The home buying process in 10 simple steps

It can seem like such a confusing procedure, but we can break the home buying process down into 10 major steps.

1. Find the right real estate agent
Having a savvy real estate agent on your side makes the whole process so much more simple. Working with a professional who knows the market, the process, and how to get the best home for you takes much of the stress out of buying a home.  Plus, it doesn't cost you a dime.  An agent's commissions are paid by the home's seller. Real estate agents have access to important information not available elsewhere that helps you become a more knowledgeable buyer. Finding an agent that works well with you and your personality is critical.

2. Get prequalified
Getting prequalified is a simple task that lets you know exactly what price range to seriously look at and it also gives you the upper edge when it comes to multiple offers on the same home. Having a prequalification letter to present when you do put in an offer on a home gives you the upper hand over someone who hasn't been prequalified.  It lets the seller and their agent know you are capable and able to purchase the home without any foreseeable hiccups in the process. If yours is one of a few offers, a letter gives you strength in the negotiating. 
To get prequalified, you need to provide basic financial information to your lender. They will crunch some numbers and let you know how much they can lend you. Your real estate agent will also be able to help you find a good lender if you don't have one yet.

3. Figure out how much house you can afford
Some lenders give out general guidelines such as, you should look for homes that are 3 to 4 times your annual household income if you plan to make a 20% down payment. Others suggest the 28/36% rule - purchasing a home that is no more than 28% of your gross monthly income, and keeping your total debt below 36% of your gross monthly income. Your agent works with lenders every day and knows which ones are the best. Take their advice if you can and your lender will know exactly what will work best for you.

4. Start your research

There are so many houses to see! You probably already have a few neighborhoods, a certain style of home, bedroom requirements, and price range in mind, so just tell your agent what you are looking for and get busy. Your agent will give you current information on homes listed and available for you to view that meet your specifications and needs. They also know the housing trends and how to help you find the perfect new home.   

5. Shop for your home and make an offer
This is the fun part. You get to go look at homes that you and your real estate agent have found that meet your specifications. Taking a few snapshots of each home will help you keep track of your favorite aspects of each home. You will find yourself imagining where you will put your furniture in each house, your car parked in the garages, how friend and family get-togethers will work in each home, and what bedroom will work the best for each child. You'll figure out which house is the perfect home. Then you and your agent will make an offer on that home. Your agent will have already completed a lot of research about the current market trends in your area so you can be confident you are getting the best deal possible. When you and the seller agree on terms, you can then put your favorite house under contract.  

6. Get an inspection and research your due diligence
Part of the due diligence process is getting an inspection done on the home. Let your agent make these arrangements. An inspection lets you know if anything in the home is in need of repair or if there is structural damage that must be addressed. The due diligence period protects you because if anything is found to be of any concern at all, you can renegotiate your offer or completely withdraw your offer without penalty. Both the buyer and the seller receive copies of the inspection and it can be decided who will take care of any repairs that need to be made. You will get a final walk through to make sure all agreed upon terms have been met.

7. Work with your lender and determine your best loan option
Staying in contact with your lender through the home buying process is necessary. Your agent will also be involved and helpful as well. There are all kinds of loans available. When you let your lender know what is most important to you, they will be able to find a loan that fits your needs. 

8. Get an appraisal on the home
Your lender will arrange for an appraisal of the home to get an estimated current value of the home. The appraisal lets you and your lender know if you are paying a fair price for the home. If the appraisal comes back lower than your current offer price, negotiations will usually have to be made and the price of your offer lowered. That usually means a better home price for you. 

9. Let your agent coordinate paperwork

There is a great deal of paperwork that goes into purchasing your home.  Let your agent take care of it. Your agent and lender will arrange for a title company to take care of the paperwork as well as you await to move into your new home. 

10. Close on the home and get the keys
At closing, you sign all the paperwork that is required for your new home ownership. Loan documents are also included. It usually takes a few days for the loan to fund and all the paperwork handled. Once the seller receives their payment, the home is yours and you get to move in!

I hope this information has helped you get a clearer picture of the home buying process. I would be glad to answer any questions you may have about purchasing a new home, 801-631-3430. 
P.S. Here is another post explaining due diligence you may want to have a look at.

Brought to you by Heath @ HeathsHomes.com