The home buying process is usually thought of as a complicated process, but it doesn’t have to be. If you are know what to expect and have a real estate agent who is knowledgeable and committed, the process can be stress free and even exciting. This is a shortened version of my Home Buyer’s Guide.
Step 1: Select a Real Estate Agent
The first thing you are going to want to do is find a real estate agent. If you are serious about finding a house, a real estate agent has access and time to search all of the listings in your preferred areas and find the deals that match what you are looking for. While you may be worried about the cost associated with “hiring” an agent, don’t be. Most agents are paid by the agent of the seller.
Step 2: Select a Lender
After finding a real estate agent to help, you probably want to start talking to a lender who can either pre-qualify or pre-approve you. While a real estate agent helps you find a house; a lender makes buying (financing) the house possible. If you are in need of a lender to interview, ask your real estate agent. Be sure to actually interview lenders instead of making a random selection. The lender you select can very well make the impossible come true, but can also turn buying your first home into a nightmare. If you would me to provide you with lender referrals, I would be happy to recommend to few.
Step 3: Start Looking for your Home
It is important for you to spend some time with your real estate agent discussing your preferences. Where do you want to live? What style of house would you prefer? One story or two? Do you know how many bedrooms and bathrooms you will need? Would you like a small or large backyard? It is also important to rate how strong your preferences are. Once you and your agent find a suitable amount of listings to investigate further onsite, your agent will set up appointments to show you those homes.
Step 4: You’ve Found The One
Once you find the “right” one, your real estate agent will write an offer on the house and present it to the seller’s agent. The offer will outline the terms of your potential purchase (price, financing, closing date). Within 48 hours, the seller will either accept your offer as written, counter your offer with changes, or reject your offer.
Step 5: Inspection Period
If your offer is accepted, the next step is to hire a professionally inspector to assess the house. This is important as the inspector will examine the major systems in the house (heating, roof, electrical, plumbing, structural) to discover any potential problems. If there are any major problems, you can ask the seller to fix them. Most of the time, the seller will either fix the problems or offer a discount on the purchase price for you to have them fixed yourself after the sale.
Step 6: Appraisal
After the inspection, comes the appraisal of the home to prove to your lender that the house is worth the price. If the appraisal is dramatically lower than the agreed upon price, the lender will no longer loan you the original amount. In this case, the seller can reduce the price, you can pay the difference between the values, or you can back out.
Step 7: Loan Approval
Usually at this point, all that’s left to worry about is loan approval for you. You should have been in frequent contact with your lender, who updates your real estate agent on the status of the approval. Loan approval means that you have provided all of the documentation required by the lender and that the lender is satisfied that you have the resources to purchase and make mortgage payments on your home.
Step 8: Closing & Possession
Closing is the ceremony where ownership of the home changes hands and you become a homeowner. While the ceremony sounds elaborate, you will basically just be sitting at a table signing dozens of documents. Depending on your contract with the seller, you will either get possession of your new home immediately after closing, or a few days later. Congrats! You just bought a home.
If you are interested in obtaining more information on buying a home in St. Louis or just have some questions about St. Louis Real Estate in general, contact me at DanBrassil.com.