How to Buy a Home, Condo, or Town Home
Get Your Finances in Order
Most people think they know what is on their credit reports, however sometimes there are surprises or mistakes on your credit reports. It is best to review and correct all three of your reports before you start to search for a home. These credit reports will play an important part in the mortgage approval process. They will determine the interest rate and other important terms of the loan that the lenders will offer you. To learn more about credit reports and how credit scores are calculated visit www.myfico.com or to get a copy of your credit report visit www.freecreditreport.com.
Shop for a Lender or Mortgage
Finding the right type of loan to suite your needs as well as finding the right lender or mortgage company can be very important to the success of your home buying experience. It is a good idea to get familiar with the different types of loans available today. A good lender will explain all of your options. We recommend that your talk to more than one lender to help you get a better feel for the loan market and current mortgage rates. View our Types of Mortgages to get a better idea about which type of loan or mortgage will best suites your needs.
Get Pre-Approved for a Mortgage
After you have decided which type of loan and which lender will best suite your needs it’s time to get pre-approved. Why should you get pre-approved? For example: You make an offer on your dream home and the seller receives a similar offer the same day. The only difference is that your competitor has been pre-approved and is ready to move forward with the formal contract. Which offer do you think the seller will accept? Learn more about how and why you should get pre-qualified.
Determine How Much You Want to Spend
Buying a home is not as difficult as you might think, however the process will be much easier if you take time to determine how much you want to spend versus how much you can spend. You will save many hours and a lot of effort by determining your wants, needs, must-haves, and how they will all fit into your budget before you start physically looking a homes. Use our free MLS search to get familiar with the local market Learn more about common home buyer mistakes.
Select an Exclusive Buyer’s Agent
Hiring an exclusive buyer’s agent can benefit you in many ways, particularly because you are already paying for those services in the purchase of the home. So why shouldn’t you have contractual relationship with a realtor who is legal bound to work for you and can be held legally accountable for any problems or mistakes? You should. Both the seller’s agent and the Buyer’s agent are paid from the proceeds of the transaction that are included in the marketing costs of the home. If you don’t take advantage of hiring your own exclusive buyer’s agent, you are paying for services that you aren’t getting. You have the right to legal representation when you purchase your home, condo, town home, or any other real estate. See our Home Buyer’s Bill of Rights to find out more or search for an Exclusive Buyer’s Agent.
Search for a Home
Once you have decided on an exclusive buyer’s agent your agent will email or give you MLS listings which fit your criteria for you to review. Also be sure to pick up home sales magazines, newspapers, and continue to search the Multiple Listing Service (MLS) to search for properties that might fit your needs. You might even plan afternoon drives through the neighborhoods that interest you, but be sure to call the agent you have hired before attempting to view any homes. This will save you time money and effort in the long run.
As you search for homes be sure to keep in mind what you do and do not like and communicate those feelings to your agent. Neither you nor your agent wants to waste time looking at homes that aren’t appropriate for you. Perhaps a home isn’t perfect, but with a few minor repairs it could be the perfect home for you. Don’t let cosmetic or minor remodeling problems discourage you . Many remodeling jobs add incredible value to a home.
During your home search keep in mind there are many topics that are very important to your search. You need to consider the possible resale value, neighborhood restrictions, age of the heating/air unit and water heater, electrical systems, easements, and zoning as well as numerous other issues. This is where your exclusive buyer’s agent comes in, this is where you get the most “bang for your buck.” Your exclusive buyer’s agent will have access to this information and will be able to get it to you quickly. See our Guidelines for Clients for more information on this subject.
Making an Offer
When you have decide on the home you want to buy your exclusive buyer’s agent will write a purchase contract, which is known as the “offer.” Your offer will spell out what you will pay for, what the seller will pay for, when and where you will close, and when you will take possession of the home. You contract will also include many important contingencies such as home inspection, title, loan, and appraisal. These contingencies will work to protect you, the home buyer, as well as save you time, money, and effort.
When you make your initial offer, you should also include an earnest money check. Earnest money is a good faith deposit that shows the seller you are submitting a serious offer. The earnest money check is deposited into an escrow account by a closing attorney or principal broker and is held in trust until either closing or returned to the buyer. If you purchase the property the full amount of the earnest money check will be applied to your closing cost or the contract sales amount. If you decide not to purchase property the earnest money may be returned to you, the buyer, or given to the seller depending on the terms of the purchase contract. learn more: All Real Estate Contracts Are Not Created Equal
Negotiation and Counter Offers
In many cases the first offer you make may not be accepted by the seller. If this happens the seller will usually make a counter offer. Each offer and counter offer will have a specific timeframe within which each party must respond. There can be several rounds of counter offers.
Home Inspections
The purchase contract is usually contingent upon the buyer being satisfied with the results of the home inspection. The Buyer’s Agent of Nashville & Middle Tennessee always recommends you get a full home inspection including mold inspection, radon gas, septic systems, lead-based paint for homes built before 1978, foundation, test for private wells. and heating & air inspection. Most loans require a termite inspection, however if you are paying cash or are using a loan that does not require a termite letter you and your agent should make sure to get one. If there are any problems with any of these inspections your exclusive buyer’s agent will sure to address them. learn more about our services with One Stop Shopping With The Buyer’s Agent of Nashville & Middle Tennessee.
Shop for Homeowners Insurance
You exclusive buyer’s agent will refer you to three reputable area insurance companies and give you some general advice in this area, however you must make the final decision about the home owners insurance you buy. See: What You Should Know About Home Owners Insurance for more information on shopping for home owners insurance.
Getting the Home Appraised
The lender you have chosen will arrange to have the home appraised, which could affect with or not the loan is approved. It is unlikely that you will have a problem in this area because your exclusive buyer agent will have already done a Comparative Market Analysis (CMA) on the home or property to ensure that you did not offer more than the fair market value when you made your original offer. Our agents use virtually the same technique for determining the value of a home or property as the professional appraiser do. This is just one of the many ways The Buyer’s Agent of Nashville & Middle Tennessee help you save, time, money, and effort. To learn more see our How Homes Are Priced for more information.
Go to the Closing
The “closing” or “settlement,” as it is sometimes called, is the event in which actual ownership of the home or property is legally transferred into your name. In Tennessee closings are usually handled by a closing attorney or title company who also handles the escrow settlement and title services. Before closing and even during closing there are a few things that could happen. You might find out your closing costs are going to be a little higher than you thought because of some additional service fee added by your lender. There could be an unforeseen problem with your credit report which delays the purchase; a problem the seller had promised to remedy wasn’t repaired in time; the seller has not transferred to home warranty into your name. How will these last minute problems be handled? That’s where the experience and loyalty of an exclusive buyer agent is so valuable. Remember, as the largest and oldest exclusive buyer’s agency in the Nashville & Middle Tennessee area, if a problem arises we have probably seen and dealt with it before.
And when everything is said and done, and all the papers are signed you are the proud new owner of a wonderful home, congratulations!
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