Basics of Buying a Home

Be an informed and educated Homebuyer if you decide to purchase real estate. There are many things to learn as you navigate through the process.  Here we highlight some of the basic steps and we would be happy to provide further detail and information should you have any questions at all.

1. Get pre-qualified by a trusted lender to determine your price range.  It's very important, especially in today's economic times, to spend within your means. So the first step in the home-buying process is finding out exactly how much you can afford. Get in touch with an experienced and trusted lender who will pre-qualify you based on the your income and debt ratios.  They should provide a GFE (Good Faith Estimate) outlining the estimated closing costs and pre-paids required.  In addition to a competitive rate, find a lender who is responsive and experienced.  This mortgage lender question checklist will be helpful in evaluating lenders.

2. Research to find an Agent who is the best fit for you.  You likely already know someone who is an Agent, but make sure you find the best representation and experience possible. For most people, purchasing a home is the single largest financial transaction they will ever make. So it's critical to match up with a person best suited for the job.  Many people are comfortable using an Agent referred by someone they trust.  Making sure the Agent is full-time is smart, since many Agents  dabble part-time without up-to-date knowledge in an ever-changing real estate market.  

3. Narrow down the location you'd like: Once you know your price range, start researching locations that have homes you can afford. Most Buyers like to find a house that is a reasonable commute time to their work (try driving to/from the subdivision during peak traffic times). An area with amenities such as pools, parks, hike/bike is also popular. Buyers with children will look for good schools; even if you don't have kids, buying in a location with highly rated schools maintains property values. Each person's ideal neighborhood will be different.

4. Start the home search. Now comes the most exciting part of the process: start house-hunting! Looking online is where over 80% of Buyers start the search, but there is nothing like actually seeing a house firsthand to really see if it's the right one.  Should you look at brand-new or resale or both? Your Agent can help you evaluate which subdivisions are the best fit for you.

5. Make an offer. After looking at homes, there will usually be that certain one that speaks to you. It's time to write an offer.  Often Buyers feel a bit overwhelmed when it comes time to sign the contracts, but your Agent will guide you through this step and be there to answer questions you are sure to have.  We often tell people that buying a home is like riding a roller coaster as there are ups and downs during the process. Until you actually get to the closing table, it's best not to get your heart completely set on a home during the offer process.

6. Negotiations & getting under contract. Sellers and Buyers do not have the same goals. Sellers generally want the highest price and Buyers want the lowest.  Here's where your Agent comes into play in negotiating the best deal for you. By accessing recent neighborhood sold statistics, your Agent will make sure you do not overpay for your house.  And did you know that in Texas most Sellers pay for the Buyer Agent commission, so hiring a Buyer Agent is no charge for the Buyer? 

7. Get a home inspection during your option period. It's of pivotal importance to inspect your home during your option period (the timeframe where you can back out of the contract for any reason by paying an option fee).  Many Buyers will only ask what time the Inspector can come and how much they charge. But be sure and read through this home inspector checklist to be sure you hire a competent Inspector.

8. Contract to closing. There are many steps and parties involved in the closing process including the Appraiser, Escrow Officer, Inspector, Lender, and Surveyor.  Your Agent plays a key role in communicating between you and all parties to make sure everything moves forward on target.  An experienced and effective Agent will know how to "put out fires" along the way and ensure your transaction runs smoothly to closing.