Purchasing a home is probably the biggest financial decision you will ever make. Whether you’re a first time home buyer or you are moving on to a different home that better meets your needs, this decision must be made carefully.
Why Do You Want To Buy? Are you tired of paying rent? Have you outgrown your current home? Would you like a larger yard? Would you rather live in a different area? Do you want to shorten your commute? Having a clear sense of your reasons for buying will help you choose the right house.
Has Your Income Grown? Home ownership can be a very good investment. As you pay down the principal of your loan, you are building equity over time in addition to any market appreciation on your property.
Can You Afford To Buy? Experts recommend spending between 33-40% of your income on housing. The tax benefits of home ownership can provide a considerable advantage over renting.
Before you start shopping for your dream home, it’s a good idea to make some preparations.
Get Pre Approved With the market the way it is today it’s a good idea to speak with a lender before looking at homes. Sometimes you can afford more than you may think and sometimes less than what you may think. This also avoids you seeing your “it” home and not being able to submit an offer as offers will require a pre approval letter from your lender or proof of funds showing you can purchase it.
Be Careful With Your Finances Now is not a good time to make sudden career changes or large purchases. You want to approach home buying from a position of financial stability.
Buying a home This process requires making many important financial decisions, understanding complex issues and completing a lot of paperwork. It helps to have an expert in your corner when undertaking such a large purchase. I can guide you through the process, and can also get you access to listings before they hit the general market.
Once you’ve got those preparations out of the way, it’s time to find the home of your dreams.
Take a Drive Get to know the neighborhoods you are interested in. Drive around and get a feel for what it would be like to live in the area. Start getting a sense of the homes available in those neighborhoods.
Time to Buy Pick several homes you would like to view and we will make appointments for you to tour them. Once you have chosen “the one” we will put together an offer and send to the seller. Once accepted the process will begin
Title Company and Escrow Holder You or the seller will need to select a title company which acts as a neutral third party holding all instruments necessary to the sale. The title company will research the complete recorded history of the property, to insure that the title is free and clear of encumbrances by the date of closing and that all new encumbrances are properly added to the title. Some properties are subject to restrictions which limit various activities from building to parking restrictions. There may be recorded easements and encroachments, where others have limited rights to use your property.
Inspections Once your offer is accepted by the seller, you’ll have so many days, stated in the contract as your “Option Period”, to have professional inspectors evaluate your home’s major systems. We may recommend other inspections, such as roof, chimney/fireplace, property boundary survey, well, septic, pool/spa, asbestos or mold.
Appraisal and Lending Keep in close communication with your lender, who will let you know when additional documents are needed to approve your loan application and fund your loan. The lender will send an appraiser out to the property and you will pay a fee for this service. Appraisers are specialists in determining the value of properties, based on a combination of square footage measurements, building costs, and recent sales of comparable properties. When you are within two weeks of closing, double check with your lender to be sure the loan will go through smoothly and on time.
The hard part is behind you, but there are a few more steps before you can move in to your new dream home.
Final Inspection A few days before you take over the property, we’ll do one last inspection to make sure everything is in order.
Utilities and Services You will have to change the utilities and services of the house over to your name.
Closing Escrow When your transaction is nearly completed, the title company will provide you with a “closing disclosure”, that details all of the financial details of your home purchase. We will go over this with you to ensure its accuracy. At the last step in the buying process, the title company will have you sign the final documents, including loan documents (“deeds of trust”). When everything is complete, the title company will record the transaction for you at the County Assessor’s Office, and you will become the official new owner.