Buy your dream home with confidence

So, you want to buy a home—now what? Buying a home is an emotional, exciting, and also exhausting experience. You may also be wondering along the way—what am I missing? This is a common question. Here’s a break-down of how the buying process works from start to finish.

• Get pre-approved. The best first step is to get pre-approved for a mortgage.  This will help you know a maximum amount you can  qualify for, but more importantly this will help you determine an amount you are comfortable with.  There is a tendency for people to overspend if they start to look at homes first only to find out it is out of the price range they are comfortable with in terms of a monthly payment.  To do this you’ll need to get some paperwork ready: pay stubs, W-2s, bank account statements, tax returns for the past two years, and credit lines, and names and addresses of your landlords for the past two years. Typically you will want to shop around for a lender, after all the purchase amount is the same but the fees lenders charge can vary greatly between lenders.  You can start with your current bank and I can recommend local lenders with good reputations as well.  Depending on your situation some lenders may be better suited to help you due to the loan products they have available.  Remember, the amount your lender approves you for as a maximum – this is by no means what you should spend.
• Find an agent. A good real estate agent will help you navigate the process every step of the way. This is also a step where you should consider several agents.  Just because you know an agent or maybe you are even related to an agent does not mean that is the best agent for the job.  You can check the online reputation of an agent by reading reviews at various websites, but that should not be your only step in evaluating.  You should meet with potential agents to be able to ask questions and get a sense of whether you personalities mesh.  Make sure that the way the agent works suits your needs.  Too many agents think it is all about them and you have to fit into their system, that is not an agent you want.
• Look at homes. Be patient at this stage. Your real estate agent may show you a variety of homes to get your reaction on features they think you’ll like. Give your agent detailed feedback so they can show you homes that are perfectly suited to you. It is important to set a timeline to find you home based on when you want or need to move. Also, make sure you let friends and family know you’re looking for a new home--you may even find out about an amazing home before it hits the market.
• Make an offer. Once you’ve found your dream home, you will want to move quickly. Your agent will guide you on a reasonable first offer to start negotiations based on market conditions. Also, make sure you consider closing costs which could account for 2-5% of the home price.
• Negotiate. Depending on the current market conditions you may need to be prepared to go back and forth with the seller a few times on price and selling conditions before you reach a deal. Your real estate agent will be your advocate here to negotiate terms that are most important to you.  Having an agent that negotiates real estate deals every day is critical to ensuring your offer is crafted in such a way that you get not only the best price but also the best terms for your situation.  This is a big reason to have a REALTOR that you trust and can help you make decisions based on the particular situation.
• An accepted offer. Pop the champagne! If you reach an agreement, you’ll make an earnet money deposit at a title company to show good-faith.   The amount of earnest money can vary depending on the home and situation, ask your REALTOR for their best advice.  Escrow is typically 30-45 days where the seller takes the house off the market with the contractual expectation that you’ll purchase the house - provided you don’t find any serious problems during the inspection.
• Do a home inspection. Even if the home appears to be flawless, there’s no substitute for having a professional inspector review the property for quality, safety, and general condition of your potential home. You don’t want to be surprised with a home that needs a lot of unexpected repairs. If the inspection reveals undisclosed serious defects, you can potentially negotiate further to have the seller make repairs or discount the selling price. You’ll also likely have the option to withdraw your offer and get your earnest deposit  back.
• Closing. When your negotiations with the seller are successful, and any negotiated repairs have been completed, you should be ready to close. At your closing, you’ll spend about an hour signing paperwork, mostly from your lender.  Typically you will receive the keys and possession to the property once the loan is funded and the deed is recorded with the county, this is usually the day after you sign the paperwork.