You’ll soon be going through the home-buying/mortgage process and to prep you, here’s what you can expect:
1. Get pre-approved before you look at homes.
This allows the lender to review your credit score, income, assets, and liabilities. Knowing what your budget is and type of loan you’ll be using (FHA, Conventional, USDA, or VA) will allow your agent to show you homes not only in your budget but also that will be in sync with your loan type. You don’t want to fall in love with a home that is not an option for you.
2. Work with a reputable real estate agent. (ME!! 😃)
Your agent will not only help you find a home, but will (and should) be with you during the entire process. You’ll need not only a qualified agent, but someone that you can feel comfortable with. Once you find your perfect home your agent will write up the offer contract and submit for consideration. The agent will work on your behalf to get you the best deal and answer any questions you have.
This is where you put money down in ‘good faith.’ This tells sellers you’re a serious and qualified buyer. The escrow is held by closing/title company and will be applied to your downpayment at closing. Amounts may differ.
4. Inspections/appraisal and title work on the property.
After your offer is accepted you will order your inspection. While this is not required it is HIGHLY RECOMMENDED. This is your opportunity to hire a professional inspector to tell you everything about the homes condition. This is your only opportunity to change your mind or negotiate with the seller should the inspection find undesirable issues. This is paid for by YOU. If you are purchasing land you may order a survey (same premise as the inspection). The lender will order an appraisal (also paid for by the buyer). This information tells the lender if the home is a good risk and has the necessary value to fund the loan. While the inspection can be waived (not recommended), if you are purchasing with a mortgage loan the appraisal cannot be waived. The title company/ closing company will do all title work on the property.
5. Clear any outstanding conditions. To get to a ‘clear to close’, you will have to provide any required documentation requested by the lender. This is often the most stressful time of the loan process as you may be asked to provide A LOT of documentation. Hang in there…there is a light at the end of the tunnel!
6. Closing Day! Celebrate!
Once you have the ‘clear to close,’ you’re free to close on the loan and take ownership of the home. Rejoice! You made it through the process and are now a proud homeowner!