Steps to follow when purchasing a home
The home buying process can and will vary based on where you are buying your home. State laws vary so you want to make sure you are dealing with someone familiar in the vicinity where you are looking to buy your new home. Also, property variations also can affect the process because certain loan types may not be available for the property type that you are looking to buy. There is never a fail-proof process on what you need to do or procedure you need to follow to remove all uncertainty in the home buying process, but if you follow these STEPS the best you can you can eliminate a lot of uncertainty as well as stress during this exciting time of our life
1st Step when Purchasing a Home: Unless your paying cash MAKE SURE YOU HAVE YOUR FINANCING LOCKED UP.
I would suggest knowing your score before seeking out financing. The CFPB has made this process not only easy but also your RIGHT to receive a FREE CREDIT REPORT. You might be surprised at what you may find on your credit report. Your credit is one of the biggest pieces to your loan file and the better your credit the easier it will be to obtain financing and the less time it will take before you can close on your loan
As I stated before, you need to make sure your lender is familiar with where you are looking to purchase your home. You also want to make sure they can offer you a broad selection of mortgage programs from FHA, VA, USDA, Special Fannie Mae and Freddie Mac Programs along with any 1dt Time home buy programs or Grants that may be available. I personally would stay away from the FAST On-Line mortgage quotes because when buying a home Fast isn’t exactly what you are looking for. You want an Expert to help guide you through this very complicated process. Also, the more programs available the lender has the more options they will be able to provide to you. Rates & Fees are also normally higher when dealing with the Large Lenders. A reduction of .5% on your interest rate could save you tens of thousands of dollars over the life of the loan. Also, any fees they charge just adds to the amount of money you will need at the closing.
Have your last two years tax returns, W2s and your most recent 60 days of paystubs ready. These will determine how much income can be used to qualify. For example, Overtime, Bonus & commissions may not be allowed due to how you get paid or how long you have been on the job. Job gaps may also be an issue when your loan makes it to an underwriter.
This is also one of the BIGGEST factors in the Home Buying Process. There are Grants, Community second Mortgages to help with your Down Payment. Then there are loans such as USDA and VA that will finance up to 100% of the value of the home. Fannie Mae and Freddie Mac just launched programs that only require 3% of a down payment. Then there is FHA requiring 3.5% of a down payment. Your Down Payment is the percentage of the home purchase price that you will need to come up with.
Real Estate Agent: When looking for a home is in your best interest to use a Real Estate Agent.
This service is paid for by the Seller
They have access to Homes listed on the MLS (Multiple Listing Service) which will provide you up to the minute listing of all the homes in the area that you are interested in.
They will also negotiate the sales price on your behalf and also put together the sales contract.
They will (SHOULD) know the area in which you are interested and can provide you with great insight.
I can not stress enough how important it is to get professional representation for The Purchase of your home. The cost may well offset any legal matters that may arise.
What they do:
A Home Inspection is NOT REQUIRED when purchasing a home. This is NOT the appraisal of the home that is done by your lender. To find out EXACTLY what the home inspection is just CLICK HERE. A professional home inspection is an examination of the current condition of a house. It is not an inspection to verify compliance with appropriate codes. It is just that, an INSPECTION of the home to make sure there are no hidden problems such as electrical issues, leaking roof, air conditioning or furnace damages or end of life, plumbing issues etc…
Conclusion: Make sure you have a GREAT TEAM that consists of