The Buying Process

1. Select a Real Estate Agent
- The first step as a buyer is to find an agent who can represent you according to your needs and wants, but also connecting to someone you enjoy spending time with. Due to recent changes in real estate law, we as agents are now required to sign a "buyers brokerage services agreement" which discusses who will be responsible for our compensation (either the seller or buyer). 

2. Qualify Financially
- In order to purchase a property, you have to be able to pay the purchase price plus your closing costs (1%-3% of the purchase price). If you are like most people, you haven't been blessed with enough cash to purchase something outright, which means you will need to get preapproved for a loan. Relying on a loan means you only have to pay a portion of the purchase price (i.e. "the down payment"), along with your closing costs, and this in turn makes purchasing a property affordable. Once you are preapproved, we can then start showing you properties. There are three main loan providers available in our area that can provide you with a preapproval (Mortage Firms, Banks, and Credit Unions). We have contacts at each of these and are more than happy to connect you with someone.

 
3. The Home Search
- Once you are financially qualified to make a purchase, it's time to start finding and viewing properties in person. There are a variety of sources available to you as a buyer to find properties for sale. You can use a real estate agent, search online, read magazines or go browse different neighborhoods in person. However, the most common method for buyers searching for residential property is to search online (Homes.com, Realtor.com, Zillow.com, etc) or download their App. Since all of these sites pull from our local MLS (which is something only we as real estate agents have access to), buyers today actually have access to the same inventory that we do. So, most of the time, finding properties to look at will be a combination of us sending you listings and you sending us listings until we find the right one. 
 
4. Making an offer
- Once you find that right property, it's time to write an offer. The first step is for us to run a preliminary pricing analysis in order to evaluate the appraised value versus the purchase price. The real estate market is constantly changing so it's important that your agent can accurately advise on market conditions in order to help you get the home you want at a fair price. 
 
5. Being Under Contract
- Once you have an offer that gets accepted, you are officially under contract and it's time to cel-e-brate! But not for too long, because you now have contractual obligations and buyer responsibilities to fulfill. You will be responsible for delivering your Earnest Money (EM) deposit, making an official loan application, working through all your contingencies, and ensuring that you meet all the contract deadlines. We as your agent will be here to guide and walk you through this process. 

 

6. Title and Escrow

- Title and escrow are a neutral 3rd party company that facilitates and verifies that all the legal and financial obligations of the transaction are being met. The title department will provide you with a title report, which you will review as part of your feasibility period. The escrow department is where you will deliver your EM deposit, pay your closing fees, and will be the location of your final signing appointment.

 

7. Home Inspection and Feasibility Period

- The first 10 days of being under contract is typically when you will inspect the property for defects and perform any feasibility studies. The average home inspection costs $400-$600, well inspections $500, and septic inspections $400 (typically paid by the seller). All of these fees are paid upfront at the time of service and are not part of your closing costs. If anything is discovered during this period, this is where we can negotiate on your behalf. There are three main negotiating options available to you as the buyer. You can ask for (a) repairs, (b) a closing cost credit, or (c) a reduction in the purchase price. A fourth option, which doesn't require any negotiation, is that you can simply walk away from the transaction. It's important to understand that even though you have the legal right to negotiate, you have to consider that the seller has the same right. Ultimately, a successful negotiation is one in which you and the seller come to an agreement. Otherwise, the transaction falls apart. As a buyer, you can't just negotiate based upon your wants, you have to also consider what is acceptable in the eyes of the seller.
 
8. Appraisal
- If you are obtaining a loan and putting less than 15%-20% down, your lender will require an appraisal to be completed. The appraisal is primarily for the benefit of the lender, but it also protects you as the buyer from paying more than fair market value. Because our company focuses mostly on pricing properties, we provide very accurate appraisal forecasts. In over 70 real estate transactions, we have only encountered one low appraisal, and we fully informed our client about its possibility. In the end, it actually saved him $10,000 off the purchase price. The cost of an appraisal today is about $700-$900, which is paid for by you, the buyer. Some lenders require this to be paid upfront, while others allow it to be paid at closing. The appraisal fee is typically considered a 'closing cost'.

9. Underwriting

- Once your appraisal has been completed, your file will get submitted to final underwriting. So long as you have provided your lender with all the required documents, this process should be completed within 5 business days. Once underwriting has been approved, your lender will send you the Closing Disclosure (CD). The CD is a document that basically summarizes all the terms and fees regarding your loan. You'll want to compare this to the good faith estimate provided by your lender at the time of your initial application. You will be required to wait 3 days before proceeding. After this waiting period, loan documents will then be sent over to escrow and your signing appointment can then be scheduled.
 

10. Final Walk Through

- The final walk through occurs within 5 days of closing. The purpose is to give you an opportunity to re-inspect the property. Has the property been kept in the same condition as when you bought it? Is everything there that's supposed to be there? Is everything still operating properly? Has any damage occurred? Did the sellers complete the work they said they would do? Most walk through's take 30 minutes or less and nothing of concern is discovered. But on occasion, something is discovered during a walk through that makes you appreciate that you took the time to make it happen.

​

11. Signing Appointment

- The signing appointment is where you will bring your final payment and sign all the documents so that the property can be transferred into your name. This appointment is typically scheduled at least one day prior to closing and lasts about 45-60 minutes. If you work normal business hours, you will need to arrange time off from work. You should bring two forms of ID and be ready for a hand workout (lots of signing!)

12. Day of Closing
- This is the day in which you will take legal ownership and possession of your new property. Don't forget to transfer utilities into your name, update your mailing address, and change out the locks on your new home, if applicable. Also, if you are selling one home and moving into another, don't forget to cancel the home owners insurance on your previous home.​

8

13. Give Thanks (1 Thes 5:18)

- Being thankful is a good thing, don't forget to give thanks!

​

Don't do it alone!

- We hope you will consider In The Light Homes to be your real estate agent! If you choose us, we will be there for you and with you, every step of the way.