The first step in buying a home is to prequalify you with an experienced loan officer. You may want to "interview" two or three lenders before deciding on one. In addition to checking interest rates, you may want to ask about other charges the lender may have. Personal service, loan charges, and personalities all are important so be sure you feel comfortable with your lender! I will be happy to provide you with business cards of lenders that I have worked with-you may also want to check the phone book or advertisements in the weekend papers.
The lender will ask you for information regarding your income, present and past work history, current monthly debt payments and other related information. They will possibly run a preliminary credit report to help determine your profile for obtaining a new mortgage. They will also determine the approximate amount that you will qualify for.
You will be asked to schedule an appointment for a full loan application, including a credit application, which will confirm your employment, debts and credit history. The cost is typically $65-$85.You will also need $300-$350 for the home appraisal.
Once the lender has analyzed your financial profile, he will discuss your financial ability and qualification for different mortgage programs. When the loan application and credit report have been completed, I will schedule showing of homes in your area of selection and within your price range.
When I take you looking at homes take your time looking at5 each property. Sometimes the owner will be there--don't let that stop you from looking at the home closely. This is a great time to ask questions! Look in the cabinets and closets, walk around the property, think what it would be like to LIVE in the house. I will give you a "rating sheet" to use while previewing homes. You will be able to take notes on each home, list the positives and negatives, and rate each home on a scale of 1 to 10. It will take some of the confusion away at the end of the day when you can't remember details about some of the homes.
When you find the home for you, I will call the listing agent and get as much information as I can: terms regarding the sale, multiple offers, date for possession, etc. I will also run listings of other homes in the area which are similar to the one you are considering. We will compare those homes with the one your are considering. From there, you will be able to determine what price you want to offer for the home.
I will write the contract with you and explain the terms and conditions. You will need to write out an earnest money check ( typically between $500-$2000, depending on the price of the home). This check will e cashed within 24 hours of acceptance of the contract.
Even though having a home inspected is optional, I always advise my customers to have an inspection performed-what you don't know about a house could cost you hundreds, even thousands, of dollars down the road. After you have an accepted contract, there will be a short time frame (about 1 week) in which you may have the home inspected and request items be repaired/replaced. The purpose of an inspection is to determine the condition of the property and to check for major problems such a structural problems or safety issues-NOT to prepare a list of cosmetic repairs. Depending on the inspector you hire, they will check the furnace, water heater, roof windows screens, electrical box and appliances. Keep in mind, the inspectors job is to find things wrong with the house and they are very good at their job. Remember, just because an inspector lists something on his report does not mean you have to request the seller fix/replace that item. When you buy a previously owned home, there will usually be some cosmetic improvements needed. You will need to pay the inspector at the time of the inspection and you will receive you inspector's report immediately.
The title commitment for the property will be delivered approximately 10 days after you have an accepted contract. This document will show if there are any encumbrances or liens on the property and is the first step in ensuring that a "clear title" will transfer to you on the day of closing. If the property is located in an area with a Homeowners Association, or in a covenant controlled community, the Covenant Rules, Regulations, and Declaration and Bylaws will also be attached to the title documentation. Please read the document to make sure there is not a regulation that you just can't live with. Just like everything else in the contract, you have a short time frame in which to do this and be released from the contract, so please read it as you receive it.
The appraisal will be ordered by your lender. The purpose is to determine the current value of the property to ensure you are not paying too high of a price. This is typically an expense of the buyer.
The first week of the contract is a stressful and exciting time. Don't let your imagination and or fears get in the way of your logical thinking. Remember that it's normal to be anxious and maybe lose a little sleep. If you become over worried, please give me a call so we can talk through your areas of concern.
The week before closing is also very demanding. When your loan package is submitted for approval, the "underwriter" may ask for some additional last minute documentation such as a pay stub, bank statement, letter of explanation, etc. This type of request by the "underwriter" is necessary for your loan package to meet the "lender requirements." You must respond to any request for additional information immediately or your loan package will not be approved. Just remember, the lender is on you side. Unfortunately, there are a lot of government guidelines that must be adhered to or the final decision from the impartial decision makers (the underwriters) will be to turn down the loan. This final week is also the time for you to notify the Phone company, Public Service, cable and trash of your change of address. The water will be transferred for you by the Title company.
The day before closing I will receive a settlement statement which gives the exact, to the penny, accounting of your settlement costs. I will review these figures with you and make sure you know the exact amount to bring to closing.
You must bring a Cashier's check or a Certified check for the exact amount of the settlement charges to the closing. Have the check made payable to YOU. You will be asked to endorse the check at the end of the closing. A typical closing will take 1 to 2 hours. Be prepared though, there are exceptions to the rule and it could take longer. I will attend the closing with you to review the documents and answer any last minute questions you may have.
