A Guide to Home Buying

Here is a comprehensive guide on steps on how to buy a home. Buying a home can feel exciting and overwhelming whether you’re a first-time buyer or refreshing the process. You’ll move through several key steps during the home-buying process. These include mortgage pre-approval, budgeting, touring homes, making an offer, and closing. This guide breaks the journey into 10 clear steps to build confidence in homeownership.

1. Location:  Identify Where You Want To Live

If you’re not exactly sure where, pick a few counties that you are open to. If you have children, you may want to pinpoint what school districts you are open to, and that can dictate what locations you are open to:

2. Find Your Real Estate Agent

Get in contact with your Realtor of choice.

3. Obtain Mortgage Pre-Approval

If you aren’t an all-cash buyer, you’ll need a loan to purchase your property.

*You can reach out to your real estate agent for lender contact suggestions*

• Contact a bank, lender, or mortgage broker to obtain mortgage pre-approval. Submit all requested lender and bank documents promptly, as delays can affect your transaction timeline and contractual deadlines.
• Request that the lender list the maximum amount you can afford within your initial Pre-Approval Letter.
• Please ask your lender if you will need Seller Assist in order to purchase, based on your amount of savings. *See Terms and Definitions.

4. Provide Your Realtor With Your Budget

Your maximum amount within your pre-approval letter does NOT have to be your desired budget or purchase price.

• Establish your home purchase budget by informing your realtor of your desired maximum purchase price or your desired maximum monthly mortgage payment.

5. Provide Your Home Criteria

Once you establish your budget, share your desired home features and preferences with your Realtor. Once confirmed, your realtor will begin emailing you homes. Your criteria should include the following:

• Minimum Number of Bedrooms, Bathrooms, Location / School District, Single or Semi Detached, Etc.

6. Schedule A Home Tour With Your Realtor

Now that you have your pre-approval and have shared the homes you like with your realtor, it’s time to start scheduling house tours in person.

7. Placing An Offer

Now that you’ve found the home of your dreams, it’s time to place an offer.

Here are some questions you should ask yourself before placing an offer:

• Purchase Price?
• Do I want to do any inspections? Or am I willing to move forward without an inspection? (Inspections are always recommended, however, in a competitive market, offers without an inspection will typically hold more value to the seller).
• Do I need Seller Assist? Should I request Seller Assist? (offers without a request for seller assist will typically hold more value to the seller)

• Confirm those answers with your realtor.

Thereafter, your realtor will create the agreement in writing for you to sign.

• Typically, your offer will be responded to within 24 to 48 hours. Hang Tight.
• My motto is, if it’s meant to be, it’ll be.

8. Next Steps After Your Offer Is Accepted

Congrats! Now that the seller has accepted your offer, it’s time to complete the remaining steps before closing.

8a

• Earnest Deposit: Prepare your earnest money deposit check and confirm with your Realtor who should receive it and where you should deliver or mail it.
• Title Company: They are responsible for ensuring the title is clear and managing settlement *You can reach out to your real estate agent for title company suggestions*
• Mortgage Financing Commitment: Get in contact with your lender to provide any requested documentation in order to eventually obtain a Mortgage Commitment. *Providing ALL the requested lender / bank documents in a timely manner is very important and can impact the deadline of your deal*

8b

• Home Inspection: If you elected to perform a home inspection in your offer, contact the home inspector to schedule the inspection. The inspection and inspection report should be completed within 10 to 15 days, based on the deadline in your agreement of sale. The inspection is generally paid for by the buyer. *You can reach out to your real estate agent for suggested home inspection companies*
• Based on the inspection report, you have the right to negotiate, if need be, based on the required repairs (Please ask your Home Inspector to highlight the major issues/ repairs).
• Home Insurance: Start shopping around for Homeowner’s Insurance and have your insurance agent provide the declaration page to your lender. *You can reach out to your real estate agent for suggested home insurance providers*

• Appraisal: The bank orders the appraisal, and the buyer pays for it. Neither the buyer nor the seller selects the appraiser. This is when the bank sends out a certified appraiser to ensure the property’s condition is up to bank standards and advise on the value of the home. If the appraisal value comes in below the agreed purchase price, you will need to renegotiate the purchase price. Requested repairs can come up within the appraisal reports as well. Your lender will advise if there are any requested repairs. *If you can make it past the above processes, you are only a few steps away from purchasing your new home.*

9. You’re One Step Away From Homeownership!

• Once your lender issues a Clear to Close, you have secured your mortgage commitment, received appraisal approval, and can move forward with settlement on your new home.
• If a settlement date hasn’t been confirmed already, please reach out to your real estate agent to provide you with a settlement date, location and time. Most of the time, closings are held at the title company’s office.
• Schedule a date and time with your realtor to do a final walkthrough of the property. This is typically done the day of or the day before settlement.
• At least 1 to 2 days before closing, please have your lender confirm how much funds you will need to bring to settlement. Funds should be in the form of a Cashier’s Check, typically payable to the name of the Title Company. Keep in mind, delays are normal, as there are many moving parts to accomplish the goal of you becoming a homeowner. This process typically takes 30 to 60 days, sometimes longer. 45 Days is a great timeline to keep in mind. Patience and having fun within this process is key!

10. Settlement Day

• Bring two forms of ID and the Cashier’s Check.
• This typically takes 30 minutes to 1 hour, sometimes longer.
• You’ll be signing documents prepared by your lender and the title company.

I hope this guide helped you feel more confident about the home-buying process and what to expect at each step. To make things even easier, I’ve created a free printable brochure that walks you through the 10 steps to homeownership. Feel free to download it, print it out, and share it with family or friends who may be on the same journey.

Jim Thelusca

610-927-7466

JThelusca@PagodaRPM.com