First Time Home Buyers Guide – Guidelines on What You Can Expect During the time of action

First Time Home Buyers Guide – Guidelines on What You Can Expect During the time of action

Generally what I see in today’s market is most home buyers begin their search online. A great place to start! You can find out pretty much everything you need to know about neighborhoods, schools, real estate trends, crime statistics, convenience of the town, already the weather over a 12 month period. Pretty much all you need to know to thin down your search. Once you do know the location of where you would like to live your next step would be to contact a realtor.

Meeting with the Realtor:

The realtor should set up an appointment to meet with you confront to confront. At the meeting the realtor will go over your needs and wants for a home. It’s important to remember that your needs are what you must have, ex. Bedrooms 3, 2 bathrooms, walking distance to public transportation. Wants would be pool fireplace, master bath, items that would be nice, but are not necessities. The reason I mention this is we all want more, and sometimes when finding your first place there will be compromises that have to be made. Would you whether be 1 block from work and sacrifice a bedroom, or would you whether be 1 mile from work and have your three bedrooms? There will always be a compromise to be made. You might get lucky and be able to have it all, but I wouldn’t count on it.

What happens now?

Your realtor will want to know if you are pre-qualified. If you’re not than your realtor can generally recommend either mortgage lenders or brokers to start the pre-qualifying course of action. Why? It’s important to know first that you qualify for a mortgage before you waste countless weekends searching for a home and then discover you’re not able to get qualified. Nothing would be more heartbreaking than to find the perfect home that you can’t qualify for. Your realtor needs to know how much you’re qualified for, more importantly how much of a monthly payment you’re comfortable with. Generally we qualify for more than what we are willing to pay monthly. If they don’t ask, do yourself a favor and make it clear how much you’re comfortable with. for example you may qualify for $350,000, but ideally you would whether stay within $300,000 range. At this price point it makes a huge difference on what you will be viewing. Don’t allow yourself to be set up for disappointment by viewing homes that will push past your threshold.

When do we view homes?

Your realtor will most likely set you up on moment notifications to receive homes that meet your criteria. You should continue your research online; you know better than a realtor what is alluring to you. Once you find homes that you like or that your realtor found it will be time to start viewing.

I generally keep viewings down to 5-6 homes per showing. It has been my experience that beyond that they become on big blur. When entering the home make notes of the neighborhood, curb allurement, the layout of the home. What does it have that you like, love or hate. Rate the homes 1-5, 1 being the best. Keep track of your top choices, they will come in handy later. Once you have been out several times and have viewed the homes that caught your interest it will be time to make a decision. Look at the homes that you have viewed; remember to keep the ones that rated high. Do you see yourself living in one of those homes? Does it have what you need and some of your wants? If so then perhaps it’s time for a second viewing, (As I am writing this, I am thinking about my home buyers, most people buy on emotion. You will walk into the home and know it’s for you. There is nothing that your realtor can do or say that will sway you to buy a home that you don’t want. If the home is truly for you, but for some reason you hesitate your realtor will walk you by it. Sometimes first time home buyers just get scared).

Found my home! Now what:

Your realtor will do a buyer market examination on the home to discover a fair market value. If it happens to be within the fair market value range then they will suggest a fair market offer (I generally try and stay within a 3-5% range of listing price if the home is listed at fair market already). Your offer unless it is complete asking price will generally be countered so prepare yourself for negotiations. If the home is what you want and it’s the best that you have seen, then don’t be afraid to stay to close asking price (again provided it is at fair market already). The price is only a suggestion, in the end its up to you.

Presenting the offer:

The next step is to put an offer package together. The offer package will consist of the offer price, how much money will be put down at the signing of contracts, will there be more money put down at closing? If so this will also be mentioned. The more money that is being put down the stronger the offer appears to the home sellers. How soon will a home inspection be done (when you go to the home with a licensed inspector and go over the home top to bottom to make sure there no major defects). It is best to schedule a home inspection with 3-5 days after they accept your offer. More than that and the home sellers become more eager and it also leaves the home open for possible buyers to come in and out bid you. When do you plan on having a commitment from the bank (commitment from bank is a letter stating that they approve the loan after contingencies have been met). Ideally we like to see 40 days from signing of contracts. This is an calculate, many obstacles can arise.

They will be looking for the pre-qual letter from your bank, in addition as attorney information (if you’re in a state that uses attorneys for real estate).

You can go back forth several times with the homeowners before coming to terms with prices and terms(terms could be money down, inspection date, closing date etc.)

Offer Accepted!

Great! The next step from the buyer is to schedule the inspection. As stated earlier they are there to point out any defects. (Any major defects such as HVAC, Septic, Mold issues, Radon, Termites any wood destroying pest) need to be taken care of usually by the seller. There will be minor issues such as doors sticking, perhaps a leaky faucet, that you can negotiate, however if you got a great price on the home then why threaten it by nit picking minor details.

If there were any major defects then the realtors will try and negotiate what absolutely must be done to proceed. Often with major repairs the edges won’t commit to a loan until they have been repaired. Most of the burden would lie on the home seller.

After the inspection the realtor will be contacting your attorney along with you mortgage lender to discuss details of buy offer, the inspections and the results.

After a day or two of inspections your attorney will receive contracts from the seller’s attorney. They will call you into the office to discuss the contracts, the dates that need to be followed for appraisal (bank hires someone to come out and do an inspection on character to determine a price that is fair market). Commitment dates and closing dates (generally these dates are on or about as long as it’s a private seller and not a foreclosure, different article altogether).

Title will be ordered, which is a search for liens, open building permits violations on home, if anything were to come up during this search the homeowners would have to rectify the problems before you could close on the home. You need a clear title to close when financing your home.

Your realtor should stay involved with you and your attorney throughout the time of action. They should be following up with repairs, appraisals, any contingencies that haven’t been met. Closing on a home is like a Symphony and your realtor is the conductor. They are there to make sure all runs smoothly.

Little Details:

– Everything is going smoothly with your closing; there are some items that you need to take care of.

– Homeowners Insurance must have for closing!

– Electricity needs to be switched the day you close.

– Call Telephone Company and Cable Company to either install or keep the service with a name change.

– Make sure you have estimates for moving rates if you’re using moving company.

Getting close to closing on your new home:

The last week before closing you should hear from your attorney and lender on what monies you will need to bring to closing. There will other document that might be needed at close.

The day of closing you will do a walkthrough of the home with your realtor. This is to ensure that home has not suffered any damage since your inspection, also to make sure that in any case appliance were suppose to stay are there. If there is a problem during the walk by, generally they can worked out at closing.

I hope this was helpful to first time homebuyers.

This information is for general purposes and is in no method legal advice. It is based on my experience as a realtor. Any legal questions please consult your attorney.

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