YOUR SEARCH BEGINS
Buying a home is one of life’s biggest investments and a most exiting adventures.
In this first meeting that is usually done at the office your realtor will ask you the necessary questions to truly understand your needs. The buying process will be explained in detailed, the means of communication and the frequency of these should also be discussed. The necessary paperwork will be filled and signed by both buyer and realtor.
Why to get pre-approved and the difference with a pre-qualification
Getting pre-approved will let you know exactly how much you can afford and securing the financing to make the purchase.
A pre-qualification will only give you a rough estimate on your financial condition.
THE PRE-APPROVAL A MUST HAVE
It's important to know the difference between pre-approval and pre-qualification, which is often use interchangeably. Pre-qualification is an estimate of how much you can borrow. A pre-qualification may or may not affect your credit. It all depends on whether a lender checks credit reports during this stage and how often you apply.
Pre-approval goes a step further and analyzes your creditworthiness. This type of qualification is the one to be used when searching for your new home since it will give you a more accurate price range of home you can buy. Being pre-approved can make the difference between winning a bid on a property or not.
Here are some of the documents that you will need to provide your lender to get the pre-approval process started:
· Current pay stubs, usually for last two months
· W-2s or 1099s, usually for last two years
· Tax returns, usually for last two years
· Bank statements
· Investments/brokerage firm statements, Assets
· Net worth of businesses owned (if applicable)
· Credit card statements
· Loan statements and Debts
· Alimony/child support payments (if applicable)
After you have been pre-approved and the criteria on what are you looking for has been analyzed your real estate agent will make appointments for the properties that meet your criteria.
It is important to plan well the visits. Talk with your real estate agent to determine the best routes, times and days.
Your real estate agent will keep you informed with new properties that come in the market and the ones that are not longer available
MAKING THE OFFER.
Your real estate agent will help you determine your offer and negotiate in your behalf.
She will provide information such as:
· How long the home has been on the market
· If the price has been reduced
· How much the home is worth
· If there are multiple offers
· Other items that might be included in the sale (furniture, hot tub, etc.)
· The "list to sale price ratio," indicator on how competitive the market is for homes in this area
· Why the seller is selling
· Whether the seller is offering an assumable loan or financing
Once the offer is written, your agent will present it to the seller's agent. At that point the seller can accept your offer, reject it or counter it to start the negotiation process. Your agent will work with you to plan a strategy to ensure the most advantageous terms and acceptable pricing for you and your budget.
CLOSING ON YOUR HOME
Once your offer has been accepted, the closing process begins. Here are some of the typical steps involved.
Home inspection — Most property sales are contingent on the results of a home inspection, which is paid for by the buyer. The inspection typically occurs within 10 days of offer acceptance, and includes a review of the home’s exterior elements like the roof, siding, trim and windows, as well as kitchen and bathroom fixtures and appliances and major systems like heating and cooling, plumbing and electrical.
If defects are discovered during the inspection, you may exercise the remedy described in your offer or negotiate with the seller to determine what repairs will be made.
Mortgage Application – This has to be done as soon as possible since there are date-lines in the contract
Title search — This is a historical review of all legal documents relating to ownership of the property to ensure that there are no claims against the title of the property. It is also recommended that you purchase title insurance in case the records contain errors or there are mistakes in the review process.
Appraisal — As a standard part of the mortgage process, your lender will order an appraisal report to ensure that the loan will be guaranteed by the home's value.
Final walk-through — If it's requested in the contract, you’ll be given the chance to look at the home to make sure it's in the same condition as when you signed the sales agreement.
Closing costs — In addition to your deposit and down payment, there are a variety of other costs involved in closing including:
· Loan origination fees, appraisals and reports
· Surveys and inspections
· Mortgage insurance
· Hazard insurance
· Title insurance, notary and escrow fees
· Recording fees and stamps
MOVE INTO YOUR NEW HOME
Enjoy your new home for years to come. Remember to change the address from all your bills and notify friends and family.
If this is your primary residence and you live in Florida, to apply for the Homestead tax exemption