Home Ownership.Below you will find an overview of the home-buying process.
Click the title to drop down the article. If you have any questions or if you are ready to start the home-buying process just reach out it will be my pleasure to assist you. Sholom Kass "Looking to buy a home? Pickup the phone and call Sholom!"
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Pre approval
If you plan on buying a home with a mortgage, before starting the home search it is important to get a Pre-approval from a mortgage lender. (don't worry if you don't know lenders I can give you some recommendations)
What is a Pre-approval?
Application: You'll need to fill out a mortgage application. This includes information about your income, employment, debts, and assets.
Credit Check: The lender will check your credit history and credit score. A higher credit score often makes it easier to get approved for a loan and may result in better interest rates.
Documentation: Prepare and provide necessary documents, such as pay stubs, tax returns, and bank statements.
With this information the lender can verify you are qualified to purchase a home and how much of a loan you can be approved for.
Here's why pre-approved buyers are ahead in the home-buying game:
-Pre-approval saves time and heartache from looking at houses you can’t afford.
-You cannot submit an offer on a house without a pre-approval letter from a lender which tells the sellers you are a qualified buyer and have the ability to close. Sellers will not wait around holding off from accepting other offers only to find out you don't qualify.
-Pre-approved buyers can generally close escrow more quickly, since most of the work has already been done.
What is a Pre-approval?
Application: You'll need to fill out a mortgage application. This includes information about your income, employment, debts, and assets.
Credit Check: The lender will check your credit history and credit score. A higher credit score often makes it easier to get approved for a loan and may result in better interest rates.
Documentation: Prepare and provide necessary documents, such as pay stubs, tax returns, and bank statements.
With this information the lender can verify you are qualified to purchase a home and how much of a loan you can be approved for.
Here's why pre-approved buyers are ahead in the home-buying game:
-Pre-approval saves time and heartache from looking at houses you can’t afford.
-You cannot submit an offer on a house without a pre-approval letter from a lender which tells the sellers you are a qualified buyer and have the ability to close. Sellers will not wait around holding off from accepting other offers only to find out you don't qualify.
-Pre-approved buyers can generally close escrow more quickly, since most of the work has already been done.
Buyer consultation
Once you have your preapproval all parties involved in the purchase of the home will get together to discuss the process of buying a home, determine your needs and review the current active inventory. Design a game plan.
Home searching
I will help identify their relevance based on the criteria we established. Ill assist you with current market value and keep you informed when new homes become available.
I have a focused system that will allow us to find your home without searching for months and having to look at dozens of home. We will discuss this during the buyer consultation.
Going to open houses and making appointments to see homes.
I have a focused system that will allow us to find your home without searching for months and having to look at dozens of home. We will discuss this during the buyer consultation.
Going to open houses and making appointments to see homes.
Submitting an offer
Submitting your offer is non binding. It is the first step. When we find the home you love and are ready for the next step I will submit an written offer on your behalf to the seller or sellers agent. The offer will include the price you are willing to pay for the home, when you would like to close the method of payment cash vs mortgage, the amount of down payment by contract signing and closing as well as any contingencies you want in the contract.
What is a Contingency?
A contingency clause in a offer or contract defines a condition that must be met or an action that must be taken before a sales agreement becomes binding.
Typically the contingency for inspection will be include in the offer and is satisfactory before going to contract.
Ernest Money deposit / Down Payment
Breaking out the checkbook and presenting an earnest money check to the seller shows that you’re a serious buyer, and it helps your offer get the attention it deserves.
A solid contract supplemented with an earnest money deposit shows a seller that you have both the resources and the desire to seal the deal.
Including a considerable deposit could even help your offer be selected over others since buyers stand to lose their earnest money if they jump ship on a real estate transaction.
Earnest money gives sellers monetary assurance that a buyer won’t back out of the contract without valid cause.
Most contracts have contingencies that allow buyers to walk away from the deal and get back their earnest money deposit . A common one is if buyer does not end up qualifying for financing.
But, if a buyer decides to cancel the contract for a reason not covered by a contract contingency, earnest money is generally forfeited to the seller.
How Much?
The earnest money amount will vary according to your area, seller and price of home you're considering. The best way to determine local customs is to talk to an experienced real estate agent. Your earnest money deposit could range anywhere from a couple hundred dollars to a few thousand. So much depends on the specific property, the competitiveness of the market and other market-specific factors.
A competitive market might mean you’ll need to put down more money. Most agents agree that buyers should include an earnest money amount that will be taken seriously, but not so much that a buyer’s finances are at risk. It’s unlikely that you’ll lose your earnest money deposit, but it’s important to protect yourself.
Who Holds The Money?
A third-party escrow agent such as the lawyer or title company, will hold your earnest money deposit in an escrow account.
The terms of the contract decide where earnest money lands if the contract is broken. Let’s say that a buyer’s contract has made the final purchase contingent on the results of an inspection. If the inspection reveals problems that are unacceptable to the buyer, the buyer can walk away from the home with his earnest money. If the buyer backs out just due to a change of heart, the earnest money deposit will be transferred to the seller.
This is one of the reasons it is important to have an experienced realtor in order to ensure you have a good contract with proper contingencies to protect your earnest money deposit.
When?
The earnest money deposit / down payment is only paid once you enter into contract with the seller.
What is a Contingency?
A contingency clause in a offer or contract defines a condition that must be met or an action that must be taken before a sales agreement becomes binding.
Typically the contingency for inspection will be include in the offer and is satisfactory before going to contract.
Ernest Money deposit / Down Payment
Breaking out the checkbook and presenting an earnest money check to the seller shows that you’re a serious buyer, and it helps your offer get the attention it deserves.
A solid contract supplemented with an earnest money deposit shows a seller that you have both the resources and the desire to seal the deal.
Including a considerable deposit could even help your offer be selected over others since buyers stand to lose their earnest money if they jump ship on a real estate transaction.
Earnest money gives sellers monetary assurance that a buyer won’t back out of the contract without valid cause.
Most contracts have contingencies that allow buyers to walk away from the deal and get back their earnest money deposit . A common one is if buyer does not end up qualifying for financing.
But, if a buyer decides to cancel the contract for a reason not covered by a contract contingency, earnest money is generally forfeited to the seller.
How Much?
The earnest money amount will vary according to your area, seller and price of home you're considering. The best way to determine local customs is to talk to an experienced real estate agent. Your earnest money deposit could range anywhere from a couple hundred dollars to a few thousand. So much depends on the specific property, the competitiveness of the market and other market-specific factors.
A competitive market might mean you’ll need to put down more money. Most agents agree that buyers should include an earnest money amount that will be taken seriously, but not so much that a buyer’s finances are at risk. It’s unlikely that you’ll lose your earnest money deposit, but it’s important to protect yourself.
Who Holds The Money?
A third-party escrow agent such as the lawyer or title company, will hold your earnest money deposit in an escrow account.
The terms of the contract decide where earnest money lands if the contract is broken. Let’s say that a buyer’s contract has made the final purchase contingent on the results of an inspection. If the inspection reveals problems that are unacceptable to the buyer, the buyer can walk away from the home with his earnest money. If the buyer backs out just due to a change of heart, the earnest money deposit will be transferred to the seller.
This is one of the reasons it is important to have an experienced realtor in order to ensure you have a good contract with proper contingencies to protect your earnest money deposit.
When?
The earnest money deposit / down payment is only paid once you enter into contract with the seller.
Property inspection
Once an offer is accepted you will schedule a home inspection in the next 24-48 hours.
A property inspection is a crucial step when buying a house, and it serves several important purposes:
A property inspection is a crucial step when buying a house, and it serves several important purposes:
- Identify Potential Issues: Property inspections help uncover any hidden or potential issues with the house. Inspectors thoroughly examine the structure, systems (plumbing, electrical, HVAC), and overall condition of the property. This includes checking for issues like water damage, faulty wiring, plumbing problems, or structural issues.
- Ensure Safety and Compliance: Inspections ensure that the property meets safety standards and building codes. This is important for the well-being of you and your family. Identifying and addressing safety issues can prevent accidents and future problems.
- Negotiation Power: The inspection report provides valuable information that can be used in negotiations with the seller. If significant issues are discovered, you may have the opportunity to request repairs or a reduction in the sale price.
- Budget Planning: Knowing the condition of the property allows you to plan for potential repairs or maintenance costs. It helps you understand the financial commitment beyond the purchase price and closing costs.
- Peace of Mind: A thorough inspection provides peace of mind for the buyer. Knowing the true condition of the property allows you to make an informed decision about whether to proceed with the purchase or reconsider based on the identified issues.
- Future Planning: The inspection report can serve as a guide for future maintenance and improvements. It provides a snapshot of the current condition of the property and helps you plan for any necessary repairs or upgrades over time.
- Protect Your Investment: Buying a home is a significant investment, and a property inspection is a way to protect that investment. Identifying and addressing issues early can save you money in the long run and ensure that your home remains a sound and valuable asset.
- Insurance Considerations: Some insurance companies may require a home inspection before providing coverage. Knowing the condition of the property may also help you determine the appropriate level of homeowners insurance.
Contract
Once all contingencies in the offer are met the next step is the contract. The Sellers attorney will draw up the contract. A list of attorney will be provided to you or you can choose your own. After you go over the contract with your attorney and it is acceptable you will sign and send together with the down payment to the sellers attorney. At that point the sellers will sign.
Congratulations you are under contract!
Congratulations you are under contract!
Applying for financing
After you signed contract the lender will conduct a more thorough review of your finances and the property. This is the final loan approval process. It is important that you respond to any request for additional documentation that the lender requires in a timely fashion.
Schedule Appraisal and Order Title.
Your lender will order an appraisal to ensure the property's value justifies the loan amount, assess the loan-to-value ratio, check the property’s condition, and comply with regulations. This protects both the lender and borrower by confirming the property’s worth and avoiding lending risks
Your attorney will order a title search. A title search is ordered when buying a house to verify that the seller has legal ownership of the property and to ensure there are no outstanding claims or liens against it. This protects the buyer from potential legal issues or ownership disputes.
Mortgage commitment
Once all conditions are met. The lender sends a letter with lender's intent to finance the purchase.
Schedule Appraisal and Order Title.
Your lender will order an appraisal to ensure the property's value justifies the loan amount, assess the loan-to-value ratio, check the property’s condition, and comply with regulations. This protects both the lender and borrower by confirming the property’s worth and avoiding lending risks
Your attorney will order a title search. A title search is ordered when buying a house to verify that the seller has legal ownership of the property and to ensure there are no outstanding claims or liens against it. This protects the buyer from potential legal issues or ownership disputes.
Mortgage commitment
Once all conditions are met. The lender sends a letter with lender's intent to finance the purchase.
Closing
If everything goes smoothly, we will schedule a closing date. This is where you and your attorney along with the sellers and their attorney will meet so you can sign the final documents. You will pay any remaining closing costs (your attorney will provide these estimates for you), and officially become the owner of the home!
Prior to the closing we will do a walk through of the property. A walk-through allows you to inspect the property before closing to ensure it’s in the agreed-upon condition, check for any issues or repairs, and confirm that everything is as expected.
Prior to the closing we will do a walk through of the property. A walk-through allows you to inspect the property before closing to ensure it’s in the agreed-upon condition, check for any issues or repairs, and confirm that everything is as expected.
