Questions ?  We have Answers.  Home Buying Process Outline   1. Determine price range of home.      a. Down Payment      b. Loan Amount 2. Find your personal Realtor 3. Find Your Dream Home 4. Reach an agreement with owner of the home you want. 5. Make application for home. 6. Inspect Home. 7. Get Homeowners Insurance. 8. Get ready to move.      a. Forward Mail      b. Turn on Utilities      c. Call Movers   Where to Begin: Personal Freedom Home ownership frees you from the shims and dictates of a landlord. There will be no unexpected rent hikes. You will be able to decorate as you like, have a cat or dog, and make improvements on your property. You gain privacy and the freedom of expression   Pride of Ownership Perhaps the most intangible, yet powerful advantage is the pride of ownership. A home gives you and your family a feeling of stability and commitment. A special sense of security and satisfaction come as you begin to put down roots in a neighborhood. Your family will enjoy the benefits of this decision for many years.   Where to Begin The process of buying a home can seem long and complicated - so many new works to learn and understand - deciding what you really want in a home - wandering if you can afford such a major purchase. The Loan Process Qualifying? Applying for a home mortgage is like applying for any other kind of loan. Due to the amount borrowed and term of loan the approval process is more detailed and takes more time. Your application will be evaluated based on three factors.     Your income and assets Your credit history The appraisal of the property Pre-Qualification This is the preliminary estimate of how much a lender may be willing to loan you, based on the the information you provided. Depending on your situation, the loan officer might also want to run a credit report. Prequalification will let you know how much you can spend even before looking for your perfect home. Pre-approval This is the best way to shop for your home. Pre-approval will define exactly how much the lender is willing to loan you, so you can begin your house hunting adventure with the assurance your financing is ready and waiting. It is like shopping with cash in hand. Down Payment The down payment is the up-front cash you will pay toward the purchase of your home. Although, down payments of 20% or more are common, homebuyers can put down as little as 5% to 10%. However, Private Mortgage Insurance (PMI) usually will be added to loans with less than 20% down and this will increase your monthly payments. What are Closing Costs? Closing costs are simply the costs of borrowing money, establishing the loan, and preparing the necessary documents to finalize the sale. These costs may be significant.   The costs of borrowing money. This includes what some lenders call "discount points", a one time charge to adjust the yield on the loan to what the market conditions demand. Each point equals one percent of the mortgage amount. The costs of establishing a loan. These might include the loan origination fee, appraisal fee, and cost of credit reports, premiums for hazard and mortgage insurance are usually paid at closing. Also, prepaid interest will be collected for the period between closing and the end of the purchase month. The costs of document preparation. Title costs pay for the search of public records to determine if the property you want to purchase is free from any other ownership or liens. Recording and transfer fees cover the legal recording of the deed with the proper agency as well as the transfer of taxes. Over all closing costs vary lender to lender and the type of loan you choose. What to bring for your loan application Account number for revolvong charge accounts such as Visa, Mastercard, Sears, Discover, etc. and approximate balances on each. Account numbers and mailing addresses for depository accounts such as checking, savings, brokerage accounts, etc. Name, mailing address and account numbers for loan payments made during the last two years such as automobile and installment loan or former home loan. Name and mailing address of employers for the last two years. Residence information for the past two years, including landlord names and addresses. Offer and acceptance contract for new purchase. Contact, specs, plans, and cost estimate for a construction loan. DD214 or Certificate of Eligibility for VA loans. For FHA and VA Loans:              a. Current paystub for all employed borrowers              b. Current statements for a deposit accounts.              c. Appraisal and credit report fees.      10. Self employed - Prior two years tax returns and current income statement and Balance sheet signed and dated.      11. Owner/Partner - Prior two years tax personal and corporate tax returns and a year to date Balance Sheet and Income Statement on the Corporation/Partnership signed and dated. This list is intended to supply as much information as possible at the time of loan application. There may be additional information requested at any time due to changes in circumstances or as a result of receiving information that needs clarification or explanation. Your lender will give the exact list of what you need. Preparing to complete the Purchasing Process Once you have formal loan approval from your lender, they will forward loan closing instructions to a Title Company to complete your transaction. What does the closer do? Based on the offer and acceptance agreement between you and the seller of the property, they make sure all contingencies are met. Accept and coordinate the flow of documents Prepare a closing statement of the entire transaction, collect all funds and disburse to all parties who have performed services. (Termite Company, Surveyer, Attorney, Seller, etc.) make sure all documents are properly executed and redorded. Secure title insurance
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