I find one of the exciting things about Real Estate is being able to be a part of THE FIRST TIME HOME BUYERS PROCESS. From my lens, I see an opportunity to share my knowledge of the business, my own ups and downs of buying many properties, and just the process itself. I love being able to share ideas, thoughts, and guide people towards something that is going to make a huge impact on their daily life.
From the buyer’s lens, I see fear, anxiety, hope, excitement and sometimes disappointment. Which gives me an opportunity to help ease and aid in overcoming some of those feelings. Not to mention join many great feelings because this is a journey we are on together for at least 45 days.
Most buyers have no clue what this process looks like. What do I need to qualify? How much do I have to make? How much can I afford? Will I have all the documents that I need? Who does what?
It’s not what you are doing, it’s How and Why you are doing it that should matter. Those are the questions a good Real Estate Agent will ask you. IF they don’t, you should already be asking yourself and figuring that out.
The process itself is quite easy. There is a lot of paperwork but once gathered, everyone else takes over. Here’s what you need to know:
Banks/Lenders/Mortgage Brokers all assist in gathering your financial information. Tax returns, bank statements, other means of income and expenses. Sometimes that includes divorce paperwork, including child support or alimony. At this point they should be able to give you a pretty good idea of what you can afford. They then can give you a PRE-APPROVAL letter. This doesn’t guarantee the loan at this point, it just says that you can afford that amount. This letter makes your home offer stronger because you have proof you can afford it. It reassures the sellers that you are qualified to buy this home.
Real Estate Agents or brokers are your next step. They can help guide you through this whole process. They assist in getting you into the homes you want to see, either by homes that you have found, or if you have given them parameters of what you are looking for, they have made a list and will show you those homes. Once you have found a home that you want to make an offer on, the agent then completes an offer for you to submit to the owners or their agent. From there it’s negotiation and hopefully in the end you can meet in the middle.
Once under contract, you then go back to the lender to APPLY for the loan. Paperwork is then shuffled to underwriters for approvals.
Closing is done in a few ways. Depending where you are in the United States or other parts of the world, this may vary greatly. Typically, TITLE Lawyers collect all the information from the Lender, buyers and sellers’ information. They will prepare the new deed and title search for the property. Issue title insurance. If problems or questions come up, you are notified. You can more than likely work through them. They gather all outstanding mortgage details from sellers, square away all misc. debts like water, sewer, and prorate taxes and other filing fees, commissions and other charges that can vary from each transaction.
Once the lender has all the information and underwriting has approved the loan, you are then CLEAR TO CLOSE. There are times when extra paperwork is needed to continue, that of which you gather and keep the process going.
When Title has the CLEAR TO CLOSE, the new deed, all other documents and final numbers, they then give you a form that has all the final numbers and you have a few days to look the information over, ask any questions, and make sure this is what you want. If you’re good with all that, you finalize a date to close.
At CLOSING you need your ID, to prove you are who you say you are. There are lots of documents to sign for the buyers, only a few for the seller. Once signed they hand you keys to the new property and off you go. Each state may be different so make sure you check with your agent on the exact process that works for you.
Now that you know the process, I hope that eases some fear of not going forward. However, I can’t express how important knowing HOW and WHY you are doing this. Let me ask you the hard questions.
These are the HOW questions:
How do you plan on paying for this? Meaning, explore faster, more genius ways to pay this down. Take advantage of refinancing when the market turns to help pay off the mortgage sooner and in return put that money towards other goals.
How do you plan to budget for a LifeStyle? Owning a home is amazing, but don’t over buy to the point of no life or LifeStyle. Know what you need to enjoy life and budget that into your discussion on a home budget. You will thank me later.
How long do you plan on staying? Buy a home that makes sense for the Life you have and a few years out. If you buy smart, you can adjust homes, locations and living expenses when you need to without worrying you made a mistake or you’re stuck. You are never stuck.
How do you not get attached? By not attaching ourselves to things, we then are able to move on when the situation doesn’t work any longer. Enjoy it, but don’t let it control you. Treat your home like a business. Invest smart, maintain it, and let go when the risk is no longer the reward. The risk could be location, expenses, size and anything related to your WellBeing.
These are the WHY questions:
Why this location? Will this location allow you to do the activities you love to do? Are you here because of work or friends? Do you feel tied to this location? Do you like the community?
Why this Style? Everyone has a style of home they like. Try to find a style that is close to what you want, you will enjoy it more, take care of it better. If style is important, you may have to look out beyond a location to get what you want. Ask what is more important. Style or Location?
Why this size? Size does matter. If you know what a few years out looks like, plan for that size, not what you will need in 10-15 years. Lots can happen before then. Buy smart! Upsize and downsize when you come to that point, but live for now and what works for now.
My hope is that people start asking these questions before and during the buying process. It’s ok to not know the answer right now. Explore, plan and then adjust when you need to. Life isn’t meant to be sedentary. Keep an open mind. Don’t over buy just to work your face off and not even spend time there. You will lose years of fun, exploring, enjoying life just to prove you can afford a home. A home is security and an asset only. Your life is what is precious.
LTD can help you find partners, resources and education that will help you make better decisions towards your home, living expenses and wellbeing. It’s never too late to transform what is into something fantastic.
Becoming a member of Light Touch Dwellings gives you access and deals towards many homes, property and LifeStyle services. We will help align your ideal LifeStyle with a home. Why wait to save, join now for savings.