The Home Buying Process brought to you by Darin Bjerknes of Commonwealth Realty.
If you’re looking to purchase a home in the near future, stay tuned for what you can expect along the way.
# 1. One of the first things that you want to do when you’ve decided you’re ready to purchase a house is, to get Pre-Approved with a lender. You’ll want to figure out what you can afford and what they’ll lend you. You’ll want to make sure that you’ve cleaned up your credit score and have saved money for a down payment. FHA loans, which stands for “Federal Housing Administration” require a minimum credit score of 580 to permit a 3.5% down payment. Conventional Loans often require a credit score of at least 620, if not more. In a competitive market, sellers will be more apt to accept your offer if you have conventional financing over an FHA loan, so keep your credit scores up and save for your down payment. Conventional loans usually require at least a 5% down payment. Another important reason to get pre-approved is the fact that sellers won’t look at your offer until you have that piece of paper
2. Determine your wants and needs for your home. How many Bedrooms, bathrooms..do you need a garage, and where would you like to buy?
3. Get Represented! Hire a real estate professional, preferably me :), to help with the most expensive purchases you’ll ever make. One of the first things we’ll do is go over the “Agency in Relationships Disclosure”, which will explain your representation options as a buyer. If you decide to work with a certain Realtor, you’ll sign a “Buyer’s Representation Agreement”. At that point, you’ll be represented by a buyers agent and he or she will help you find a house, draft the offer and contingencies, be there with you for your inspection, and finally the closing, as well as much more.
4. The search begins! Now that you’re represented, your buyer’s agent will most likely set you up a property email search that will send you new properties from your selected home search criteria. After we find properties that you want to look at, your agent will schedule the showings and you’ll walk through the homes. After you’ve found the right one, it’s time for the offer.
5. You write your offer! When making an offer, there are several things to consider. You’ll want to know your Offer Amount, Amount of Earnest money, what type of financing you’ll be using, a closing date, will you be asking for a home warranty, what will be included with the home (such as the appliances for instance), will you be asking for seller paid closing costs, do you want an inspection (which I highly recommend by the way), any other contingencies, and has the seller received any other offers??
6. Negotiation: The negotiation can last anywhere from a couple hours to a few days in normal transactions. There may be some back and forth between the buyer’s agent and the listing agent and hopefully soon everyone will come to an agreement.
7. Inspection Time: After your offer has been accepted by the seller, it’s time for the inspection. Your agent will usually give you a few names of trusted inspectors for you to decide on. After doing your research on who you’d like to use, a date is set for the inspection. You’ll want to be there for the entire inspection so you can learn all the ins and outs to your potential new home. Your agent or another representative is usually there with you as well.
8. The appraisal: If everything went well with the inspection, your lender will then order the appraisal. Your lender wants to make sure your house is worth what you are paying for it.
9. Waiting for the closing: After all of the contingencies have been met and all of the signed documents have been given to your selected title company, the wait begins. Your title company will be making sure that the title is clean and that your new home can be transferred to you cleanly and correctly. Your closing will usually happen anywhere from 30 to 45 days in most circumstances. The last step before the closing is the final walk through of your home. This usually happens the day before the closing or the day of. We are looking to make sure the house is still the way we remember it and that nothing is wrong.
10. The Closing! After all of the waiting, the day has finally come where you will get the keys to your new home. You’ll want to bring your photo id and the cashiers check for your down payment unless you’re wiring the funds instead. You’ll sign a ton of paper and usually after a 1/2 hour to 45minutes, you’ll be a homeowner. I hope this has shed some light on the home buying process and what is involved. Make sure to hire an agent you can trust and that will have your back through the entire process.