Buying a home can be a scary process especially for first time home buyers. Having a clear understanding of the entire process can relieve much of the worry and concern.
6 steps to understand that will make the buying process much smoother:
- Determine Your Budget: One mistake many buyers make is not knowing how much they can truly afford in a home. Plan your budget including ALL of your monthly payments. Make sure to budget for a nest egg (savings) in case of a rainy day. Also, be aware that you may qualify for more than you are comfortable spending. Do not “over borrow”.
- Find The Right Real Estate Agent: Using a real estate agent that has been referred to you is one of your best options. This gives you the confidence of knowing that someone you trust was happy with their performance. Make sure that they are experienced and that there is compatibility. You will be spending a lot of time together.
- Get Pre-Approved: This is the stage that the lender is chosen, and buyers provide all documents to the lender including W-2s, bank account statements, tax returns, etc. The current market is a very fast-moving market. Many sellers are requesting proof of pre-approval prior to even showing the home.
- Find A Home and Make An Offer: Have your agent view homes with you. Use the real estate professional’s expertise to negotiate a fair offer on the property based on comparable sales in the area. If the offer is excepted, the home will then be under contract and enter the escrow period. During this time, you will complete all inspections, finalize lending and the attorney will prepare all legal documents.
- Closing: At the closing, all legal and loan documents will be signed by both buyers and sellers. Once the loan has been funded, you are clear to move in.