Preparing To Buy Your First Home
Helpful Steps for the Home-Buying Process
The most important thing to do before you shop for a home is find out how much you can afford to spend. The pre-qualification consists of a short conversation, either in person or over the phone. We’ll crunch the numbers and help you find an affordable mortgage solution that meets your needs, allowing you to shop for homes within your price range.
Before You Shop for Your Home
The role of a realtor
We recommend that you work with a buyer’s real estate agent. Unlike a seller’s agent who works for the seller, a buyer’s agent works for you. Your agent will help you find homes in your desired price range, arrange showings and coordinate your offer – at no charge to you! The buyer’s agent will share the commission that is paid by the seller. You should speak with several agents before you decide who to work with. Choose someone who listens to your needs and has experience in the price range and neighborhoods you are targeting. We are happy to suggest real estate professionals who have been successful in helping other homebuyers.1
The role of an attorney
We recommend that buyers hire a real estate attorney to represent them through the process. It’s a small cost compared to the large investment you are about to make. You can choose your own attorney or we can recommend a real estate attorney who will typically offer a reduced price.1
After You’ve Found Your Home
Mortgage Application Process
Once you choose the house you’d like to buy, you’ll complete a formal application. When you receive the official application from your loan officer, you’ll also receive a Loan Estimate form (LE). This form clearly outlines all the loan information including the estimated cash to close. You’ll sign the official application form and return it within 10 days with the requested documentation, such as pay stubs, tax returns and proof of assets.
During this time, the appraisal will be ordered on your behalf. The appraiser will contact the seller directly to schedule an appointment to view the house. Once the home is inspected, the licensed appraiser will compare your home to the sales price of similar homes in the area to determine fair market value.
When your loan is approved, you will receive a commitment letter. At this stage you will be required to buy an insurance policy on your new home. You will need to purchase this policy prior to closing on the loan. Proof of this purchase is called an “insurance binder.”
On the day before the closing we’ll tell you the exact amount you’ll need for your closing costs. You’ll need to bring the full amount in the form of a bank or credit union check. Make sure to schedule a final walk-through of the home with your realtor on the morning of your closing. This is an important opportunity for one final look at the house before you take ownership. At the closing you will have the opportunity to ask your attorney any last questions you have about your mortgage.
CAP COM and Homeowners Advantage do not guarantee the services of any real estate agents or attorneys.