A Step-by-Step Guide to The Home Buying Process:
1. First, you must obtain a pre-approval or a pre-qualification from a lender. I can provide you with some trusted and recommended mortgage lenders if you do not already have a preferred lender. This is the critical first step to make sure that you have all of your finances in order and have a clear idea of your ideal price range and limits.
2. Once we have a pre-qualification, we will begin the fun process of looking for your new home! Via email, I will provide you with up to date listings in your price range, area(s) that you are interested in and the type of home that you are searching for within your search criteria.
3. After our showings and once you find your potential new home – I will write an offer for you to review and sign. This is lengthy, legal paperwork and I will explain all of the documents and information in the offer you are agreeing to before I submit it to the listing agent.
4. When you are putting an offer in on a home that you and your family are interested in, you will need to provide the lender letter showing your pre-qualification and a personal check or money order for the Earnest Money Deposit (EMD) in the amount of $1000.00 or another agreed upon amount based on the offer price. These funds remain yours throughout the process and are returned to you at closing or can be used for extra items that are required during the buying process. Your lender will provide that information for and talk to you about using your escrow of $1000.00.
5. Once an offer is written – I will send your offer to the listing agent of the seller and he/she will present your offer to the owner of the home. The owner can do one of three things – they can accept your offer as written, they can counter your offer (different amount or different terms than you have asked for in original offer) or they can reject your offer.
6. If a counter is sent back, I will meet with you to go over what the seller has proposed. Here again – you can accept, counter back to the seller, or reject their counter offer. We will negotiate as long as necessary in hopes of finding a suitable way forward for both parties.
7. Upon accepting (either by the seller or you) the contract becomes “ratified”. Once a contract is “ratified” there are usually only three ways that you can get out of the contract without being in default. The first is if the home is in a HOA (Homeowners Association) community and you do not agree with the terms of the HOA, which will provided to you upon being ratified within a 10 day range – you can back out of the contract without being in default. The second way is when the home inspection is performed (I will provide you with trusted home inspectors in our area if you do not know of one) and this will cost between $300-450 out of pocket at the time of the inspection. If the home inspector finds something wrong with the home and you decide that the problem is too big, you can get out of your contract without being in default. The third way is not being able to get funding from your lender. Your lender will review your file a few days prior to closing it is always a good idea to hold off on any large purchases until AFTER settlement as making a large purchase BEFORE settlement may cause you to no longer qualify for your loan.
8. The next step will be working with your lender to have the home under contract appraised by an independent third party licensed appraiser. This is a requirement for you loan. Your lender will collect funds from you (usually around $400-475) to pay for the appraisal. This MAY be one of the items that you could use your EMD to pay for – but you will have to speak to your lender in this regards to see if it is something that can be done for you. Typically, your loan can take anywhere from 30-45 days to close after being “ratified”.
9. I will give you names of trusted settlement companies in our area that you can choose for your closing location. Your lender will provide a Closing Disclosure at least three days prior to closing that will show ALL aspects of your loan. It will show you where your money is going, line by line, and where the seller’s money is going as well. The settlement agent will go over this with you in detail at the time of closing. Your settlement company will have all closing documentation and I will be present with you during closing to answer any and all questions you may have pertaining to your closing packet.
10. You will need to get all utilities transferred to your name effective the day of settlement.
11. We will conduct a final walk through, typically an hour or two before settlement, to ensure that the property is still in the condition you saw at the time of contract. It is also a time to inspect any repairs which were agreed upon at the home inspection and make sure they have been completed.
12. At the conclusion of settlement, you will be given the keys to your new home! It is always a good idea to have locks changed if you are purchasing an existing home.
13. Now it’s time to CELEBRATE and start making this new house your HOME!!!
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