The average home buyer will visit ten homes over ten weeks before finding one that inspires them to make an offer. With this historic sellers’ market, you might find that you are searching longer for your new home. It is imperative that you have your preapproval in place to speed up the process and show sellers that you are indeed serious about buying their home. In general, preapproval takes about a week and is something that should be done before you start your search.
When you have found the property you like, and it is within your home buying budget, it is time to make an offer. This process is where your real estate agent’s experience and skills come to help you. Home buying is a business negotiation.
After receiving your offer, there are three things that the seller can do:
- Accept the offer.
- Decline the offer. This happens if the seller doesn’t think your offer was close enough to their expectations to negotiate.
If the seller counteroffers, you can then accept, counter, or decline as well. You can negotiate back and forth as many times as you’d like until you reach an agreement or decide to move on to another property. Once your offer is accepted (or you accept a counteroffer), you sign the purchase agreement. You’re now under contract.
This time is called the contingency period, and any inspections, appraisals, or anything else built into your purchase agreement will take place now. It is also a critical period for confirming that the home is what the sellers portrayed it as and doesn’t have hidden issues with a home inspection. Home Inspections cost between $278-391 and are usually covered by the buyer, though this can be negotiated in the offer. You can ask to be present at the inspection, and if you can’t be there, you should confirm that your real estate agent is available. You can get a lot of information from your inspector if you are present, and you can take measurements and pictures if you are planning to buy things for your new home.
Stuff will come up on the inspection because no home is perfect. If serious issues come up, you will need to partner with your inspector and real estate agent to see what the next steps should be.
The Major Reviewed Areas:
- Heating system
- Central air conditioning system
- Interior plumbing and electrical systems
- Attic, including visible insulation.
- Windows and doors
- Structural components
You can also request additional inspections by a specialist if it is a concern in your area:
- Lead piping or paint
In this contingency period, you also are officially going to apply for a mortgage, compare rates, and decide which loan you are going to go with for your new home. Once you choose a mortgage, the underwriting process will review your finances, financial documents, and house appraisal. The underwriter will make the final decision on your approval. Your swift turn around with documents that they need and good communication on your part will make that process move quickly, but this part can take 4-8 weeks to complete.
If all goes well, then you proceed to closing day. This is the day you walk through the home to see if any fixes that were needed were completed. If all is good, you sign your buyer’s paperwork. You can sometimes get your keys that day, but sometimes it occurs a few days after. You are a homeowner!
Advisory services offered through Capital Asset Advisory Services, LLC, a Registered Investment Advisor. This material has been prepared for informational purposes.