10 Steps to Buying a Home
Secure a Real Estate Professional – Did you know that when a Builder or REALTOR® lists a home for sale, they are representing and looking out for the seller’s best interests? So, to successfully buy a home and have YOUR BEST INTERESTS represented, it’s wise to secure your own dedicated REALTOR® as early in the process as possible. As REALTORS®, we are actively in the local housing market every day. We know, understand, and protect your rights as a buyer. We are experts in the process & nuances from start to finish. We know about coming soon homes that are not on the market yet through our professional networks. We use our expertise at every turn to negotiate for your interests, advise you on each step along the way and continually position you for success! Your first best step toward buying a home is giving us a call. Let us put you on solid ground for the steps that follow!
Get Prequalified – Before going out and falling in love with a home – it’s best to know, from a lender’s vantage point, what you can afford! Unless you are planning to pay cash for a home, we recommend that you speak with a mortgage lender before looking at houses. And, if you do not have a lender you want to work with, we have worked with many lenders over the years and are happy to refer some top notch lenders to you! Your mortgage lender will look at your income, credit scores, revolving debts and obligations such as child support. They will also provide you with great advice about various loan options that best match your needs and desires. The lender will provide information about current interest rates, loan terms and affordability considerations. Based on those conversations, your lender can provide you a “pre-qualification” amount which will give you confidence in knowing what price-range homes you can shop. This step also helps to position you as a serious buyer in the market and affords you respect from potential sellers.
Make your Wish List - Decide where you want to live and how many bedrooms and baths you’ll need. Consider lifestyle - condominiums offer shared amenities, with less responsibility. Single-family homes offer more space and privacy, but more exterior and yard maintenance. Do you know what an HPR is? Do you like open or more traditional floor-plans? These things are fun to think through and help you express your individuality as a homeowner! And we are here to help you think it through and envision the place that feels like HOME to YOU!
Select Your Home - No home is perfect, so don’t let minor flaws influence you. Think long-term. Which home best suits the activities and needs of your household now and in the years ahead? Don’t buy more than you need or can comfortably afford. As your REALTOR®, we will help you think through these things and will secure property condition disclosures, tax records, HOA information and other details you will want to consider when selecting a home.
Make an Offer - Your offer depends on the current market – and all the variables in the market. This is another place where we shine as your REALTOR®. Being in the market every day, we are mindful of the obvious and hidden variables that make offers attractive to sellers and protect you as the buyer. We will be there to advise you through each detail of the offer process.
Provide Earnest $ - To be seen & respected as a strong buyer, we often recommend that our buyers include 1% of the purchase price as earnest money in their offer. For example, if you offer $300,000 on a home, be prepared to pay $3,000 earnest money within 3-5 days after making the offer. This applies toward your closing costs and is refundable if the contract is terminated based on inspection, appraisal or other contingencies defined in the purchase agreement. However, each transaction is unique – and there are times when we advise our buyers to offer less or more than 1% earnest money based on a given scenario. So please don’t let that 1% threshold scare you! Let’s chat – your situation may suggest a different level of earnest money!
Get Inspections – When your offer is accepted by the sellers, you will be officially “under contract.” Once you are “under contract,” you will have a designated period of time to hire professionals to inspect and assess the condition of the home. The inspectors will point out the age of systems, they will note any large and small repairs that are needed, they will assess if termites are present – and, if you so choose, they can check for radon gas, mold, and other details that are important to you. Any needed repairs or improvements to the home can be negotiated following the inspections. Remember – we’re in your corner for those negotiations!
Get an Appraisal – If you are using a mortgage loan to purchase a home, the mortgage lender will order an independent third-party appraisal to determine market value. Most homes appraise for at least the buyer’s offer price – because the offer is most often based on a REALTOR® assessment of the current market conditions. However, sometimes appraisals come in lower than purchase price – and when that happens, banks usually refuse to grant the loan unless you renegotiate with the seller or you are putting down a large percentage of the purchase price in cash. If it appraises, the lender will move toward closing. Again, as experienced REALTORS®, we are present and actively representing your best interests during this process.
Title Search, Loan Finalization, Moving Prep & Final Walk Through – There are several final details working in the background as you approach closing. Your REALTOR®, Title Company, and Lender will work together to make sure details related to ensuring a clean property title and loan are ready for you at closing. The last week before closing is a crucial time for your lender and title company to confirm & finalize details on your behalf. It is also an important time for you to be quickly responsive to any questions or requests they may have. Additionally, your REALTOR® will provide recommendations regarding who & when to call to schedule utilities, movers and other moving prep needs. You will also have an opportunity to walk through the property a final time with your REALTOR®, usually 0-3 days prior to closing, to confirm your home is in the same or better condition as when you made your initial offer.
Go to Closing - Once final negotiations are complete, title & loan documents are complete and all contingencies are met, we will join you at the escrow office (title company) to ‘close’ the transaction. This is where all final paperwork is signed, the home is officially paid for by the buyer & buyer’s lender, and any other disbursements are made by the escrow officer. You then get the keys to your new home, according to your agreement.
Congratulations! You’re new home awaits you!