First Time Home Buying

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Post on 12-Aug-2015



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<ol><li> 1. Buying Your First Home Brian Moran, REALTOR Bass Ohio Real Estate 20575 Center Ridge Road Rocky River, Ohio 44113 (440) 668-1288 1 </li><li> 2. Steps to Home Ownership 1. Get Pre-Approved 2. Hire a REALTOR (ME!) 3. Hire a Home Inspector 4. Make a Formal Application 5. Get Ready to Close 2 </li><li> 3. Step 1: Get Pre-Approved The first step when buying a home is to get pre-approved for a mortgage! The terms pre-approval and pre-qualification are OFTEN misunderstood 3 </li><li> 4. Step 1: Get Pre-Approved A pre-qualification is usually an approximation of the price for which a borrower might qualify. More often than not, information is exchanged verbally regarding debt, income and assets. A credit report is usually not pulled. A pre-approval is more powerful: a credit report is pulled (ideally from all three credit bureaus); income, employment and assets are disclosed and documentation to support the income, employment and assets is provided. 4 </li><li> 5. Step 1: Get Pre-Approved General Rules of Thumb: You can afford a home 3x your annual income Taxes: 31% of your income goes towards taxes Total Debts: 40% goes to pay debts Including mortgage payment, car loans, student loans Expenses: 29% goes towards everything else Food, clothing, entertainment, vacations, etc. 5 Taxes, 31% Total Debt, 40% Expens es, 29% </li><li> 6. Step 2: Hire a REALTOR Why Hire a REALTOR? They have Education &amp; Experience Knowledgeable about the area Can provide Market Condition Information Negotiation Skills Handling of Paperwork Answers Questions Establish a Relationship for Future Business 6 </li><li> 7. Step 2: Hire a REALTOR A REALTOR will assist you with the following functions: Finding a mortgage lender Getting pre-approved Establishing needs, wants and goals for your new home Wants In-Ground Pool 3 Acres Marble Tile in foyer Stainless Steel Appliances Needs 3 bedrooms 2 Bathrooms Garage Good School District 7 </li><li> 8. Step 2: Hire a REALTOR A REALTOR will assist you with the following functions: Looking at homes Researching the area and amenities for the homes you like Submitting a purchase agreement Submitting counteroffer(s) Setting up inspection (home and other inspections as needed) Submitting an inspection response to the seller(s) If necessary, renegotiating details in the contract as a response to the inspection Getting documentation to the lender and sign lenders disclosures 8 </li><li> 9. Step 2: Hire a REALTOR A REALTOR will assist you with the following functions: Setting up homeowners insurance Receiving final approval for the loan Arranging closing with title company, lender, buyers, sellers and agents Reviewing title work and survey Getting loan documents to title company Preparation of closing statement by title company Obtaining final closing numbers Contacting your bank to arrange for the money needed for closing Signing documents 9 </li><li> 10. Step 3: Hire a Home Inspector After you have an accepted offer on your prospective home, in most cases, the next step is to get the home inspected by a professional inspector. You want to find a person who is qualified and licensed to inspecting homes, so that you end up with a thorough report detailing the condition of your new home. One source to use when looking for a licensed home inspector is the National Association of Home Inspectors Inc. (NAHI). The NAHI website contains important and helpful information about the home inspection process Visit NAHI ( to locate an inspector in your area There are other ways to find a licensed inspector: Obtain a referral from your REALTOR Obtain a referral from a friend, family member or co-worker Obtain a referral from your Mortgage Advisor 10 </li><li> 11. Step 5: Get Ready to Close Congratulations! You have successfully made it through the initial stages of the home buying process. Your home inspection was satisfactory Your appraisal supports the price you agreed to pay for the home Your title work is complete You have your homeowner's insurance policy declaration page and invoice for your first year premium You have clear final loan approval Your closing has been set You know the time, date and location for the title company for your closing 11 </li><li> 12. Step 5: Get Ready to Close Your lender and/or REALTOR will provide you with the amount of money needed for closing You will be advised to either obtain a cashiers or certified check for the amount of money needed to the title company Your lender and/or REALTOR will tell you the location of your closing and provide you with directions You will need to bring a current drivers license with you to closing You will sign your name on multiple documents The closer will make copies of the documents 12 </li><li> 13. Step 5: Get Ready to Close Before closing, buyers typically have a final opportunity to walk through the property to assure that the nothing has changed since the purchase agreement was signed. After closing, the buyer receives the keys and the seller receives payment for the home. Deeds, loan papers and other documents are prepared, signed and filed with local property record offices. 13 </li><li> 14. 14 Congrats! You are now a Home Owner! </li></ol>