April 12th, 2019 7:50 AM by Jackie A. Graves, President
Now that you know who's riding with you on your homebuying
journey, it's time to map out the details of your trip. Buying a home is likely
the largest purchase you'll ever make – that's why you should take the time to
carefully plan out your path to homeownership. There are a lot of variables to
consider and everyone's journey is different, but here are general "pit
stops" you will make along the way.
Stop 1: Understanding What You Can Afford
hit the road, map out your budget. Take inventory of your finances, including
income, debts, savings, and monthly expenditures to assess how much you can afford.
Stop 2: Getting Pre-Approved
A pre–approval letter
from your lender will tell you the maximum amount you are qualified to borrow.
Having a pre–approval letter in hand while shopping for homes can help you move
faster and with greater confidence. Be sure to ask your lender how long your
pre-approval will remain valid. And remember that the pre-approval letter
details the maximum amount you can borrow. Make sure you only borrow what is
comfortable for you and your budget.
Stop 3: Finding the Right Home
Finding the right home for
your needs will have long–term impacts on both your wallet and your quality of
life. Prioritize your needs and wants and determine your deal breakers before
you get started on your search. Be sure to consider a variety of factors like
home type, location, size, taxes, and if this will be your forever home.
Stop 4: Making the Offer
found they home you want to buy, your real estate agent will submit an offer letter.
The seller may counter your initial offer but once both you and the seller
agree on all terms you will sign a purchase agreement. Once you have a signed
purchase agreement you will work with your lender to finalize the loan
application process to obtain final mortgage approval.
In this step
to secure your financing there are two main types of mortgages — fixed–rate and adjustable–rate — that have their own set
of features and benefits that you should carefully consider. Selecting the
right mortgage for you may make a big difference in your monthly payments and
the overall cost of your loan.
Stop 5: Examining the Home
keys are transferred to you, your lender will help schedule a home appraisal to
determine the home's value based on its condition and comparable homes in the
neighborhood. You should also have the home inspected to determine the
condition and report any significant repairs. It is recommended that you make
the home purchase contingent on both the home appraisal and inspection to help avoid
Stop 6: Closing Day
Once you loan
is approved your lender will schedule the closing. This is your final stop towards
homeownership where all the documents are signed and the property is legally
transferred to you.
mentioned, these are just the general stops you'll make along the way. We will
go more in-depth about each stop as we continue our spring
homebuying blog series, so be sure to follow along!
Source: To view the
original article click here