Step – 1 Make the Decision to Buy. It seems obvious, but it’s good to note that the first step to buying a house is making the decision to buy. Consider the reasons you want a new house and write them down. Determine how long you want to live in the new house – does buying still make good financial sense? Can you afford a house that will meet your list of requirements? A good rule of thumb is your mortgage payment should not exceed 1/3 of your net monthly income.
Step 2 – Seek Professional Guidance I’d like to schedule a time to meet with you to hear the reasons you want to buy a house and your plans for the future. We’ll talk about neighborhoods, and your list of requirements as well as how you would like your house and neighborhood to grow with you.
At this time, I will also help you get pre-qualified for a mortgage loan. Pre-qualification is a written statement from a loan officer indicating his or her opinion that you will be approved for a mortgage loan up to a certain amount. The fact that you are pre-qualified will help us when we are negotiating the deal.
Step 3 – Begin the Hunt After our initial meeting, I’ll search all my resources for houses on the market that fit your criteria. I’ll schedule appointments to tour the houses at times convenient to you.
As we tour houses, I’ll point out positive features and negative features. I’ll ask you to tell me what you like and what you don’t like. You’ll probably amend your “wish list” as we tour houses, some things will become more important and others less important. With this new information, I’ll refine our search criteria to narrow in on the house of your dreams.
Step 4 – Know the Market My knowledge of the local market is an essential factor in the house search. I’ll let you know when the market in a particular neighborhood is “hot” and requires immediate action or when the market is “cool” and allows for thoughtful consideration.
As we tour houses, I’ll let you know when the asking price has negotiating room and when the house is “priced to sell”. My unique market knowledge will keep you a step ahead of the “house hunting competition”. In a “seller’s market”. It is not unusual to see multiple offers on a property, full-price offers, and even above-price offers. On the flip side, during a “buyer’s market” there are more houses for sale than buyers. This gives us more negotiating room as houses are taking longer to sell.
Step 5 – Find Your Dream House I’m confident we’ll find your dream house. When we do, I’ll put together the purchase offer tailored for your needs including appropriate contingencies (such as obtaining financing, favorable home inspection, etc.).
The offer is normally presented with a deposit cheque. This is “earnest money” made to the listing brokerage to secure an offer to buy the property. The amount is applied to the offer amount, usually the down payment. If the seller accepts the offer the money is held in trust till the possession date and forwarded to the lawyers to complete the transaction. Generally, the possession day can be in as little as ten days depending on your banking institutions’ policies.
Step 6 – Negotiate the Deal It is not uncommon to receive a counteroffer when the initial purchase offer is submitted. Don’t let this discourage you. We will discuss the counter offer and decide whether or not to accept the counteroffer, submit our own counter offer, or reject the counter offer and move on.
Market conditions will play a role in how aggressively we negotiate the deal. We will also work within your limits. Emotions can lead to buyer’s remorse. It is better to set limits prior to negotiating an offer and stick to these limits.
Step 7 – Get a Loan During the closing period, you will be working with your mortgage lender to close the loan. Since you pre-qualified for the loan before starting your home search, you will be that much closer to the end. I’ll gather the necessary property information your lender will need to close the loan.
Step 8 – Close the Deal You will receive a “Good Faith Estimate” of closing costs at the time the loan application is submitted to the lender. The estimate is based on the loan officer’s past experience and may not include all the closing costs. I will be glad to review the “Good Faith Estimate,” answering questions and highlighting missing costs and estimates I believe to be low.
Step 9 – Move-In Congratulations! It’s time to move into your new house and make it your home. Enjoy this exciting time. I’ll give you a checklist to help you remember the numerous details that will make your moving day a pleasure.