Buyer's Guide


Your complete guide to buying a home

home buyers guide

Buying a home is a huge step both financially and emotionally. It can seem overwhelming at times. I have broken down the process down into manageable steps for you. Use this guide to help you manage the buying process.



STEP 1: DETERMINE HOW MUCH YOU CAN AFFORD


Before you start looking through listings in the hope of finding your dream home, take a good look at your finances. You will be better able to know how much of a house payment you can afford and if you can cover the ongoing expenses of owning a home. A self-audit of your finances includes these three steps:


  • How much savings do you have? Before you consider purchasing a home, you should make sure you have a solid savings plan in place. You also need to have two to four months of living expenses already in savings. These funds can help pay some of the initial expenses like a down payment and closing costs. Lenders will want to see that you are responsible and have a savings plan that works.
  • What does your current spending look like? It’s important to know how much you spend every month. You also need to know exactly where your money is going. This step is essential for calculating how much of a mortgage payment you can afford. Make sure to account for all of your expenses, including everything from utilities to groceries and clothes to student loans. Count retirement funds, regular savings, entertainment, and kid’s activities.
  • How is your credit? To qualify for a home loan, you will need a good credit score, a solid history of paying bills on time, and a debt-to-income ratio (DTI) of about 43%. Lenders usually consider the ongoing expenses of owning a house to be about 1/3 of your monthly gross income.

STEP 2: FIND A REAL ESTATE AGENT


Most people work with a real estate agent when purchasing a home. They are your representative and will look out for your best interests. An agent will help you find homes with the features you want, help you get showings, and help you make offers and negotiate. You generally do not have to pay for a Realtor’s assistance. The seller pays them a commission, usually about 3% of the purchase price.


Some of the ways a real estate agent can help you when purchasing a home include:


  • Knowledge of Market Trends: Agents identify home value trends, buyer demand, the overall state of the market, and new developments.

  • Price and Value: An agent knows what a home is worth and can help you with a reasonable offer price.

  • Negotiations: They will know when a lower price is appropriate and argue to negotiate prices based on repairs needed or other contingencies.

  • Insider Tips: An agent is familiar with localities and can offer tips about schools, neighborhoods and how those may influence property value. 

  • Professional Recommendations: If you need a lender, contractor, attorney, or another vendor, an agent will make referrals.

  • Experience: The agent is familiar with the process and brings their expertise to the table to help handle the process and oversee paperwork to ensure you stay ahead of due dates.

Keys to new home

STEP 3: OBTAIN PRE-APPROVAL FOR A MORTGAGE


Getting pre-approval from a lender or mortgage broker removes a lot of the hassles from the home buying process. They will be base this amount by looking at your credit score, income, and present assets. Once you know how much you can afford we can start looking at homes within your budget and proposed loan amount.

STEP 4: START VIEWING HOMES WITH YOUR REAL ESTATE AGENT.


I will recommend properties that have the features you want and are within your budget. Don’t get discouraged if you don’t find the perfect match right away. You may need to look at several options before finding the one that is right for you. Be patient. You may see several homes so it’s a good idea to take photos or videos so you can remember each one.


Be sure to get signed up on my auto email notification system to get notified of new listings as they hit the market!

Family with kids viewing house

STEP 5: MAKE AN OFFER


Once you are sure of the home you want to buy I can help you negotiate an offer. Don’t get discouraged if the offer doesn’t work out. Sellers have the option of rejecting or accepting offers. Sometimes, several offers are made until successfully closing on a home. Once you make an offer, several things can happen.

  • The seller may accept the offer, and you’ll begin the process of finalizing the paperwork to complete the purchase.
  • The seller may reject your offer.
  • The seller may counter back with another offer. They may not like the price or some other part of your offer. They will request changes and then accept the amended offer.

STEP 6: SCHEDULE A HOME INSPECTION


Having a home inspection will give you a better idea of the inner workings of the home. After the official inspection, you’ll be given a detailed report with the findings. If there are issues found that are more than just a cosmetic problem, negotiations can be reopened. The seller can be asked to fix any issues before closing on the house. 

STEP 7: The Closing Process


Once the seller accepts your offer, you will work with your lender to complete the mortgage paperwork. The lender will usually request an independent appraisal of the property. This step protects both the lender and you. It’s important to ensure that you are getting a fair price for the home. Three things can happen after the appraisal.


  • The appraisal matches what you offered, and the lender will clear the loan so you can close on the property.
  • The appraisal is more than what you offered. This will indicate you are getting a good price for the home, and that means you’ll have instant equity.
  • The appraisal comes in below your offer. In this case the lender will not approve the full amount of the loan. You may need to make up the difference or try to renegotiate with the seller to get a better price.


Once you are satisfied with your terms and conditions of the offer, you can sign off on the subject removal. Typically we receive deposits 48 hrs after final subject removal. This gets held in the broker's trust account and goes towards your down payment at closing. It usually takes a minimum of 3 weeks from subject removal to closing dates, or longer depending on what dates work for both parties, as set out in the offer. You will pay your down payment and closing costs to your lawyer or notary. Then you will sign your mortgage. 


Once the closing date arrives, we will get notified by the lawyer or notary that the title has been registered. Keys will be passed over upon possession date, as set out in the offer.


Congratulations! You are now a new homeowner!

READY TO START YOUR SEARCH?



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