Home buying can be a daunting prospect, especially if you are a first time homebuyer.  However, with the right guidance, it can be a smooth, enjoyable experience leading to a great place to live that's also a fantastic investment. 

If you're new to home buying or if it has been a while, I encourage you to check out some home buying tips.

Home Buying Tips and Information

What is the Process?

Getting Pre-Approved for a Mortgage Loan

If you're planning on buying a home, the first thing you need to do is check on your financial situation.  You need to get pre-approved for a couple of reasons. 

1) You need to find out how your credit is.  Many times there can be a mistake or older negative accounts that can come back to haunt you.  If you run into one of these problems and you are working with the right lender, he or she will give you tips to improve your credit so that you can purchase your home as soon as possible.  Even if it takes a few months to a year, a good lender will hang in there with you while you increase your credit score.  I encourage you to check out the mortgage lenders on the mortgage tab above.  All of them are exemplary and will work for your benefit.

2) You need to know how much you can afford.  One of the most frustrating experiences is to fall in love with a home and then find out that you can't afford it.  The pre-approval process allows you and your agent to only view homes that are in your price range, thus allowing you to make a choice you can be confident in.

Making an Offer

Once you find the home of your dreams (or the home you'd like to live in until you can afford the home of your dreams), it's time to make an offer.  This is where having an agent is extremely important.  A good agent will provide you with information about similar homes that have recently sold in the neighborhood for comparison (also called comps).  This enables you to see what kinds of prices other buyers have paid for similar homes and will help you decide what to offer on the one you are buying.  You and your agent will talk about the condition of the home and features that may make it worth more or less than other similar homes.

This is also the time to consider when you want the close of escrow to be, what kind of earnest money you will put down and whether or not you will have a home warranty on the new home.  The purchase contract is a binding contract so it is important that you understand it.  In Tucson, this is a nine page document, so make sure you ask your agent to explain anything that is not clear to you.  A good agent is willing to spend as much time as necessary for you to understand what you are signing.

Once you put in your offer, the sellers may submit a counter-offer.  This means that they accept all the terms of the offer except for the ones listed in the counter-offer.  You then have the choice to accept their counter, make your own counter, or back out of the purchase.  Usually, buyers and sellers come to an agreement without too much difficulty and before you know it, you are under contract and on your way to owning your new home. 

Escrow

When you wrote your offer, you agent will have collected a check from you for your earnest money.  Now that you are officially under contract to buy a home, your agent will open escrow at a title company.  The title company will cash your check and hold the funds until the close of escrow, at which time, they will credit the money to your closing costs. 

If you choose to cancel the contract in a manner not provided for in the contract, you may have to forfeit the earnest money to the seller as damages.

Inspection Period

Once the buyer and seller have agreed upon the terms of the sale, the inspection period begins.  Unless otherwise stated in the contract, the inspection period is 10 days long.  The buyer is allowed to do any and all inspections he wants to do within this time period.  I recommend doing a general inspection and a termite inspection to begin with.  The general inspector can give you an idea of what areas you may need to inspect further.  You can then choose to hire other professional inspectors as necessary.

After your 10-day inspection period, you will complete a BINSR (Buyer's Inspection Notice and Seller's Response).  On it you will indicate whether you will accept the property as is, ask for certain repairs or reject the property outright.  If you request repairs, the seller has five days to respond as to whether or not they will make the repairs.  Once the seller has responded you will have a five-day period to decide whether you will accept the seller's response or back out of the contract. 

Note: These time frames may be different if your contract indicates a different amount of days.  Your agent is responsible to keep track of when things are due and ensure that you have the appropriate paperwork turned in.

Financing, Walk-Through & Signing

Throughout the escrow period (time between opening escrow and the date that the house is officially sold), you will be working with your mortgage broker to ensure that he or she has everything needed to process your loan.  You will also provide information to the title company so that they record the new deed in your name correctly.

The seller is required to complete all agreed upon repairs within 3 days of the close of escrow.  This is also the day that you, the buyer will sign the paperwork.  Before signing, however, you need to do a final walk-through.  You and your agent will go to the home and check to be sure repairs were made as agreed and that the house is in generally the same condition as it was at the time that you went under contract.  If something is not right NOW is the time to speak up.  Your agent will have you sign a form that indicates that the home is acceptable or that there are some items you disapprove of.

After you have done your walk-through and everything is satisfactory, you will go to the title company and sign documents to transfer the home in your name and documents to take out a mortgage on the home. 

Close of Escrow

On the close of escrow date, the mortgage company will send funds to the title company, which will then distribute the funds as they are instructed to do.  Once the funds have changed hands and the title company records the transaction at the County Recorder's Office, you will receive the keys to your new home.  Congratulations!  You're the owner of a brand new home!! 

Of course, this is just a summary of the process of purchasing a home.  If you have more questions or would like to talk about looking for a home for yourself, you can call me at (520) 481-3695 or Email Me. 

Below are some links that are helpful during the buying process.