"There’s No Place Like Home!"

Written by Amy Celeste Wilson
Broker Associate, Certified Residential Specialist, Accredited Buyer’s Representative -- Lifestyles REALTORS®.

Just like Dorothy in the Wizard of Oz, we all find ourselves searching at one time or another for something over the rainbow. According to Dorothy, that something is a place where “skies are blue…and dreams that you dare to dream of really do come true.” Yes, that’s right, it’s Home! And even Dorothy needed some help reaching her home!

So, here are the steps that will guide you through the process of finding your new home. The process is fairly straightforward and can be lots of fun, especially if you are prepared for the journey.

Step 1: “Are you ready?”

If you’re tired of paying another person’s mortgage (aka ‘renting’) and want to invest your hard-earned money in a wise investment, then you are making a good decision! Remember, purchasing a new home is a huge emotional and financial commitment; make sure that you are mentally prepared for the responsibilities that accompany owning your own home.

Just as important, make sure you are financially prepared. Is your credit good? Do you have money in the bank? Check your credit history and your credit score! You are legally entitled to one free credit report from Equifax, Experian and TransUnion each year. Visit www.annualcreditreport.com to learn more.

Step 2: “Do your homework!”

Simply put, do all that you can to learn about the home buying process. The internet provides a wealth of information. REALTOR.com is a very popular website with tons of tips for buyers (and sellers)…everything from how to buy (or sell) a home to home decorating and gardening ideas. Other sources of information are books, tapes and, of course, Real Estate agents. It is a good idea to choose a REALTOR® who has been recommended to you and/or who you have interviewed.

Step 3: “Get Pre-approved!”

If there is one step that many buyers ignore, this is the one. Don’t make this mistake. It is wise to apply with at least two different mortgage lenders to get pre-qualified for a loan. Based on your credit, employment status, debts, and income, the lender can ‘pre-approve’ you for a maximum loan amount. Ask for a Good Faith Estimate (GFE) from each lender. This will show you an estimated breakdown of closing costs, prepaid expenses, and the monthly mortgage payment.

Step 4: “Look at Homes”

Now that you’ve done all of your prep work, it’s time to get busy! You can attend open houses, drive around new neighborhoods, and search for listings on the internet. Your REALTOR® can email listings to you prior to deciding which homes to visit. This can really save you time.

Once you’ve found that perfect home, be sure to obtain the Seller’s Property Disclosure Statement from the owner or listing agent. If you are interested in a condominium, try to get the Condo Association documents before you make an offer. You don’t want any surprises! Also, obtain a revised Good Faith Estimate from your lender. This will give you a more accurate financial picture based on the property you’ve selected.

Step 5: “Make an Offer”

There is quite a bit to consider before signing a contract. This is why it is vital to utilize the services of a REALTOR®! The Purchase and Sale Agreement (aka ‘contract’) is a legally binding commitment, so don’t make your decision too quickly or without assistance. Your REALTOR® will help you with all of the terms and will act as your negotiator throughout this entire process.

Here are some of the details you’ll need to consider: offer price, preferred closing date, downpayment amount, binder deposit amount, and any special conditions. Always ask that the Seller provide a one-year Home Warranty. I’ve used my warranty twice in a month and saved hundreds of dollars!

Step 6: “Inspect, Insure, Inhale…Exhale!”

You should always get an independent home inspection performed, even on new construction! You will also need a mandatory Wood Destroying Organisms inspection. Your REALTOR® will coordinate and handle the details. The inspections will uncover any repairs that are needed. If you have negotiated well up front, the Seller will be responsible for some, if not all, of the repairs.

Lenders require that you purchase Homeowner’s Insurance and Flood Insurance (if appropriate) prior to closing. If you are purchasing a condo, many lenders require Contents Insurance.

Step 7: “Close the Deal!”

Once your loan has been fully approved (congratulations!), the deal can be closed. Closings normally take place at an attorney’s office or title company. Once again, your REALTOR® will schedule and coordinate all aspects of the closing.

Unless you are paying cash, be prepared to sign lots of loan documents! You will leave the closing with the keys to your new home and the knowledge that you have made a worthwhile investment!

Quotes are from The Wizard Of Oz by Noel Langley, Florence Ryerson, and Edgar Allen Woolf.