Monday, August 19, 2019 / by Natasha McNealy
Buying a home is proven to be a great financial investment and often has a positive impact on your finances long term. If you are an interested first-time homebuyer, this is what you can expect to do and be prepared for, in the home-buying journey.
1. Preparing Your Finances - this step is absolutely crucial before you go any further in the home searching and buying process. By gathering up all of your finances, you will be able to understand what you can afford to pay each month (you should be able to comfortably pay your mortgage payment each month), have enough for a down payment (around 20%) and pay for closing costs. Your credit score is also very important when it comes to getting a mortgage loan, so if it is something that needs work, make it your priority.
3. House Hunting - now that you know what you have qualified for and what you can afford, it is now time for the fun part of house hunting! At Agents With a Smile, we want to help you make this part of the process as smooth as possible. We can narrow down searches for you that fit your needs - financially and by preference and have the ability to be your buffer between you and the seller. When you find “the one” we will help make an informed offer. Once you are accepted, we receive a purchase contract and money in escrow begins.
4. Time to apply for the mortgage - time to make step two official. Once the seller of your dream home has accepted your offer, you must apply for a mortgage and you typically have only 45-60 days in your purchase contract to do so. You must provide proper documentation to the lender like employment W2’s, credit scores, other debts and so on (to ensure you’ll be a responsible paying homeowner) before they can offer you a loan estimate with approximate interest rates, monthly payments, and closing costs.
5. Closing - Once you have an approved mortgage, you receive a closing disclosure. Here it will list the fees you have to pay (about 2-5% of the home price) and be ready to sign a lot of documentation. Once the loan officially closes, the seller gets paid and you are a brand new homeowner!