The 10 Steps to Buying a Home

It’s your first time buying a home, and you are not sure what to do. Don’t worry, it’s not just you! Purchasing a home can be challenging as it involves many steps and transactions that can overwhelm inexperienced home buyers.

However, with the help of a reliable realtor, you can go through each of these steps, and move into your brand new home.

So, here are The 10 Steps to Buying a Home, and some of the things you can expect along the way:

Step 1. Initial Consultation

Meet with a trusted realtor in your area for an initial consultation. This is crucial as it will determine how the rest of the steps will go. Your realtor will provide you with market education and orientation. Be sure to discuss your needs and wants with your realtor in order to prioritize what is placed at the top of your list and what goes at the bottom. Keep in mind that most homes are not going to have everything that you need and want.

Step 2. Get Pre Approved

Find a lender of your choice. You should be able to get a referral from your realtor. Once you find a suitable lender, you will be asked to provide documentation pertaining to your income, debts, assets, and liabilities, as well as a credit check. These requirements will help the lender assess how much they can lend you.

Once reviewed, the lender will send you a preapproval letter or prequalification letter with the amount the lending entity is able to loan.

Step 3. Home Search

In most cases, your realtor is going to set up an online portal to help you search for homes within your set criteria. Once you see something you are interested in, the realtor will then set you up for tours or walkthroughs.

Step 4. Make Offers

Once you’ve located a house that falls within your set criteria, have your realtor run a comparable market analysis to figure out what the market value of the home is. After reviewing the agreement of sale, talk through the negotiating points of the deal to write a competitive offer for the home.

Step 5. Negotiation and Acceptance

Your agent is going to negotiate on your behalf with your wants and needs in mind. When you and the seller have come to terms and agree on the final agreement of sale, both parties will sign the contract. Once that is done and executed, an earnest money deposit of an agreed upon amount will be wired or sent to the listing agent or the title company.

Step 6. Home Inspection

Home inspections are elected in the Agreement of Sale. Your agent will coordinate the inspection, and a report will be drafted after the walkthrough on the house. Once it is ready, you and your agent will decide how to move forward with the inspection results, and deliver it to the seller.

Step 7. Title Work

The buyer will order a title search to make sure that the title is clean, and that there are no liens, encumbrances, or any other clouds on the title. This is important because no mortgage company will approve an application on a property with any title issues. After the title search is satisfied, you will receive a title commitment and a title insurance policy at settlement.

Step 8. Loan application

Submit a formal application to get a loan for the house. As part of your application, you will be required to submit documentation regarding your income, debt, assets, and liabilities.

Step 9. Renegotiation

Renegotiate the deal, if necessary. This usually happens when the result of the title search and the appraisal is not deemed at par from the initial agreement by the two parties.

Step 10. Settlement

This is the final step of the transaction. This is where you, the buyer, will bring the necessary funds to close while the seller hands over the title and possession of the home in return. Both parties will sign the closing documents on the agreed upon closing date. You will also need to sign the promissory note and the mortgage to secure the funds. The seller will receive the funds via wire transfer or check, and then you will take accept the keys to the house in exchange.

I hope these steps help guide you through the home buying process and give you a smooth and successful experience!