Buying A Home
Buying a home can be daunting and maybe you aren’t sure where to start. We aim to simplify the process of buying a home and show house hunters that this does not need to be a stressful decision. We are here to walk you through the home buying process and show you how easy it can be.
STEP 1 – FINANCING
Finding a mortgage lender. You can shop for a loan with several banks and mortgage companies to see who has the best fit for you. We can help to guide you with some good choices. You can usually get a good idea with 2 or 3.
Different loan programs. An FHA loan is great if you don’t have a big down payment and they are the easiest to obtain. FHA requires a minimum of a 3.5% down payment. FHA also requires private mortgage insurance (PMI) so you will add that to the interest rate that is quoted. If you have a bigger down payment, 5% or more you may qualify for a conventional loan. With conventional loans the interest rates are generally lower because you don’t have to pay PMI. There are also VA loans for Veterans that don’t require a down payment at all. There are several government loan programs that can help with down payments or closing costs. Several lenders also have programs that will help with closing cost.
How much will it cost you? Besides the down payment, you will have other associated cost. Your lender will charge loan fees and then you will also have title and escrow fees. It’s a good rule of thumb to plan on up to 3% for those. So at the minimum, you should plan on having 6.5% of the sale price of the home saved for closing.
The Buyer’s Advantage:
The Realtor’s commission is paid by the seller
of the home. Their representation as your Buyer’s Agent
doesn’t cost you a thing!
Deciding what you are comfortable with paying. Prepare by determining what you are comfortable with spending per month with considering your other monthly expenses. Your new home may have a homeowner’s association and sometimes a few. That along with property taxes and insurance will be added into your payment. Your Realtor can help you to make those calculations.
Make an appointment to talk to the lender in person. You will be best prepared if you bring your last 2 paystubs, bank statements, and tax returns. The lender will run your credit to see what your FICO score is, income and expenses, they will calculate how much house you can purchase. In general, banks will lend up to 28% of your yearly income.
STEP 2 – FINDING YOUR HOME
Now you are ready to start looking for your new home! You will be armed with a pre-approval letter that states how much you are qualified to purchase and what type of loan you will be getting. This letter is important because it will allow us to submit offers.
Meet with us. Now you have the finances in place and how much you can spend. Sit down with your Realtor and discuss what is important to you for your new home as well as your needs and wants list. You will likely already have a good idea of what area you like but your Realtor can help guide you depending on your preferences.
Start the search! Our MLS program can separate homes very narrowly such as by school districts, lot sizes, hoa fees, bedrooms/bathrooms, square footage, single family home, townhome or condo. Together you can sort through hundreds of homes and start narrowing it down.
Make sure the home meets your needs, covers a
few of your wants, and most of all, is a sound investment. We will help you to sort through of all of this.
House Hunting. This is the fun part! We will schedule to show you all of the homes that you picked out. We will have all of the detailed information at hand so we can do a breakdown of your payment along with all of the associated costs like taxes, homeowners insurance and HOA dues.
STEP 3 – THE OFFER
Putting in an offer. Once you have decided on a home, we will sit back down and do some research of what the homes have recently sold for in the neighborhood. This will allow us to put in a realistic offer. We will then write your offer based upon the price and terms that you have decided upon.
‘You need a good Realtor that will represent you exclusively through all of the contract negotiations and have your best interest.’
Negotiating your offer. We will then submit and discuss your offer to the listing agent that works for the seller. Once both you and the seller agree to terms, your offer will be accepted and you will go “under contract” this means that the home is pending sale for you and no one else can purchase it.
STEP 4 – THE PROCESS
Opening up escrow. We will send the final executed contracts (signed by all parties) to the title company and you will be required to put an Earnest Money Deposit into a new escrow account that has been created for you. You will then wire that deposit to title company’s escrow account from your bank.
Your due diligence period. This is your period (usually about 10 days) to do your inspections, review the sellers report on repairs that have been made, read over the homeowners rules and regulations, and generally determine that you want to move forward with purchasing the home. It’s a good idea to have a licensed inspector check the home in regard to plumbing, electrical, mechanical, structural, heating and cooling, water heater, etc.
Your loan period. As soon as your offer is accepted, your lender will have you fill out an application and start getting all of the needed documentation from you. They will also order an appraisal to be done on the property. This is to insure that the price you have agreed to pay is the true value of the property. It generally takes about 14 days for the appraisal to be ordered, conducted, and the report returned to the lender for review.
Moving forward. Now it’s all in the hands of your lender. They will be working on financing your loan and we will be determining if based on the inspection, if there are any repairs or renegotiating that needs to be done.
STEP 5 – THE CLOSING
Loan documents. It takes about 3 weeks until your lender has your loan documents prepared. They will send them to you to review and accept. After that there will be a 3-day waiting period (TRID law). Once that period has lapsed, your lender will prepare your loan documents for you to sign at closing.
The signing. Once the title company has received your loan documents, we will be notified that you will need to set up a time to sign your final closing documents. It is at this time you will need to have your final funds for closing ready. The earnest money deposit will be deducted from your down payment and the remainder of the down payment, your lender fees, and title and escrow fees will be due before or after your signing and wired again from your bank into your escrow account.
The closing. The Seller will also be signing their title and escrow documents to transfer the property to you. After everyone signs, your lender will “fund the loan” meaning sending the money they are loaning you to the title company. The title company will do all of the final processing to transfer funds to the seller and send the deed to the property to the Clark County Recorder’s Office to record the property in your name.
The keys! Once we have confirmation that the property has recorded in your name, we will meet at the house or a convenient location to give you the keys to YOUR NEW HOME!
We are there for you every step of the way.