Congratulations! You’ve made an important decision to invest in a home!
Determine what you can afford by going to a bank
Shopping around for a home loan is important in ensuring you are getting the best interest rate. Some banks or credit unions offer better rates. Getting pre-approved from a lender is key when buying a home to have the buying power to make an offer.
What is a Good Faith Estimate?
A Good Faith Estimate gives you an idea of what it’s going to cost you to buy a house.
This is the amount needed to bring to closing. This covers your mortgage taxes, pre-paid taxes, insurances, recording fees and any other fees pertaining to closing on your new home. It is smart to discuss this in detail with your lender when getting pre-approved.
What do I do next?
Find the home of your dreams! Then, you can negotiate a price with your Realtor. The best way to calculate a value, is to compare the subject property to other properties similar properties in that area. You can do this by either comparing it to properties you have seen yourself or asking your Realtor for guidance.
What’s needed to write an offer?
When writing an offer, you will need to know the budgeted amount you would like to spend on the home, an earnest money check and a pre-approval letter from your lender.
What is Earnest Money?
Earnest money is like a security deposit. It shows the seller you are serious about your offer and that you would like to purchase the home. Earnest money will be deposited and deducted from your account within 24-48 hours, so it is important that you have sufficient funds in your account. This money is refunded back to you if you withdraw your offer during the inspection period.
How do Home Inspections work?
We advise all buyers to hire a home inspector to uncover any deficiencies in the home. This will be the time to expose hidden defects. It is strongly encouraged to spend between $300 and $350 on the inspection to have a licensed professional inspect the main mechanical systems within the home. During the Inspection period, (up to 14 business days), the quicker you decide to move ahead with the purchase, the quicker the next step can begin. (After closing on your home, the seller is not responsible for anything related to the property, aside from misleading the buyer or failing to properly disclose a deficiency before the time of the sale.)
What is happening behind the scenes during the closing process?
- The inspection timeframe will depend on what you and your Realtor decide, but typically this is anywhere between 10 and 15 days.
- Your Lender will order an appraisal (if you are financing with a loan), which can take between 10 and 30 days to receive the final report. The timing will depend on how busy the appraiser is at the time.
- The Lender needs roughly three days to process your loan after they receive the final appraisal report.
- The Lender then sends the package to your closing company, who then requires a minimum of three to process.
Tasks to complete before closing:
- Switch all utility services into your name. Note that this step typically takes place after you have received a clear to close. (Generally, one to three days before closing)
- Change your address at the bank, update your personal checks
- Obtain homeowners insurance
Final walk through
On the day of closing, we will do a final walk-through to ensure the property is in the same condition as when you signed the original Purchase Agreement. A walkthrough should take roughly 30 minutes to complete; enough time for us to be very thorough. During this assessment, you should check for new issues that may have come up since the last time you viewed the home. At this time, you should check all major appliances to ensure they are in working condition. Once you close on the home, previous owners are not obligated to fix any items or new damages that may have occurred. For example, consider turning on the dishwasher and washing machine, checking outlets and light switches, and testing other basic operations. Check to make sure any previously agreed-upon repairs have been completed. Then, look over the general condition of the property, inside and out.
What is needed on the day of closing?
Without the items below you can have the closing delayed or canceled:
- Valid Driver’s License
- Certified or a Cashier’s check on the day of closing, made payable to the closing company for your closing costs, (cash is not an acceptable form of payment for closing)
Please direct any other questions/concerns to your real estate agent.