Steps in the Home Buying Process

Oftentimes when you begin to think about purchasing a home, the process becomes overwhelming. It is especially overwhelming when you are hearing about these days is how difficult it is for sellers. However, don’t get discouraged! Follow these steps in the home buying process and you will be on your pathway to homeownership in no time!

TALK TO A LENDER – GET PRE-APPROVED

One of the most important first steps in the home buying process to get pre-approved for a loan. The pre-approval process is incredibly important because it allows you to understand your budget. You can look at all the homes you want to. However, if they are out of your price range you will be unable to make a competitive offer, or even no offer at all.  Lenders will ask for numerous financial documents including bank statements and W2s in order to find your debt-to-income ratio. This ratio compares how much debt you have to your income in order to figure out what you can afford to pay per month. They will also go over different rates that are available to you. 

FIND AN AGENT

The next step is to find an agent that is a good fit for you. Some important qualities you want in a realtor are:

1. Good communication – both for your sake and the sake of your offers. Other agents like to be kept in close contact during the process.If they know that agent has strong communication skills it may help your offer stand out
2. Availability – You want an agent who is available to help when you need it. In the current state of the market, you have to be able to see a property as soon as it hits the market. Having an agent who is available or able to find help so you don’t miss out on your chances is critical right now.
3. Market Knowledge – This will help in allowing you to write a competitive offer! If homes are selling for 10%-15% above the listing price in a given area, you need to have the supplemental market knowledge so you are not submitting offers that won’t be competitive. 

If you are unsure where to start, you can always reach out to a real estate professional first. A good agent will have lots of connections and be able to point you in the right direction for finding a lender that will work for you. 

START THE SEARCH

Once you are pre-approved and have your agent, it is time to start looking! Your agent should set you up with an automated search to include everything you want in a home. For example, if you want a 3-bedroom, 2-bathroom, single family home in Bonney Lake, WA your agent can add all the criteria into a search and you will only be sent homes that match your requests! Try to stay away from sites like Zillow as they tend to be infrequently updated and can often be misleading.

WRITE AN OFFER

After you find a home you love, it is time to write up that offer! Make sure you are listening to your agent’s advice as they are trying to help you write an offer that will stand out. Things you will want to consider are purchase price, earnest money deposit, contingencies (financing, inspection and title), and a down payment addendum (more on these later). You should also make sure your agent is calling the listing agent to see if there is anything the sellers are looking for in particular, such as a rent back or short/long closing.

WAIT….

The stressful part is waiting…and waiting…and waiting for the seller to make a decision on which offer to select. Make sure your agent is staying in touch with the listing agent so they can have confidence that by selecting your offer the communication will be strong throughout the closing process!

It is important to remember that we are currently in a STRONG sellers market, meaning there are far more buyers looking for homes then there are homes on the market (see my blog post about market statistics HERE to get a better understanding of a sellers market.) Your first offer may not be accepted, and that is okay. There is a lot of competition right now. Some of your competition are willing to go above and beyond what you are able to do. Keep looking and don’t give up hope. Remember that the perfect home for you is out there. When the time is right, your offer will be accepted. 

INSPECTIONS and APPRAISALS

Yay! Your offer was accepted. Now the REAL fun begins. If you had an inspection, you will want to get that ordered as quickly as possible. Your lender will also order an appraisal for the home.  Once all of those come back and everything looks good, you are clear to close!

CLOSING DAY

The day has come! You have made it through closing and it is time to get your keys. You are now officially a homeowner! Give yourself a huge pat on the back and enjoy your new home. 

If you want more details on what happens during this process, be sure to download my buyers guide HERE! It is full of information to help ease the minds of anyone who is in the market to purchase a home.