The process of buying a home can be broken down into 5 steps. Here's what those steps are along with an explanation of each.
1) Orientation - in the initial interview, you'll meet with a real estate professional to define what you're looking for and learn about the entire process of buying a home. You'll gain valuable market knowledge about different areas, home prices, available financing, and normal procedures.
Based on your wants, financial picture, and needs, you can begin to prioritize price, style, neighborhood, and size. This criteria allows the real estate professional to start looking for homes that fit your desires.
2) Financing - Putting all the things you need to make a loan application together can take some time, so take the list that is included in this report to avoid any delays. Many times, people will wait until they find a home and negotiate a contract to make a loan application for a specific type of mortgage.
Another strategy is to actually apply for pre-approval prior to finding a home. This will give you a firm commitment and can be helpful in negotiating the contract. In fact, making an offer when you are already pre-approved can make the difference between your offer being accepted or rejected. Sellers much prefer a buyer who has financing in place over a buyer who might not secure financing for the purchase price.
3) Formulating the Offer - When you find the right home, you will want to make an offer to purchase it. This is done in writing specifying every detail that is part of the agreement. There are standard forms used, which any real estate professional will have.
4) Due Dilligence - When formulating your offer, you will most likely want to have an Inspection Contingency which allows you to, during a defined period of time, bring in a home inspector to point out any possible defects in the house. Armed with the information in the inspection report, you may decide to ask the seller to make repairs, lower your offer price, buy the house as is, or withdraw your offer.
Title issues or liens can be problematic and tough to find, but will be handled by the title company you choose to work with.
5) Closing - The last step is to assemble all of the loan papers at the closing. You will need to pay the balance of your down payment and your closing costs at this time. Usually, a cashier's check is required for these funds. Sometimes extra charges pop up at the last minute and title companies will ask you to bring your personal checkbook so you can cover the difference. However, other title companies require all funds to be in the form of a cashier's check, so ask your closing agent about their company's policy.
Comments(0)