First Time Home Buyer: The Buying Experience Explained & What to Expect
First Time Home Buyer:
The Buying Experience Explained & What to Expect
Buying a house is a lot of work, but there’s also a lot to gain from it. Here is the home buying experience explained and expectations to have. Not every buying experience is the same and they’re all unique in their own way but a majority of the process is similar.
Start by picking out your team. Who’s your agent and who’s your lender? Interview agents and lenders before sticking to one.
The pre-qualification process is fairly simple and if your financial information is organized, you’ll be able to breeze through it. Most local lenders have an online application to start the process. They will then schedule an appointment in their office to discuss with you your financial buying goals, what you qualify for, how to get your credit in tip top shape (if you have credit issues), different loan programs you may qualify for and any other pertinent information tailored to your needs.
After you’re pre-qualified you can begin searching for homes. My process is fairly simple, at the first home we look at you’ll be provided with a buyer packet. In this packet there will be a current list of homes for sale in your price range, information on the home buying process and some fun items to track what homes you’ve looked at and what you think about them. We’ll also discuss your home goals and see what is currently available out there that match them.
Making offers is such a fun part of the process but it’s also so nerve wracking! When you make your offer on a home, we’ll discuss comparable homes sales in the area, how long the house has been on market, if the home will have a lot of competition, etc. I will guide you on the decision of what to offer for the price and what to include in your offer. Here are other items to think about are:
- How long your escrow period will be for?
- Your earnest money deposit. This is typically 1% of your purchase price but it can vary.
- Your loan amount/down payment. This is typically on your pre-qualification letter from your lender.
- Any inspections you’re going to ask the seller to pay for. The typical inspections include but are not limited to: pest inspection, well inspection, and septic inspection.
- Who pays title and escrow and where it will be at.
- Any items you want included/excluded from the house/property.
- Contingency period time frames, shortening/lengthening.
Offer accepted! Now what?
Within 3 days, of your accepted contract you’ll need to take your earnest money deposit to the escrow company that you and the seller have agreed to use. Within 7 days, the seller will provide you with a packet of disclosures, which you and I will discuss, sign, and figure out any questions you have. During that time we will also schedule any inspections that you will be paying for. A typical/highly recommended one is the general home inspection. This cost depends on the square footage of the home and if any outbuildings are included in the inspection. Plan for this to cost an estimated $400. If you’re paying for a pest inspection, plan for $125-$150. Your lender will also schedule the appraisal during that time, plan for a possible estimate of $600. Remember these amounts are estimated so they could be higher or lower but it’s always better to plan for a higher amount than to be short. Other inspections that you might be paying for include the well, which can cost about $400+ and a septic inspection/pumping, the septic cost depends on how much is pumped out but plan for about $1,000+/- to be on the safe side. Inspections and the appraisal need to be done within the 17 day appraisal/inspection contingency. This would be the time period that you would also ask for any repairs that come up in the inspections and on the appraisal. Within 21 days you’ll also need to remove your loan contingency, meaning you are ready to move forward to closing.
You’re near the finish line! The lender will continue to get any other documents they need from you. You’ll sign the lenders “CD” which is their closing disclosures and they’ll send the packet to the escrow company. You will have a 3 day wait period before you’re able to sign at the title company or with a mobile notary. After the 3 days, you will sign and escrow will have you bring in your downpayment. The seller will also sign at some point during this period. On closing day, your lender will wire transfer the money to escrow and as long as escrow receives it before their cutoff time, they will deliver their documents to the county recorders office and give us a confirmation of recording. At that point, you will officially be a homeowner and you will get your keys!
Things do happen during contract periods so while this sounds like a cake walk, understand this is a general outline of what to expect, sometimes things pop up like solar leases, low appraisals, or sellers saying no to repairs or missing the cutoff time for recording. These are normal parts of it and you’re working with a professional who will be there to help you navigate through the easy stuff, as well as the hard stuff.
Ready to get started? Give me a call and let’s get to planting those roots!
Kelsie Morse
530.844.3507
CM Construction|Providence Properties|DRE # 01985095
