The SYLVIA TEAM will guide you through the steps below, from the offer, contract and closing.
Step 1: Start Your Research Early
Three to Six months is not too early to begin the process
Start researching – use our search menu option.
Note homes you are interested in and see how long they stay on the market.
Note any price changes.
These two items alone, will give you a sense of the housing trends in specific areas.
Step 2: Determine How Much House You Can Afford
Lenders generally recommend no more than 3 to 5 times annual household income, if buyers plan to make a 20% down payment and have only a small to moderate amount of other debt.
However, those numbers can be unrealistic depending on individual family expenses, risk on incomes with bonus, commissions, etc. In general, my personal belief is to opt to the more conservative approach, especially after the downturn we all experienced 2008-2015.
The determination should be based on your own financial situation. Hopefully you have a realistic idea of what you can comfortably afford without over extending yourself.
Step 3: Get Prequalified and Preapproved for Your Mortgage
Seller’s often will not take an offer serious if the offer does not include a Pre-Approval letter or Proof of Funds giving them the security that their buyer is qualified.
Before you start looking for a home, you need to know how much you can actually spend.
To do so, get prequalified for a mortgage. Getting prequalified just requires you to provide financial information to your mortgage banker
Your income, savings, investments, etc.
Your debt such as current mortgages, cars, loans, credit card balances, etc.
The lender reviews information and tells you how much you can borrow.
This will provide you your price range of home
Once you find a home, the formal pre-approval process begins
Lender uses to formally verify your financial status and credit.
Step 4: Find the Right Real Estate Agent
Real estate agents are important partners when you’re buying or selling a home.
They provide helpful information on homes and neighborhoods that may not be easily accessible to the public.
Their knowledge of the home buying process, negotiating skills, and familiarity with the area you want to live in can be extremely valuable.
My personal opinion, the most important part of negotiating, is being able to remove the emotional part that often is involved in both sellers and buyers.
The good news – It doesn’t cost you – Agents are paid by the seller of the house.
Step 5: Shop for Your Home and Make an Offer
Create a Checklist and take your own notes on all the homes you visit.
You may see just a few homes, or many homes. After a while, the you will lose track of what homes had what features …etc. You can take pictures while you are previewing.
Make sure to check out the little details of each house. For example:
Test plumbing by running showers/faucets – see how strong the water pressure is
Try the electrical system by turning switches on and off
Open and close the windows and doors to see if they work properly
It’s also important to evaluate the neighborhood and make a note of things such as:
Are the other homes on the block well maintained?
How much traffic does the street get?
Is there enough street parking for your family and visitors?
Is it conveniently located near places of interest to you: schools, shopping centers, restaurants, parks, and public transportation?
Take as much time as you need to find the right home. Then work with your real estate agent to negotiate a fair offer based on the value of comparable homes in the same neighborhood. Once you and the seller have reached agreement on a price, the inspection process and mortgage appraisal and underwriting process takes place.
Step 6: Get a Home Inspection
Typically, purchase offers are contingent on a due diligence period. This is when the home inspection of the property should take place.
An inspection is to check for signs of structural damage or things that may need fixing.
Your real estate agent usually will help you arrange to have this inspection conducted within a few days of your offer being accepted by the seller.
The due diligence contingency protects you by giving you a chance to renegotiate your offer or withdraw it without penalty if the inspection reveals significant material damage.
This inspection is at your cost out of your pocket.
You should receive a formal report with details and pictures of the findings
At this time you decide if you want to ask the seller to fix anything on the property before closing the sale.
Note: There is always a final walk-through of the house, which gives you the chance to confirm that any agreed-upon repairs have been made.
Step 7: (Step 6 and 7 are done Simultaneously) Typically, Purchase Offers also contain a Finance Contingency – Work with a Mortgage Banker to Select Your Loan
Lenders have a wide range of competitively priced loan programs & reputations for customer service can vary.
You will have MANY questions when you are purchasing a home, and having an experienced, responsive mortgage banker/broker assist you can make the process much easier.
Every home buyer has their own priorities when choosing a mortgage. Some are interested in keeping their monthly payments as low as possible. Others are interested in making sure that their monthly payments never increase. And still others pick a loan based on the knowledge they will be moving again in just a few years.
Home Appraisal will be a Lender Requirement (If you are doing a cash deal, I ALWAYS recommend an appraisal). Either way this is also an expense out of your pocket up front.
Lender arranges the appraisal –
The appraiser provides an independent estimate of the home value
The appraiser is a member of a third party company, not directly associated with lender.
The appraisal lets the buyer/lender know whether you are paying fair price for the home. You will get a detailed report complete with comparable pictures of other homes and square footage details related to your property.
Step 8: Coordinate the Paperwork
As you can imagine, there is a lot of paperwork involved in buying a house. Your lender will arrange for a title company to handle all of the paperwork and make sure that the seller is the rightful owner of the house you are buying via title searches
Step 9: Closing the Sale
At closing, you will sign all of the paperwork to complete the purchase, including your loan documents, that convey title to lender/owner.
Once the check is delivered to the seller, you are ready to move into your new home!
Copyright 2024 The Sylvia Team
The Sylvia Team | Jasper, GA 30175 | lisasylvia3@gmail.com
