Home Buying Basics – Step by Step

So you’re ready to buy and you are wondering what are the steps to purchasing a home? Every real estate transaction will always have it’s unique variables and you can prepare yourself by looking over this list.

To make things easy, this will be divided into two sections.  One section will include steps specifically for you and the other section will include steps we will be doing if you pick us as your real estate team.  We recommend printing off this list and crossing out items as they are completed.

Picking Your Realtor

This is one of the more important steps that will have a major effect on your real estate journey.  From experience, to local knowledge, personality, and availability, you’ll want to find someone you are comfortable working with that you feel is looking out for your best interests.  Naturally we are going to recommend our team because we take our role very seriously.  Our style is natural, laid-back, and honest.  We’re going to make sure we are the right fit for you and have the time to meet your needs.  If not, we have a network of agents we can refer you to all over the world to assist you.    

Get Pre-Approved for a Loan

Unless you are a cash buyer, you’ll want to get pre-approved for a loan.  There are some people that want to start the process before getting their pre-approval and that is a huge mistake.  Some sellers will require the buyers to submit a pre-approval letter before entering a property and the last thing you want to do is not truly know what you qualify for or have to wait on a lender to work one up when you find a property you love.  There is no cost to getting a Pre-Approval. We can give you some great recommendations for lenders if need be. Once we get that taken care of, it’s time to go find you a new home!

  • You’ll want to see what your lenders guidelines are for getting a loan estimate – an estimated breakdown of your closing costs
  • If you have a special type of loan, you’ll want to be aware of the conditions – income restriction, property type, payback, etc.

Start Your Home Search

You may have already been browsing around on many of the real estate portals including Zillow and Trulia which is a good place to start.  However, once you are working with us, we’d like to give you a market advantage.  When you use these real estate portals you are browsing through outdated information that can be days or weeks behind.  In a hot real estate market such as Pinellas County, using these sites as your go-to source could make you a day late and a dollar short when making an offer on a home. Let us set you up on your MLS search today and give you the edge on your competition. 

Making An Offer 

Once we find a home you like, we’ll do some research and look at a few different factors to determine what kind of offer we’d like to make. We will look at days on market, what the comparable properties in the neighborhood have recently sold for, the condition of the house and the motivation of the seller. When writing up the offer we will discuss and decide on a few things: the offer price, the amount you’d like to put in escrow, the time allowed for an inspection period, the closing date and any additional terms that may be necessary.

Contract Execution

When the contract is legally executed that’s where the true works begin.  There are many items we will be taking care of for you on your behalf including keeping you updated on any contingency timeframes.  You will have a certain amount of days to put in a loan application with your lender of choice (we’ll let you know how many days based on the contract).  We’ll coordinate with you on options to get the escrow deposit delivered. There may be several emails from both the lender and title company requesting time-sensitive information so you’ll want to keep an eye out for that.

Home Inspection

The inspection period is usually the make or break time when buying a home. The home inspection will allow us to find out if there are any major defects with the home. If there are any major defects we can take one of two routes – We can ask for the sellers to take responsibility for it where they will either hire someone to make the repairs or credit us money at closing. The second option is we can back out of the contract with no negative repercussions. We will make sure you are certain of your decision before the inspection period is over.

Negotiate Repairs

After the inspection we will review the report and figure out what concerns need to be addressed. Every inspection report will find something… we are looking to find the major items that are either a hazard or uninsurable.  You might have heard before that houses in Florida are typically sold “As-Is”. This means that the seller has no obligation to complete repairs, however both sides of the party want the transaction to go through so the vast majority of sellers will be willing to make some necessary repairs. As mentioned before, we are able to back out of the contract during the inspection period if we are not able to come to an agreement on repairs.

Loan Underwriting & Appraisal

At this point in the process, your loan should be in the underwriting process. We will coordinate with your lender and the listing agent to schedule an appraisal. If the home has been priced correctly then we should have no problem with the home appraising at value.  During underwriting all of your financial documents and credit history will be analyzed and when everything is given the green light we can begin the closing process.  Keep in mind any major changes in your financial status or debt to income ratio could cause financing to fall through.  Make sure your lender goes over any restrictions that could kill the loan – “financing a car, furniture, etc.”

Final Walkthrough

Either the day before or the day of closing we will perform a final walk through of the property. We will walk through the home to make sure all utilities are working properly and we will also verify that any repairs we agreed on were completed. When this is signed off we are ready to go to closing. (Do you want more information on the final walkthrough? Check out this in-depth article we wrote here).

Closing

You may want to do some hand exercises before closing because you will be signing a ton of documents. Usually closings take anywhere from 1 to 2 hours. Once we’re done we will give you your keys and congratulate you on being a new homeowner!

What Does The 727 Team’s Steps Look Like?

We think there can be some misunderstandings out there on the work-load a buyer’s agent must take on during a transaction.  Some of these misunderstandings may come because of bad experiences or agents not doing their jobs.  With Ryan and Chris, it’s always about top-notch customer service and going the extra mile for our clients.  Here’s a peek into what we usually do if you allow us the honor of serving you as your buyer’s agent.

  1. Have a consultation with you to discuss your dreams, wants, and needs.  (Providing information on the local market).
  2. Discuss the steps of the process, our role, and figure out how we can best serve you.
  3. Recommend lenders upon request and provide contact information.
  4. Set you up on a MLS (multiple listing service) search and start looking for properties.
  5. Recommend you receive a loan estimate from your lender so you can have an idea of closing costs.
  6. Setup and show you properties.
  7. Screen any potential properties for price history, comparables, restrictions, and additional documentation.
  8. Analyze property details for homes on the tax appraisers website.
  9. Make sure listing agents have the appropriate disclosures on properties you are interested in.
  10. Write an offer on a property you are interested in and answer any questions on the contract, addenda, and disclosures.
  11. Find out closing agent (either attorney’s office or title company) from listing agent and include in the contract if you elect to let the seller pick the closing agent.  (This is common on the FAR/BAR AS/IS and could mean the seller will pay the owners title insurance).
  12. Confirm listing agent received offer and keep open line of communication on status.
  13. If offer is accepted and delivered to all parties, contract is executed and we prepare our buyers for the next steps.
  14. Establish specific timeframes with our buyers including loan application timeframe, escrow deposit delivery time, and inspection period.
  15. Send contract and addenda to all parties including the chosen lender and closing agent (title company or attorney’s office).
  16. Find out for our buyers options to deliver escrow deposit (earnest money) and make it convenient for them.
  17. Obtain escrow receipt from closing agent and deliver to all parties.
  18. Offer recommendations for home inspectors (if requested) and help with the coordination of setting a time.
  19. Advise on how the inspection period works and what options are available within the contingency.
  20. Attend the home inspection.
  21. Check on loan application with lender.
  22. Review inspection reports and discuss the details.
  23. Negotiate with sellers/listing agent any repairs or credits if needed.
  24. Explain how the appraisal works.
  25. Order appraisal through the lender and establish timeframes.
  26. Check in with title company/closing agent on status of municipal lien search, title commitment.
  27. Monitor timeframe for loan approval and stay in touch with loan officer.
  28. Review appraisal, if property doesn’t appraise, both the lender and buyers will be reached out to to discuss options.
  29. If property appraises, deliver to respective parties.
  30. If requested, offer recommendations of home insurers and make sure they will have what they need to bind insurance.
  31. Go over wire-fraud risks and discuss options to stay protected.
  32. Coordinate on a good time to turn on utilities and answer any questions about available providers in the area.
  33. Confirm that closing disclosure was received in a timely manner and review.
  34. Coordinate final walkthrough time.
  35. Attend final walkthrough and visually inspect property.
  36. Coordinate with all parties to make sure we are on time for closing.
  37. Provide disbursement request to title company.
  38. Get our buyers a closing gift.
  39. Attend closing.
  40. Give our buyers the keys!!!!

Our relationship doesn’t end at closing.  We stay in touch with our clients (many who have become good friends of ours) and we are always available as a resource for any of their questions or needs.

Call The 727 Real Estate Team

If you have any questions, or you need help starting the process of buying a home, contact us today!