Aloha,

The Home-Buying Process in 10 Simple Steps. Wouldn't it be great if buying a home were as simple as it is in a game of Monopoly? All you'd have to do is find a desirable neighborhood, hand the bank a few bucks, and you receive a house. Of course, the home-buying process is a bit more complicated in real life, and while it’s a process, it's not impossible. Competition among buyers in today’s market has gotten intense, so if you're serious about homeownership, you'd better get your act together. To point you in the right direction, here is a road map of the home-buying process. From choosing the right professionals to signing that final contract, here are the typical steps you need to be aware of.

Step No. 1: Chose an agent

The first step in the home-buying process is to find an agent you feel comfortable working with on what will likely be the largest financial decision of your life. Choose a Realtor who communicates, has your best interest at heart, and puts you first.

Step No. 2: Find a lender

Once you've chosen a real estate agent you trust to be your advocate, ask him to recommend lenders.  There are either direct bank lenders, or brokers, that will shop around for the right loan for you to help you buy your home.  A local Realtor® has experience working with mortgage brokers and title companies and can recommend lenders. Choosing someone to handle the financial part of the home-buying process can feel like a scary step, but choosing a lender that's competitive on rates, communicative, and available is key.

Often mortgage companies consider you a file, not a human, and if they aren't available on the weekends or evenings, you may not be happy working with them down the road.

Step No. 3: Clean up your credit

Now that you have a great lender, you can ask for guidance on any credit score issues you may be facing. Whether it's a small or large problem, the lender can provide guidance to help repair your situation and make sure you'll be approved for a loan.

Step No. 4: Apply for mortgage pre-approval

A lender will help you determine exactly what you can afford and, therefore, which houses you should be considering. To arrive at a purchase price, you'll factor in expenses like homeowners insurance, association dues, and utilities to make sure you can comfortably make your mortgage payments. The lender will then identify the total amount of money it's willing to lend you.

Having a pre-approval letter in hand when you're ready to purchase a home adds strength to your offer, which can be an important advantage in this competitive home-buying market.

Step No. 5: Create a home wish list

Once you know what your purchasing power is, talk with your real estate agent about your ideal home. Come up with a few "musts," as well as "wants" you'd ultimately be willing to compromise on. Think about the amount of bedrooms and baths you must have, single level or stairs, yard work, or no yard work and garage, or carport. 

Think about location.  Do you want to be within walking distance of restaurants? Do you want space between you and your neighbors? Or is proximity to a good school the most important factor?

Step No. 6: Search the listings

Now comes the fun part: searching for homes that meet your parameters. When you begin touring homes that are on your short list, take along a notepad and jot down your thoughts as you approach each home. Can you imagine yourself living there?  Open houses are great, but often times, many homes will not be open, so ask to set up a time with your Realtor, to view several homes in one day.  But, keep it to a maximum of 6-7, because they will all start to look the same, after a while.

Step No. 7: Make an offer

Your real estate agent will walk you through the steps required to make an offer on a home in your area.

Your offer will likely include earnest money that will, be used to open an escrow account and apply toward your down payment on the home.  Expect some negotiation, and discuss a competitive offer with your agent. 

Step No. 8: Get final mortgage approval

Once your offer to purchase is accepted, you'll work with your lender to get final approval for your home purchase by the date specified for the closing. The lender may require you to pay property taxes or homeowners insurance for the first year at the time of closing, so make sure you know what funds will be expected.  Your lender will give you an estimated closing sheet that will give you an idea of how much you will need to come to the closing table with.

Do not make any major purchases like that big-screen TV or riding lawn mower until after closing, especially if you'd be using credit, as that can affect your mortgage qualification.

Step No. 9: Do your due diligence

The due diligence process usually includes getting a home inspection to make sure you haven't missed any hidden problems on your walk-throughs. If issues are found, negotiate for the current owner to fix them or take the cost of repair off the closing costs.

Step No. 10: Attend the closing

Once all of the above steps are completed, you'll be on your way to the closing table. This is when the deed to the home is transferred from the seller to the buyer. Every transaction varies, but plan to sign a ton of paperwork. An escrow officer will guide you through the process. Then you'll officially be a homeowner and receive the keys to your new home.  Congratulations!