Are you thinking of buying a home? Congratulations! This is a big decision that comes with a lot of excitement and a fair share of anxiety. You want to make sure that you’re making the right decision and that the process goes smoothly. This guide was put together to help you navigate the home-buying process. From getting pre-approved for a mortgage to going through the escrow process, we’ve got you covered. So, let’s get started!
1. Get Pre-Approved for a Mortgage
The first step in any home search is finding out how much home you can afford and securing financing to make the purchase. While prequalification can give you a rough estimate, getting pre-approved for a mortgage provides added advantages. It gives the seller more security and puts you in a stronger position than other potential buyers, especially in a multiple-offer situation. Your mortgage pre-approval lets the seller know that you’re serious and fully prepared to buy their home.
Key Mortgage Terms
- Annual income
- Conforming loan
- Debt-to-income ratio (DTI)
- Down payment
- Loan-to-value (LTV)
- Loan estimate
- Pre-approval
- Pre-qualification
2. Find the Right Real Estate Agent
Finding the right real estate agent is crucial and can impact how long you search for a home and how much you ultimately pay for it. A well-connected and experienced agent can get you in the door to your dream home faster and help you negotiate a deal you’re 100% satisfied with. Your agent should give you their all, and in return, you should be loyal to the agent working on your behalf.
3. Search for Your New Home
Your agent can set you up on a search for homes that are currently on the market or will be coming soon based on your pre-approval. They may even be able to show you off-market listings, giving you a competitive advantage. Once you find the home you want to buy, you’re ready to make an offer.
4. Making Your Offer
Making an offer on a home can be nerve-wracking, but a good agent will help you navigate the process with ease. Your agent will check comparable homes in the area to see what they recently sold for, and will assess any disclosures to ensure there are no major issues with the home. If there are multiple offers on the table, your agent will work to position your offer in the best way possible to help it stand out. A skilled negotiator can be invaluable in this stage of the home-buying process.
5. The Escrow Process
Once your offer has been accepted, the escrow process begins. During this time, you may need to do further investigation of the property if there weren’t already inspections done. The lender will order an appraisal and finalize the loan, and you’ll need to provide any documents requested by the lender in a timely manner. If there were contingencies as part of the purchase agreement, this is the period in which those contingencies need to be removed, or the contract can be canceled. About 5 days before the close of escrow, you’ll do a final walkthrough to check if any requested repairs have been completed and that nothing in the home has changed substantially since the offer was made. Around this time, the lender will be getting ready to fund the loan. Signing usually happens a few days before closing. Once escrow receives both the buyer and seller’s signed documents and receives the funds from the lender and buyer, the sale will be sent to the county for recording. The home officially changes ownership when the county records the sale.
Key Terms in the Escrow Process:
- Contingencies
- Inspection
- Appraisal
- Mortgage points
- Discount points
- Origination fee
- Title insurance
- Underwriting
- Closing Disclosure (CD)
- Deed of sale
Michelle Fanto-Chan: Your Trusted Bay Area Realtor
Michelle Fanto-Chan is a top-ranked real estate agent and realtor in the Bay Area with extensive market knowledge who can help you find the home of your dreams. With many years of experience in the real estate industry, Michelle can guide you through the entire home-buying process, including setting a perfect timeline, negotiating with sellers to get the price that meets your needs, and overcoming all potential challenges that you may face in getting your dream house.
Book an appointment today and learn more about how Michelle Fanto-Chan can help you fulfill your goals of owning a perfect home in the Bay Area.
