Home Buying 101

If you are a first time home buyer or it's been a long time since you've purchased a home, you need to know that while buying a home is a major decision, the process does not have to be a difficult one. The following information will help you to be an informed buyer and be successful in your purchase of a home.

The first thing you will want to do before you start looking at homes is to contact your lending institution. Your lender will help you to determine how much home you can afford to purchase and what type of loan will be the best for you. Your lender will provide you with a pre-approval letter, which will help you to verify with the seller's agent that you are qualified buyer.
Once you have your pre-approval letter, you should contact a local real estate agent to help you in your search. They will be able to give you information on the homes for sale in the area you desire, as well as find them in your price range.

To assist your real estate agent, you will need to provide to them what you are looking for in a home. How many bedrooms you need, as well as bathrooms or acreage, will assist them in finding you a home. Your criteria is very important to your real estate agent and once they have found homes that match what you are looking for, they will set up the showings for you.

Once you have found the house that you want to purchase, your real estate agent will assist you in preparing a purchase and sale agreement. The purchase and sale agreement will have the terms of the offer, such as price offered, earnest money deposit amount, financing terms, and any contingencies, such as a home inspection, that you require. The purchase and sale will also have the date you wish to close. You will want to make sure you verify with your lender how much time they will need before you can close.

If you are unsure of what price you want to offer on the home, you real estate agent can do a Comparative Market Analysis on the home. This should include similar homes that have sold within the previous year and it will help you and your agent determine the fair market value of the home.
Once you have filled out and signed the purchase and sale agreement, it will be presented to the sellers by their agent.

The seller will have three options to choose from when considering this offer. They may accept the offer as is, reject the offer outright, or make a counteroffer. A counteroffer is when they are rejecting only part of your offer and are trying to come an agreement you both can live with. If you come to an agreement on all of the terms of the offer and it is signed by both you and the seller, the agreement is now in effect and the house is under contract with you.

Once you have put the home under contract, it may take up to 60 days to close on your home. This allows the title attorney to make sure there are no issues with the deed and allows the lender to get all necessary paperwork taken care of. It will also allow you the time to get all the inspections done that you may require. Your real estate agent will help to organize all matters of closing on your home, from working with the title attorney to making sure your lender has all the necessary paperwork. You will not be alone, however, as your real estate agent will guide you through this process.