Buying your Home
Eight steps to buying your home
1. Decide to buy
There are personal reasons to buy a home and there are solid financial reasons to support your decision to buy a home, and, among these, equity buildup, value appreciation, and tax benefits stand out. Base your decision to buy on facts, not fears.
- If you are paying rent, you very likely can afford to buy
- There is never a wrong time to buy the right home. All you need to do in the short run is find a good buy and make sure you have the financial ability to hold it for the long run
- The lack of a substantial down payment doesn’t prevent you from making your first home purchase
- A less-than-perfect credit score won’t necessarily stop you from buying a home
- Historically, the best way to get closer to buying your ultimate dream home is to buy your first home now
- Buying a home doesn’t have to be complicated
2. As your agent we will:
- Educate you about your market.
- Analyze your wants and needs>
- Guide you to homes that fit your criteria.
- Coordinate the work of other needed professionals.
- Negotiate on your behalf.
- Check and double-check paperwork and deadlines.
- Help resolve any problems that may arise.
3. Secure financing.
To ensure you are considering homes within your budget and to make you offer more competitive, pre-qualification or pre-approval of financing is recommended. While you may find the thought of home ownership thrilling, the thought of taking on a mortgage may be downright chilling. Many first-time buyers start out confused about the process or nervous about making such a large financial commitment. We have professionals available who can assist with maximizing your financing options.
4. Find your home.
Looking for your home begins with carefully assessing your values, wants, and needs, both for the short and long terms. Some of the questions to ask yourself are:
- What do I need to be close to? Are there specific neighborhoods I prefer and why?
- How much space do I need and why?
- Which is more critical: location or size?
- Would I be interested in a fixer-upper?
- How important is the potential for home value appreciation?
- Is neighborhood stability important?
- Would I be interested in a condo?
- Would I be interested in new home construction?
- What features and amenities do I want? Which do I really need?
5. Make an offer.
The three basic components of an offer are price, terms, and contingencies.
Price – the right price to offer should fairly reflect the true market value of the home you want to buy. Your agent’s market research will guide this decision.
Terms – the other financial and timing factors that will be included in the offer.
Terms fall under six basic categories in a real estate offer:
- Schedule – a schedule of events that has to happen before closing.
- Conveyances or Fixtures – the items that stay with the house when the sellers leave.
- Commission – the real estate commission or fee, for both the agent who works with the seller and the agents who works with the buyer.
- Closing costs – it’s standard for buyers to pay their closing costs, but if you want to roll the costs into the loan, you need to write that into the contract.
- Home warranty – this covers repairs or replacement of appliances and major systems. You may want to consider asking the seller to pay for this.
- Earnest money – this protects the sellers from the possibility of your unexpectedly pulling of the deal and makes a statement about the seriousness of your offer.
- Contingencies – these are the conditions that must be satisfied by a given date, in order for the sale to complete. We protect your interests by ensuring these are not removed too early.
6. Perform due diligence.
Unlike most major purchases, once you buy a home, you can’t return it if something breaks or doesn’t quite work like it’s supposed to. That’s why property inspections and a Homeowner’s Insurance Warranty are so important.
a)Homeowner’s Insurance Policy – this protects you in two ways:
- Against loss or damage to the property itself
- liability in case someone sustains an injury while on your property
b) Property inspection - This report may expose secret or unknown issues a homeowner may not know of or might not disclose, so you know exactly what you’re getting into before you sign your closing papers.
Your major concern is structural damage.
- Don’t sweat the small stuff. Many things can be easily fixed or even can be overlooked. The Inspector can advise on the degree and necessity of such repairs.
- If you have a big problem show up in your inspection report, you should bring in a specialist. If the worst-case scenario turns out to be true, you might want to walk away from the purchase.
- Many home warranties cover repairs or replacement of appliances and major systems.
7. Close of Escrow.
The final stage of the home buying process is the lender’s confirmation of the home’s value and legal statue, and your continued credit-worthiness. This entails a survey, appraisal, title search, and a final check of your credit and finance. We will keep you posted on how each is progressing, but your work is pretty much done.
You just have a few preclosing responsibilities:
- Stay in control of your finances.
- Return all phone calls and paperwork promptly.
- Communicate with your agent at least once a week.
- Several days before closing, confirm with your agent that all your documentation is in place and in order.
- Obtain certified funds for closing.
- Conduct a final walk-through.
On closing day, you’ll sign documents that do the following:
- Finalize your mortgage.
- Pay the seller.
- Pay your closing costs.
- Transfer the title from the seller to you.
- Make arrangements to legally record the transaction as a public record.
As long as you have clear expectations and follow directions, closing should be a momentous conclusion to your home-searching process and commencement of your home-owning experience.
8. Protect your investment.
Throughout the course of your home-buying experience, we’ll get to know each other fairly well. There’s no reason not to remain in touch periodically. Even after you close on your house, we can still help you:
- Find contractors to help with home maintenance or remodeling.
- Help your friends find homes.
- Keep track of your home’s current market value.
Attention to your home’s maintenance needs is essential to protecting the long-term value of your investment.
Home maintenance falls into two categories:
- Keeping it clean and well maintained: Perform routine maintenance on your home’s systems, depending on their age and style.
- Keeping an eye on it: Watch for signs of leaks, damage, and wear. Fixing small problems early can save you big money later.
- Enjoy your new home!