No two home buying experiences are alike in Florida or anywhere else, and some find the process of buying a home a bit distressing or overwhelming. Here are some home buying tips to help with your process.
Most real estate agents and mortgage lenders recommend pre-qualifying for a loan before selecting a home to purchase. This process will help you:
- Determine the price range you can afford
- Understand the types of loans you qualify for
- Determine what your monthly payment will be
The Loan Process
Most real estate agents and mortgage lenders recommend pre-qualifying or getting pre-approved for a loan before selecting a home to purchase. You will have a stronger offer for properties if you are able to submit a prequalification or pre-approval letter with your offer to purchase a home. Pre-approval is the stronger of the two options.
There are four basic steps to the loan process which, except for loan pre-approval, are completed after you have an accepted offer on a property. The four steps are:
Application: A loan application is submitted by you as the buyer to a qualified lender. The lender will provide a list of documents needed to support your application. Fees and down payments are discussed, and you as the borrower will receive a Good Faith Estimate (GFE) and a Truth-in-lending statement (TIL) from the lender, itemizing the rates and associated costs for the loan.
Loan Submission: Once all the necessary documentation is in, your completed file is reviewed by the lender before going to loan underwriting for approval.
Loan Approval (Underwriting): Loan approval, or underwriting, generally takes 24 to 72 hours. All parties are notified of the approval or any loan conditions that must be met before the loan can close.
Closing: Once all parties have signed the loan documents, they are returned to the lender. If all the forms have been properly executed, the lender sends the loan funds by wire transfer to the escrow company pending recordation of the closing of the property.
Before deciding which house to buy, think about your lifestyle, your current and anticipated housing needs, and your budget. Additional factors to consider in selecting a property include location, bedroom and bath count, schools and amenities. It’s a good idea to create a prioritized list of features you want in your home–you’ll soon discover finding the right house involves balancing between your “must-haves” and your “nice-to-haves.” Based on criteria that you establish, your real estate agent will help you find the perfect home.
As your agent, I will apply my extensive community knowledge and professional resources to research available properties, and show you the homes that best meet your needs. If you find a property that interests you through the Internet or your own research, let me know so that a showing can be arranged.
Once you have found the home that you wish to purchase, I will apply my professional training and do all the necessary research to help you structure an effective offer.
This is where my negotiation skills come into play. When an offer is made, the seller will have the option of accepting, rejecting or making a counter offer. I will help negotiate the best possible terms for you.
I will draft the purchase agreement, advising you of protective contingencies, customary practices, and local regulations. Home warranty, title and escrow arrangements will be detailed in the offer. Although I will give you advice and information, it is your decision as to the exact price and terms that you wish to offer.
Managing the Escrow
When the purchase agreement is accepted and signed by all parties, I will open escrow for you and your initial earnest money will be deposited with escrow. The escrow company is a neutral third party that will receive, hold, and distribute all funds associated with your transaction.
Prior to closing escrow, all of the contingencies of the Purchase Agreement must be met. I will coordinate this process. Typical contingencies include:
- Approval of the Seller’s Property Disclosure Statement
- Approval of the preliminary title report
- Loan approval, including an appraisal of the property
- Physical inspections of the property
- Pest inspection and certification
- Acquisition of homeowner’s insurance
Closing Escrow and Moving In
When all of the conditions of the purchase agreement have been met, you will sign your loan documents and closing papers. You will deposit the balance of your down payment and closing costs to escrow and your lender will deposit the balance of the purchase price. The deed will then be recorded at the County Recorder’s office and you will take ownership of your home.
As your real estate agent, I can be a valuable source of helpful tips for planning and coordinating your move.