Buying a home, for many, is the single largest financial decision you may make in your lifetime. The purchase process can be can be a very intimidating task, and at times overwhelming. PPM Realty has put together the following summary to narrow down this daunting procedure into 7 key steps.
1) Mortgage Pre-Approval
Obtaining a pre-approval from a lender is the most important step in preparing to purchase a home. The pre-approval helps you to determine the price range you can afford, the down payment required, estimated closing costs, monthly mortgage payments, interest rate and the most suitable loan program.
2) Setting Up Your Home Search
Your PPM Realty Buyers Agent will assist you in setting up a home search on the Multi Listing Service (MLS) based on your criteria (price range, bed, bath, location, etc.). While many buyers begin their search on numerous 3rd party websites, it is important to note that the data on those sites is unregulated, and not always accurate. The MLS is tracked and monitored by the Realtors Association to ensure that all pricing, home specs, & statuses are accurate.
3) Time to Look at Houses
So, now you've been searching for homes on the Internet and the MLS, and have narrowed down your search to a handful of properties. Once you get to this point, notify your PPM Realty Buyers Agent of any homes that you would like to see. They will be able to schedule a time for you to view all of these homes at your convenience. PPM Realty's Agents work 7 days a week and can show you any property, regardless of which website it is listed on.
4) You Have Found Your Home and Want to Make an Offer
You've found the home you want to buy and now it’s time to write up an offer. Your PPM Realty Buyers Agent will go through all comparable sales data to help you determine a reasonable home value and offering price. At this time your Lender will also issue a revised Pre-Approval, as well as Closing Cost & Monthly Payment Estimates to ensure you are comfortable with the offering price. Your PPM Realty Buyers Agent will then submit a signed offer with the Pre-Approval, reviewed and signed Sellers Disclosure, Consumer Notice, copy of your Escrow Money check & any other necessary disclosures or contingency forms.
5) Under Contract: What to Expect
Once all parties have executed the Agreement of Sale, the home is now considered to be under contract pending contingencies. Most home sales have a minimum of two different contingency periods, the inspection and a mortgage contingency. These contingencies have specific time frames in which they must be completed to uphold your obligations as part of the Agreement of Sale. You should confirm with your PPM Realty Buyers Agent the specific dates that need to be met as part of the agreement. Below are the 2 most common sale contingencies.
Inspection Contingency: The inspection contingency provides you with a timeframe to have the property inspected and to ensure that it is in an acceptable condition.
Mortgage Contingency: The mortgage contingency allows you a specific period of time for you to obtain a written approval and mortgage commitment from your lender. Once under agreement your lender will provide you with the paperwork and documents necessary in order for them to issue you a mortgage commitment.
Your PPM Realty Buyers Agent will provide you with our Home Buyers Checklist of contract specific dates and requirements (included in your PPM Realty Home Buyer's Guide) to help you navigate the purchase process.
6) Preparing to Close
Once your Lender issues a mortgage commitment, they will send the settlement agent closing instructions and fees. From there, the settlement agent will provide you with a final Closing Disclosure, which is an itemized list of all closing costs including lender fees, escrows, title and transfer charges. The Closing Disclosure will include a summary of all the costs associated with the sale and provide you with the total funds you'll need to bring to closing, known as Cash to Close. After you're given final amount, you will obtain a Cashier’s Check (cleared funds) or funds can be wired directly to the Settlement Company.
7) Closing Time!
Now it’s time to coordinate a time and location for settlement. At Settlement, you will bring the Cashier’s Check, photo identification and any other documentation required by the lender or settlement agent. Once all paperwork is signed, the keys to the house are yours!