With the interest rates being historically low, now is a great time to purchase a home as your dollar goes much farther toward your next home. We’ve included a step by step process so you are a little more prepared for how it will go from start to getting your keys.
We will set up a meeting to find out your wants and needs:
- What areas are you looking at? Which cities or neighborhoods interest you?
- Where do you work? Is there a commute to consider?
- How much can you afford? (the pre-approval process will dive deeper into this)
- Does the school choice matter to you?
- Do you have a preferred style of home?
- Size of the home and yard or other amenities?
Pre-Approval: By this point, we will have connected you with a mortgage lender to pre-approve you so the home search we will conduct with you will be within your means. They will take things like your debt-to-income ratio, and your credit to factor how much you could possibly pay and with that number, you can figure out how much you will be comfortable paying for a mortgage each month.
Search: The home search starts with us taking into consideration all of the prerequisites of the home you desire and setting up alerts for you to see them when they hit the market. Once a home that fits your wants, needs and price comes on, we will schedule an appointment to view the home.
Offer: Once we have viewed the home and you decide you are interested in making an offer, a few things will happen. We will research the property to show you what an appropriate value should be, we help you determine what price and contingencies you want to put into your offer, we write up the offer and give it to you for signatures and then we present that offer to the listing agent.
When we present the offer, we will include the offer itself, a copy of your pre-approval letter from your lender (or a proof of funds statement if you are paying cash), the legal description of the property and a copy of your earnest money check.
Earnest Money: Earnest money is the money you offer to the seller to indicate your seriousness to buy the property. The check is held by our office until mutual acceptance of your offer when it is given to the escrow agent who cashes it and places the funds into a trust account which will be applied to your closing costs and deposit. If the contract is terminated using a contingency clause, the earnest money will be refunded to you.
Inspection: We always suggest that you have a qualified inspector inspect the property, even if it is a new construction home. Once the inspection is complete, we will look at the results and negotiate with the seller to correct any issues.
Escrow: Escrow is an independent third party that makes sure all liens are released on the property before you take possession. They will send you a package of documents to complete before your closing date that should be returned as soon as possible to avoid any closing delays.
Title Insurance: Title insurance is paid for by the seller that it is not to be confused with household insurance. Title insurance insures you, the buyer, against issues that could come up on title in the future.
Insurance: The next step is to secure your homeowner’s insurance rider before taking possession of your new home and before the bank will lend you money for the home. They need to know that the house is insurable and that it is insured. Usually this is done with a quick and easy phone call to your insurance agent.
Signing: If you are financing the purchase of the property, you will have a large loan package to sign. This will typically be done during an appointment at the escrow office where they will provide all the documents to be signed, and another copy after you have signed. If you wish to fully read each document before you sign, be sure to let the escrow officer know when they are scheduling your appointment. They will make sure you know what you are signing even if it is not the case.
Money Transfer: Escrow will tell you how much money you will need to bring to the signing. This money will be the down payment and any closing costs, less the amount of money you paid upfront in the form of earnest money. Usually they require this money to be in the form of a cashier’s check or a wire.
Final Step: If you financed the property, your bank will wire all the funds to escrow that will send the documents to the county recording office to record the property in your name.
Keys: This is when the fun starts. When we are able to hand over the keys to you and you are able to take possession of your home! From this point on, you have become a part of our Keller Williams family and will keep in touch for any real estate related needs you have in the future.