Whether you are a first-time homebuyer or have owned a home in the past, the process of buying a home can be a bit intimidating. Your home will most likely be the largest investment you make during your lifetime so it is important to understand the home buying process. In this week’s blog from North Georgia Lending, we’ll look at the basic steps in the homebuying process so that you are prepared when the time comes to purchase your next home.
Before you even begin looking at homes, you need to know what is in your price range. This means taking a good look at your finances and making some projections on what you think you might be able to afford. A mortgage professional can always give you a hand with this process. Mortgage brokers represent several different lenders to offer competitive interest rates and terms that meet the unique needs of each of their clients. A mortgage professional can take a thorough look at your credit score, your savings, your employment history and other factors to predict your ability to repay the loan you are requesting.
Prequalification and Preapproval
Prequalification will be the next step once a mortgage professional has reviewed your finances. Prequalification is rather informal and requires minimal paperwork. It is meant to give you and your real estate agent a realistic price range for affordable homes. Preapproval is much more formal process in which you will receive a quote for a specific loan amount. A preapproval is only granted after the review of documentation like paycheck stubs, W-2s, and credit scores.
Finding a Real Estate Agent and a Home
You can begin to look for a real estate agent on your own or your mortgage professional can provide you with some local recommendations. Your agent can use your prequalification to show you homes in your price range that meet your requirements. Once you find a home you love, you will work closely with your real estate agent and mortgage professional to start the process of making an offer.
Making an Offer
Your real estate agent will communicate with the seller’s representative and negotiate the sale on your behalf when it is time to make an offer. If the seller accepts your offer, the home will go into escrow. This is the first step in finalizing the sale.
Once you’re in escrow, the home will need to be inspected. In most cases, the offer you’ve already made is contingent on the results of this inspection. This means if anything comes up during inspection that may require money out of pocket to repair, you can ask the seller to make the repairs or make an adjustment to your offer to offset these costs.
Appraisal and Closing
The new home you are purchasing will need to be appraised before your lender can finalize the transaction and complete paperwork. This appraisal shows you, your lender, and the seller that you’re paying a fair price for the home. Once the appraisal is complete, your mortgage broker will begin preparing your closing paperwork for your loan. Once the paperwork is complete, the lender pays the seller for your home, and the home is yours!
Get Started with Us Today
Every home purchase is a unique process but this should give you an idea of what to expect when purchasing your next home. Be sure to contact North Georgia Lending in Cumming, GA, when you’re ready to take the first step toward buying your new home.