PREPARING TO
BUY PROPERTY
Once you have made the decision to buy in the near future, it is a good idea to start preparing for your upcoming purchase.
Gather Documents for Lender
The first step to purchasing a property will be having the finances secured. When you go to apply for a loan there are financial documents the lender will want to see. These documents can include the following:
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Bank Accounts
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Financial Statements
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Credit Cards
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Other loans (auto loans, student loans, etc…)
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Pay stubs
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Tax Returns for 2 most recent years
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Leases for any investment properties
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401k statements, bonds, stocks, mutual accounts, life insurance.
Check Your Credit Score
Your credit score will have a huge impact on the loan you can get and therefore a huge impact on which type of property you can purchase. You should contact a trusted lender and have them check your credit score. If you do not know of one to contact feel free to reach out and I can recommend some trusted lenders that I work with in the area.
Make Smart Financial Decisions
Since you are getting ready to make arguably the biggest purchase of your life, you must be careful with your financial decisions in particular from now until you make the purchase. Avoid making other big purchases such as a new car. Avoid taking on other loans. If you have other current loans such as car or credit card loans, be sure to make timely payments. If you have credit cards try not to have an outstanding balance of more than 30% of your max limit. Along with making smart financial decisions you also want to show stability, so avoid making career changes such as switching jobs.
CHOOSING A
REAL ESTATE AGENT
Purchasing a property requires a lot of important decisions, understanding of laws & regulations, handling complex issues, good negotiation skills, and a ton of legal paperwork. Having the right Real Estate professional to represent you is extremely important as you are trusting them to take the lead in handling all of these things on your behalf. Here is a list of some important factors to consider when choosing an agent:
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Is your agent familiar with the area you are looking to buy in?
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Is your agent a full-time agent? If you take the chance with a part-time agent do you really think the agent will be dedicating enough time to get you the best possible home? Wouldn’t you want someone who is dedicated to his craft full-time?
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Will your agent be available for you just during business hours or after hours also? Many times just one day of delaying an offer can be the difference between getting your offer accepted or having someone beat you to it.
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Do you feel comfortable with the agent? Does the agent treat you like a friend or simply just another client he wants to get a deal done with just to get paid?
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Does your agent respond in a timely manner? As mentioned earlier Timing can be everything when it comes to making an offer.
CHOOSING
A HOME
START YOUR HOME SEARCH AND NARROW IT DOWN
It is now time to begin your search for homes that you like. There are many ways to do this and I like to utilize many different techniques to ensure we are seeing all homes the hit the market, giving you the best possible selection. These days many buyers are using public websites such as Redfin to search for homes that they like, which is perfectly fine. However, even if you are searching yourself on these sites, I will be proactive to ensure we do not miss any homes. I will add you to the Home Snap app which is a Realtor app that gets data directly from our MLS (Realtors only database), therefore you will see homes as soon as they hit the market. I will also do my own research on the MLS database to find homes that fit your criteria, and even can put you on an email drip that will immediately send them to you.
YOU FIND A HOME YOU LIKE, NOW TIME TO PURCHASE
Once you find a home you like we will prepare an offer. I will ensure to weigh out the potential costs and expenses associated with the property so we can be sure it fits your needs and budget. We will also be sure to make a strong offer that stands out above the rest and has a high chance of acceptance.
OFFER ACCEPTANCE STEP-BY-STEP
An effective agreement is a legal arrangement between a purchaser and a seller of the property. All parts of the offer will be included in the written contract which you will see and sign off on before even sending to the seller and his/her agent. You will also be emailed copies of everything you sign to ensure you are kept up-to-date on the process. There are several time-sensitive steps along the way, so I will ensure we stay on top if it, and meet all of the strict deadlines to avoid any penalties or delays.
TITLE COMPANY FOR CLOSING
Included in the contract will be a Title Company which is to host the settlement for the deal. A closing agent from the Title company will hold the Ernest Money Deposit in Escrow and research the property history thoroughly to ensure the title is clear and free of encumbrances.
SAFETY INSPECTION
Once the offer is accepted, we will have a licensed safety inspector come to the property within the timeframe stated in the contract and conduct a safety inspection. This is a crucial step in purchasing a home whether it is used or brand new, you never want to get stuck buying a home and quickly finding out that there are major problems with the property which can be costly.
After the inspection is completed typically 1 of 2 things happens:
1). You are satisfied with the inspection results and now we can move one step closer to obtaining the property.
2). There are things that came up in the inspection that you want to negotiate with the seller (typically asking for repairs or a reduce in purchase price).
HOME APPRAISAL
Throughout this whole process you should be keeping in touch regularly with your loan officer. Typically, they will be going back and forth asking you for more documents or verification. As it starts to get closer to settlement day, the lender will have an appraiser go to the property and do an Appraisal. This means a licensed appraiser makes an accurate estimate of the property value. This is done so the lender can ensure they are giving you an accurate loan amount for the property you are purchasing.
PROPERTY INSURANCE
When obtaining a loan, you will be required to get property insurance. The amount will depend on the loan amount and also the lender. It is a good idea to shop around for a few different options as you can save hundreds of dollars a year by weighing out different options.
HOME OWNERS ASSOCIATION (HOA) APPROVAL
Assuming all the above steps have been checked off, one of the final steps in the contract is to receive the Home Owners Association documents fully describing all of the HOA rules and regulations. These should be sent over by the seller or their agent and reviewed by you, as long you approve of all of the rules and regulations then we can continue to move forward to closing day.
CLOSING DAY
YOU ARE ALMOST AT THE FINISH LINE,
JUST A COUPLE MORE STEPS LEFT!
WALK-THROUGH INSPECTION
Typically, the day of or one day before the settlement date, we will have a final walk through of the property to ensure everything is in the same condition as when we made the offer. The main things to look for are to make sure there are no extra items left behind and that everything that was supposed to be included with the home purchase is still in the home.
UTILITIES
You will be provided a list of useful numbers to activate utilities and home services after closing.
SETTLEMENT
The settlement day is finally here! This is typically held at the office of the Title Company (although sometimes done right at the home). The last of the paperwork that needs to be signed is signed here, you are given copies and can see all of the details of the financing numbers and such. If you are bringing funds for the Title Company you can bring a certified check or a lot of times most Title companies will allow a wired transfer of the funds. Once all paperwork is signed you will receive the keys and any other important information that is needed. Congratulations you are now a homeowner!