First-Time Home Buyer Process and Tips

1. Get your finances in order

Review your credit report and be sure you have enough money to cover your downpayment and your closing costs. Down payments can be as low as 3.5-5% sometimes less with grants! 

2. Don’t wait to get a loan

Talk to a lender and get prequalified for a mortgage before you start looking.  We recommend Shawn Jensen see his contact information here

3. Do your homework, get educated on pricing

Understand the pricing and market conditions by talking to us and viewing some properties.  We can help set your expectations and get you dialed in on what good deals are.

4. Be picky, but not unrealistic

Ask us if you real estate goals are realistic.  If your real estate goals are extremely challenging get your finances in order and be prepared to move quickly on a great deal when it finally comes on the market. The great deals sell fast! We need to be the first shoppers in the property, and first to turn in an offer.  We specialize at this.

5. Time your move

Timing your move is important.  After you settle on a home you have 30 days before you 1st mortgage payment is due so that gives some flexibility.  Consider When is your lease is up and weight your options.  Start home showing 3-4 months before your lease is up.  It takes 30-60 days to settle and sometimes months to find “the one” for you.

6. Think long-term

Are you looking for a starter house with the idea of moving up in a few years, or do you hope to stay in this home longer? Could you keep this home work as a good investment  in the future?This decision may dictate what type of home you’ll buy, as well as the type of mortgage terms that suit you best.

7. Don’t let yourself be house poor

If you max yourself out to buy the biggest home you can afford, you’ll have no money left for maintenance or decoration, or to save money for other financial goals.

8. Get an inspection!

Insist on a home inspection and, if possible, get a warranty from the seller to cover defects within one year.  Sometimes we can get the sellers to make repairs to issues discovered at the inspection.

9. Go to settlement!

We’ve found the house completed the inspection, secured the loan, and now it is moving time! 

10. Hire Us!

As your exclusive buyer’s representatives we look out for your interests and guide you through the purchasing process.  At no cost to you—buyer’s reps are paid out of the seller’s commission payment.

Why you should use a real estate agent?

1. We have loads of expertise

Buying a home is a complicated process.  Buying a home usually requires dozens of forms, reports, disclosures, and other technical documents. We have  the expertise to help you prepare a killer deal, while avoiding delays or costly mistakes that can seriously mess you up.  We do this all day everyday! Chances are we’ve seen it all before.

2. We have unusual super searching power

The Internet is awesome. You can find almost anything – anything! Sure my websites, Trulia, and Zillow are great but we have access to even more listings. Sometimes properties are available but not actively advertised.  We also follow auctions, foreclosures, short sales, that sometimes never get listed. We also do a lot of networking in areas you may be searching.

3. We know how to negotiate and get deals done!

Any time you buy or sell a home, you’re going to encounter negotiations—and as today’s housing market heats up, those negotiations are more likely than ever to get a little heated.

Sometimes you can expect lots of competition, cutthroat tactics, all-cash offers, and bidding wars. Don’t you want a savvy and professional negotiator on your side to seal the best deal for you?

And it’s not just about how much money you end up spending or netting. A Realtor will help draw up a purchase agreement that allows enough time for inspections, contingencies, and anything else that’s crucial to your particular needs.

4. We’re connected

We might not know everything, but we make it our mission to know just about everyone who can possibly help in the process of buying a home. We know lenders, title companies, home inspectors, home stagers, contractors and—the list goes on—and they’re all in our network for you to use.

5. We adhere to a strict code of ethics

We are very honest and truly care about achieving your goals. Realtors are held to a higher ethical standard than licensed agents and must adhere to a Code of Ethics.

6. We’re your sage parent/data analyst/therapist—all rolled into one

The thing about Realtors: we wear a lot of different hats. Sure, we’re salespeople, but we actually do a whole heck of a lot to earn our commission. We’re constantly driving around, checking out listings for you. We’re researching comps to make sure you’re getting the best deal, setting up inspections, contractor meeting, dealing with buyer’s anxiety during the offer process, we’re constantly scanning the market and networking trying to find a place for you, coaching you on realistic expectations and the best thing to do, advising you on lenders, calling your lender, dealing with appraisals, and trying to negotiate the best deal for you. 

And, of course, we’re working for you at nearly all hours of the day and night—whether you need more info on a home or just someone to talk to in order to feel at ease with the offer you just put in. This is the biggest financial (and possibly emotional) decision of your life, and guiding you through it isn’t a responsibility we take lightly.

What do home inspections cover?

Key things to keep in mind

A professional home inspection helps you to learn about the home you’re buying, and gives you the knowledge to address potential concerns. Inspections should cover all mechanical and structural components to a property that the inspector can see. You an also test for an array of environmental concerns like radon.  It is important to choose an good inspector and chances are we have some we can recommend.

Home inspectors look for everything they can find and not limited to:

Siding: Look for dents or buckling

Foundations: Look for cracks or water seepage

Exterior Brick: Look for cracked bricks or mortar pulling away from bricks

Insulation: Look for condition, adequate rating for climate (the higher the R value, the more effective the insulation is)

Doors and Windows: Look for loose or tight fits, condition of locks, condition of weatherstripping

Roof: Look for age, conditions of flashing, pooling water, buckled shingles, or loose gutters and downspouts

Ceilings, walls, and moldings: Look for loose pieces, dry wall that is pulling away

Porch/Deck: Loose railings or step, rot

Electrical: Look for condition of fuse box/circuit breakers, number of outlets in each room

Plumbing: Look for poor water pressure, banging pipes, rust spots or corrosion that indicate leaks, insufficient insulation

Water Heater: Look for age, size adequate for house, speed of recovery, energy rating

Furnace/Air Conditioning: Look for age, energy rating. Furnaces are rated by annual fuel utilization efficiency; the higher the rating, the lower your fuel costs. However, consider factors like payback period and other operating costs, such as the electricity to operate motors. 

Garage: Look for exterior in good repair, condition of floor—cracks, stains, etc., condition of door mechanism

Basement: Look for water leakage, musty smell

Attic: Look for adequate ventilation, water leaks from roof 

Septic Tanks (if applicable): Adequate absorption field capacity for the percolation rate in your area and the size of your family

Driveways/Sidewalks: Look for cracks, heaving pavement, crumbling near edges, stains

Common Closing Costs Questions

Things to know

The lender must disclose a good faith estimate of all settlement costs. A check to cover your closing costs will probably have to be a cashier’s check. The title company or other entity conducting the closing will tell you the required amount for:

  • Downpayment.
  • Loan origination fees.
  • Points, or loan discount fees you pay to receive a lower interest rate.
  • Appraisal fee.
  • Credit report.
  • Private mortgage insurance premium.
  • Insurance escrow for homeowner’s insurance, if being paid as part of the mortgage.
  • Property tax escrow, if being paid as part of the mortgage. Lenders keep funds for taxes and insurance in escrow accounts as they are paid with the mortgage, then pay the insurance or taxes for you.
  • Deed recording fees.
  • Title insurance policy premiums.
  • Survey.
  • Inspection fees—building inspection, termites, etc.
  • Notary fees.
  • Prorations for your share of costs, such as utility bills and property taxes.

 A Note About Prorations. Because such costs are usually paid on either a monthly or yearly basis, you might have to pay a bill for services used by the sellers before they moved. Proration is a way for the sellers to pay you back, or for you to pay them for bills they may have paid in advance. For example, the gas company usually sends a bill each month for the gas used during the previous month. But assume you buy the home on the 6th of the month. You would owe the gas company for only the days from the 6th to the end for the month. The seller would owe for the first 5 days. The bill would be prorated for the number of days in the month, and then each person would be responsible for the days of his or her ownership. 

What to Keep From Your Closing

  • The Real Estate Settlement Procedures Act (RESPA) or HUD-1 statement. This form itemizes all the costs associated with the closing. You’ll need it for income tax purposes and when you sell the home.
  • The Truth in Lending Statement summarizes the terms of your mortgage loan.
  • The mortgage and the note (two separate documents) that spell out the legal terms of your mortgage obligation and the agreed-upon repayment terms.
  • The deed, which transfers ownership of the property to you.
  • Affidavits swearing to various statements by either party. For example, the sellers will often sign an affidavit stating that they have not incurred any liens on the property.
  • Riders, amendments to the sales contract that affect your rights. For example, if you buy a condominium, you may have a rider outline the condo association’s rules and restrictions.
  • Insurance policies that provide a record and proof of your coverage.