The Home Buying Process
BEGINNING YOUR SEARCH
The first stage in the home buying process entails preparation, education and finding yourself an agent.
- Begin your home search online. Before making a move it is very important to familiarize yourself with the neighborhoods that you may be considering, the available inventory and what kind of value you will get for your dollar. Some excellent places to start you search are:
- Get Pre-Approved. When making an offer, the Pre-Approval demonstrates that you are qualified to purchase and puts you one step ahead of a buyer without one. Like shopping for a car, it is best to call several mortgage lenders to see who can offer the best product to suit your needs. They will ask for paperwork (W2’s, paystubs, etc.) in order to qualify you for a particular price range.
- Find an agent. When searching for a home, having the right agent makes all the difference. Forming a relationship with someone that you can trust guarantees that the home buying process will be as seamless and stress-free as possible. It makes sense to form a relationship with one agent so that they know exactly what you are looking for and can work in your best interest. Remember, listing agents always work in the best interest of the seller.
FINDING A HOME
The second stage in the home buying process involves some footwork, negotiation and going to contract.
- Begin your search in person. Now that you have an understanding of the market, your pre-approval and an agent it is time to see a few homes in person. This can involve having your agent schedule private viewings for you as well as attending open houses. Remember, if you attend an open house without your agent make sure to let whoever is running the open house know that you are working with an agent. This will alleviate having to sign in and give any of your personal information.
- Make an offer. Once you find a home that suits your needs, it is time to make an offer. The terms of your offer include the price, your financing and your closing timeline. Your agent will present your formal written offer along with your pre-approval. It is likely that the sellers will counter-offer before coming to an agreement.
- Schedule an inspection. After your offer gets accepted, you can arrange to have a licensed home and termite inspector come to take a look at the home. Their job is to provide you with information regarding what parts of the home are in good shape, what might need attention and what to keep an eye out for. This is for the buyer’s education and not used as a point of renegotiation. If pricing is needed regarding any repairs it is best to have a licensed contractor look at the home.
- Find an attorney. You have had your home and termite inspection and are now ready to move forward. The next step is to find a real estate attorney. Their role will be to protect your best interest from contract to closing along with your real estate agent.
- Sign contracts. Your real estate agent will provide your attorney with all of the information they need to arrange for contracts to be drawn up. Once the paperwork has been finalized, your attorney will arrange to have you sign the contracts and put your down payment. The contracts then get sent back to the seller’s attorney for the sellers to sign. When the contract has been fully executed, the home gets removed from the market and is no longer shown as available.
CONTRACT TO CLOSING
The third and final stage in the home buying process calls for your agent, your attorney and your lender to work together in finalizing the deal.
- The appraisal. Now that you are in contract, your bank will order an appraisal. Your real estate agent will meet with the appraiser and provide comparable sales to show the bank that the home is indeed worth what you are asking them to lend you.
- Title search. Almost simultaneously, your attorney will order title. A title search company is called on to ensure that the home is up to code, has all of the necessary C/O’s and is free and clear of any liens. Think of this as a background check on your soon-to-be new home.
- Obtaining your mortgage commitment. From contract to closing, several conditions must be satisfied in order for you to obtain your mortgage commitment. Your lender may ask for updated documentation during this time. When the underwriting process has been completed and all of the conditions have been satisfied, you will receive your commitment and be cleared to close.
- Final walkthrough. When the closing has been scheduled, your real estate agent will arrange for you to come have one final look at the home before you sign all of the paperwork. This serves to make sure that nothing has happened to the house in the time period between contract and closing. You will look around and make sure no damage was done when the sellers moved, check all of the appliances, etc.
- The closing. It is finally time to close on your new home! Before closing, your attorney will let you know exactly what you need to bring with you (identification, checks, etc.). You and the sellers will sign all of the paperwork to transfer ownership and provide you title to your new home. Congratulations!