Buying a new home is complicated—especially for first-time buyers who aren’t familiar with the process. If you are thinking about purchasing a new home, it’s important to learn about the process so you know what to expect. Here are the 10 steps to buying a house:
Get Pre-Approved For A Mortgage
If you plan on financing your new home, the first thing you will need to do is get pre-approved for a mortgage. During the pre-approval process, a lender will assess your income, debts, and assets to determine how much you will be able to borrow to purchase a home. Use this information to set your budget so you know what homes you can realistically afford to purchase.
Find A Realtor®
You shouldn’t go through the process of buying a home without a Realtor® by your side. Look for a Realtor® who has experience helping buyers purchase homes in the area you are interested in. This way, you can ensure that they are familiar with the neighborhood.
Having the right Realtor® is important, so be sure to do your research. Read online reviews, ask your friends for recommendations, and interview more than one Realtor® before deciding who to hire to help with your home search.
Create A Wish List
Now it’s time to create your wish list. What are you looking for in a home? Are there certain things that you can’t live without? What features are most important to you? Write everything down and give this list to your Realtor®. Your Realtor® will need this information in order to start searching for the perfect home for you.
Search For A Home
Your Realtor® will keep an eye on the real estate market and send you listings of homes that meet your criteria. If you would like to see a home in person, work with your Realtor® to schedule a showing.
Don’t get frustrated if you don’t find the home of your dreams right away. Some people find the right home in a matter of days, whereas others spend months scouring the real estate market before finding the perfect home. Be patient.
Make An Offer
Work with your Realtor® to submit an offer once you find the right home. Your Realtor® will draft a sales contract, which will you need to review and sign before it is sent to the seller.
The seller may reject your offer, accept your offer, or make a counteroffer. If the seller makes a counteroffer, you will need to review it and determine whether or not you would like to accept or counter it. You may need to go back and forth with the seller several times before reaching an agreement.
Schedule An Inspection and Appraisal
Once your offer has been accepted, the next steps you need to take are scheduling an inspection and appraisal of the home.
During the inspection, a professional home inspector will assess the home’s roof, ceilings, walls, floors, plumbing, electrical system, and more to look for serious issues that need to be addressed. If serious issues are found, the home may fail inspection, which means the lender may not be willing to finance it.
If minor issues are found, this shouldn’t affect your financing. However, you may want to ask the seller to resolve certain issues or credit you for the necessary repairs.
The purpose of an appraisal is to determine how much the home is worth. If the appraisal comes in lower than expected, this could affect your ability to obtain financing.
Purchase Insurance
The next step is purchasing homeowners’ insurance for your new home. You will be required to show proof of this insurance to your lender in order to close on your home.
Feel free to shop around and get quotes from multiple insurance companies before deciding which policy to purchase. If you aren’t sure where to begin, ask your Realtor® or lender for insurance company recommendations.
Finalize Financing
You will need to work closely with your lender in the weeks before closing to ensure they have everything they need to finalize your financing. Your lender may ask you to submit various documents, including tax returns, bank statements, and other financial documents.
Be sure to respond to these requests from your lender as soon as possible. If you take too long to provide the appropriate documents, your lender may need to push the closing date back.
Do A Final Walkthrough
It’s in your best interest to schedule a final walkthrough of the property either the day before or on the day of closing. The purpose of this walkthrough is to confirm that the property is in the same condition that it was when the sales contract was signed.
If you discover any problems during the final walkthrough, you may need to postpone closing until these issues have been addressed.
Close On Your New Home
The sales contract will include a closing date, which is the date on which the seller officially transfers ownership of the home to the buyer. The closing date is usually set for 30 to 60 days from the date the contract was signed. However, the closing date may be pushed back if there are unexpected delays in the inspection, appraisal, or financing process. That’s all it takes to buy a new home. It may take time to find and close on the right home, but moving into the home of your dreams is well worth the wait!
