Processes to Expect When You Buy a Home
Updated: May 2
Real Estate Buying Process
First, you’ll want to have the answers to these questions:
What is your price range? What kind of property are you looking for?
Are you financing your purchase? Are you pre-qualified? Pre-approved?
Do you have any pets? Any children?
Do you have any required/important amenities?
Second, find out what your purchasing power is based on your available payment level and type of financing. You will want a pre-approval, which is a full loan approval – it shows that you are willing and able to purchase a home without any financing hindrances.
Quick Recap of Loan Process
Prepare for a Loan – submit applications. Note: It is wise to consider receiving rates from multiple lenders. Do so within a 7 to 14-day period so that it only counts as an inquiry on your credit score one-time.
Begin Your Property Search & Get an Offer Accepted (Hire a professional!)
After Offer is Accepted – Escrow Period includes loan submission, underwriting, approvals, loan documents, and recording.
Close of Purchase
Third, you’ll want to secure an accepted offer but that may include some negotiations. Therefore, it is IMORTANT to hire a professional agency when you begin your property search. A professional will handle the negotiations but you should be familiar with some terminology.
Negotiation Phase Terminology
Counteroffer: this may counter terms in your original purchase offer. There may be several counteroffers shared back and forth before all parties agree on all terms.
Seller’s Multiple-Counter Offer: if there are multiple offers, the seller can use this form to counter all offers at one time. As a buyer, you want to make sure your purchase offer has terms that appeal to the seller on a personal level. The seller has the final say before the purchase contract is ratified. The seller must accept your counter.
Common terms that are negotiated: price, escrow period, contingency period, closing costs, home warranty, leasebacks, repairs, etc.
“Back-Up” position – means the seller has accepted another offer but will keep yours to ratify if the first offer cancels or falls through
Last, you’ll enter into and after typically 30 days (or the agreed upon time-frame in the contract) you’ll close your home purchase.
Quick Recap of Escrow Process
Submit EMD (refundable deposit)
Lender processes loan
Review and sign all contractual disclosures
Complete buyer’s due diligence: inspections, appraisal, loans finalization, etc.
Sign all loan and title documents
Closing of purchase
These are a few of the major processes you’ll encounter on your journey of purchasing real estate property. Depending on your real estate purchase’s circumstances you may run into few other kinds of processes that are specific to certain transaction types such as: short sales, foreclosures, probates, trusts, and REO’s. Encountering these kinds of transactions is evidence of how important it is to hire a professional real estate agent or brokerage to represent you . If you would like additional information on Why You Need a Buyer’s Agent check out my other blog post.
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