Buyer's Guide

Mortgage lenders recommend you do not buy a home that is more than 3 to 5 times your annual household income. If you are not purchasing a home with cash, you will need a mortgage pre-approval provided by your mortgage lender. A lender will work with you to get a loan that meets your needs. Some buyers are concerned with keeping their monthly payments as low as possible, others want to make sure that their monthly payments never increase.

A mortgage requires a good credit score. You can improve your score by:

• Paying down credit card balances.
• Continuing to make payments on time.
• Avoid applying for a new credit card or car loan until you have been approved.
• Avoid making big purchases until you have been approved.
• If possible, avoid job changes until you have been approved.

In order to make your dream of buying a home a reality, you will need to save cash for your down payment, earnest money, closing costs & home inspector.

• A Down Payment is typically between 3.5% & 20% of the purchase price.
• Earnest Money is money you put down to show you’re serious about purchasing a home.
  • - It’s also known as a good faith deposit.
• Closing Costs for the buyer run between 2% & 5% of the loan, depending on the loan type.
• A Home Inspection costs $500 to $1,000.

• W2’s from the past 2 years
• 3 months worth of pay-stubs
• Bank statements (past 3 months)
• Previous 2 years of tax returns
• List of your debts & assets
• Divorce decree
• Additional income documents

So you have found THE house! Congrats! In today’s market when the demand is higher than the amount of homes available it is important to act fast!

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There are some components to an offer that make it more appealing to the sellers.

• Put Your Best Foot Forward
  • We will discuss your options and create your very best offer. Depending on the circumstances, you may have only one chance to make a good impression.
    
    
• Put Down Earnest Deposit
  • Earnest money shows the seller you are serious.
    
    
• Shorter Inspection Periods
  • Try shortening the inspection period to 10 days - if an inspection is available, check first!
    
    
• Offer to Close Quickly
  • Many sellers prefer to close within 30 days.

The Seller Could

• Accept the Offer
  
  
• Counter-Offer
  • A counter-offer is when the seller offers you different terms.
  • **You can negotiate back and forth as many times as needed until you reach an agreement or someone chooses to walk away. 
    
    
• Decline the Offer
  • This happens if the seller thinks your offer isn’t close enough to their expectations to further negotiate.
    
    
• Offer is Accepted - CONGRATS!
  • You will sign the purchase agreement and you are now officially under contract! This period of time is called the contingency period. Now inspections, appraisals, or anything else built into your purchase agreement will take place.

• Finalize Home Mortgage
• Schedule Home Inspection
• Declutter! Sort through every drawer, closet, cupboard & shelf, removing items you no longer need or like. Donate or sell items that are in good condition.
• Create an inventory of anything valuable that you plan to move.
• Get estimates from moving companies

• Schedule movers/moving trucks.
• Buy/find packing materials.
• START PACKING

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• Schedule time for closing.
• Contact utility companies (water, electric, cable).
• Change address: mailing, subscriptions, etc.
• Minimize grocery shopping.
• Keep on packing.

• Obtain certified checks for closing.
• Schedule and attend a final walkthrough.
• Finish packing.
• Clean
• Pack essentials for a few nights in a new home.
• Confirm delivery date with the moving company. Write directions to the new home, along with your cell phone number.

• Closing is when you sign paperwork and you receive your new home’s keys! Typically, closing takes four to six weeks from when you sign the contract. During this time, purchase funds are held in escrow, where your money is held safe until the transaction is complete.

Lenders are required to provide you with a closing disclosure, at least three days before closing. This will show you what your final loan terms and closing costs will be. You will have three days to review the statement. This is done to ensure that there are no surprises at the closing table. If there is a significant discrepancy between the loan estimate and the closing disclosure, we must notify your lender and title company immediately.

We will do a final walk through the home within 24 hours of closing to check the property’s condition. This final inspection takes about an hour. We will make sure any repair work that the seller agreed to make has been done. We will be sure to:

• Make sure all appliances are working properly
• Run the water in all the faucets and check for any possible leaks
• Open and close garage doors with opener
• Flush toilets
• Run the garbage disposal and exhaust fans

Who will be there:

• Your agent.
• A title company representative.
• Your loan officer - (sometimes).

The closing typically happens at the title company. You will be signing lots of paperwork so get your writing hand warmed up! Some of the papers you will be signing include: the deed of trust, promissory note, and other documents.

• Government-issued photo ID
• Cashiers check to cover the remainder of the down payment, closing costs
  and pre-paids.

Congratulations! It was a lot of hard work, but you are now officially homeowners!! Time to throw a party and get to know your new neighbors!