Home seller profits are soaring as home prices set new records in the pandemic. Home sellers nationwide in 2020 saw a home-price gain of $68,843 on the average sale—that is up from $48,500 two
A Beginner's Guide To Homebuying
Dated: November 16 2020
Buying a home is often a major dream, but it can be overwhelming. For most of us, it’s the biggest purchase we will make in our lifetime. I’m going to try to demystify the process here.
Checklist: Buying A Home Step By Step
Before you hit open houses, you should sign on with an agent and begin the process of getting preapproved for a mortgage or loan.
Questions for potential agents
Copies of recent pay stubs and statements
Copies of your past two W-2s
Starting The Search
After preapproval, you are ready to start the search. Be prepared to discuss what you’re looking for in a future home with your agent.
List of preferred neighborhoods
List of features you want in a home
Submitting The Offer
When you find a home you love, you’ll work with your agent to create an offer.
YOU’LL NEED ALL OR SOME OF THESE:
Seller disclosure form
Personalized offer letter
List of comparable sales from your agent
Congratulations! Your Offer Was Accepted!
Next Up: Signing The Contract of Sale
Your realtor will give you the contract and take your down payment. Your down payment is placed in a Trust Account as specified in your contract. Your agent will walk you through each installment of the down payment. Then you start your second set of steps.
Your Due Diligence
Find a home inspector you trust and consider additional inspections if your home is old or you’d like to further investigate potential issues.
List of recommended home inspectors
Homeowners’ Association documents or guidelines
You’ll want to be present during the home inspection so you can ask questions and see potential problems for yourself before deciding which repairs to request.
List of utility providers and phone numbers
Start The Mortgage Process
Now that the home-buying process is off to a good start, be sure to call your mortgage lender to lock in your interest rate — or be prepared for potential surprises at the closing table.
Inspection Report Comes Back
When the home inspections are complete, you’re ready to ask the seller for repairs. Consult your real estate agent to make sure you ask for the essentials — and skip the small stuff that could put your purchase at risk.
Your Lender Will Want To Make Sure The Property Appraises For More Than You’re Paying
At this point, your lender will request an appraisal. As a buyer, you can’t do anything to influence this process, but it’s a good idea to confirm that one has been requested.
Don’t Forget About Homeowners Insurance! You Will Need It For The Mortgage
As you approach your closing date, you’ll need to secure homeowners insurance on your new home. Be prepared to comparison-shop, but don’t skip this important step.
Quotes for homeowner’s insurance
Appraisal Comes Back
When the appraisal is complete, assuming the value is in line with the agreed-upon price, the mortgage process will continue. If not, you may be headed back to the negotiation table (or you may need to come up with the difference in cash).
Check In With Your Loan Officer
A few days before closing, your paperwork — including the appraisal, income statements, assets, and more — is shared with your loan underwriter for a final review.
Two days before your closing date, your loan will receive final approval, and the loan documents will be ordered.
The day before your closing, an escrow officer or closing attorney calculates final costs and credits for buyer and seller.
The Final Walk-through
At a time selected with your Realtor, the two of you you look everywhere inside and around the home one last time. Be sure that everything that’s supposed to be there is present and in the condition you expected, with nothing unwanted left behind.
Closing day! Be prepared to receive the keys, hand over your down payment and closing costs, and be ready to spend at least an hour signing a pile of documents.
A cashier’s check for your down payment and closing costs
Once everything is signed and processed, the loan closes and property transfer is recorded. You’re a homeowner!