The Home Buying Process Is the home buying process overwhelming? It doesn't have to be with the basic steps listed below. Get familiar with the process and terms used so that you can be prepared. Of course, specifics of the process may vary depending on the real estate laws of your area.
Every buyer should get a copy of their credit report and know what it says before applying for a mortgage. The information will determine loan terms and interest rates. Your credit score could determine eligibility for a home loan. Have you considered what monthly payments you can afford for a home loan?
It is imperative to find the right type of loan and best lender for your success in purchasing a home. Do your homework to determine qualifications of a FHA, VA, etc type of loan best suits your need.
Talk with the lender of choice about getting a pre-approval. This process will determine eligibility of the loan, your debt to asset ratio and how much you home can afford. With a pre-approval letter, a seller will take your offer seriously.
Prioritize your home wish list
The price range of homes should be determined first, what can you afford? After that, consider how many bedrooms, baths, area, location and style. There are so many things to consider on a home purchase, but making a list and prioritize your needs is the best way to approach this process before the search begins.
Real Estate Agents
Understand that real estate agents represent buyers and sellers. Do you really want the same agent that works for the seller to represent you also? This scenario is called dual agency and has many pros and cons. There are agents who specialize in being a buyer's agent. This agent could have your best interest at heart. Real estate agents have a responsibility to be honest and fair.
Search for homes
Your real estate agent will send you home lists to consider. Pick up magazines with homes for sale and well as your own internet search. Don't forget to check the classified ads of your local newspaper.
Look at homes of interest
Make an appointment to see homes that are of interest. Consider other factors besides beauty. The age, structure and features could be perfect, but may be in the wrong location. Bring your list of priorities with you on viewing homes and take notes.
Make an offer on home of choice
There are so many mechanics of making an offer that vary per local in the US. Ask your agent about the specifics of your location. Don't forget to consider all facts about the home before making an offer. Include in your offer contingencies that would be of benefit to you including a rejection if home inspection is subpar, an appraisal is too low, etc. Talk to your agent to determine what verbiage should be added to your offer for your best benefit.
Daily progress check
After contract acceptance, everyone should stay on top of the progress. Problems may need a resolve such as low appraisal.
Don't forget to do a final walk-through before closing. There will be a HUD-1 settlement statement prepared for closing day. Do you understand the closing costs and what each line item means? Have you prepared your closing contribution in a cashier's check or wire transfer of funds for the closing attorney?
The home buying process can be simplified with proper research and asking questions.