Buying a home can be intimidating. But you can set yourself up for success by understanding the process and finding the right help. I’m Mister Frisco, Viktor Taushanov, and an educated consumer is my best customer. So here’s an overview of the home-buying process that I help you navigate so you can find your dream home as quickly as possible.
Financing
As easy as it is to picture the features you want in your new home, financing is the most important first step. Choosing a lender is where it pays to be picky. Not only can the right lender get you a great rate, but they can make things go smoothly during closing. So skip picking the first online result or randomly walking into your bank. Instead, please seek the advice of friends who have recently gone through the home-buying process or ask an experienced Realtor, like me, about which lenders make closing as hassle-free as possible.
Making Your First Offer
Once you get pre-approval from your lender, you are ready to make an offer. Making an offer is where we start deep-diving into finding your dream home. Here I provide a Comparative Market Analysis so you can choose the home price you’re most comfortable with. Once you accept all the conditions in the offer, I submit the offer to the seller. But making an offer is only the beginning of buying. After I make your offer to the seller, critical negotiations begin. Once your offer is accepted, we proceed with inspections, negotiations for repairs if necessary, and finally, moving to the closing.
Option Period
The options period is a time given to the buyer to inspect the property and negotiate repairs or any other condition on the contract. The terms (time and fee) are negotiable and usually depend on market conditions. Typically, the term is seven to ten days, with an initial offer fee of about $100. In Texas, the buyer has the unrestricted right to terminate the contract during this period with a full refund of the earnest money. The options fee, however, is not refundable if the buyer terminates.
Financing Contingency
The financing contingency is given to the buyer to be approved for a mortgage. During this period, the buyer should submit all additional paperwork required by the lender to obtain conditional approval. Suppose the buyer can not obtain approval in this period. In that case, the financing contingency should be extended, or the buyer has the unrestricted right to terminate the contract and get the earnest money back.
Closing
Both parties should sign the closing documents at the Title Company on closing day. In addition, you will need to bring an ID (i.e., diver’s license) and closing funds in the form of certified funds (money order or cashier’s check). The amount you need to bring to the closing table will be in the Closing Disclosure, which will be provided by the Title company or the lender no later than 24 hours before the closing day.
What Kind of Funds Will You Need?
So how much is this going to cost? Well, it depends. You may have to meet a minimum down payment to secure funding, depending on your loan type. For example, you need 3.5% for an FHA (federally insured loan) and 5% for a conventional loan. However, to avoid paying PMI (private mortgage insurance), you will need a 20% down payment when securing a conventional loan. Once you’ve built 20% equity in your new home, you can ask your lender to waive the PMI. With an FHA loan, the insurance lasts for the loan’s lifetime. Another payment you will encounter is earnest money. Although earnest money is negotiable, it’s typically 1% of the purchase price. It’s also refundable and is applied towards the purchase of your new home. What about closing costs? These expenses also fluctuate depending on taxes, escrow fees, insurance, etc.
Gold at The End of The Rainbow
It would be asking a lot to navigate this process alone. Luckily you don’t have to. Instead, I can help you every step of the way, advocating on your behalf in every negotiation to help you find the home you want at the price you feel good about. Sure, there are many steps in the home-buying process, but I’m happy to share tons of information so you can feel confident about every decision you make in the buying process.
Buying a home is the biggest financial decision most people make. But don’t go it alone. I’m Mister Frisco, Viktor Taushanov, and I’m here to help you every step of the way. Let’s work together to find the home that suits your lifestyle so you can live happily ever after.
