The purchase of a home can be an exciting time of your life, but there are important steps that are involved in the transaction. I have prepared a list to follow so that you can be best prepared.
Step 1: Start The Research
Start your research of areas that you are most interested in. Take note of the various properties and prices that are found in the market. This will provide you with an idea of what locations might be best for you to consider.
Step 2: Identify Your Budget
Take a look at your budget, debt, and amount of money you have available for a down payment. A lender will need to qualify you for a loan, but you should make this assessment as well based on your own level of comfort.
Step 3: Get Prequalified
Before you begin searching for properties, you will need to formally find out how much you can spend. The best way to go about this is to get prequalified for a mortgage by contacting a reputable mortgage broker and providing some of your personal information and details. Your lender will then tell you how much you will be approved for which will define what price range of homes you will be looking for. It is important to provide them with accurate data for the pre-approval as you will eventually have to supply supporting documents, credit reports, etc. to verify your financial status.
Step 4: Searching for Homes and Offer
When visiting homes in different locations, consider things like convenience to local services, your place of employment, or other things that are important to your lifestyle.
Once you locate a home of interest, craft and submit your offer with your pre-approval letter.
Step 5: Home Inspection
A home inspection is a very important occurrence as it can check for signs of structural damage or major items that may need repair. Offers are often times made contingent of a satisfactory home inspection to protect the buyer’s interests.
Step 6: Home Appraisal
Your lender will make arrangements for an appraisal. The appraisal process confirms to all parties that the price you are paying is a fair price for the property.
Step 7: Complete the Necessary Paperwork
Your lender will also arrange for a title company to research documents and confirm that the seller is the current and rightful owner of the house. You will need to finish your loan package by providing your lender with documents that prove your employment and financial status.
Step 8: The Closing
After the walk-through of the property, you will then move on to the closing. Here, you will sign numerous legal documents to complete the purchase, including some of your loan paperwork. Once this is complete and the check is delivered to the seller, you are ready to move into your new home.