The Buyers Journey 🚀The key steps to buying a home.
✅ Step 1
Evaluate your financial situation:
Check your credit score (620+ is preferred by most lenders), how much savings you have, do you have at least 2 years of work history in the same field, do you have two years of tax returns, how much debt you have, etc.
✅ Step 2
Speak with a lender:
If you feel you are ready to move forward on buying a home, speak with a mortgage lender. A lender will get an overall sense of your financials and determine whether or not you qualify for a mortgage. If you do qualify, they will tell you what price home you can afford and write you a pre-approval letter.
✅ Step 3
Find a local Real Estate Agent 👋
Speak to a local real estate agent who is familiar with the city you are looking to buy a home in. A real estate agent will set up a search based on your personal wants, needs, neighborhoods, and budget. Your real estate agent is paid by the seller of the house you end up purchasing so you, the buyer, do not have to come out of pocket for the buyers agents’ service.
✅ Step 4
Go house shopping:
The fun part! Your real estate agent will set up showings and accompany you to see the homes you are considering. We’ll help point out red flags, provide information on each home, and give on-site advice.
✅ Step 5
Make an offer:
Time to get serious! How much do you want to offer? You and your agent discuss how much you should offer for the home but at the end you decide the number. The agent writes it up and presents it to the listing agent (the sellers real estate agent). The seller decides what offer is accepted.
✅ Step 6
Option / Home Inspection:
Once your offer is accepted by the seller, you will have a few days (option period) to get the home inspected. You hire a licensed home inspector to look through all the entire home. This is also the time your agent will negotiate repairs or concessions. During the option period, you can walk away from the home for whatever reason you want – without much penalty.
✅ Step 7
Once the option period ends, your lender will order an appraisal of the property (the buyer usually pays for this). A licensed appraiser will inspect the home, run an analysis of similar homes in the area that recently sold, and determine the value of the home. The lender is making sure the home is valued at or above what you are offering.
✅ Step 8
Move towards closing:
You’re almost there. During this time, your lender, real estate agent, and title company will tie up any loose ends, ask you for additional docs (updated check stubs, bank statements, etc), and prepare your closing docs. You will be given a closing disclosure about three days prior to closing – this doc will have all your loan details, monthly payment amount, down payment and closing cost, etc.
✅ Step 9
You show up to the title company office (they also have remote closings), you read and sign a bunch of docs that pretty much boil down to “I promise to pay my mortgage”. Once both you and seller have singed and the transaction is funded, you get your keys! 🔑 🎉 Congratulations!