First Time Home Buyers

Congratulations on your decision to take the big step to purchase your first home!  We know this can be an exciting but intimidating process, so following are some tips on how to move forward.

Where do you start?

Lot’s of first-time buyers start by looking at houses but this is getting the cart before the horse. Because homes can go quickly, you need to get your financing in line first so you can move quickly when you find your dream home. So, your first step should be finding a mortgage consultant you trust. A good mortgage consultant will walk you through the home buying process, help you gather all of the necessary paperwork needed and give you solid advice on what you need to do to get the best deal possible. Because this is such an important step, I recommend starting with a conversation.

Have Your Credit Pre-Approved

Getting a credit pre-approval means you receive a loan commitment from your mortgage company before you find a home, based on a review of your credit and finances. A credit  pre-approval shows sellers that you’re a qualified buyer and helps you establish a clear price range. The process of applying for a credit pre-approval is the same as a typical mortgage application, except that it doesn’t include information on the property you will purchase. Your loan officer collects information on your credit, income, assets, and debts, and sends this information through an underwriting system. If the underwriting process determines that you qualify for a loan, you receive a loan commitment for up to a certain amount, which is contingent on the property meeting certain criteria.

Go House Hunting

Now that you’ve had your credit pre-approved and you know how much you can afford, it’s time to go house-hunting! You may look at one house or two dozen before you find the one that’s right for you. Just keep an open mind and focus on the things that are really important to you, and you’re sure to find a place where you’ll feel at home.I can refer you to one of my excellent Realtor partners if you do not already have a relationship with a reputable Realtor. Below are a few key tips to remember:

  • Choose the right neighborhood for you and your family.
  • Be open to different house styles because you might find yourself surprised by what you like.
  • Can’t find the right house? Have you thought about a custom home build?

Make an Offer

So, you’ve found a house you want to buy. Congratulations! Now you need to decide how much you’re willing to pay to make it yours. In today’s real estate market multiple offers on the same home are commonplace, so you may only get one chance to make an offer that the seller will consider. That’s why it’s important to think carefully about your strategy. Your Realtor will guide you through reviewing the prices of similar homes. Although you can’t directly compare the home you want with the homes on the list without ever having been in them, you can use the list of comparable sales to get a general idea of the neighborhood’s price range.

In addition to sale prices for other homes, there are several good ways you can determine a good amount to offer:

  • The condition of the house
  • The current housing market in the area
  • Your financial threshold

Get a Home Inspection

When you are making what is likely the largest investment of your life, you should know as much as possible about what you are buying. That’s why it’s a good idea to have a home inspected before you make your purchase. Most purchase contracts contain provisions for a home inspection to be performed within a certain timeframe, and sometimes they specify what action the buyer and seller may take if problems are uncovered. It’s very important that you choose a qualified inspector who has plenty of experience with residential homes. Contact a national or state association of home inspectors to find out what certifications it requires for membership and if there are any members in your area. Your Realtor will guide you on choosing a reputable home inspection company.

Close the Deal

You’ve found your home, agreed on a price with the seller, had the home inspected, and now you’re ready for the closing, where you will officially take ownership of the property. Welcome to the end of the home buying process—and the beginning of your homeownership journey. The closing date will depend on when the seller is ready to move out, when you are ready to move in, and when all of the mortgage details have been finalized. You may want to request a closing date near the end of the month in order to minimize the amount of interest you have to prepay on your mortgage.

What happens at closing

Despite all the new technologies that are streamlining the mortgage process, the closing phase remains very paper-intensive. You will have to review and sign a hefty stack of documents, some of them in duplicate and triplicate. You will also have to pay for any closing costs, including:

  • Lender fees, such as an origination fees and discount points
  • Third-party fees for services not provided by your lender, which may include a settlement fee, appraisal fee, credit report fee, title insurance, and attorney’s fees
  • Prepaid items that must be paid to your lender in advance, such as prepaid interest, hazard insurance, and deposits to set up an escrow account

Move into Your New Home

Now all the hard work is done and it is moving day! Making yourself at home in your new surroundings is about more than unpacking. Try to explore the neighborhood and get acquainted with neighbors right away. Ask about stores, playgrounds, and places of worship, so you don’t have to put your life on hold while you familiarize yourself with the area.

l

Get Approval

Find a House

Make an Offer

U

Get Inspected

~

Closing the Deal

Move in Ready!!

Have Your Credit Pre-Approved

Getting a credit pre-approval means you receive a loan commitment from your mortgage company before you have found a home, based on a review of your credit and finances. A credit  pre-approval shows sellers that you’re a qualified buyer and helps you establish a clear price range. The process of applying for a credit pre-approval is the same as a typical mortgage application, except that it doesn’t include information on the property you will purchase. Your loan officer collects information on your credit, income, assets, and debts, and sends this information through an underwriting system. If the underwriting process determines that you qualify for a loan, you receive a loan commitment for up to a certain amount, which is contingent  on the property meeting certain criteria.

Go House Hunting

Now that  you’ve had your credit  pre-approved and know how  much you can afford, it’s time to  go house-hunting. You may look at one house or two dozen before you find the one that’s right for you. Just  keep an open mind, and focus on the things that are really important to you, and you’re sure to find a place where you’ll feel at home. I can refer you to one of my excellent Realtor partners if you do not already have a relationship with a reputable Realtor. Below are a few key tips to remember:

  • Choose the right neighborhood for you and your family
  • Be open different house styles, you might find yourself surprised by what you like
  • Can’t find the right house? Have you thought about a custom home build?

Make an Offer

So, you’ve found a house you want to buy. Congratulations! Now you need to decide how  much you’re willing to pay to make it yours. In today’s real estate market multiple offers on the same home are commonplace, so you may only get one chance to make an offer that the seller will consider. That’s why it’s important to think carefully about your strategy. Your Realtor will guide you through reviewing the prices of similar homes. Although you can’t directly compare the home you want with the homes on the list without ever having been in them, you can use the list of comparable sales to get a general idea  of the neighborhood’s price range.

In addition to sale prices for other homes, there are several good ways you can determine a good amount to offer:

  • The condition of the house
  • The current housing market in the area
  • Your financial threshold

Get a Home Inspection

When you are making what is likely the largest investment of your life, you should know as much as possible about what you are buying. That’s why it’s a good idea to have a home inspected before you make your purchase. Most purchase contracts contain provisions for a home inspection to be performed within a certain timeframe, and sometimes they specify what action the buyer and seller may take if problems are uncovered. It’s very important that you choose a qualified inspector who has plenty of experience with residential homes. Contact a national or state association of home inspectors to find out what certifications it requires for membership and if there are any members in your area. Your Realtor will guide you on choosing a reputable home inspection company.

Close the Deal

You’ve found your home, agreed on a price with the seller, had the home inspected, and now you’re ready for the closing, where you will officially take ownership of the property. Welcome to the end of the home buying process—and the beginning of your homeownership journey. The closing date will depend on when the seller is ready to move out, when you are ready to move in, and when all of the mortgage details have been finalized. You may want to request a closing date near the end of the month in order to minimize the amount of interest you have to prepay on your mortgage.

What happens at closing

Despite all the new technologies that are streamlining the mortgage process, the closing phase remains very paper-intensive. You will have to review and sign a hefty stack of documents, some of them in duplicate and triplicate. You will also have to pay for any closing costs, including:

  • Lender fees, such as origination fees and discount points
  • Third-party fees for services not provided by your lender, which may include a settlement fee, appraisal fee, credit report fee, title insurance, and attorney’s fees
  • Prepaid items that must be paid to your lender in advance, such as prepaid interest, hazard insurance, and deposits to set up an escrow account

Move into Your New Home

Now all the hard work is done and it is moving day! Making yourself at home in your new surroundings is about more than unpacking. Try to explore the neighborhood and get acquainted with neighbors right away. Ask about stores, playgrounds, and places of worship, so you don’t have to put your life on hold while you familiarize yourself with the area.

Thrive Mortgage, LLC (NMLS #1494084) is an equal housing lender. This is not a commitment to lend or extend credit. Programs, rates, terms and conditions are subject to change without notice. Terms and conditions apply. All rights reserved. Contact us for details. Consult your accountant about tax deductions. NMLS Consumer Access