If your a little nervous just thinking about buying a house, we get it!
Buying your first home is a serious commitment. It's likely to be the most expensive purchase in your life. So be a good boy scout and
PREPARE
Like any great adventure, you begin with trusted companions. You want to surround yourself with people who know what they are doing and are really good at it! As a home buyer, you need 100% loyalty from your real estate agent. Learn about exclusive buyer agents who serve only home buyers. Interview agents and make sure you are a good fit.
The Basics of Buying your First Home
• Be pre-approved with a local lender. When we identify a house and you want to write a contract, we will contact the lender to write a lender letter. This will be submitted with your contract offer.
• You will write an earnest money deposit check for 2 to 3% of the offer price. This percentage applies to the Greater Washington DC area. A picture of this check is sent to the listing agent, along with the lender letter & contract. This shows the seller and agent that you are earnest in your offer. The higher the EMD check the better your offer looks. Since the listing agent will pull the house off the market, if our offer is accepted, they want some certainty that you are planning to follow through and buy the home.
• If your offer is accepted, your EMD check goes into an escrow account until settlement. This money comes back to your side of the settlement table.
• When writing the offer, appraisal and financing contingencies should be included. These contingencies are in place as protection for you. The appraisal is ordered by your lender. An independent appraiser goes to the house and evaluates the property. If the property does not appraise, meaning the appraiser determines that the house is not worth the sales price, we come back to the seller/listing agent and ask them to lower the price. If they disagree and we cannot come to an agreement on price-you can get out of the deal. The financing contingency is in place in the event that something unforeseen comes up with your financial situation (you lose your job for example) and you can no longer qualify to receive a loan this contingency can get you out of the deal.
• When we have a ratified contract which is both sides come to an agreement and the contract is signed by both parties, schedule a home inspection. We'll send you a couple of links to home inspectors for your review. Choose a company and we will schedule the inspection.
• The home inspection is paid for at the time of service. Prices in the Washington DC area range from $300-$600 and the inspection takes between 2 and 4 hours depending on the size of house and property. One of you should be there since the inspector will explain how the house works. He/she will provide a detailed report and we will go over the report with you. There will be items that we will ask the sellers to fix or credit us. This is another place where we negotiate to get you money toward closing costs or repairs.
• You will apply for homeowners insurance. Be sure to get "loss of use" coverage.
• Your lender will be checking in with both of you as he/she prepares your loan. The settlement attorney gathers all the documentation for settlement from buyers and sellers. He will examine the title to be sure it's free and clear to sell. He will check for easements & encroachments on the property and make sure all existing mortgages, liens on the property etc are satisfied. Finally, the settlement attorney disburses the money and records all documents with the state and county.
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