The journey of buying a home starts long before you say, "I am ready to buy!" There are many things that should be considered months, even years before you decide to purchase a home. As your Realtor, I will provide you with information, resources and access to my network of professionals to get you prepared within the timeline you desire. Whether that be 2 years or 2 months!
There’s a lot that buyers can do to make the process smoother. Here are ten tips.
1. Prepare Your Credit and Finances
Preparation is key! Before starting your home buying search, it is important to do a "pulse check" on certain things that can dramatically impact you during the homebuying process. Things such as your credit score, credit history, down payment/closing cost availability and work status have a dramatic impact when buying a home. These things directly impact how much you can be approved for, your interest rate and so much more. I will guide you early on how to address each of these things so once you are ready to buy you are in the best position possible! With my trusted network of real estate professionals, you will be ready to buy in no time.
2. Choose a Trusted Realtor
Choosing a Realtor to accompany you on your homebuying journey is such an important choice. It is important to do your due diligence and select a Realtor who is honest, knowledgeable, and patient. And most importantly, select a Realtor who puts you first and values ethics and human compassion. Not all Realtors are created equal; be sure to take your time and find one who you mesh well with.
3. Have a Buyers Consultation With Your Realtor
Investing in a home is one of the most important decisions you’ll make and for most people it is the largest investment they will have. Your home is where memories will be made. It is also a valuable financial investment that allows you to build a strong financial foundation for your future.
As your Realtor, everything I do on your behalf will be motivated by your wants and needs for your new home, neighborhood and life dynamic.
We will start with a consultation to narrow down what you really want in a home and what's most important to you. We will discuss things like the area and neighborhoods you desire the most. Your neighborhood is an extension of your home. It is important to consider things like commute length, schools, local amenities and ease of access to everyday necessities. I will provide you with information for your specific neighborhoods - including lifestyle trends, walkability ratings, local restaurants, and more.
One thing that sets me apart from others is my vast knowledge of the local school district. As a former teacher and district admin that has worked with almost every school in the district in some capacity, I can provide valuable information about specific schools, district programs and much more as it relates to the areas you are considering to buy a home.
Once you have identified the neighborhoods that you are most interested in, we will identify things you want most in your new home. Such as the number of bedrooms and bathrooms, private yard or pool, updated kitchen, 3 car garage etc. We can narrow this down pretty far but there will always be nuances to every home. I will use my expertise to help guide you in your decision making.
4. Get a Prequalification With A Trusted Lender
It is important to get pre-qualified to determine what you may be able to comfortably afford. Prequalification is not the same as preapproval. Prequalification provides a very rough estimate of what loan amount you may qualify for based on very rough estimates of income, current debt and your credit score. Lenders will usually do a quick calculation based on information you provide to give you an idea of what you may be able to be approved for.
5. Get Pre-Approved!
Once your credit and finances are in order, it's time to get preapproved! It is important to get pre-approved to determine what you can comfortably afford. It allows us to move fast when we are ready to make an offer as being pre-approved increases the strength of the offer you submit!
Preapproval is different from prequalification in that lenders will usually ask you for verified documentation of income(pay stubs, W2s, tax returns etc) and a hard credit report among other things. This will allow a lender to determine what you are approved for and what you can comfortably afford. Preapproval is recommended for buyers who are ready to search for homes and have solid credit, income and down payment availability.
A mortgage preapproval typically lasts about 60 days. I am happy to suggest a list of trusted mortgage professionals I highly recommend if you don't have one of your own yet.
6. Let's tour Homes!
Now, the fun part begins! We’ll work together to get an accurate idea of your price range, an estimate of your monthly payments, and a pre-approval letter, so we can move quickly if need be. We will plan a tour schedule that considers both our schedules and each homes unique circumstances carefully. Some homes need to be viewed ASAP and others may have a more flexible timeframe depending on the specifics of each listing.
We will typically tour homes together. You are welcome to bring along any co-buyers, friends, or family you’d like to join you! You will have thoughts and reactions with each home we tour. I’ll help guide you in regards to each home's pros and cons and help evaluate priorities in the context of what’s available in your price range.
It’s a good idea to see several homes before making a final decision. This allows you to compare multiple properties and make a more informed decision. But sometimes, the first house is "the one" and that is ok too! Trust me, the home that is perfect for you will come at just the right time.
Consider these things when touring homes:
- Check the overall condition of the home.
- Keep track of important information and questions by taking notes and pictures. I will provide you with a touring kit to take notes!
- Look past the cosmetic features of the home that can be changed. Instead, consider if the house has "good bones."
- Consider the location and neighborhood. How will living here impact your commute and overall quality of life? I will provide neighborhood insights and data to help you make informed decisions.
- Does the property have a HOA? If so, we can discuss the rules and determine if you are comfortable with them.
7. It's Time to Make an Offer!
After you’ve found a home that you love, I’ll evaluate the local market and prepare a strong offer that is reasonable given the market data and most importantly puts your needs first. Your offer will be written using the most recent as-is offer forms issued by the Florida Realtors organization.
Your offer will include the following:
- The offer price
- Any Terms – such as a request for closing costs, financing, appraisal and a home inspection contingencies.
- A Target date for closing
- Terms for the earnest money deposit – I will advise you about what amount your deposit should be based on local norms and current market conditions.
- Offer Expiration date
After we submit the offer, we wait for the listing agent to update us on the status of the offer. If there is little to no communication after 24 hours, I will reach out myself for an update. If the seller has received more than one offer, the following can happen:
- The seller can accept the "best offer" immediately. The best offer is very subjective and depends on the seller's priorities. Some sellers prioritize a quick closing date while others prioritize the highest price. Some prioritize a short inspection period.
- The seller can counter(see below) every offer to try and solicit a better price and terms from each buyer.
- The seller can counter only one offer that’s close to what they want
If a counteroffer situation arises, we will work together to analyze the sellers priorities, and to discuss possibly adjusting contingencies and/or adjusting the offer price. We can also discuss walking away from the deal if the counter offer is not something you are interested in or comfortable with. Your needs come first!
What is a counteroffer?
The seller can accept your offer as is, or they can make a counteroffer with adjustments they are requesting to the offer. For example, they can counter with a price of 380k vs the 375k you initially offered. Or, they can counter with a sooner closing date or shorter inspection period.
You can accept or reject the counteroffer as is or revise the counteroffer. Once all parties agree on a set of terms, the contract is final. If you don't accept the counteroffer or issue a counteroffer of your own, the contract is not executed and we move on to the next property.
8. Offer Accepted - Let's Schedule A Home Inspection!
During a home inspection, a licensed home inspector will check all the major systems, appliances, and structures in the home and evaluate the condition of each one. After, they will send you a report that identifies that state of each of the major parts of the home and any potential problems, repairs or maintenance that should be done.
After we receive the report, we will analyze it together and discuss the findings. In some situations, the report reveals issues that may be a deal breaker for you and cause you to walk away from a house. Or, sometimes the findings indicate repairs that the seller can make before closing or provide a closing credit so you can take care of the repairs yourself after closing. You can also have an information only inspection and just want to know the condition of the home. This type of inspection is common with investors who plan to renovate the property.
I will attend the home inspection with you. This allows us the opportunity to see any issues first hand and ask the inspector lots of questions!
The home inspection can seem like a scary phase in the homebuying journey. But is one of the most important. A home inspection has the potential to reveal things that are not visible to the naked eye and helps to empower your decision making. I’ll be your partner every step of the way! I also have a number of trusted home inspectors I can recommend when the time comes.
9. Appraisal - Is Your Dream Home Worth What You Offered?
Before you close on your home, you(and the bank) will want to make sure the home is worth what you have offered the seller. There could be nothing worse than paying more for a home than its worth! That is where an appraisal comes in. A certified appraiser chosen by the lender will come to the home and compare the property and its features to other homes that have sold recently. They will use that data and other calculations to determine the home's value.
After, the appraiser will provide the report to the lender. If the homes appraises for equal to or more than what has been offered we are all clear! If not, the bank will most likely not lend more than the house is worth and you will have some important decisions to make:
- We will go back to the seller and explain that the appraisal came back lower and we will renegotiate the price.
- If the seller does not want to lower the price, you have two options:
- Put down the difference yourself(not recommended in most situations)
- Walk away from the deal and exit the contract(this is why we have an appraisal contingency in the contract)
When market conditions are favorable, most sellers will accept the counteroffer to lower the price if the appraisal comes back lower than the contracted price. This is usually to avoid having the deal fall through and prevent their house from sitting on the market longer than expected.
10. Clear To Close!
As your closing day nears, it is normal to feel nervous and excited all at the same time! Soon, you will have keys and you will officially be a homeowner.
We will stay in constant communication with your lender and the title company. Avoid applying for any new credit! I will confirm that any contract contingencies have been fulfilled and we will do a final walkthrough 24 hours before closing
The following things should be done before closing:
- Confirm that your contract contingencies are resolved, including the home inspection, an appraisal, and your financing.
- Finalize your homeowners insurance policy and provide the information to lender and title company as instructed.
- Review your closing disclosure form, which you’ll receive three days before your settlement, and ask questions if you don’t understand something! It is very important to review the closing disclosure and catch any mistakes before hand.
- I will schedule a walk-through of your new home within 24 hours before your closing to check its condition.
What happens at the closing?
We’ll be finalizing all of the paperwork to close on the sale of your new home. Closing can take up to a few hours. Make sure to bring appropriate forms of ID, a check for any missed expenses and any other materials required by the lender or title company.
Congratulations! You’ve got the keys to your new home!
Be sure to keep all your documents in a safe place. A fire and water proof safe is the best option. Also, be sure to change your address with the local post office and forward your mail for at least 1 year. Contact the local utility companies to add new service or transfer your service address. Once you are in your new home, be sure to change to locks and setup any new security programs.
Now, sit back, relax and enjoy your new home in all its glory...you deserve it!
