12 Steps You Need to Follow If You Wish to Buy Your Home
Posted: Oct 23, 2018
Summary: Thinking of buying a home? Here are 12 steps that you may have to follow, to make sure you make no mistakes and complete the process without any hassles.
Buying a home can be easy with all the help that is available. But if you follow a few basic steps you can save time, protect your interests, and avoid unwanted surprises. Here are 12 such steps to buying a new home:
Step #1: Shop for a mortgage
Shopping for a mortgage before shopping for the house may not make sense to you right now. But this still is the first step you need to follow as it can tell you how much you can borrow and how much you will have to pay as a monthly payment. A lot of mortgage servicers may get in touch with you through purchase mortgage live transfer leads once you show interest in buying a home. You can find out their terms and may be even get pre-approved for a purchase mortgage.
Step #2: Get in touch with a good lawyer
There are many legalities involved in buying a home. Instead of waiting till the last moment, it is always better to look up a few lawyers and select one who is honest, straight-forward, takes time to explain things, and fits into your budget.
Step #3: Find out how much a home might cost
Before looking at the houses, it is better to find out at what prices they are selling, in your area. You can get this information from your local paper, your town/county government office, or a local real estate agent. Look for at least three houses like the one that you want so that you can get a fair idea of how much your target house might cost you.
Step #4: Arrange for the down payment
Unless you qualify for a VA mortgage or a FHA mortgage, you may have to arrange for 15 to 20 percent of the price of the home as a down payment. If that is not possible look for lenders who offer mortgages at 10% down payment or lesser than that. However, such loans may be more expensive and a lot more riskier.
Step #5: Find an agent
Hiring an agent is the best way to look for houses. Ask around and search on the net for a few real estate agents and make sure they are registered and licensed. Find out if there are any complaints or suspensions against them.
Step 6: Select your new home
It is natural to fall in love with the first house that you might see; but it is not always practical. Compare a few houses and select one based on your requirements and budget. Find out why the seller is selling the house and see if you can negotiate. Make a reasonable offer based on the information you have.
Step #7: Wait for the reply
Ideally the seller should get back to you with a ‘Yes’ or a ‘No.’ But more often than not, he will always make a counter offer that is higher than your bid. You may expect a few rounds of these before you both settle down on a specific price.
Step #8: Finalize the home
If the seller accepts your offer, you may be asked to pay up a binder which is a deposit of may be one percent. This deposit is usually refundable. Also you get a few days of grace period just in case you want to change your mind.
Step #9: Consult your lawyer
Once the offer is finalized you should get the contract from the seller’s lawyer. Make sure your lawyer reviews it and goes over the contingencies carefully. Ask him to verify that the seller has a clear title and that the house conforms to the local zoning laws. The contracts are usually negotiable and you should be able to add a clause or two before you sign. However, approving them is left to the seller.
Step #10: Sign the contract
Once you have established that everything is fine, you can sign the contract and hand over the big check, which is the down payment you make based on the terms of the purchase mortgage. The money generally goes into an escrow account that will not be available to either you or your seller, until the deal is closed.
Step #11: Submit the mortgage application
If you have decided on a mortgage servicer who may or may not have come to you via purchase mortgage leads, you can submit your mortgage application along with the fees. Get an estimate of the closing costs that you will have to pay. You may have to submit some documentation as required by the lender.
Step #12: Sign the papers at the closing
Congratulations! This is the day you become the owner of your home. Take a lot of blank checks with you as you may have to write separate checks for each and every closing cost. You may want to hold that big fat bank check for the purchase price before it is handed over to the seller.
Your dream of buying a home has turned into a reality with the completion of these 12 steps. But it also puts you in debt. Many buyers think this is the biggest mistake they have made in their lives; but it isn’t. As you go on making your monthly payments, your principal will start going down, you get to enjoy tax deductions, and you also enjoy the freedom of not having to deposit a rental amount into a home owner’s bank account. It is all yours now.
Author writes for Halbart Technologies. A reverse mortgage live transfer leads generation company in New York, US.