The Home Buying Process: 9 Easy Steps
The Home Buying Process: 10 Easy Steps
Courtesy of Chris Edgecomb (770) 530-7712
Step 1: Working with The Edgecomb Team!: Allow us to help you make your next move a reality! We will work diligently to help you find your dream home in Ball Ground, Canton, Cumming, Dawsonville, and Gainesville! So, whether you want to buy, sell, invest, or rent, feel free to e-mail or call!
Step 2: Checking Your Credit: This is one of the single most important pieces of information a lender can have – it helps to determine your interest rate. Remember: It is ALWAYS important to continue to build and improve your credit.
Step 3: How Much House Can You Afford?: Look at your budget and how much you make. Add up all of your monthly expenses (not including your house payment), and don’t forget the little items. Subtract all of your monthly expenses from your pay – this will give you an idea of how much you can afford at your current spending level. Or, no more than 28% of your current income should go toward your mortgage (including taxes and insurance). Don’t Forget: Housing expenses go BEYOND just your mortgage!
Step 4: Get Pre-Approved for Your Mortgage: Getting pre-approved helps in 2 ways:
First, it helps you narrow the homes you should consider because it tells you what price home you can afford.
Second, it gives you an advantage over other buyers; sellers like seeing that potential buyers are already have financing secured. During pre-approval, you will need to provide proof of income and your social security number so the lender can review your credit. Remember – pre-approval is more like a limit, and you can always buy for less than your pre-approval amount. Also, pre-approval is not the same as pre-qualified (which is just an ESTIMATE for how much you can borrow and is NOT guaranteed).
Step 5: Working with a Real Estate Agent: When you work with an agent from Keller Williams, such as me, our services are completely free. Also, real estate agents have access to the most up-to-date listings for homes that are for sale. These websites are updated by realtors on a daily basis. Through using these search sites, we can find you exactly the home you want.
Step 6: Finding Your Home: Searching for the perfect home can be overwhelming, but luckily, through working with a real estate agent, some of that can be toned down. To help avoid wasting time looking for homes that aren’t even what you’re looking for, set aside time to determine what you are looking for in a home. By doing so, you’re allowing yourself and your realtor to have a very clear idea of what you are looking for. Therefore, create a list of the top 10 and 5 priorities that you want in a house. For example, location, house size and features, and the school district may be a few things that are not negotiable in your home.
Step 7: Make an Offer: This is just a short and simple description of things to remember when making an offer. This time in the house buying process can often me emotionally draining, as your offers may be rejected several times before the seller accepts one. Just remember the following: 1.) You don’t have to offer the asking price. Through working with your real estate agent, you can determine a good first offer price. You real estate agent can help you determine a good price to offer. 2.) Keep bargaining in mind. Being flexible with closing dates, contingencies, and small repairs can often make the seller more flexible with their price. 3.) Get it in WRITING. Once you and the seller have agreed on a price, make sure EVERYTHING is in writing – even those things that don’t seem important.
Step 8: Choosing the Right Kind of Mortgage and Locking in Your Rate: This is one of the MOST critical steps in buying a home. The best way to start is by educating yourself. Make sure to research the different types of mortgages, the pros and cons of each, how long you will be in your home, your risk tolerance, and what you expect to happen with your income. Here is a list of some of the mortgages out there right now: Fixed Rate, Adjustable Rate, Hybrid, Option ARM’s, Interest Only, and Balloon Mortgages. Make sure you do your research, or talk to a loan officer about what loan may be right with you. Sometimes several days, or even a week, can go by before you hear back about your offer. Locking in your rate essentially means that your lender commits to giving you a specified interest rate for a specified period of time.
Step 9: Getting a Home Inspection and Appraisal: Make sure you do this BEFORE you finalize the sale of any home. You want to hire a third party to come in and to an inspection of the home you want to purchase. These inspections will generally uncover any problems with the house that will affect its liability, safety, or value. Generally, you will want to make your home offer CONTINGENT on this inspection, this way, if the inspector finds something seriously wrong with the home (say termites, for example) you can get out of the contract. Inspections generally do not cover cosmetic issues with the home, so be on the lookout for nails left in the walls, cracked paint, etc. You will have to look for that yourself. An appraisal will more than likely have to be done as well, and that is a written estimate of a property’s market value. Most lenders require this to make sure that the home isn’t worth less than the loan amount (you wouldn’t pay $150,000 for a house that appraised for $125,000, would you?). If this DOES happen, you will need to re-negotiate a lower price with the seller.
Step 10: Closing Your Home: Congratulations! You have made it to the last step in the home buying process! The closing procedure is when all parties involved sign the required papers and the ownership of the property is transferred from the seller to the buyer. Within the 24 hours leading to the closing, you should be able to take a walk through of the home – this allows you to make sure all of those contingencies with the offer have been met and that the home is in move-in condition. Closing requires a great deal of paperwork. Also, be prepared to sign a number of legal documents and pay closing costs. Make sure to prepare your finances to pay some amounts at closing. Closing can be a stressful time, so MAKE SURE to ask your realtor if you need help with anything or have any questions.
REMEMBER: I would love to help you buy your first home! If you have ANY questions that I can answer, please feel free to contact me at (770) 530-7712, or CEdgecomb@. Thank you very much!
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