10 Steps to Choosing and Purchasing Your Home (PART 2)

Be sure to check out PART 1 here!

So you are ready to buy a home.  It’s a big decision and there’s a lot to learn.  But with these 10 quick steps, choosing and purchasing your home will be easier and more seamless than ever before. This guide provides 10 key steps, information and tools in order for you to find, purchase and finance a home that meets your needs and preferences.

 

In a previous blog, I discussed the first 5 steps in helping you choose and purchase your home.  You can read that blog here.  Now, it’s time to discuss the last 5 steps so you can finalize that home purchase and get to the celebrating!

STEP 6:  Obtain a Mortgage

Securing a mortgage is oftentimes more complex and more expensive than a consumer may realize.  That’s why it’s important to be organized and find a competent mortgage loan officer.  Your ABR (Accredited Buyer’s Representative) has already helped other buyers work through the mortgage application process and can also provide valuable assistance.

How to obtain a mortgage:

• Apply for a loan: Your ABR can help you understand the pre-application steps, the information your lender needs, the decisions you will have to make at application, the application costs and the application legal requirements.
• Closing costs and The Truth In Lending Statement: Mortgage costs include appraisal and points (a fee based on the amount of the loan).  Depending on the loan, you may also be required to pay for mortgage insurance.  To help you see everything you’re paying for the length of the mortgage, you will receive a Truth in Lending Statement, which is a good-faith estimate of all of the costs associated with the mortgage.
• Application and lender requirements:  Includes social security number, date of birth, photo identification card, paycheck, W-2 or 1099 tax form, employers, accounts, current assets, liabilities, current and previous addresses, sales contract.
• Special situations:  Lenders may require additional information if you are: self-employed, compensated on a commissioned basis, separated or divorced, social security/pension/disability/any form of public assistance benefits considered as income, bankruptcy/foreclosure or any judgments against you in the past 7 years, Department of Veterans Affairs (VA) Loan Application. 
• Other considerations: Be sure to consider points and rate options and keep in mind that your financial position must be the same at closing as it was when you were approved (don’t buy a new car or purchase anything major!).
• Obtain homeowners insurance:  Before closing, your mortgage will require you to obtain homeowners insurance.  Costs and coverage will vary.
• Escrow accounts:  Decide if you want to pay your property taxes and homeowners insurance policy on your own or if you would rather wrap them into your monthly mortgage payments. 

STEP 7:  Prepare for Closing Day

Many important details must fall in place before you close on your home.  Your ABR will help you stay on track.  The most important details include:

• Completing a home inspection
• Requesting an attorney review
• Finalizing your mortgage
• Getting ready to move
• Attending a final walk-through
• Preparing to pay closing costs

STEP 8:  Close

The actual, legal transfer of ownership is called closing or settlement.  Participants of the closing usually include:

• You, the buyer
• The seller
• The closing agent, the title insurance representative and the escrow agent (one person may fill all these roles)
• The real estate agents
• Attorneys for the buyer and seller

During the meeting, you’ll sign many documents including:

• The closing statement
• The mortgage papers
• A Truth in Lending Statement
• Any additional documents required in your state

Be prepared to provide your payment of closing costs, proof of insurance and approval of inspections, too!

STEP 9: Move

You found your home!  The contract has been signed!  The closing date is set!  Now it’s time to move.  Be sure to plan for the moving day well in advance with these helpful tips:

• Determine cost of moving:  Many people are surprised by the variety of expenses associated with moving, including packing materials, utility connections, insurance, cost of movers, truck rental, etc.  You can eliminate or reduce these costs by investigating moving companies, estimating moving costs and making a moving checklist.
• Moving coverage:  Before you select a mover to help you, confirm that the company is insured and provides coverage for your belongings.  Three of the most common forms of insurance coverage are basic liability, declared value protection or actual cash value and replacement value.
• Packing tips:

o   Begin packing as early as possible

o   When packing, go room by room

o   Make a list of what’s in each box

o   Label all boxes by room

o   Cushion the bottom and sides of boxes

o   Pack heavy items in smaller boxes

o   Packed boxes should not exceed 30 lbs

o   Fill you washer/dryer with clothes, linens and light items

o   Wrap and secure cords

o   Use rope or elastic to secure doors and drawers

o   Let the children help!

Take a look at an online moving checklist to help guide you too!

STEP 10:  Celebrate!

Congratulations!  You’ve worked hard to achieve your dream of homeownership.  I would like to wish you many years of happiness in your home.  Cheers!

Want to learn more?  You can receive your own home buyer’s toolkit at www.toddohlde.com.  Click on Contact Me to send me an email and request your copy.  All you have to do is provide me with your home address.  It’s as easy as that!