Congratulations, you’ve made an important decision to invest in a home!
Determine what you can afford by going to a bank
You can shop around for a home loan. Some banks or credit unions have better rates. Getting pre-approved from a lender is key when buying a home to have the ability to put in 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 to cover, mortgage taxes, pre-paid taxes, insurances, recording fees and any other fees pertaining to closing on your new house. It is smart to discuss this with your lender when getting pre-approved.
What do I do next?
Find a home! Then you can negotiate a price on the home with your Realtor. The best way to calculate a value is to compare the subject property to other properties that are similar. You can do this by either comparing it to properties you have seen yourself or asking your Realtor.
What’s needed to write an offer?
When you write an offer, you will need to know a how much you would like to spend on the home, you will need 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 will come out of your account within 24-48 hours so make sure you have the funds in your account. This money is refunded back to you if you back out of purchasing the home during the inspection period.
How do Home Inspections work?
We advise all buyers to hire a home inspector to find out if there are any deficiencies in the home. This is the time to find if there are any hidden defects. It is strongly encouraged to spend between 300-350 to have a professional come and inspect most of the main mechanical systems in the home. During the Inspection period the sooner you decide to move along with the purchase the quicker the next step can start. (After closing the seller is not responsible for anything other than if they miss led the buyer about something or didn’t properly disclose a deficiency before the time of the sale.)
What is happening behind the scenes during the closing process?
- The inspection period will depend on what your realtor decides with you but typically it’s anywhere from 10-15 days.
- Lender orders the appraisal which can take roughly 10-30 days for them to get the report depending on how busy it is.
- Lender needs roughly 3 days to process loan after this.
- Lender then sends package to closing company who needs at least 3 days to process.
Things to do before closing:
- Utilities will need to be switched into your name which you typically don’t do until you have the clear to close. (Typically, a couple days before you close)
- Change your address at the bank, checks
- Obtain home owners insurance
Final walk through
Right before closing we will be doing a final walk-through to make sure 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 you 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 made. 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:
- Driver’s License
- Certified or a Cashier’s check on the day of closing payable to the closing company for your closing costs.
Please direct any other questions/concerns to your real estate agent.