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Step 1: Defining What You Want
Start by creating a prioritized list of features you want
in your next home and the reasons why. Use it as your search
guide, but remember that depending on your funding, you will
probably need to make some compromises. In addition, talk
to your real estate professional about where you want to live.
Location is a huge part of any move. Realtors® are trained
to help their clients narrow down their choices by sharing
market trends and local information like neighborhood statistics
and community links.
Step 2: Get Pre-Approved for a Mortgage
Now that you know what you want, it's time to see what you
can afford. You can start by crunching the numbers yourself
using our selection of calculators.
When you're ready to move to the next step, you can get pre-approved
for a mortgage. This process can often be performed in under
an hour and it accomplishes two important goals. First, it
will tell you how much house you can afford and what your
monthly payments would be. Second, it tells the seller that
you can afford to buy their home.
By definition, a pre-approved buyer has an approved mortgage
subject to an appraisal of the property. Many times a buyer
can use this pre-approved status as leverage during the negotiation
process.
Step 3: Search For Homes
Once you know what community you'd like to live in and have
an idea of how much house you can afford, its time to start
checking out actual properties. Beginning this search online
can help save you time since it can help you target homes
that meet your search criteria. Our home notifier can even
email you when properties come on the market that meet your
search criteria.
Next, begin visiting homes in person. Ask your local real
estate professional to arrange visits and attend open houses
that are in your target area and price range. When comparing
homes, make sure to look at all aspects of the property. Is
the property tax approximately the same? Are both the houses
renovated? Do they both have the same amount of bedrooms and
bathrooms? Are both houses located on the same or similar
streets? Does either house have any encumbrances?
Remember to keep an open mind when you are looking at homes.
Use a virtual home planner to help you imagine what the house
could become with you as the owner.
Step 4: Making An Offer
Once you find the home you want, you need to make an offer
for the house. Typically this is a very difficult and trying
time since both parties have totally different goals. In most
cases it is better to have a third party, such as a real estate
professional, negotiate the offer. If you have any personal
interaction with the homeowner, don't give out any information
about your move, your current housing status, financial status
or your feelings about their property - positive or negative.
This could hurt you in future negotiations.
This might also be a good time to consider purchasing a home
protection plan. These insurance policies can be purchased
by the buyer or seller and help protect against unexpected
costs or home repairs during the listing period or in the
initial years after a home has been purchased.
Step 5: Inspection & Insurance
After your offer is accepted you will need to set up, coordinate
and interpret various inspections, including insect, radon,
building quality, oil tank, title, etc. You will also need
to arrange for homeowners insurance and finalize the mortgage.
This is a major step in the buying process and there are
many potential problems that can be discovered during this
period. These include a leaky roof, radon gas, termite damage,
a foundation problem, and wall cracks, to name a few. These
problems happen all the time. The difference between closing
on your dream home and starting the process all over again
is what occurs during the negotiations between you and the
seller.
Your Realtor® can help make these discussions go more smoothly.
In most states you will also have the option of a "walk
through" before the closing. This is your last chance
to make sure that all of the items that you have agreed upon
were completed to your satisfaction.
Step 6: The Final Closing
Before you arrive at the closing, make sure all the necessary
paper work and deposits have been completed. If the mortgage,
title work, homeowners insurance and other items necessary
under local and state laws are not completed and brought to
the closing table, the closing may not happen on time. And,
depending on what the contract says, this could result in
further action including financial penalties and even the
loss of your rights to the home.
Once you close, it's official - you own the house! But there
might be a few things you want to do before you lay out the
welcome mat. These include arranging for an alarm system,
turning on the electricity, subscribing to the local paper,
cleaning or replacing the carpet, arranging for lawn services,
etc. This could also be a good time to make some needed renovations.
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The Buying Process
