The 8 Steps to Buying a Home

Begin only when you are ready to buy. Ask yourself when do you need to be settled? How will moving in sooner or later affect you? Who is involved in the purchasing process? Are all parties committed? How will your job and current living arrangements affect your decision? What are your financial strengths and weaknesses? If you have to sell your current home should you buy or sell first? These are just some of the questions you should ask yourself before you consider buying a home.

Once you've answered these questions you should ask yourself the most important question of all "If you found a home tonight that met your needs, would you buy it?" If the answer is no, then don't look now. Finding your dream home before you are ready to buy will only make it harder to shop in the future. What good is it to compare all future homes you look at to a home you saw when you weren't able to buy it?

Once you've decided you are ready to buy find an agent you are comfortable with. Get to know the agent and let the agent get to know you. Building a relationship with your agent will save you time and effort. An agent who knows what you are looking for will be better able to serve you by narrowing down the number of homes you will have to view to only those which fit your criteria.

Meet with a loan officer and get pre-approved. A loan officer will be able to help you determine how much you can afford based on your credit, income, and how much you comfortable with as your monthly payments. In addition, a loan officer will be able to advise you of any possible problems with your credit that may affect your mortgage application.

Determine the physical and lifestyle requirements of your home. Physical requirements include factors such as square footage, number of bedrooms, number or bathrooms, etc.. While you may find a home that meets all of your physical requirements you must also think about your current and future lifestyle. Do you plan on getting married or having children soon? Do you like to entertain or have a large family? Do you have any hobbies or participate in any sports that will require the storage of any large equipment?

How many homes will you have to view before you find your dream home? The answer is different for every person. You may find your dream home the first day out or it may take weeks or even months. Picture your furniture, family and friends in the space. Can you decorate the space to your tastes? What can you do to make this home your home? Are any objections to the property easily rectified? Is the only thing you don't like about the home an ugly counter that can be easily replaced or a badly painted room that can easily be repainted? If so look past these minor imperfections.

Determine the terms of the purchase. Remember you are buying a home, not it's contents. Don't get caught up on small items such as fixtures, furniture and appliances. Also don't get caught up in trying to get a good bargain or what you may think the sellers profit is, you should be concerned with value. Are you getting the home at a reasonable price that you can afford? Make sure you determine a closing date that will work for you. Work out all the contingencies such as the mortgage commitment and home inspection contingencies.

Once your purchase agreement has been presented to the seller there are four possible outcomes. (1) The seller may accept the offer as is, (2) The seller may reject the offer, at which time you may present an entirely new offer (3) In the case of multiple bids the seller may accept a competing offer, (4) The seller may counter your offer at which time you may then agree to the counter, reject the counter, or re-counter their offer.

Once your offer is accepted your mortgage company will order an appraisal, run a credit report and conduct an income and deposit verification. A title search and home inspection will be ordered. Once all this is completed your mortgage will then go into the loan approval, or underwriting, process. You will receive a good faith estimate from your mortgage company which will include all the fees required for your mortgage. Closing costs usually amount to 2-3% of the purchase price of your home. It is now up to you to coordinate your moving arrangements.