The Pre-Approval Process
Before you put any energy into finding your new home the first step to homeownership is to speak with a reputable loan officer or mortgage broker. This will help you to figure out what your purchase price should be to fit your financial situation. If this is going to be a cash purchase, then it is a good idea to have proof of funds available. Once we find the ‘right’ home for you and we get ready to make an offer, sellers will require either a pre-approval letter or proof of funds to be submitted with the offer. Therefore, getting pre-approved on a loan amount prior to spending time looking for homes is an important first step.
Documents required for Pre-Approval:
- 2 years’ tax returns, W2’s and 30 days of Pay stubs.
- If retired, social security and pension award letters.
- 2 forms of ID (Driver License & Social Security card)
- 2 months bank statements
- 2 months IRA Statements or most recent quarterly statement
- Statements from your investment accounts showing yearly or monthly distributions
Meet with us to discuss your wants and needs in a home!
We can help you devise a strategy for getting the home you want in a stress free, enjoyable manner. Remember to discuss time-frames, objectives, expectations, wants and desires with us. Things to consider include location, neighborhood, and size of home, number of bedrooms, storage space, community amenities and current market conditions.
View Home Inventory
Ready for the fun part? It’s time to start viewing the homes that meet your criteria. It’s important to give us honest feedback so we can better understand what you’re looking for and better assist you in finding the home that you want.
We’ve found the home for you, let’s make an offer
When you find a home, you love that meets what you are looking for, it will be time to make an offer. We will take a look at comparable homes which have recently sold to help determine the right price to offer. We will also go through the offer details with you, explaining the terms and conditions. Once you make the offer, negotiations, done by us on your behalf will take place until an agreement is reached between you the buyer and the seller. Once you agree to the terms of the sale, all the documents will be sent to the title company and your lender to prepare for closing.
Loan ApplicationNow that you’ve found the home you want, it’s time to make the loan application. We will assist you with sending the executed contract to your lender to prepare your loan application. Your loan officer will contact you requesting additional documents and will provide you with your loan application to complete.
Documents which may be required for your Loan Application:
- Pay stubs for the past 30 days
- Last 2 Years W2’s and/or 1099’s along with Employers Information
- 2 Years of any additional income verification
- Checking, Savings, Investment Account Balances
- Bank statements (last 2 months - all pages)
- IRA and/or 401 statements (last quarter or last 2 months, all pages)
- Driver’s License
- Social Security Card
- 2 Years of residence history – mortgage and or rent payments
Your escrow deposit is now due. The title company will provide wire instructions for you to wire your escrow deposit.
Next, an inspection of the property needs to take place. Inspections must be completed in a timely manner, usually 5-10 days after the contract is signed, we will discuss timing with you at the time of writing the offer. If you would like, we can assist in getting the inspection done. The purpose of this process is to ensure that you know exactly what is being purchased, prior to completing the transaction. Your inspector may also recommend additional inspections for specialized items, if necessary. A thorough inspection enables a home buyer to avoid costly surprises after the close of escrow. It is an indispensable component of a well-planned purchase. Property inspections cost approximately $300-$500 depending on the square footage of the home. In addition to the property inspection is a WDO (wood destroying Organism) inspection which inspects for termites, cost on average is $100-200. All inspection costs are due at time of or prior to the inspection paid directly to the inspection companies.
Appraisal and Survey of the Property
The home appraisal and survey is an unbiased 3rd-party’s professional assessment of the value of the property to intend to buy. The appraisal process and surveying is facilitated by your lender and the title company. It is important that the appraisal be equal to or more than the price you are paying for your new home so you can qualify for financing. Appraisal costs can average up to $500 and are due at time of appraisal. Survey costs can often be added to closing costs or paid at time of survey.
Homeowners insurance will need to be arranged for the property, if you do not have an insurance agent we can recommend one for you. Your lender will require an insurance quote and policy put in place prior to closing.
Getting Ready for Closing
We will arrange the closing date between you, your lender and the title company. Prepare to contact the utility companies i.e. water and electric, to get a date set up for utilities to be transferred into your name. The title company will coordinate with you to prepare a wire transfer for the closing funds ready for closing day.
Close on the property
The closing is a formal process where all parties sign all of the necessary paperwork to complete the transaction. Title to the property is transferred from the seller to you. The seller receives payment for the home, and you receive the house keys! Deeds, loan papers and other documents are prepared, signed and ultimately filed with local property record office by the title company.
Move in - welcome to your new home!
It’s time to move-in. Home sweet Home! There is nothing quite like the feeling of satisfaction gained from finding the perfect home to meet your needs.
6 Things Not To Do When Applying For a Mortgage
- Do not make major purchases like furniture, appliances, jewelry, vehicles or vacations
- Dont change or quit your job.
- Consult with your mortgage professional before withdrawing, depositing or moving large amounts of money in or out of your bank account.
- Do not pay off debts or collections (unless instructed to do so by your mortgage professional).
- Avoid using cash for a good faith deposit - cash is difficult to verify and could result in a closing delay.
- Dont have your credit report pulled too many times - this can hurt your credit score.