Buyer Resources
Buying a home usually represents your single most significant investment
The home buying process is one of the most exciting and frequently stressful experiences you’ll ever go through. This holds true whether you’ve bought many homes or you’re looking to buy your first, whether you’re in the market for a new primary residence, an investment property, or that perfect vacation getaway.
Define your goals, research your options, make your plans
Since buying a home is such a big step, educating and preparing yourself as much as possible is very important. This means determining the reasons you’re buying and what kind of home you’re looking for. Since buying and financing a home are closely related, it also means examining your current financial situation and projecting how much you can afford.
Once you’ve answered these questions, even tentatively, you’ll be in a better position to research housing and mortgage options and create an action plan and timelines for moving forward.
Contact a real estate professional
Buying real estate is a complex matter with many factors since no two homes or transactions are alike. Moreover, with all the unique opportunities and potential pitfalls of the current market, it’s more important than ever to contact a real estate professional once you’ve decided to buy.
When choosing a real estate professional to guide you through the property search, financing, negotiation, and transaction processes, you should consider their local market knowledge.
Get pre-approved for a loan
I recommend that you get pre-approved for a loan before you start viewing homes with the serious intention of buying. The pre-approval process involves meeting with a lender and authorizing them to examine your current financial situation and credit history. On the basis of this examination, the lender may provide you with a document detailing the amount you can borrow to buy a home. Consider looking online to see what different lenders offer, or contacting your local bank or credit union.
The benefits of pre-approval include:
You’ll know what you are eligible to receive and be able to plan accordingly. As a qualified, motivated buyer, you’ll be taken more seriously when you make an offer. Lenders can tell you if you qualify for special programs to help you afford a better home (particularly if you’re a first-time buyer).
Real estate financing is available from many sources, and an experienced real estate professional can suggest lenders with a history of offering excellent mortgage products and services.
View homes and select THE ONE
But, knowing what you’re looking for is the key to the home search process. Among other things, that means distinguishing between “must-haves” and “like-to-haves.”
There are many benefits to starting the search process at a real estate website. You can view many homes and their details.
However, it’s also important to view homes in person. While the property details may seem similar online, homes can be very different in layout, design, artistry, and other aspects. Ideally, you should view homes with the help of an experienced real estate professional who’ll notice things you might miss, provide expert analysis, and act as an impartial sounding board.
Make an offer and negotiate with the seller
Once you’ve found the home you’d like to buy, it’s time to make an offer. Your state or local real estate association likely has contracts generally used for transactions in your area. These contracts enable you to specify a sale price and also allow the inclusion of clauses specifying various terms of purchase, such as the closing and possession dates, your deposit amount, and other conditions.
You should carefully review these clauses with your real estate professional to ensure they accurately express your intended offer. In addition to drawing up the contract, your real estate professional will happily address all your questions about the offer process.
You’ve written the offer; your real estate professional will present it to the seller and/or the seller’s representative. At that point, the process will vary somewhat depending on your market.
Generally speaking, the seller can accept, reject, or counter your offer to initiate the negotiation process.
Successive counter-offers, with deadlines for responding and meeting conditions, may be exchanged between you and the seller until a mutually pending agreement is reached or the negotiations break down.
Secure your financing
Once you have a pending agreement, it’s time to return to your chosen lender to finalize mortgage details and close the deal. This means finalizing your down payment, interest rate, regular payment schedule, and all other financial conditions associated with the closing.
Close the deal. If you’ve efficiently handled everything connected with purchasing your new home, taking ownership should be a positive joy with no surprises. Key steps to the closing, also referred to as the “escrow” or “settlement,” include:
Getting a title search – you will need a historical review of all legal documents relating to ownership of the property – to ensure that there are no claims against the property title. It’s also necessary to purchase Title Insurance for protection in the event of errors in the records or mistakes in the review process.
The final walkthrough: You will be given the chance to look at the home one last time to make sure it’s in the same condition as when you signed the sale agreement.
The settlement – typically, on the Closing Date, you’ll meet with a lawyer, real estate professional, or escrow agent to verify and sign all the paperwork required to complete the transaction. The settlement will include paying your closing costs, legal fees, property adjustments, and transfer taxes. At that point, you’ll receive the property title and copies of all documentation about the purchase.
In most cases, the Possession Date will fall within a few days, and you will be able to move into your new home.
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