For many first time home-buyers, where to start is the big question. The whole idea can, at times, seem overwhelming. So let’s break this down into small steps you can follow even if you started at the fourth or fifth step. Assuming you are going to finance the purchase, here are the ideal steps to follow:
To avoid disappointment, your credit score and credit history is where to start. These are what determine if you qualify for a mortgage loan. The score you automatically get with your credit card statement is only good as a generalization. It will not be the score a lender will use. To get your appropriate credit scores (there are 3 of them), go to myFICO.com and pay for each bureau’s score. Doing this will NOT affect your score at all. Alternatively, you can speak with a lender who can pull your credit. To do so, they need your permission, social security number and some other personal information. This will affect your score by a very few points, however…
Pre-Qualify For A Loan
…this same lender can use the credit score and other documents you provide to pre-qualify you for a loan. Why pre-qualify? Once you know how much loan you can get, it is easy budget for the home you can afford. This is the single most important step you can take to avoid disappointment down the road. There is nothing worse that walking into an Open House, loving everything you see, only to find it’s more than you can afford.
Narrow Your Search
Now that you are pre-qualified, you are ready to talk to a Realtor. You, or your lender, can give them a realistic sense of your home-buying budget. Realtors can work with you when they can quickly get a letter from your lender. They need this letter when writing an offer for a home on your behalf. The letter shows the sellers that the process will not be delayed by your trying to secure financing.
Next, your realtor works with you to determine which areas have homes within your price range that have the features your want. To this end, the Realtor sets you up with a way to receive the latest homes for sale as well as a way to search the Multiple Listing Service. This is where all the homes listed for sale can be found.
Look At Homes
First, look at homes on-line to figure out which homes to rule out. Initially, you may have 100 or more homes to look at. With some patience you narrow this down to a few homes to see in-person. Your Realtor is your point of entry into these homes. They make the appointments necessary, make sure keys are available and that any pets are not a cause for concern. Open Houses are another way to see homes. Keep in mind that if your realtor is not there to see the home, they can’t advise you as to how good (or not) a deal it really is.
Make An Offer
When you have found THE ONE, your Realtor confirms the house is priced right. They also give you an idea of how quickly (or slowly) the market is moving in the area. Use this information to determine your offer. If homes are selling fast, seriously consider offering more than the sellers are asking. Remember the home has to appraise at the offered amount or you are not going to be able to finance it as planned.
Escrow (Or All The Steps Left To Get The Keys)
Once the seller agrees to your offer, you all go to escrow. This is the process of confirming all the details to make sure you are getting the right house, from the legitimate seller, and the sellers are really going to get paid. This is also the point where the paperwork grows well beyond anything you’ve seen so far. You are seeing or hearing from your lender and realtor almost daily as there are many forms to fill out and sign.
An inspection of the home by a trained professional is done to find any things you need to be aware of. This report is used to prepare a list of requested repairs as necessary. Negotiations over the repairs will follow. Usually, 3 weeks to a month after you open escrow, everything wraps up. The buyers get title to the home and keys. At the very same time, the sellers get their money. And the home will be recorded as having transferred from the sellers’ ownership to you, making you the legal owner of the home.
So, where to start? Contact me at 760 622 5087 or [email protected] As both a mortgage broker and a Realtor, I make this whole process seamless and as straight-forward as possible. I’ll have you moving in with a minimum of fuss and bother. You can check-out the experience of past clients here.