Homebuyer Checklist
You have made the decision to buy a home! But now what? Here is a quick seven step guide to help prepare you for the process.
Find out how much money you are eligible to borrow.
- I know you may be thinking, why shop mortgages before shopping homes? The answer is twofold. First, determining how much money you can borrow has a direct relationship with the amount of house you can buy. The biggest disappointment buyers can experience is finding the home of their dreams only to learn that a lender may not qualify them to purchase it. Second, when shopping mortgages, lenders often issue pre-approval letters. These letters are crucial in the beginning stages of going under contract. If a buyer is able to provide a pre-approval letter right off the bat, the seller can have confidence the deal won’t fall through.
Determine how much money you are comfortable putting forth as the down payment.
- This question will likely arise as you’re working with a lender through Step 1. Whether it be 3%, 5%, or 20% of a home’s purchase price, a lender is going to want to know how much you will be putting down at closing. Usually, the higher the down payment, the less expensive the loan. However, there are many loan options available in today’s market that can fit the needs of buyers.
Talk with a Realtor.
- If you are new to the area, or new to home-buying in general, this may be Step 1 for you. Most realtors have relationships with lenders they trust, and can help point you in the right direction to a lender that has proven to be reliable. However, if you know which lender you will be going with, brief your realtor on Steps 1 & 2. Once they know your price range, they can start narrowing down the search with your specific home-requirements in mind (neighborhood, school district, number of bedrooms, etc.).
Find your dream home!
- Realtors have access to the Multiple Listing Service (MLS), a multi-faceted resource to help you find the perfect match. This is the best part about buying a home – enjoy it!
Make an offer.
- Your realtor will put your offer together and submit it to the listing agent. There should be an “expiration date” on your offer (normally 24 hours). The listing agent will present the offer to their seller; the seller will either accept, reject, or come back with a counteroffer. If you receive a counteroffer, you will work alongside your realtor to negotiate the sellers’ terms. Once negotiated, you will be under contract. Congratulations!
Did Someone Say Contingencies?
- The contract process can seem daunting at first. The first step will be delivering a binder deposit – an agreed upon amount of money towards your down payment that shows the seller you’re making the offer in good faith. You’ll have a home inspection, which may lead to asking for some repairs to be completed prior to closing. You’ll have a property appraisal done, where the appraiser will determine the value of the property based on recent sales, location, etc. The lender requires the contract price be equal to or exceed the appraised value. These contingencies are standard in any sale – if you are working with an experienced realtor, they will be able to guide you through this process with knowledge and expertise.
Sign the papers.
- The moment you have been waiting for finally arrives – closing! This is the final step in the process. The title company will dictate how you will pay closing funds for the remaining balance of your down payment, the seller will sign the deed over to you, and unless otherwise noted in the contract, you’ll gain possession of the property. All of the hard work has paid off. Congratulations, new homeowner!
Don’t forget to celebrate!
To celebrate buying a new home, consider hosting an intimate gathering with close friends and family, where you can share the excitement of this milestone together. Create a cozy ambiance with soft lighting and comfortable seating, and serve delicious homemade appetizers and drinks. Take the opportunity to give guided tours of your new home, highlighting your favorite features and sharing the story of how you found your dream home. Set up a photo booth with props and backdrops to capture fun memories, and encourage guests to leave handwritten notes or well wishes in a guestbook. As the evening winds down, gather everyone for a toast to new beginnings and the memories you’ll create in your new home.
Did you know…
Jacksonville Statistics:
- The median monthly owner costs for homeowners is $1,412.
- The median value of owner-occupied homes is $146,500.
- The median rental amount is $927.
- 71.5% of homeowners have a mortgage.
- 47.9% of residents moved into their home between 2000-2009.
- 45.7% of housing units are 3 bedrooms.
*Source: U.S. Census Bureau, 2013