Follow me on this path to home ownership…..
1. Begin contacting a couple of lenders. Obtain a pre-qualification or loan qualification letter to include with your offer. These letters show a more serious intent to purchase a property and shows a seller you’ve done some homework.
2. Think about obtaining an attorney as it’s recommended you have one to help with the legal side of the transaction process. Attorneys are a recommendation but important to know they are not required to close on a residential home sale. Where an attorney isn’t present to represent a buyer, the Title Agency will perform all the work for the closing. TITLE AGENCIES AND REALTORS are not allowed to provide legal advise so proceed cautiously when not using a Real Estate Attorney.
3. Consider the offer then I will work on a sales agreement to send to seller’s agent where they will either accept/counter/reject offer. An INITIAL EARNEST DEPOSIT is needed with agreement. Typically the earnest money is $5,000 ($1,000 with initial offer and $4,000 as secondary deposit to be placed in your attorney’s escrow and used to close along with the rest of your deposit funds and mortgage documents. You should get this back if deal falls through if something major appears on inspection reports, we can’t clear title or your lender doesn’t approve your loan.
4. When both parties agree on final price, contract will then go to your attorney and seller’s attorney for review where they will modify the agreement for one reason or another during the Attorney Review period, around 3 to 5 days.
5. During this time we look at hiring a home inspector (and septic company to inspect septic). Because the home’s water source is well and from a public utility company, a well water inspection is also needed.
6. Also begin searching for a Title Company for your attorney to use if they don’t have one. Title company will begin process of property background history, search for any liens on property and order a survey of the property. There is a charge for these services which are paid at closing. Info will be sent to you and attorney for review. Seller and attorney will be notified of results when search is complete.
7. When a home inspector is found, order a home inspection of the property along with septic and well water inspections. Usually 10 day period is allowed after attorney review is complete. Buyers are responsible for paying these service fees for these inspections up front and not at closing, so please be prepared to pay for these inspection services when scheduled.
8. Results of inspections to be sent to you and attorney and shared with me at your request. Additional requests to seller if needed based on inspections to address any major concerns….. Contact an insurance company to begin obtaining home owners insurance information also.
9. While inspections are being ordered and scheduled, lender process will need to begin with lender of choice to begin financing and qualification process.
10. Wait while Title company performs title search/property survey – 30 to 60 days.
11. Waiting period while lender begin process of financing options for purchase property. About 30 to 60 days, title search should come back and information shared with attorney and lender. Lender needs clear title for final qualification of home loan. Title company issues title insurance also to guaranty clean title report. If issues come up, it’s up to attorneys to figure out any discrepancies and work with lender to find out if they will move forward on financing.
12. Seller final agreement on all outstanding inspection requests and contingencies, and addendum docs added to contract if needed if additional contingencies are added to contract.
13. If inspections reports come back without issues or issues are addressed, if Title report comes back clean or issues are addressed, if Lender is satisfied with inspections reports and clean title and approve your loan, the deal goes to the closing table at buyer’s or seller’s attorney office (most times it is at buyer’s attorney). Then all documents are signed to complete final commitments to lender, attorney will work on closing documents with buyer after seller signs off.
14. Final walk through of home performed before you sign closing docs, then at attorney’s office, once all docs are signed—YOU GET THE KEYS to your new home!
15. Work on transferring utilities from previous owner to your name