11 Steps Away From Buying Your Dream Home

 There is no doubt that the market for houses has been on fire recently. More and more people are taking advantage of low interest rates and easy mortgage loan terms to go from being renters to being home owners. With so many people entering the market, it is inevitable that questions will arise.

There are many things to consider when buying your first home. Some of the most important steps to buy a house are:

Step 1: Learning the home buying process

Start by learning as much as you can about how the home buying and mortgage application process works. Read as much as you can about buying a home. Check out the many books in your local library that offer hints to first time home buyers. Read financial web sites on the internet for tips for first time home buyers. You may even want to sign up for a class aimed at first time homeowners. Many towns and cities offer these kinds of classes, and they can be a great source of information for the buyer looking for his or her first home.

Step 2: Find out the pre-qualified price range

It is important to find out how much you can borrow before you start looking for a home. Talk with several mortgage lenders in your area and get pre-qualified for a particular price range. The mortgage lender will be able to help you determine how much you can borrow based on your annual income. In general, mortgage lenders recommend that all home related expenses, including the mortgage payment, insurance premiums and real estate taxes, do not exceed 28% of your monthly income.

Step 3: Get Pre-approved for mortgage loan

The next step is to get pre-approved for mortgage financing. This is similar to getting pre-qualified for a price range, but it is a more formal process. You will need to supply proof of your income for the pre-approval process to move forward. Most lenders will want to see income tax returns from the past two years as proof of the income you are claiming.

Step 4: House hunting

After you have been pre-approved for your mortgage loan, it is time to actually start house hunting with a realtor (find out why you need to find a realtor before buying a house?). Your mortgage lender will give you a letter stating that you have been pre-approved for a mortgage and the amount you are authorized to borrow. You will need to present this letter to the real estate agent when you get started. It is important to get pre-approved for a mortgage loan before beginning your home search. The real estate agent and real estate company will be much more willing to work with you if they know you can afford the home you are looking at. In addition, sellers will take your offer much more seriously if it is accompanied by a pre-approval letter from your mortgage lender.

Step 5: Make an offer

Once you have found a home that meets your needs, it is time to make an offer on the property. You will already know the most you can spend from the pre-approval process, and you probably will have your own ideas on what the property is actually worth. In addition, your real estate agent can guide you through the negotiation process and offer procedures. A copy of your pre-approval letter will be presented as part of the written offer. This will ensure the seller that your offer is legitimate.

Step 6: Negotiation process

If the seller accepts your first offer, congratulations. Your negotiations are over and you're ready to start preparing for your move. More likely, however, is that the seller will come back with a counter-offer. This negotiation process can go on for a short or long amount of time, depending on factors like the motivation of the seller, the local real estate market, and a host of other factors. The real estate agent will be a good guide through the negotiation process. After all, he or she will have been through this process many times before.

Step 7: Provide copy of Purchase and Sale Agreement to mortgage broker

After the negotiation process has been completed, you will need to present your mortgage broker with a copy of the Purchase and Sale Agreement for the home.

Step 8: Work to close the mortgage loan

After presenting the Purchase and Sales Agreement, you will need to work with the mortgage broker to ensure you meet all the conditions required for the closing of the mortgage loan.

Step 9: Some inspection prior closing

Prior to closing, you will want to make sure to have a thorough home inspection performed by a qualified and certified home inspector. A home inspection will protect you from flaws in the construction and condition of the home that are not obvious to the naked eye. Home inspections can uncover things like foundation cracks, termite infestation and other home quality issues.

Step 10: Hand over down payment

After the home inspection has been performed and the report has come back clean (or all the items uncovered have been repaired), it is time for the buyer to actually hand over the money for the down payment and sign the loan documents.

Step 11: Collect the house key

After the closing of the loan, the fun part of home buying begins. Your real estate agent will hand over the keys to your new home and you can actually move in and enjoy your beautiful new home. Welcome to moving day!

 Andrew Loh

More Articles 

Tips for Inground Swimming Pool Liner Preparation and Installation! - Daniel G Osko
Do you think that only the pro's can do it? Think again. Although we recommend a professional installer, with the correct tools and care most anyone can install their liner. Just follow the guide below, and you decide. A little work can save...

Beat the Heat - choosing an Air Conditioner - Donald Grummett
What size air conditioner do I need? A larger air conditioner will not always provide more cooling. It should be sized for the room area. If properly sized it should operate long enough to remove moisture from the air. It is the moisture...

Tips for Working on Plaster Walls - Dean Novosat
If you live in an older house, say 50 or 60 years or older, there is a good likelihood that you have plaster on your walls. Plaster walls were very common, especially in the late 18th century and 19th century. Plaster was fairly readily available,...

Building closet organizers - Adam Peters
Closet organizers can be a valuable space saving technique in your home. Closets are a much used part of the home, but they are, typically, poorly organized. That can cost space that could be used to store other belongings. This lack...

Home Improvements for Walls and Ceilings - Tony Robinson
When improving your home you will need to get rid of the old and install the new. You will remove stains, mildew, peeling paint, caulk, as well as other filter clutter before repairing your home. At what time you take the time to patch up or...

How to Find the Best Home Improvement Loan - John Mussi
If you're looking for the best home improvement loan for your money it can sometimes seem like an uphill climb. You may not know whether the offer that you've received is the best that you can get, or if you should try to find a better offer...

Spring into Lawn Mowing - Lillian Dave Brummet
Ahh. Spring arrives with the beautiful twittering of birds preparing their nests for the unborn. What - can't hear them? The low rumble of lawn mowers not only drowns out natures' symphony, but also disturbs skittish wildlife and sleepy neighbors....

7 Materials For Creating The Perfect Kitchen Countertop - James Mahoney
The kitchen countertop has to be able to take a lot of abuse including the heat of pots, cutting and knives and abrasive cleansers. The ideal countertop should be able to stand up to heat and the sharp edge of a knife. Let us take a look at...

Toile Bedding - Pat Bowlin
Toile is a centuries old fabric that has once again become quite popular for use in gorgeous, lushly detailed bedding. (pronounced twaal) Delicate drawings, very Old World in nature, often define the fabric. Some conflicting opinions exist...

Basement Remodeling Starts With Reliable Waterproofing - Robert Clarke
Basement remodeling can add lots of extra living space to your home but beware; basement water leakage could put a real damper on your hopes if not properly corrected. There are two conditions you must address for a dry basement,...

Mortgage Tips From Me To You - Seymore Hennigan
At some point in your adult life, you are likely to purchase a house of your own. Whether you are sick of renting, or you have decided to settle down and start a family, purchasing your first home can be an exhilarating and nerve-wracking adventure....

Flat Roofs - Naldo Camarones
Flat roofs are a great way to keep a building safe from water. Knowing exactly what to do with a flat roof will ensure you have a working roof system that will last a long time. Though they may look good, and are very common, flat...