Whether it’s your first home or your third home, buying a new house is an exciting experience that requires a significant amount of time and focus. I know that this process can seem overwhelming, so I've put together 7 steps to help you make sure it goes a smoothly.
Organize Your Wants & Needs When searching for a new home, take note of features that repeatedly stand out to you. This includes features that your current home doesn’t have but you wish it did. Or it can be things that you have now, but want to make sure your new home also includes. Are you tired of cleaning snow off of your car? Maybe a garage space is needed. Do you work from home? Maybe an extra office space would help. By narrowing down your list of needs and wants, you can streamline the process to finding your ideal home.
Review Your Budget It’s important to establish a purchase price that you’re comfortable with. This way, you can ensure that you won’t get in over your head with a housing payment that you can’t afford long term. Lenders generally recommend that your maximum household expenses shouldn’t exceed 28 percent of your gross monthly income. While your debt, like credit cards or loans, shouldn’t exceed 36 percent. Real estate agents are a great resource if you are struggling to find the right amount.
Prequalified and Preapproved Becoming prequalified for a mortgage loan will help you get an even better idea of what you can actually spend on a home. To get prequalified, you will need some financial information, such as your income, savings amount, and any investments you may have. Your lender will then review this information and tell you how much they can lend to you. Preapproval will happen when you complete a mortgage application. This step involves providing your financial documents, like W-2 statements, bank account statements and paycheck stubs. All the information goes to your lender so that they can verify your financial status and credit standing.
Find a Great Agent Congrats - you have already completed this step by visiting my website. :) Real estate agents play an important role when it comes to home buying. We are here to work with you and help you find your perfect home. Realtors not only have insight on the market and your neighborhood, but they are also skilled in negotiating and navigating the home buying process. On top of everything else, hiring me as an agent won’t cost you anything. They’re compensated from the commission paid by the seller of the house so you owe me nothing.
Get a Home Inspection Once you have found your ideal home and neighborhood, it’s crucial to get a home inspection. I can assist in arranging an inspection. This step usually happens within a few days of your accepted offer. You might walk through a home and think that there are no issues. But a home inspector will go over every detail of the house and could uncover problems that you didn’t noticed. If significant damage is discovered, you can then go back to the seller and renegotiate or withdraw your offer without penalty.
Have the Home Appraised Lenders will arrange for an appraiser from an outside company to estimate the value of the home. This will ensure that you are paying a fair price for the home and that it is a smart investment to make. If the home doesn't appraise for the value that you offered the seller, you will have the ability to renegotiate or withdraw your offer without penalty.
Closing Time You’ve reached the final step! This is the time when you will need to pay your closing costs, which typically represent 2 to 5 percent of the home’s purchase price. Usually, this includes title company fees, your down payment, appraisal fees, prorations, prepaid taxes and homeowner’s insurance (minus the Earnest Money Deposit (EMD) that you submitted with your offer or after your inspection). Closing costs are normally completed during your closing which will also include any paperwork that needs to be signed, like loan documents.
Finally, when the loan is funded and the seller has received their funds, you can grab the keys and move in to your new home (unless the seller has some occupancy time)! Congratulations on becoming an official homeowner!
Selling your home can sometimes be a stressful and emotional time. Preparing yourself for what's to come can help ease most of that. More importantly, having the right Realtor (hint: ME!) can help even more! Let's sit down and discuss your options.
What's Your Home Worth? One of the most important steps in the process of selling your home is knowing the price it's worth. My Comparable Market Analysis (CMA) will pull comparable properties in your area sold within the last six months and show what each home sold for. This will give us a recommended listing price.
Click here to submit a form or Contact Me for your Free Comparable Market Analysis when you're ready!
The Paperwork The next step after your CMA is to complete and sign all of the paper work. Don't sweat it! I will walk you through this process in person once we meet. We will go through each document together and discuss what each one means. It is my goal to make sure you understand everything that you are signing and prevent any suprises down the road. There are no silly questions, so make sure bring up anything you'd like to discuss!
Marketing Your Home After the paper work and your home is listed on the Multi Listing Service (MLS), I'll get to work using my secret sauce marketing plan. Wether it's online social media marketing, contacting my list of waiting buyers, mass emails to agents that have buyers that meet the criteria of your home, each marketing task will have one thing in mind - maximum exposure to potential buyers!
Executing A Purchase Agreement (aka PA) Once a buyer is interested in your home- the fun begins! Negotiating a purchase agreement. Some of the items that will be negotiated are price, contingency time-frames (inspections, appraisal, closing, possession, etc), and more. Once both parties are satisfied, the seller and buyer will sign off on an executed purchase agreement and the work begins! The documents are sent to the mortgage lender and title company to begin their work as well.
Inspection Period In the purchase agreement there will be a negotiated period of time for inspections to be completed by the buyer. During this time, the buyer can (at the buyers expense) inspect the home and decide if she/he is satisfied or would like to ask the seller to fix certain things. If the buyer asks the seller to fix anything, the seller can accept or reject the request. Most times buyers are looking for major issues, not the little honey-do list items.
The Appraisal The mortgage lender wants to know that the house that the buyer is purchasing is worth what they are lending them to buy it. The buyers mortgage company will order an appraisal from an outside appraisal company. This is typically paid by the buyer. Usually within 5-10 days, the lender and buyer will receive the appraisal results.
Clear to Close Music to your ears! A clear to close will initiate a settlement statement for the buyer and seller. This statement shows which costs go to where and who will pay for them, per the contract. I will look over this as your Realtor, but you should do the same to make sure nothing was missed!
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