Buying a Home in 10 Simple Steps

     

     So you want to buy a home? You've saved and saved and finally have enough for a down payment and are ready to find the home of your dreams! Awesome! Now if only buying a home was as easy as buying a new outfit. All you'd need to do was go to the new home store, pick out your home, swipe your credit card and you'd be done. Unfortunately, buying a home isn't that easy, but it doesn't need to be overwhelming either. 

     Below, I'll break the process down into 10 simple steps, so that if you are ready to buy a home, you will know what to expect.

Step 1 - Find an Agent.  You can of course search online, go to open houses and try to do it on your own, but don't. The seller will have an agent working exclusively for their interests so you need one working for you. Ask friends and family for recommendations. Most people have someone they can recommend. Of course, since you are reading this blog, you already know a great agent so give me a call. 

Step 2 - Find a Lender. Not all lenders are created equal. You will be spending a lot of time working with your lender, so find one who fits your personality that you can work with. I recommend a local lender as well. Many times, local lenders know the agents. If you get into a multiple offer situation on a home, an agent who knows and trusts the lender to get the loan done on time can help your offer.
  
    If you chose a good agent in step one, they will be able to recommend lenders they have worked with in the past. If you chose me, of course I can recommend some great lenders!

Here's one I'd highly recommend.

Step 3 - Get Pre-Approved For A Loan.  We are currently in a seller's market with low inventory. That means most homes are receiving multiple offers. In fact, of the 108 homes that sold in Tracy, CA in the last 30 days, 65 percent of them sold in 14 days or less! If you aren't pre-approved for a loan your offer most likely won't even be looked at. 

     Pre-approval and pre-qualified are very different! Pre-approval means a lender has looked over your documents and as long as nothing changes between now and the time you close you will get the loan. Pre-qualified simply means you should be able to get a loan but nothing is really certain. Pre-qualifying is honestly a waste of time. Go the extra step and get pre-approved. (Did you notice above where I said "as long as nothing changes . . . "? That makes this a good time to remind you that once you have been pre-approved for a loan, don't make any big financial changes. Don't apply for a new credit card or a car loan or make a big purchase. Any big change can mess up your pre-approval, so just wait until after we find your new home.

Step 4 - Create a Wishlist.  How many bedrooms do you want? Is there a neighborhood you want to live in or a school you want to be close to? Do you need a pool? How about a 3 car garage, or a large back yard? Do you want a modern kitchen? An open layout? Now is when you start to figure out just what it is you are looking for in your new home. Think about your lifestyle and what type of home would best suit you and your family. Don't forget to think about your commute either. The city you want to live in might only be 20 miles from your work, but what is the traffic like? If you are going to commute, what is the freeway access like? Depending on where in town you live it could add 15 minutes to your commute just to get to the freeway.

     There's a lot to think about, but deciding what you want in your new home can be a lot of fun, so enjoy it.

Step 5 - Search for Your Home.  Here's the really fun part. Get online, drive around town, go to open houses and start looking for your new home. Your agent should be a big help here. Tell them what you are looking for and let them search. A great agent will be constantly watching for your new home and will contact you as soon as they find something you might like.

Start Your Search For Homes Online Here

Step 6 - View Some Homes.  Now that you and your agent have searched online and found some homes you may like, it's time to go see them. Schedule showings with your agent who will be happy to take you around to see multiple homes. Many times these will be private showings which means you get to avoid the crowds at the open houses. Viewing a home is when you can really see it and picture your family living there. Remember, pictures lie. Some agents take terrible pictures (which there is no excuse for) and when you view the home you will be pleasantly surprised. Other agents will do a lot of photoshop work to make the home look better than it really is. You won't know until you go see the home.

Step 7 - Make An Offer. You've searched and found your dream home and now it's time to make an offer. Your agent is a treasure chest of information and help at this stage. They can tell you what the home is really worth. Should you offer above or below asking price? What are some of the contingencies you can remove to help your offer stand out and what contingencies should not be removed? They can tell you what the market is like and if they expect multiple offers on the home. Your offer is much more than just price and your agent will help you navigate the offer and give you the best chance of buying your dream home.

Step 8 - Get Final Mortgage Approval. This is when your loan will be completely approved. As long as you were pre-approved and didn't make big financial changes afterwards, this should go smoothly.

Step 9 - Inspection Time. While you are waiting for your loan to finalize you will also get inspections done on the property. Your agent can recommend which inspections as well as good inspectors. Typically a pest inspection and a general home inspection are great ideas. You''ll have a chance to see if any major issues turn up. If something does turn up your agent can try to negotiate with the seller to have them fixed or reduce the selling price so you can fix them afterwards. The seller isn't required to fix them, but as long as you didn't waive your inspection contingency you will be able to back out of the contract if something does come up.

Step 10 - Close. Congratulations! This is the day you sign the paperwork and get the keys to your new home! Do some finger and wrist exercises before you show up to closing because you will be signing a lot of paperwork, but when you are done, the home is yours! Now all you have to do is unpack!

Buying a home is a big deal and most likely will be the largest purchase you will make in your lifetime. There is a lot involved and it could take awhile, but if you follow the above steps it will go much easier. And of course, the most important step is Step 1 - Hire a Great Agent!