While every
situation is unique, below is a brief outline of the normal progression
in the home buying process:
I.
FINANCING
The first step in searching for a new home is determining how
large an investment you can comfortably afford and can qualify
for. A mortgage lender will calculate interest rates, your down
payment, term and loan balance to arrive at estimated monthly
payments. The mortgage lender can also pre-qualify or pre-approve
you for a loan.
II.
PRIORITIZING YOUR WANTS AND NEEDS
The next important step is determining which features are important
to you and what your priorities are. Neighborhood & community?
Home size? Architectural style? Amenities? Schools? Proximity
to work? Other needs, hopes or wishes?
III.
LOOKING AT PROPERTIES
Your real estate agent will show you a variety of properties.
This process usually takes the most time, but with the right agent,
it can go surprisingly quickly. Once you have found the home you
want, you and your agent will structure an offer.
IV.
PRE-OFFER INFORMATION GATHERING
Before making an offer, you will want some basic information about
home values in the area, how long the house has been on the market,
if the seller has lowered the asking price, and other important
home value and neighborhood factors.
V.
WRITING, SUBMITTING & NEGOTIATING THE CONTRACT
The terms of the Contract dictate the terms of the sale so it
is critical that the document be accurate to the last detail.
Once the Contract (your offer) is submitted, the Seller may respond
by accepting or rejecting your offer or submitting a Counteroffer.
You may continue to negotiate terms until you and the Seller reach
a mutually acceptable agreement.
VI.
UNDER CONTRACT: INSPECTIONS & DUE DILIGENCE
Now you begin your “Due Diligence Period” during which
you have the property inspected to make sure that the home is
sound and that all the electrical, heating, cooling, plumbing
and other systems are in good working order. If there are problems
or defects, you can reject the Contract or ask the Seller to fix
or pay for the items of concern, or the parties may negotiate
a credit of the costs against the purchase price.
VII. APPRAISAL
An appraisal is a requirement of every lender to determine if
the home is worth the purchase price. The lender’s appraiser
will come up with a Fair Market Value for the property. You can
cancel the Contract or re-negotiate the price with the Seller
if the purchase price is more than the appraised value.
VIII.
FINALIZING YOUR LOAN
Once your inspection and appraisal contingencies are satisfied,
your loan package is submitted to an Underwriter for final approval.
If the loan is approved, the lender will submit the figures to
the Closing Agent, which is usually the title company. The title
company will tabulate all figures and notify you how much money
to bring to the closing.
IX.
CLOSING
The closing is where all the documents are signed, money is exchanged
and title is transferred from the Seller to the Buyer. Closing
usually takes about an hour. If possible, documents and figures
are reviewed ahead of time so that any questions are answered
and everything goes smoothly on the day of closing. We recommend
that you bring your money in the form of a certified or cashier’s
check made out to yourself, which you will sign over to the title
company at the appropriate time in the closing.
X.
CONGRATULATIONS: You are now the proud owner of
your new home!
For
more details about the buying process or to talk with Harley about
helping you buy or sell your home,
please send an instant
e-mail or call Harley at: 303.759.8811.
Click
here to receive a detailed version of The Home Buying Process.
