Buying a home Step By step Guide

Buying a home is a huge monumental process with lots to consider, technology has made the home buying process easier, but by no means is it easy. With lots to consider, like costs, location and style a typical new homeowner goes through a range of emotions. Using the latest tools and technology lets take a look at the home buying process in detail. 

Let's break down the home buying process into some basic steps. 

1. Determine your budget: Evaluate your financial situation and determine how much you can afford to spend on a home. Consider factors such as down payment, monthly mortgage payments, closing costs, and other expenses.

Of all the places to get started the Budget phase is the most critical as it's a very linear process and can set up all the following parameters. If you find your budget isn’t matching your expectations this is a chance to work through some early kinks. Maybe you need to start by saving up a larger down payment, or possibly you can get a gift from a friend or relative. A larger down payment will help bring down the monthly payment. 

2. Get pre-approved for a mortgage: Before starting your search, it's advisable to get pre-approved for a mortgage. This process involves meeting with a lender who will evaluate your financial information to determine the mortgage amount you qualify for. Being pre-approved makes you a more serious and attractive buyer to sellers.

Getting a Pre-Approval from a lender is really the first action step in the home buying process (unless you're paying cash) and can get you on the path to home ownership. Most Pre-approvals can be completed in as little as 30 minutes.

3. Find a real estate agent: Enlist the help of a reputable real estate agent who specializes in the area where you want to buy a home. They can help you find suitable properties, negotiate the best deal, and guide you through the entire process.

Now it's important to note, consumers are not required to utilize a Real Estate Agent. You can also hire a Real Estate Attorney, or venture off on your own and find a property that way and work with the listing agent. Keep in mind that if you choose to work with the listing agent directly that you have a few options on the type of Agency Relationship you prefer, in Minnesota this is considered Dual Agency and it does have implications for the consumer that are worth considering. 

4. Start house hunting: Based on your budget and preferences, work with your real estate agent to search for homes that meet your criteria. Visit open houses, schedule private showings, and explore online listings to find potential properties.

Create an online account to search for homes, lots of Americans turn to Zillow for all their home search needs as zillow has done a great job publishing search tools that are user friendly. eXp has listened to what consumers are looking for in a search tool and so you will have the latest features available and at your fingertips if you use my app, here is link to get started, it takes 2 minutes to create a new account and you can set up custom searches, favorite properties and more, you can even schedule a showing right there on the app. Plus all your searches are saved you can even eliminate properties that don't match so you won’t have to look twice. 

5. Make an offer: Once you find a home you're interested in, work with your real estate agent to draft an offer letter. The offer will include details such as the purchase price, contingencies, and any special terms. Your agent will submit the offer to the seller's agent on your behalf.

Making an offer can be really exciting and I tell customers and clients alike, it may be the first house or the last you look at. Making a good offer, with good terms can help you lock down the home of your dreams. The offer process has lots of steps and documents to consider and so, getting acquainted with the docs and the process can make this a lot easier when it comes time to pull the trigger. If you are getting ready to make that first offer check out my series where I break down all the documents in a single family home sale.

6. Negotiate and finalize the deal: It's common for sellers to counter your offer, so be prepared to negotiate. Your real estate agent will help you navigate this process and work to reach a mutually agreeable agreement. Once both parties accept the terms, the offer becomes a legally binding contract.

Making an offer is the starting line, many offers have a few steps to get the deal contractually settled. Often the seller will counter back with revised terms, keep in  mind though not all sellers will counter back, some will be either accepted or flat out rejected. Oftentimes your agent and the listing agent will talk about what's holding the deal up and so you may end up submitting a second offer on the same property with revised terms. Every offer and situation is unique so it's impossible to know how it's gonna go. My advice is to put your best offer forward first and go from there, you never know where the chips may fall. 

7. Complete the mortgage application: If you haven't already done so, once your offer is accepted, you will need to complete the mortgage application process with the lender you were pre-approved by. This involves providing financial documents, such as bank statements and tax returns, for underwriting.

Once the offer is accepted your preferred lender will often request some initial docs to get the file ready to submit for underwriting, if there is an inspection your lender may hold off on ordering an appraisal and submitting for final underwriting, if the clock is ticking and this is a fast close that may be changed depending on the timelines. Once the initial application is completed you'll get lots of disclosures and lock your rate. 

8. Conduct home inspections: Schedule a professional home inspection to thoroughly examine the condition of the property. This will ensure that there are no hidden issues or necessary repairs that could affect the value or safety of the home.

The home inspection includes a cooling off period to have the property inspected so that you can make an informed decision on the last day of the inspection period all negotiations must be completed, if not it can be extended by agreement of all parties. If you can’t come to terms with the seller, this is the last chance to cancel the transaction that has a clear path to getting the earnest money back. 

9. Obtain homeowner's insurance: Before closing, you will need to secure homeowner's insurance for your new property. This is typically a requirement by the lender to protect their investment.

I recommend checking to see if your current insurer offers an increased value to bundle with your car or other insurance, if you don’t love the figures you can always get a few additional opinions to see what the market has to offer. One way to impact the Binders price is to have a higher deductible, it's important to understand how that would impact your out of pocket if disaster strikes, try asking for a few ranges and pick the one best suited to your needs and finances. 

10. Closing the deal: Once all conditions have been satisfied, a closing date is set. During the closing, you and the seller will sign all the necessary paperwork, including the mortgage documents. You will then receive the keys to your new home.

Congratulations on being CLEAR TO CLOSE! This important benchmark means your mortgage application has been approved, all your disclosures are done and your loan has been funded. Way to go! 

Remember, the home buying process can vary depending on location and specific circumstances, but these are the general steps involved in purchasing a home. It's important to work closely with your real estate agent and lender to ensure a smooth and successful transaction.ely with your real estate agent and lender to ensure a smooth and successful transaction.