The homebuying process as a whole can seem scary when you’re looking from the outside in. There are a lot of moving parts and different individuals involved from pre-approval to closing.
Although it might be overwhelming to think about, it’s actually a lot less complicated than you might think it is. To help you fully understand the entirety of the process, we’ll break it down into three steps.
Step 1: Getting a Pre-Approval
So you want to buy a home. Where should you start?
I know what you might be thinking, and no, downloading the Zillow app isn’t the right answer. Your first move should be to establish a personal budget and a budget for your home to fully understand your buying power.
The homebuying process all starts with a pre-approval. Your pre-approval will give you a general idea of your homebuying budget by assessing your income, pre-existing debts, credit score, and personal assets.
With your pre-approval in hand, you’ll have more of a leg-up when submitting offers for a home. This is due to three reasons: you’ll be considered a more serious buyer with the backing of a lender, you’ll save time having identified the price point of your home search, and you’ll have a quicker closing process since much of your financial information has been collected by the lender.
Getting a pre-approval is quick and easy, and will set you on the right path for a smoother homebuying process. My team will be more than happy to set you up with a pre-approval, just follow this link, fill out the form, and we’ll be in touch!
Step 2: House Hunting
With your pre-approval in hand, it’s time to start shopping for your home. With that pre-approval, you’ll have a firm understanding of your budgetary guidelines which will help narrow down your search to the homes that are within your price range.
Most pre-approvals last for around 90 days, giving you plenty of time to shop around. Once you’ve found some homes that pique your interest, your lender can help run estimates on monthly mortgage payments and closing costs for the homes that catch your eye.
Having a firm understanding of these cost structures is incredibly important before submitting an offer as it’ll ensure that you have enough within your budget to account for all of the costs associated with buying a home and avoid any snags during the closing process.
If you have any changes to your income or employment, accrue any new debts, or have an update to your source for your down payment, be sure to update your loan originator as quickly as possible to ensure that your pre-approval remains up-to-date in relation to your financial situation.
At the end of the day, buying a home is a long-term commitment in relation to time and finances, and it’s incredibly important to take your time through the house hunting process. If you wait to get a pre-approval or even update your pre-approval until you’ve found a home that you like, you’ll be putting your money and your chances at purchasing that home that you’ve chosen at risk.
If you’ve taken your time and done things the right way, once you’ve found the home that’s right for you, reach out to your real estate agent to submit an offer!
Step 3: Offer Accepted & Closing
There are few better feelings than the elation that follows the call saying that your offer has been accepted. But once your future home is under contract, what’s next?
Although having your offer accepted may feel like you’ve crossed the finish line in your homebuying process, there are still some crucial steps and deadlines to meet in order to finalize your home purchase. If your pre-approval is completely up-to-date, this part of the process will go more quickly.
First, you’ll need to confirm the rate for your loan and sign your initial disclosures, which includes all of the fine details and terms of your mortgage. Then, your lender will hire a professional to complete an appraisal on your home.
Then, to submit your loan for approval, you may need to provide updated documentation to the lender, such as a recent pay stub or up-to-date bank statements. An underwriter will then review your loan to confirm that all of the information provided is accurate and meets all of the rules for your loan program. Additionally, an attorney or title company will review the purchase and verify the legality of the transaction.
You’ll then choose a homeowners insurance policy and work with your realtor to order any home inspections that you may have agreed to conduct before the finalization of your purchase.
This process takes about 30 days. Once everything is done and dusted, you’ll receive a final approval which means you’re clear to close on your home!
Although this process seems complex and overwhelming, when you work with a member of my team, you’re guaranteed to have an experienced real estate professional in your corner to help you every step of the way. If you have any questions or want to start your homebuying process, let’s connect!