Step 1: Check Your Credit Report & Score
Before getting a mortgage or any kind of loan, you should always check your credit. According to the law, you're allowed to receive one free copy of your credit report per year. You can do this by visiting Annualcreditreport.com. Scores range from approximately 300 to 850; generally, the higher your score, the better loan you'll qualify for. Don't forget to check your report for errors. If there are any, dispute them. It may help your credit score. You can also check your credit score for free at www.creditkarma.com.
Step 2: Figure out How Much You Can Afford
You can calculate how much you can afford by starting online. You can use my online mortgage calculators that will help you estimate your monthly mortgage payment. Don't forget to factor in money you'll need for a down payment, closing costs, fees (such as fees for an appraisal, inspection, etc.) and the costs of remodeling or furniture. Remember that you don't always have to put down 20 percent as your parents once did. There are loans available with little to no down payment required. An experienced home loan expert can help you understand all your loan options, closing costs and other fees. We can recommend several mortgage professionals for you to interview.
Step 3: Find the Right Lender
You may want to talk to at least three mortgage lenders. Ask lots of questions and make sure they have answers that satisfy you. Find someone that you are comfortable with and who makes you feel at ease. We can recommend several for you to interview.
There are several different types of loans to choose from. Your loan officer can help you find the best fit for you. Most first-time home buyers go with a FHA or USDA loan. These loans require little to no money down. A more experienced borrower will normally choose another loan type called a conventional loan. Your loan professional will be able to help you decide which program is best for you.
Once you have the right mortgage lender, make sure you at least get a pre-approval. Qualifications are only a guess based on what you tell the lender and are no guarantee, whereas a pre-approval will give you a better idea of how big a loan you qualify for. The lender will actually run your credit and get more financial information about you. However, you could even take it one step further by getting an actual approval before you start home shopping. That way, when you're ready to make an offer, it will make the sale go much quicker. Besides, your offer will look more appealing than other buyers since your financing is guaranteed.
Step 4: Look for the Right Home
This is where it gets fun. Make a list of the things you'll need to have in the house. You can shop right here on our website to look at homes and not even leave your house. When you are ready, we can go home shopping! Most people look at 20 homes before they make their decision. But occasionally, people have found their home on their first visit. That’s why it’s important to have a loan pre-qualification letter ready.
Step 5: Make an Offer
Now that you've found the home you want, you will want to make an offer. Most sellers price their homes a bit high, expecting that there will be some haggling involved. A decent place to start is about three to five percent below the asking price. Once you've made your offer, don't think it's final. The seller may make a counter-offer to which you can also counter-offer. Once you've agreed on a price, we open escrow.
Step 6: Escrow
Escrow is a transition of ownership period. It usually takes 30 days to close an escrow. You will be conducting all your inspections which may include a home inspection and wood destroying pest inspection. I can recommend professionals for your inspections. We open a title order to ensure the title in clean. The seller will share with you everything they know about the house. This is called statutory disclosures. Your lender will be processing your loan and ordering an appraisal. The escrow company will collect all the information it needs to take the seller off the deed and add your name to it. If you think this sounds like a lot, your right, it’s a busy time. During this time the house is changed to a pending status on the MLS so no one else will looking at it.
Step 7: Close on Your Home
Once you have approved the condition of the house and lender has given a final approval of the loan, we close the escrow. Congratulations, you are a homeowner.
Step 8: Move In!
You've got your mortgage, closed the deal and now it's time to move in! Whether you use a mover or not is up to you. Either way, you're done with the home buying process! Just start unpacking and enjoy your mountain home!
Buying a home doesn't have to be a hassle if you're prepared and you know what to do and when to do it. Choose an experienced home loan lender and Crestline Real Estate is the key to helping you have a smooth home buying experience!