HOME-BUYING PROCESS

Step 1: Start scheduling showings with your real estate agent.

Talk to your real estate agent about what you’re looking for in a home. Most real estate agents have access to the MLS - Multiple Listing Service, to show you homes that meet your criteria.

Step 2: Make an offer.

Making an offer, involves several components. First, speak with your realtor on negotiating the offer amount and closing costs. Choose a closing date with enough time to complete inspection, appraisal, and mortgage contingencies. Decide on the earnest money deposit (EMD), which shows that you are serious about purchasing the home. Your EMD can range from a few hundred to a few thousand dollars, depending on the agreed purchase price. If any contingencies fail, your EMD will be returned to you. 

Step 3: Get a home inspection. 

A home inspection is an evaluation of the condition of the property. An inspection costs $250+ depending on the size of the home. 

Step 4: Get an appraisal.

An appraisal is an evaluation of the property’s value by a licensed professional appraiser. Most mortgage programs require a home appraisal to determine if you are overpaying for the property and if their loan is ever at risk of default. It gives the banks comfort that if you have to sell your home and cannot cover the loan amount, they will get their money back and gives you peace of mind that you are not overpaying for a house. Appraisers determine the value of the home by comparing it to recent sales of other similar properties in the area. 

Step 5: Purchase home insurance.

If you are using a mortgage for your purchase, your lender will require you to purchase home insurance and show proof of this purchase prior to closing. If you are planning on renting your property, ensure that your tenants purchase renters insurance to protect their belongings from theft, flooding, etc.

Step 6: Close on the house.

Closing refers to the day that you legally become a homeowner. The property transfers to your name via a warranty deed, identifying you as the new owner. Documents are signed and funds are dispersed to the seller.