Buying a home will, most likely, be the greatest financial commitment that you’ll make in your lifetime. Although the process can be intimidating, once you actually close escrow, you’ll immediately realize the tax benefits and pride of home ownership. Read the steps below to learn the process.
How much house can I afford? Talk to a lender to determine how much you can afford. By doing so, you will be able to immediately determine where you can live. In order to write an offer you must have a current mortgage pre-approval from a lender or proof of funds from your bank if you are paying cash. I will provide you with a list of reputable lenders who are effective in the marketplace.
WHAT DOES IT MEAN TO BE PRE-APPROVED?
A pre-approval will give you the complete measure of the home you can afford and will keep you realistic about your options. You will be asked to fill out a loan application, provide financial documentation, and have your credit run. The mortgage broker or bank will need to verify your down payment and assets. Once this happens you will be issued a pre-approval letter with a commitment from the lender to finance your loan up to a certain price. Your pre-approval is typically good for 90 days. Any changes to your financial information could alter your pre-approval at anytime. Unless instructed to do so by the mortgage broker or bank, do not pay off any debt, open new credit cards, or make any large purchases; if you change jobs you will need to notify your mortgage broker. If you are not currently pre-approved we can provide you with recommendations of reputable local mortgage brokers and mortgage bankers.
If you are planning to make a cash purchase you will need to provide a proof of funds for the entire purchase amount, plus closing costs. The funds must be in a liquid checking or savings account so consider transferring the money sooner than later. Regardless of whether you are financing your purchase or paying cash you will need to plan for depositing 3% of the purchase price into the agreed-upon escrow account within 3 days of acceptance. Be sure to set this aside now. If you would like to know what your anticipated closing costs will be let us know and we will happily run an estimated net sheet of costs for you. Having your financing in order allows you to make a quick and serious offer when the time is right. Now that you are all set it is time to start the search.
Find an Agent
You need a good agent who will work hard for you. I am dedicated to helping you find the right home, at the best price. I want you to find the home that will make you happy and successful in real estate ownership. Buying a home is a big deal, and there is a lot that can happen along the way. With all of the data available online you would think it would be easy to buy a home on your own. I want to be your trusted real estate resource and will work hard to make sure that you, and anyone you refer to me, has the best experience possible. Best of all? You do not pay me, the Seller does!
I will educate you about current market conditions and trends. I will email you daily listing updates and weekly open house guides.
What is my dream neighborhood? Based on the information you learn from your mortgage broker, and your wish list of qualities you seek in your ideal house, can you in fact afford the location that you have your heart set on? If not, can you change the parameters of your search (home size, neighborhood) to fit your budget? I will provide you with neighborhood information on schools and resources.
START SEARCHING AND WRITING OFFERS
This is the best part…searching! We will get you set up with a search account through the MLS so that you can search listings for sale, browse sold listings, and be notified when new listings come on the market. You can customize your search and receive up-to-date information about homes that fit your search criteria.
To get a better sense of what you are looking for I will want to schedule an appointment with you to look at homes together; once we have an idea of what you are looking for we will preview homes for you and leave you notes within your search platform. You will want to start visiting homes during their scheduled open houses. I will send you a list of Monday / Thursday / weekend open houses. If a home is not open then of course you can contact me for a showing.
Type of Home
What are qualities I want in a home? Do you have a non-negotiable list, regarding number of bedrooms and bathrooms or even a yard or a view? During the home buying process, this list can help you narrow down your search, and it can serve as a starting place. You may find yourself refining your desires or opening up to options you had not previously considered. I will schedule immediate viewings of properties.
Make the Offer
I will provide experienced counsel when writing an offer. I will negotiate strongly on your behalf. I will be in constant communication with you, your lender, and the title company, in order to coordinate a successful close of escrow.
Sometimes pre-inspections are needed in order to write a winning offer – after reviewing the disclosures we will educate you so that you can decide the best course of action for getting your offer accepted.
Once an offer price has been determined we will write up the offer for you. We will need a revised pre-approval letter, and if appropriate, a letter to the Seller to submit with your offer. We will then submit the offer and negotiate on your behalf.
Once the Seller accepts your offer there are multiple things that will happen:
- I will open escrow on your behalf, send a copy of the ratified contract to the lender, and help you arrange to deposit your good faith deposit into escrow
(This is the time where you conduct inspections, obtain financing, and do the appraisal)
- If you are obtaining a loan you will connect with the mortgage broker to order the appraisal and provide them all required documentation to obtain final loan approval, such as updated income and asset documents.
IMPORTANT! Do not make any large purchases or pay off existing debt without first notifying your lender
- If you are paying cash you will need to begin to collect all funds needed to close
- If applicable we will help you determine which inspections should be ordered; one of us will always be present at the inspection.
- Research and obtain homeowners insurance
- Sign off on all disclosures
- Once the appraisal and inspections have been completed you may have the opportunity to renegotiate the price or request that certain items be repaired; the Seller may accept, deny, or counter.
- If applicable remove all contingencies – no going back now!
SIGN CLOSING DOCUMENTS
- Once your loan has been fully approved the loan documents will be sent to the title company and an appointment will be made for you to sign them. If possible one of us will be at the signing with you. Bring your ID.
- Prior to the signing an estimate of your closing costs will be provided; you will need to arrange for this amount to be deposited into escrow when you sign.
- The Seller will make a separate appointment to sign.
- Once you have signed your loan documents they are sent back to the lender for final review. At this point you will not need to sign any additional documents for the loan.
- If applicable now is the time to give notice to your landlord
- We will coordinate with the Seller to arrange a final walk through for you to do one last visit
- Schedule movers, most need at least two weeks notice. If there is an HOA where you live currently, or where you are moving to, you may need to reserve a time with them to secure the elevators
- Contact utilities – turn them off where you currently live and arrange to turn them on where you are moving to
- Confirm with the lender that they have everything they need to fund the loan; the loan funds the day before, or the morning of, the scheduled closing
- We will confirm that you have signed all remaining paperwork
- As soon as the county has recorded the deed it is official!
- GET KEYS!
I will provide you with a home warranty for your first year. In the event that an appliance or the heater malfunctions, they will either be repaired or replaced. I will also give you a Grubb Company Home Owners Service List of trusted vendors.
Lastly, you will be provided a complete file at the close of escrow.