The Home Buying Process

As a follow-up to my last blog about the home selling process, here is a guide for the other side of a real estate transaction – the home-buying process.  As with selling your home, the process to buy a house can seem complex and confusing at times.  Luckily, you can get help from a real estate professional who will guide you through the process every step of the way.  One thing some first-time home buyers don’t realize is that in most circumstances, the agent’s commission is paid for by the seller of the home, not the buyer.  So this means your representation should cost you nothing!

When you meet with a real estate professional, you will want to discuss what you are looking for in a home & ideal location so they know the parameters of your home search.  Your realtor will likely ask you pretty early on if you will be requiring a loan or paying cash.  If you are getting a loan, you will want to get pre-approved by a lender right away. This helps ensure you are searching for homes in an accurate price-range and when it is time to put an offer on a house, you can quickly have a pre-approval letter to give with your offer showing you can afford a house of that amount.  Having this pre-approval completed at the start will make the process move a lot more smoothly.  If you aren’t sure where to start with finding a lender, your broker may be able to provide recommendations.

The fun part is searching for a home!  Your realtor will search for homes in your criteria & schedule showings as appropriate.  When you are looking at homes, it is important to think beyond just the obvious like number of rooms, size of kitchen, and age of the roof.  You may want to visit my blog post about important things to consider when buying a house.  There is no magic number on the amount of homes you should see before you make an offer.  I always tell my buyers you need to have the right feeling with a house – you should feel at home in it to know it is right for you.  Once you find the right home, your agent will prepare the offer based on the price and terms you choose.  Often there will be some form of negotiation on both sides and once the parties come to an agreement, you are under contract!

The contract will dictate the dates, deadlines, & terms that must be met before closing & possession – these include items like the inspection, appraisal, due diligence documents, record & off-record title, property insurance, loan deadlines, and more.  Your broker should keep you up to speed on all upcoming deadlines and what to expect.  If you are getting a loan, you will also be getting a lot of requests from the lender on information you need to provide.  Staying on top of both of these will help make the process as smooth as possible and not risk delaying close (or worst case, terminating the contract).

The last deadlines will be the closing date & possession (not always the same date).  Closing is the transfer of funds and ownership & the day we are all looking forward to!  A title company or an attorney typically acts as an independent third-party to facilitate the closing.  Post closing & at the time of possession you can celebrate your new home and the new title of being a home owner!  Congratulations!!

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I would love to help you find your next home!  Please contact me below if you have any questions on the home buying process or would like to discuss how I can help you with you real estate needs.  Visit my testimonials page to see what others have to say about working with me.


Important Items to Consider in Your Home-Buying Search

As we get into the busy spring & summer months of real estate, we will see more homes coming on the market, but along with that there will be more buyers.  In hot markets like the Boulder-Denver area, we are seeing houses fly off the market in days, often ending in bidding wars.  I believe that buyers are feeling pressured to act fast without thinking through the details of a house & how it may or may not work for them.

Houzz has a great Home-Buying Checklist that lists out 20 things to consider beyond the inspection.  There are many great points in this article to think through on your search to ensure the house you may be considering is the right fit for you and your family.  Some are obvious like:

  • Size of rooms
  • Number of bathrooms
  • Kitchen features
  • The neighborhood

However, there are other points that may be less obvious and potentially more important such as:

  • Interior layout: does the flow work for your daily life?
  • Lot grade & lot features: how much of the lot is usable for you & is the property safe for children or pets?  Is there more yard work than you can realistically manage?
  • Amount of natural light:  if you are seriously considering a home, look at it a second time and at a different time of day to see what the light is like in the house.
  • Regional weather conditions: think about the functionality of the house & outdoor space in all seasons, not just the season you’re searching in.
  • Street parking: there may be rules that are more or less favorable to your situation. Some families may need to rely on street parking and others may not want a street lined with cars.  Checking into HOA requirements &/or town ordinances can help identify what the parking situation is.

Having these items in the back of your mind as you go through your home search may help ensure you are happy with your home purchase for years to come.

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If you or anyone you know needs help on their Boulder-Denver home buying search, I’d love to help!  Please reach out through the contact form below or emailing me at beth@goodacreproperties.com.

Photo from @Houzz


Is This Your Year to Become a Homeowner?

Have you been thinking about purchasing a home for a while now but, haven’t acted on taking the first step?  Buying a home can seem daunting and you may have more questions than answers which may be what’s holding you back.  It’s true that buying a home may be one of the biggest investments you may make financially, but it doesn’t need to be a scary process.  Getting a good understanding of your finances & what to expect with purchasing a home may help you decide if you are ready to take the next step to start the home buying process.  Below are some key things to think about.

  1. Credit Report. A very basic, yet important factor in your ability to buy a home is your credit rating.  The best interest rates & more flexible loan terms are available to those with the strongest credit scores.  You should understand what your credit score is and ensure that the items they are reporting on are correct.  There are three major credit reporting agencies you can contact for your credit score: Experian, Equifax, or TransUnion.
  2. How much home can I afford?  This is probably your biggest question and something you’ll want to accurately know the answer to in order to not be disappointed later in your home search.  To get the most accurate answer, you’re going to want to have a conversation with a lender.  A lender should help evaluate your current financial situation, as well take into account your future plans that may affect how you think about your home purchase & investment.
  3. Upfront Fees & Expenses.  Most homebuyers are aware that they need money for a down payment, but it doesn’t necessarily need to be 20%.  The best way to know how much you need for a down payment is to talk with a lender – you may qualify for less percent down.  On top of the down payment, there are more costs that you will need to plan for.  Money will need to be alloted for costs associated with the loan, earnest money with your offer, costs for inspections, and closing costs. Finally, don’t forget about a cushion for things like actually moving and buying items to get settled in your new home.
  4. Lending Options. Banks are not the only source anymore for obtaining a loan to buy a home, there are plenty of other options and it is suggested you shop around to find a lender.
    • Mortgage Bankers loan their own money and then usually sell the loan to recapture their original money plus a small profit.
    • Mortgage Loan Brokers are in the business of matching buyers & homeowners with lenders that are likely to finance them.  The buyer usually picks up the fee for this service.
    • Financial Institutions are commonly known as traditional banks or “prime” lenders.
    • Private Lenders usually refers to sellers who are open to owner financing.
    • Credit Unions – some do issue mortgages for their members and generally can beat the rate of the bank, or at least offer the same.
  5. Pre-Approval.  Once you narrow down which type of lender can best meet your needs, the next step is to get pre-approved for a loan.  This is not the same as pre-qualification.  Pre-qualification is an estimate of how much you can afford in a mortgage payment and simply means that the lender has looked at the information and that there is a high probability that the purchaser will qualify for the requested loan.  Pre-approval is a firmer commitment on behalf of the mortgage company & is a more formal process including a credit check & employment verification.  A seller is likely to view you as a more capable buyer if you are pre-approved which can give you an advantage as a buyer in the marketplace.  It is wise to obtain pre-approval at the beginning of the buying process so you know how much home you can afford and risk not qualifying for a home you go under contract with.

With these steps taken care of, you may feel the confidence and reassurement to start searching for your perfect house!

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If you are ready to embark on your mission of finding your perfect home in Colorado – I can be with you for every step of the way.  Please contact me to discuss your real estate goals: