Buyers

Steps. Like the steps leading to your front door, there are steps to take, on paper, in leading you to the purchase a new home. If you ever have questions, just call me at 530-227-7791.  Your first step, before you set out for an all-day house hunting safari, is to sit down and do a bit of planning. And the first thing to ask yourself is, “how much house can I afford?” How much can you afford for the monthly house payment, and how much do you have available for the down payment?

Qualifying – An “affordable” home is not so much determined by sales price as it is by the financing which translates that price into a monthly payment, which is made up of the principal and interest on the mortgage loan and the property taxes and insurance they require you to carry—(together referred to as P.I.T.I.) So first set a housing budget, then go shopping for the house (price) and payments (P.I.T.I.) that fit that budget.

Choosing a House – Once you have determined an affordable range, the fun begins–house hunting. Choosing a new home can be daunting, but asking yourself a few simple questions can simplify the process. What are the characteristics of your present area that you like, and what are some of the things you’ll want to avoid in a new living situation? First, consider the natural features that you resonate with. Do you like to be close to the mountains, or the sea? Wooded areas, hiking trails, rivers, flat land, hillsides? How important will it be to have public transportation and shopping nearby? How far will your commute be? Consider all these factors beside just the style of house or number of rooms you are looking for. Begin a list of community features that are important to you and add to it as you think of things.

In choosing a house, the key is knowing what you need.

How many people will be living in the house? Do you prefer a new or resale home? What is your preferred housing style?

How many total rooms do you need? Do you have preferences for any particular features? Having a good idea of the type of property you’re looking for will help a realtor narrow your search.

Many home shoppers find it helpful to keep a record of the houses they inspect. A notebook is handy with pages large enough to record vital information, as well as hold pictures of attractive houses and neighborhoods that inspire you. Once your list of desirable homes is narrowed down, you will need to start considering the details.

There is a lot to take into account when comparing favorable homes: House style? Age of house? Grounds maintenance requirements? Major systems like the plumbing, heating, and electrical systems? Built-in appliances, storage space, kitchen layout, fireplaces, even phone jacks are all things to be aware of.

Locating the Right Loan – Where there was once only a couple of choices between a standard 30-year fixed rate mortgage or a VA or FHA loan, there are now many varieties of financing options available to buyers. It is often necessary to do your homework to make some sense out of today’s mortgage marketplace. A short list would include the conventional mortgage with a fixed interest rate for a period of 15, 25, 30, or more years, an adjustable rate mortgage (ARM), a VA loan, FHA loan, balloon mortgage, and lender funded program.

Competition among lenders is lively, and smart borrowers shop carefully to find the financing that best suits their circumstances and needs.Shopping for the right loan and lender can be as important as shopping for the house itself. Ask questions about anything you don’t understand. A good lender will help choose the best option for you and also make sure you understand the terms and legalities involved.

After Loan Approval – After the lender approves the mortgage, the buyer will receive a “loan commitment letter” stating the mortgage amount, interest rate, and length of loan term. The buyer should check it carefully, and return a signed copy to the lender or follow other specific instructions.

Next, the selling and listing brokers will coordinate a settlement date. You should be sent a letter confirming the date, place, time, and a checklist of everything you, as the home buyer, need to bring. Most lenders require a home buyer to provide a one-year paid receipt for a fire and hazard insurance policy.

Other things that need to be arranged before closing a deal are: Title insurance, a professional house inspection, and a final walk-through inspection.

Closing – At the settlement will be an attorney or title company representative (chosen by the buyers), all buyers, listing and selling brokers, and all owners. The home seller should bring all warranties on equipment and any instructions on equipment maintenance or operation.

The attorney will have searched the title, provided title insurance, and obtained old and new lender instructions. First, all unresolved walk-through deficiencies are resolved.

With the buyer, the attorney explains the deed of trust or mortgage; the deed of trust note or mortgage note; VA, FHA, or lender forms; and settlement sheets. Buyer signs all these and pays the balance of the down payment and buyer’s closing costs with cashier or certified check. After a lot of signing by both buyer and seller, everything having been settled upon, the house keys are passed to you. You are now the proud owner!