Owning your own home can be an incredibly rewarding experience. In addition to the intrinsic benefits of owning your own home, home-ownership can take a primary role in the future of your financial freedom. After all, everyone needs a place to live; and why throw your money away in rent when you have the possibility of building up equity and becoming debt-free.
While there are certainly valid reasons to rent in the short-term, eventually, most people find it beneficial to buy. When the time becomes right for you, it's critical you are prepared and have the information you need to make informed decisions. The steps below are designed to give you a high-level overview of the home buying process.
This is the critical first step of the home buying process. Don't worry about shopping lenders at this point (that can come once you find the right house). At this point, you want to know the available loan options to you, down payment requirements, and monthly payment.
Negotiating power. In addition to the critical information a pre-approval provides you, it's also a necessary step to give you the most negotiating power when you make an offer.
Don't just call any lender. The Idaho Real Estate Center has a team of lenders committed to provided you the best service and best rates. Call Sean Palmer at Idaho Central Credit Union. His direct line is 208-846-7109. You can also start by filling out their online loan application (please note Sean's in the application).
You need a great Idaho Realtor on your side. You don't want "a" Realtor, or a "good" Realtor, you want a "great" Realtor. After all, buying a home is one of the largest financial decisions you'll make. The Idaho Real Estate Center Realtors are dedicated to helping you find the right home, at the best price possible.
How much does it cost? In Idaho real estate transactions, it's customary for the seller to pay Realtor commissions, so using a Realtor when you buy your home costs you nothing. Some buyer's agents may charge you a fee or guarantee a minimum commission. At the Idaho Real Estate Center, we do not.
There's a lot to know when buying a home- everything from area of town, to contracts, to negotiations, to inspections, to loan-underwriting, to title and escrow. Our professional team of agents is by your side every step of the way helps you through the process and avoid common pitfalls.
Your Realtor will be happy to consult with you either over the phone or in person. In the initial meeting, your agent will ask you some preliminary questions: what parts of town are you interested in, price range, bedrooms, bathrooms, etc.
Based on this information, your agent will set up a customized search using the Realtors' database of properties. While the general public can find homes for sale online, Realtors have direct access to the central database ensuring you the most accurate, comprehensive, and up-to-date information.
Your agent will then provide you the initial list of matching properties via email. Looking through these listing details and photos is going to help you begin to learn the market and the options available.
Additionally, and just as importantly, your agent will set up an automatic email notification for new homes that come on the market that meet your criteria. This will help you watch for the best deals and best opportunities.
Once you've identified the homes for sale that appeal to you, simply send the MLS #'s to your Realtor and schedule a time to view the properties. Generally, looking at 6-8 homes a day is about the maximum you'll want to do. While more can be viewed, going beyond 6-8 showings makes it more difficult to remember which homes had what features.
Your Realtor will help educate you on the homes, the area, and the "red flags" to look out for.
Once you've identified the right home, you and your agent will discuss an offer strategy. Your Realtor has access to information that can help in the process (recent sales, market conditions, length of time on the market, owner motivations, etc.).
Unless the property is a short sale, you'll typically get an answer to your offer within a day or two. And barring unusual circumstances, you will typically close (take ownership) of that home within 4-6 weeks. Short sales typically take 2-6 months to get an answer on your offer (your agent will explain these various sale types to you).
a) Inspections. Once your offer has been accepted, the first step is to order the home inspection. Your agent will have a list of recommended professionals you may use. If the inspection goes poorly, you have several options*:
b) Appraisal. Once you've completed the inspections, your lender will order the appraisal to confirm the home is worth no less than the purchase price.
c) Final Underwriting. Once the appraisal has been completed, your loan package will be submitted to "final underwriting". While you were conditionally approved (pre-approved) at the start of the home buying process, this will be the official and formal approval.
d) Final Walk-Through. The purpose of the final walk through is to confirm that all of the seller agreed upon repairs have been completed and that the house is in substantially the same condition it was at the time the offer was made.
e) Sign Documents. The buyer and seller will sign the closing documents at the title company (separately). Commonly misunderstood, this is not the time you get the keys.
f) Funds, Records, and you get keys. Once all the documents are signed the lender will wire the loan funds to the title company. Once the title company has all the necessary funds for the purchase, they'll release the property to record at the County. Once these two steps happen, you're officially the owner and now able to get the keys.
Your Idaho Real Estate Agent will be with you every step of the way to guide you through the complicated home-buying process. Please don't hesitate to call with any questions.
Contact us for more information about first-time home purchasing.
*Disclaimer: Your rights depend on what is written in your specific purchase and sale agreement.