FIRST TIME HOMEBUYERS
Buying your first home is an exciting adventure! To succeed in this BIG step, you need to follow a few smaller (but critical) steps that will not only help you find the right home, but will guard you from making costly mistakes. Buying your first home is an investment in your future and this guide is your road map. When you’re ready to take your first step we’ll be here to help you. Let’s do this!
A buyer's agent is a licensed professional that represents you and your interests throughout the entire home-buying process. From searching for a home, to determining market value, to contracts and negotiations—a buyer's agent will help you navigate every step of the transaction, often saving you significant amounts of time, money, and energy. The cost of a buyer's agent is typically paid for by the seller, but who you choose to represent you is up to you. Use the questions below to help you pick an agent.
Getting pre-qualified with a lender will help you determine the price of home you can purchase, the amount of money you will need to put down, and your monthly mortgage payment. Your lender will also give you a loan pre-qualification letter, which will make your offer more appealing to sellers. It's a good idea to meet with more than one lender to compare costs and interest rates.
Fees you pay for the services to process the purchase of your home. Services may include the title company, lender, appraiser, inspector, surveyor, and attorney fee.
Usually made up of property taxes, insurance, and mortgage interest. Your bank requires you to pre-pay these accounts in order to protect their investment.
Create a wants and needs list that outlines what you desire in your first home.
Searching for a home is the fun part, but it's not as simple as searching on the MLS—not if you're going to find "the one." Searching the MLS on murney.com is definitely the best place to start—it's where you'll find the most accurate information on homes for sale in our area. Your agent also has access to homes that are not yet on the market, as well as homes that were previously on the market. Homes that are offered "For Sale by Owner," as well as homes that are not even on the market should also be considered. Your agent will help you search high and low through each of these options until you find the perfect home.
A database of listed properties established by the local board of Realtors® where cooperating brokers can share data on properties they have for sale.
A seller's asking price may or may not be in line with market value. In order to make an informed offer, your agent will need to complete a detailed comparable market analysis that helps you understand the fair market value of the property. Once you determine a range of value, you also need to decide the terms of your offer. This includes items such as earnest money amount, loan terms, contingencies, concessions, and the closing date. The seller can either accept, reject, or counter your offer with terms that are acceptable to them. Once all parties have signed a contract with agreed upon price and terms, you are now officially "under contract."
An amount of money pledged by the buyer to the seller, usually held by a title company, that shows the buyer's good faith in the transaction.
Once you put a property under contract, you should then hire professional inspectors to look for any problems with the home including: termites, structural, electrical, mechanical, plumbing, and exterior coverings. Your realtor® cannot recommend a specific inspection firm or inspector, but will provide you with a list of insured inspectors to make your search easier. After the inspector inspects the property they will provide you with a detailed list of defects so that you can either ask the seller to make the needed repairs or plan on making the repairs yourself.
Terms that have to be met in order for the purchase to proceed or be finalized. The most common contingencies are for loans, inspections, and appraisals.
An appraisal is an unbiased opinion of the property's value based upon recent sales of similar properties in the area. A professional appraiser will perform the property appraisal and provide you a copy prior to closing. The lender requires you to have an appraisal to ensure that your purchase price, which they are loaning you money for, is not more than the property's market value. The cost of the appraisal is paid for by you, the buyer, and is often included in your closing costs.
Sellers are required to provide you, the buyer, with a clear and marketable title to the property. A clear title means that there are no outstanding liens, claims, or interests on the property claimed by someone other than the seller. The title company performs a title search to ensure the title is clear, and then provides you, the buyer, a Title Commitment to insure the title after closing. Title work will also show any recorded documents attached to the property, such as covenants and restrictions, easements and right of ways. The title search is typically paid for by the seller; the Title Commitment is paid for by the buyer and is typically part of closing costs.
Once the seller notifies you that all repairs on the property are complete, it is best to have your property inspector re-inspect the repairs to ensure they were completed correctly. You may also have the seller provide pictures and receipts of repairs.
There are a few steps you'll want to take before you take ownership of your new home:
An account set up by your lender to hold your property taxes and homeowner's insurance. You pay into this account each month as part of your monthly mortgage payment, and when your taxes or insurance bill are due, the expense is paid by the bank from your escrow account. This ensures your taxes and insurance are always paid on time.
The final walk-thru is your last opportunity to see the property prior to taking ownership. The walk-thru is done to ensure the seller has removed all items from the property and that the condition of the home is unchanged and acceptable to you.
Closing day is the predetermined date written in your contract, when all closing documents are signed by both parties and all funds exchange hands. As the buyer, you'll bring any required funds (closing costs and prepaids in the form of a certified check) to the closing, and your lender will bring or wire the remaining balance (your loan amount). This is also when the seller will hand over all keys and remotes to the property. Once documents are signed and money is transferred, you are a homeowner! Congratulations!