Steps in Buying A Home
Buying a home is most likely the largest financial transaction you will ever make. To ensure a smooth transaction, it’s a good idea to get as much information about the basic buying process as possible. The following steps should be used as a guide when purchasing a home to avoid mistakes that could cost you money.
Step 1 – Educate yourself
Begin by doing some online research to familiarize yourself with some of your options when buying a home. For instance, should you buy a single-family house or a condo? When you choose a neighborhood, there are a few things to think about... How long will your commute to work be? What are the schools like? Find out if the area has features you want such as parks, places of worship, cultural centers, or shopping nearby. Drive by homes currently on the market to get a feel for the style and inventory. Make a wish-list of amenities you want in a home.
One of the most important steps in the home buying process is figuring out exactly how much you are comfortable spending on a home. You should purchase a home not based on what a bank says you can afford, but rather what you are comfortable spending each month. An easy way to determine, roughly, how much your mortgage payment will be can be found here: https://www.bankrate.com/calculators/mortgages/mortgage-calculator.aspx. Though I recommend contacting a lender and starting the pre-approval process (see Step 3) to be most accurate.
Step 2 – Meet with Your Broker
Choosing a buyer’s agent is an important step in buying a home because this is the person that will guide you throughout the entire buying process. Some buyers believe it’s better to work with the listing agent directly, thinking they’ll get a better deal. But nothing could be further from the truth. The listing agent is obligated to look out for the seller’s interests. A buyer’s agent, on the other hand, will look out for your best interests, do all the legwork for you, and negotiate the best price for you. Don’t look for an agent who is too nice and just tells you what you want to hear. Hire an agent who will be honest with you and won’t try to push you into buying a house you aren’t sure about. A good buyer’s agent will want you to find the right home.
Once you find an agent you’re comfortable with, have some questions ready for your first meeting. This is a chance for the buyer’s agent to ask you about how your search is going and to answer the many questions that arise when buying a home. Your agent should help outline every aspect of the home buying process so you’ll have a better idea of what is involved.
This is also your opportunity to discuss in detail what type of home you’re looking for, your price range, and which town or towns you’re interested in moving to. Your agent will probably have some suggestions based on your criteria and you may have already begun searching for homes which you can go over together. After you review your preferences, your agent can begin a more thorough search for you.
Step 3 – Pre-Approval Process
Getting pre-approved for a loan allows you to see how much a bank will actually lend you to purchase a home. This way you won’t waste time looking at homes out of your price range. Getting pre-approved helps you find out how much a lender will give you, at what rate, and under what terms. This is also a good time to find a good mortgage broker. Working with a qualified mortgage broker is one of the best things a buyer can do to ensure a successful transaction. The mortgage broker should be very knowledgeable with all of the mortgage programs that are available to you and advise you on which documents you’ll need to provide for the pre-approval process. The mortgage broker will pull your credit report, review your tax returns, bank statements, and pay stubs to get everything in order. Be prepared to provide all of these. If you’d like some guidance, I am happy to provide you a list of excellent lenders to choose from.
Step 4 – Property Search and Viewings
This is the fun part! My Specialized Search System allows you to have FREE access to every home that is available for sale in the Santa Fe area. You’ll also get priority access to the best bargains in the area, including bank foreclosures, government-owned homes, probate and estate sales, short sales and recent price reductions. My unique buyer System allows you to enter areas you’re interested in, price range, style of home and other particulars that are important to you. It then provides you priority access to all the homes that meet or exceed your criteria complete with addresses and photos of the interior and exterior of the homes. This system also lets you know about new listings as soon as they hit the market.
When working with clients, I will also have homes selected that I think will fit your criteria. Once either of us finds homes you like within your budget, you can contact me to schedule viewings. View homes with an open mind and don’t be too hard on yourself if the home is not a perfect fit. Homes are coming on the market each day, so the right home is out there. Once you find the right home, be ready to make an offer. When you see a home you love, act fast – you don’t want to be outbid and have to start your search all over again.
Step 5 – Make an Offer
One of the most common questions we get is, “How Much Should I an Offer on a Home?” Once you find the perfect home we will submit a written offer on the home. This is another step where you will be glad to have me on your side. Since I know how to negotiate, I will work to get you the best deal. Keep in mind that contract negotiations are not limited to price; they also include timing, contingencies, and much more.
Step 6 – Get a Home Inspection
Now that you have secured a property, it is time to schedule the appropriate inspections on the property. We highly recommend buyers spend the money on a home inspection. The report alone is usually worth the cost. The home inspection will be done by an inspector whose job is to make sure the home is structurally sound, its systems are working correctly, and if there’s any evidence of pests in the home or mold. Some inspectors do uncover major issues that the seller may need to address. This is also a good time to have your home tested for radon. There are several things to watch out for, but remember, most issues can be worked out in some form or fashion and I can advise you on what to do.
Step 7 – Closing
This is where all the hard work pays off and you become the owner of a home! Before closing, you should have your agent arrange a walk-through of the home to make sure nothing has changed in the property since the purchase agreement was signed. The “walk-through” is usually done two days before closing. During the actual closing, deeds, loan papers, and other documents are prepared, signed and filed with the registry. This includes the Closing Disclosure Statement, which details all the costs related to the sale of the home. Remember to bring your license and checkbook. At this point, congratulations will be in order now that you are a homeowner!
Have more questions? Peter, Tom and Elle are here to help! Contact Me.