By Sean C. Hamilton
When considering if you should take the plunge into home ownership, there are several questions that may come to mind. You may ask: Do I have enough money saved? What is my credit worthiness? Do I have too much debt? How much money will I be able to borrow? Will I qualify for a mortgage? Unless you’re in the position to make an all-cash purchase, you will have to borrow money from a lender to purchase the home you envision owning.
STEPS TO BUYING A HOME:
- Find a reputable real estate agent. While this is not absolute, it helps if you can find a real estate agent who is knowledgeable about the market in which you want to live. It will also help to put some of your worries at ease if you partner with an agent you know, trust or who comes recommended by someone you trust. Finding an agent whose sensibilities align with yours, does matter.
- Get organized by gathering the documents you will need to qualify for a mortgage. While everyone’s situation differs, generally you will need to provide your lender with check stubs and bank statements for the past 30-60 days, and W2 forms and tax returns for the last two years. Your lender will likely require additional documentation depending on your specific set of circumstances.
- Apply for a mortgage to get pre-approved. There is a difference between being pre-qualified and pre-approved. Simply put, pre-qualification means the lender has done a basic review of your creditworthiness to determine if you’re likely to qualify for a mortgage loan. Pre-approval provides a better indication into if the lender feels you will be able to actually secure a mortgage loan. A pre-approval is more of a conditional commitment to loan you the money for a mortgage. Give serious consideration to shopping around with several different lenders for the best rates and terms. When trying to decide which type of lender to choose, consider the financial institution you currently bank with (banks/credit unions); mortgage brokers and lenders your agent recommends are also great options. There are several different types of mortgages to consider: Conventional, FHA, VA, USDA.
- Find the right home. I always recommend finding a home in the best community that fits your budget and individual needs.
- Make an offer and get it accepted. When your offer is accepted it becomes a “binding” contract, and you are officially in escrow. This is the time of your “due diligence” period, the time in which the home you’re purchasing is appraised, and the period in which the lender actually does a deep dive into your credit worthiness and ability to actually secure the loan. If all goes well the lender will move your loan status to fully approved or “cleared to close.”
- This is the final step in the process where all documents are signed, acknowledged and you accept the terms of the loan. This is also the time when the title and ownership of the property is transferred from the seller to you as the buyer.
If you would like more in dept information on the steps to purchasing a home, I’d love to speak with you. Give me a call today and allow me to get you started down the path to home ownership.
Sean C. Hamilton is a REALTOR with Keller Williams Realty Atlanta Partners. He services Metropolitan Atlanta and the state of Georgia; and can assist with your real estate questions or needs no matter where you are in the world. Call or text Sean at 202-651-0309 or email him at sean.hamilton@kw.com
