Steps to Home Buying Process

This is a simple to do list to help prepare prospective buyers with the purchase of a home.  This list will provide some insight on where to start and what to expect to ease the feeling of being overwhelmed or intimidated by the unknown of the home buying process.

1. Organize your personal finances - have copies of
   
   • Latest tax returns
     
   • Most recent pay stubs
   • Latest bank statements (cash buyers)
   • Any/all income statements
2. Find home loan lender / loan officer (contact your local REALTOR® if you don't know one)
   • Determine mortgage qualification - includes credit check
     
   • Submit personal finance information to loan officer/lender - determine debt to income ratio
     
   • Get pre-qualification letter (this will state the amount of funds you qualify for) -or-
   • Qualification letter - increases the strength of the purchase contract.
   • Once this step is completed, an understanding of the mortgage amount will be established, without any obligation to purchase a home, or obtain a mortgage. Buyer can then decide to continue with the home buying process.
3. Contact your local REALTOR® (real estate agent) to start your home search
   • Provide a copy of your qualification letter - agent can set up online search based on your criteria
   • Allot time to spend online searching and researching - researching schools and neighborhood can be time consuming but well worth it.
     
   • Allot time for viewing places with your real estate agent. If you're unable to keep your appointment, call your agent immediately to cancel.
     
   • While searching for a new place, it's time to start packing up your current place especially if you're moving from a house.
     
     • Have garage sales, and donate what you don't want to take with you to your new place. 
       
     • Collect boxes or buy moving boxes to help with packing.
     • Create a packing list
4. Once that perfect place is found, the real estate agent will write up the purchase contract.
   
   • Prospective buyer signs the contract and provides an **earnest money deposit (EMD) - real estate agent will submit contract to sellers. EMD check will be held by the broker of the real estate agency until closing, at which time it will be applied toward the down payment and closing costs. Amount of check varies based on property - check with your agent.
   • Your agent will be in contact with outcome within 2-3 days of submitting the contract.
     
     • Once both parties (sellers and buyers) come to an agreement on all terms and conditions, the contract must be signed by both parties. This is when emd check will be deposited.
       
     • If both parties do not agree to all terms and conditions then prospective buyer continues searching for another home.
       
     • Once the contract is signed by both parties (ratified contract), the buyers will be guided by their agent as to the following steps that will result in a successful closing.
     • Start packing
5. A series of events will take place, including inspections, but mostly lender requirements. It's important to provide all information to lender in a timely manner to keep the ball rolling.
   • Packing agenda
     • Finish packing
     • Line up movers
     • Get utilities lined up for connection
6. Lender will provide buyer with Good Faith Estimate just before closing - break down of the purchase of the home, including taxes, special assessments, lender fees, commissions, etc. Take a close look this list and immediately contact the lender or real estate agent for any discrepancies.
7. Lender will check credit the day of or day before closing for any changes that can delay or deny the purchase before releasing funds to title company.
   
8. At closing - all parties meet at title company, buyer brings all required funds (**closing costs, down payment) in certified check, buyer and seller signs all required documents, buyer obtains keys.
   
9. Congratulations, the house is yours! You did it!

TIPS:

1. **Funds required: Earnest Money Deposit, Closing costs, Down payment - check with your real estate agent and/or loan officer to see what government programs you qualify for to assist in funding these items. Don't let this deter you from obtaining home ownership.
2. For new construction purchase, remember the agents in the model homes represent the builder and therefore cannot represent the prospective home buyer on the purchase of the home. With that in mind, choose carefully if you want to be represented by choosing your own agent to accompany you, or unrepresented by choosing the builder's agent. If you want representation, take your agent with you on your first visit to the new community.
3. When searching for a home remember that it's impossible to see every home on the market. If you find a home you feel comfortable with, put a contract on it before someone else does. Many buyers want to see every home on the market even when they find the right place. When they're ready to go back, it's no longer on the market. Don't let this happen to you.
4. Pre-qualification and qualification letters have expiration dates, use your time wisely and don't let the letter expire.  Unless, of course, you choose to wait until you can qualify for more funds by improving your credit situation.
5. *****NOTE TO ALL BUYERS: DO NOT MAKE ANY PURCHASES WHEN YOU ARE UNDER CONTRACT******* I cannot stress this enough. This is not the time to shop for a new car or furniture to go with the new home. Do not charge up the credit cards, or use a lump sum of cash out of your bank account until after closing. Lenders check credit just before closing and this can impair your purchasing power and lenders will not hesitate to pull the deal at the last minute and leave you with penalties to pay for not complying with your contract.
6. Home buying process doesn't have to complicated. Contact your local real estate agent to help you find your next place.
   

Hope this was helpful to home buyers who are new to purchasing or on the fence about purchasing versus renting to help navigate through the process. Some steps may vary depending on your location.