Buy a home | Fogata Realty

BUYING A HOME

The First Step

The first step, after you have decided to purchase a house, is to meet with a lender and a buyer’s agent. A lender will be able to tell you what price range you qualify for, and provide a pre-qualifying letter. This letter will be sent to the seller along with an offer on a property.

The Time Frame

When would you like to hold those keys in your hands? Typically, closings take place 30 - 60 days after an offer is accepted. Now is also a good time to review sample documents from your agent so you are familiar with them before you actually go to write an offer

Finding your home

This is the fun part! Determine what criteria are important to you, as well as locations in which you have interest. Understand that most houses won’t satisfy every single one of your criteria, so it helps to determine what might be deal-breakers.

Determine criteria for the home you are looking to purchase
Evaluate what is most important and what you can live without
Make a list of properties you want to see
Be prepared to be flexible, to re-evaluate and refine your search as you look at properties. Often the house people buy doesn’t match their initial search at all!

Making an Offer

Once you find a home you would like to purchase, it’s time to make an offer! If your offer is accepted, you are immediately under contract. The offer is not just about the price, there are other negotiable factors including due diligence fee, closing date, etc.

Decide if you want to make an offer on the house
Decide on offer terms, with agent’s input
Sign all paperwork
Write a personal check to seller for the due diligence fee

Information Needed in an Offer?

Full Buyer(s) name (only those that will be on the mortgage)
Price of offer
Due diligence fee (initial money given to seller to take the house off the market and give you time to perform inspections)
Additional earnest money (escrow money, typically after due diligence)
Due diligence date
Closing date
Name of your closing attorney or settlement attorney
Personal Property (appliances)
Loan info (fixed vs ARM, interest rate, down payment, etc)
Name(s) that will be on the deed
Seller paid closing costs
Home warranty information, if applicable

Under contract and Due Diligence

Once your offer is accepted you are under contract, you enter the due diligence period. During this time, you can walk away from the purchase for any reason you want, but will lose your due diligence fee. Now is when you will do any inspections you desire, and start the loan process. The house will be taken off the active market, but may still continue to allow for continued showings, and if applicable, back up offers.

Due diligence is a “hard date” and the sellers are under no obligation to extend it. Before the end of due diligence, there is another round of negotiations based on the findings of the inspections. You can negotiate any repairs that need to be done, or ask for a reduction in price in lieu of repairs. Any request should be done a minimum of a few days (ideally a week) before the end of due diligence to leave time for negotiations.

At the end of due diligence, your additional earnest money is due in the form of a certified check made payable to the settlement attorney office. If you walk away after due diligence, you forfeit the due diligence fee and additional earnest money.

Make a formal loan application, and make sure the lender is aware of due diligence and closing dates.
Decide which inspections you want
Attend home inspection, if possible
Choose homeowners insurance Review any HOA documents and covenants if necessary
Review inspection reports and decide if you want repairs/concessions
Deliver additional earnest money at the end of due diligence

Common inspections and price ranges:

Home Inspection: $350 - $600, depends on house size
Pest Inspection: $75 - $100
Radon Inspection: $150
HVAC Inspection: $100
Survey: $450 - $700, it depends on lot size Underground Oil Tank
Chimney Sweep & Inspection, if needed: $50 - $250 per flue
Structural Engineer, if needed: $750

After Due Diligence

You’ve made it through the hard part! Just make sure to keep on track of your loan, and prepare for moving into your new home!

Keep in touch with your lender and make sure you get them any required documents as soon as possible
If you are financing, please do NOT make any large purchases (furniture, cars, etc.) during this period of time as it can affect your loan
Confirm homeowners insurance to be active starting on closing date
Call utilities to be switched to your name starting on closing date
Re-inspection (if needed)/Final walkthrough

The closing statement

The CD (Closing Disclosure) is due to you three days in advance of closing for your review for accuracy. You and I will go over this together to ensure that all is well – that all credits and debits, loan amounts, etc are correct.

Closing

Closing takes place at the attorney’s office. This is where you will sign all the paperwork for the deed and loan. It typically takes less than an hour. You will be able to get the keys once the deed has been recorded in the county courthouse.