The Home Buyer’s Guide
Choosing the right home is a very exciting and stressful process. We hope the following guide will answer most of your basic questions, and provide you with a helpful framework in which to understand the process of buying a home. It is highly recommended that you contact a licensed real estate agent to answer any questions you may have about the process.
Step 1: Determine your needs
Before you begin your search, ask yourself:
- Where do I want to live? Deciding where you want to live can be a matter of your lifestyle, so you have to decide what your priorities are. The community you choose should accommodate your lifestyle priorities.
- What can I afford? Although it’s tempting to dive in and begin searching for your dream home, it’s better to start with some budgeting. It is important to know what price range you can afford in order to realistically narrow your search. You want a home that will fit comfortably into your budget, taking into account your expenses and anything extra.
If possible, get a pre-qualification for a loan. This means the lender will give you a ballpark figure of what loan amount you would qualify for, which gives you a good estimate of what you can afford.
Step 2: Find a real estate agent
Real estate transactions are complex and the contract establishes much more than just the purchase price and the closing date. In addition to offering a service which is free to you, the buyer, having a real estate agent represent your interests offers several benefits, such as:
- Helping you understand what to expect throughout the process
- Facilitations negotiations
- Keeping you informed of updates
- Providing you with access to a variety of search tools
Step 3: Select a home
Once you figure out what you can afford and obtain a pre-qualified mortgage, you are ready to begin your search. There are a variety of sources you can use to find the home that is right for you:
- Work with a real estate agent
- Newspapers and real estate magazines
- Visiting development sites
Step 4: Make an offer
When you find the right house you'll want to make an offer to purchase it right away before anyone else. When you make an Offer to Purchase (which may include an " earnest money" deposit), you should make sure the Offer contains certain contingencies. Most importantly, it should allow you to get a refund if a professional inspection reveals problems with the house, or if you aren't able to get approved for a mortgage.
Step 5: Get a professional inspection
A professional home inspection summarizes the condition of the property and points out the need for major repairs. As such, it is a major component of the home buying process. A standard home inspection summarizes findings from an inspection of the following:
- Foundation and the visible structures
- Heating and central air conditioning systems
- Walls, ceilings and floors
A failed inspection allows you to withdraw from the purchase of the property, or renegotiate the price.
Step 6: Submit your mortgage application
Mortgage interest rates, fees and other terms can vary widely. Your Mortgage Cents agent can help you determine which loan options are right for you. When you have selected the right mortgage terms, your application will be sent to a bank or other lending institution for their approval.
Step 7: Close the deal
Closing the deal consists of confirming prior arrangements with the seller and reviewng the results of any property inspections. This is also when you make the rest of your down payment, pay loan fees, sign all necessary legal documents, and get the keys to your new home.
