1st Time Home Buyers
Buying a home is one of the major purchase decisions of your life; therefore, it's important to be an informed buyer. The following buying process overview will help you get a good idea of a typical home sale and all of the steps that go into the process. A .pdf version of this process can also be found under FEATURED DOWNLOADS on the left panel.
The process of buying a home can and should be an enjoyable one. Here is a typical sequence of steps that I go through with every buyer I work with.
1)Initial Consultation-During this initial consultation I go through the home buying process and explain the legal obligations of both a seller's agent and a buyer's agent. Most of my clients pay nothing additional to take advantage of my expertise. My commission is generally paid out of the seller's agent fees(CLICK ON "HOW I GET PAID" for details). We will also discuss your home search criteria to make sure the houses that I show you are the ones you want to see.
2)Get "Pre-Approved"-This is especially key in the tough financial market we are currently in. A pre-approval is considered much better than a simple pre-qualification. This can help you immensely in a situation where two similar offers have been received and one has a pre-approval and the other has a pre-qualification. This can also help speed the process when you find your home.
3)Happy Hunting-After our initial meeting I set all my buyers up to receive automated daily emails with all the houses available that meet your criteria. From these emails you can choose what homes you would like to get a closer look of, and then I schedule showings. If you are not familiar with the area I strongly recommend driving by any homes before viewing them. This can save you a lot of wasted trips to areas that you wouldn't live in regardless of how much you like the home.
4)The CMA-Once you have found a home you really like and are at least interested submitting an offer, I usually complete a buyer Comparative Market Analysis. This report serves as a guide to compare other activity in the area, looking closely at what similar properties have sold for in the past 6 months.
5)The Offer/Negotiation-Once you have decided that this may be the home for you, I usually meet with my buyer clients to discuss the terms and conditions of the offer. From there we will work together to ensure that you are getting the most for your money.
6)Purchase and Sale Agreement(P&S)- After both parties have agreed to the price and terms of the sale of real estate in Rhode Island all parties sign a purchase and sale agreement. As this is legally binding document, I review all the information with my buyer's to ensure that everything is understood. Making sure all contingencies are in place for anything that would allow you to walk away if unforseen problems arise. If there are any special considerations for the sale of the property(ie...short sale/foreclosure) I strongly recommend seeking the advice of an attorney at this point.
7)Review and Game Plan-Even though I go over the entire process at our first consultation, since it could have been months since then, I take a little time to go over the remaining steps from here to ensure a smooth closing.
8)Home Inspection-Depending on the terms of the P&S, you are generally given 10 days to have all of your home inspections done. Depending on your home this may include a general home inspection,radon inspection, pest inspection.
9)Mortgage Application-Altough you have already been pre-approved, you will need to formally apply for the mortgage.This is where you will be able to lock in your rate and get what is called a "good faith estimate". This document will give you a good idea of the estimated closing costs and estimated monthly payments using your current interest rate and exact purchase price.
10)Appraisal-This is the lender's appraisal to ensure that the property is worth what you are paying for it.
11)Homeowner's Insurance-Before you will be able to receive your final seal of approval from the bank you will need to have your homeowner's insurance policy in place and get a binder to the lender.
12)Receive Mortgage Commitment Letter-This is usually received about 10 days before closing. This is usually the final hurdle to overcome in a conventional home buying process.
13)Final Walk Through-The morning of the closing I take my buyers for a final tour of the property. Just to make sure nothing has changed or if some changes that were agreed upon have been made.
14)Closing-Ahhhhh.We are finally here, don't worry just a few documents to sign :) and you get the keys to your new home.
**Note-This is my buying process for RI clients, my MA clients can expect pretty much the same thing, except in MA the offer is a more binding document and serves as a temorary Purchase and Sale document, until all the inspections have been done. Then both parites will sign a Purchase and Sale Agreement.
