Check List for buying a home

Dated: May 31 2022

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1. Reach Out to Me

You’re not legally required to hire a REALTOR® or real estate agent when you buy a home, but a real estate professional such as myself can make it much easier to find the home that’s perfect for you. I am trained in every aspect of the home sale process. I can help you find a property in your budget and seal the deal at closing.

 

I have your best interests at heart, I  can advise you on how much to offer for a property and can help you submit an offer letter. Most importantly, I can help keep you within your budget.

 

 

A CHECK LIST 

  •  Check List for the application

    1-Here’s a list of all the things you’ll need to get the pre-approval process started.

  • Identification: A driver’s license or state-issued ID card works best here, but any sort of government-issued ID like a passport, or military ID works too.
  • Last Two Years of Federal Tax Returns: Mortgage lenders are looking to establish a financial understanding of you; tax returns demonstrate your income history and help support your ability to pay back your potential loan. 
  • Last Two Years of W-2 / 1099 / K-1 Statements: These statements help corroborate the financial picture your tax returns paint and are an important verification step for mortgage underwriters. 
  • Paystubs Covering the Previous 30 Days: If your taxes and W-2s help the bank understand your financial past, your paystubs help them understand the present. Generally, only one paystub is necessary if it contains year-to-date payment information on it. 
  • P&L Statements (if you’re a business owner): If your income depends on the operation of a business, the bank will want to support your paystubs with profit & loss statements from any businesses you operate. 
  • Asset Statements: In order to assess your ability to make payments on a loan, mortgage companies also want to get an idea of your current assets, including balances in checking and savings accounts, retirement/401k/IRA accounts, and any investment portfolios you have.
  • Copy of Current Mortgage Statement (if applicable): If you’re already the owner of a home or property and have a current mortgage on it, your lender will want to review the documentation for that loan (even if they are the lender on that property too).
  • Copy of your Property Tax Statements (if applicable, if you own a home): Like a mortgage statement, your property tax statements will help a lender determine your payment history and ability. 

2. Figure Out How Much House You Can Afford

A lender will only offer you the amount that you can afford to pay monthly toward your mortgage. Know how much you can afford to spend on a home so you can narrow your home search and help me show you properties that you can afford.

 

The first step to figuring out how much home you can afford is to understand your debt-to-income (DTI) ratio. Your DTI ratio is how lenders compare the amount of debt you have to your income. If your DTI ratio is too high, you’re more likely to default on your home loan. A high DTI ratio makes it more difficult to find a mortgage at the best interest rate.

 

Add up all of your recurring monthly expenses to calculate your DTI ratio. Include things like rent, student loan payments, and minimum credit card payments.

 

Don’t include expenses that vary from month to month, like utilities or grocery bills.

 

Divide your total monthly debts by your total monthly pre-tax income to find your DTI ratio. For example, if your total monthly household income is $5,000 and you pay $2,000 a month in recurring expenses, your DTI ratio is 0.40, or 40%.

 

Most lenders like to see applicants with a DTI ratio of less than 50%. If your DTI ratio is more than 50%, you may want to take some time to pay down debt before you apply for a mortgage. If your DTI ratio is less than 50%, think about how a monthly mortgage payment would fit into your budget. Consider how much you can afford to spend each month on your loan. Include principal, interest, insurance, property taxes, and home maintenance in your calculation.

 

Play around with the figures and if you need help I will be happy to help you. if you need more help figuring out how much you can afford to spend on a mortgage. The calculator uses your income, debt, and other information to give you a rough estimate of how much of a loan you might be able to get.

 

3. Find A Mortgage Lender And Get A Preapproval

There are multiple types of loans ot there to help you

Type of mortgage

  • VHDA 100% Financed - NO MONEY DOWN
  • USDA 100% Financed - NO MONEY DOWN
  • FHA - 3.5 % Down
  • Conventional
  • Many programs to help you with your purchase

 

Next, it’s time to get preapproved for a mortgage. Tina Purcell at  Day One Mortgage will give you a good idea of how much house you can afford, your interest rate, and the types of loan programs you qualify for. A mortgage preapproval also tells sellers and real estate agents that you won’t have trouble finding funding for your home purchase. This gives your eventual home offer more weight.

 

Keep in mind that a preapproval is different from a prequalification. When you get prequalified for a loan, your lender doesn’t verify the claims you make about your credit and income. On the other hand, a preapproval requires a credit check and sometimes underwriting. A prequalification holds less weight than a preapproval because it often doesn’t include those details. When you get a preapproval, you get the most accurate information possible about how much of a loan you can obtain. This benefits everyone involved with your home search.

 

4. Begin The House Hunt

With your preapproval in hand, you may now start searching for homes within your budget.

You may have seen “for sale” signs around your neighborhood. Use online real estate databases to help you find properties within your budget that fit your needs. As your Real Estate agent, I will help as you look for homes. I am an expert in your local housing market and may have insider knowledge on which homes you might like. Tell me about the top qualities you’re looking for in a home and ask me to suggest properties for you to view.

 

Look at more than just the location or features of the house when you view a home. Don’t be afraid to test the home’s plumbing and electrical system by running water from faucets and flipping light switches. Take a look at the home’s gutters, chimneys, and trees. Take note of the condition they’re in. Ask the seller if the home has had radon, lead paint, or carbon monoxide inspections and ask to see the results.

A home inspector will be able to see and record many of these issues for you when you make an offer on a home. You can save yourself both time and stress by spotting deal-breakers when you’re still in the viewing stage.

 

5. Make An Offer On A Property

Put in an offer to buy the home once you’ve found a property that checks all the boxes. It can be difficult to decide how much you should offer, so listen to the guidance I can offer you. I will compare sales data and other local property values to help you make a reasonable offer. I will also draw up an offer document and submit it to the seller or the seller’s representative.

 

Keep in mind that you can ask for more than just a home sale in your offer letter. Depending on the condition of the property, you may want to request repairs or make your offer contingent upon a successful inspection.  You make a promise that you’re serious about buying a home when you put in an offer. You’ll include what’s called an earnest money deposit with your offer to prove it. An earnest money deposit is a small advance you make toward your down payment to the seller. Your earnest money deposit is usually equal to 1% – 3% of the purchase price of your home.

.

Next, wait for the seller to respond. The seller has three choices:

1.    The Seller Accepts the offer. If this is the case, congratulations! You’ve bought a home.

2.    The Seller Reject the offer.

3.    The Seller proposes a counteroffer. If this is the case, I can help you negotiate a purchase price. Sometimes you can’t reach an agreement with the seller and you may need to move on to other properties.

6. Conduct A Home Appraisal And Inspection

After you reach an agreement with the seller, it’s time for the appraisal and the inspection. Appraisals and inspections vary in a few important ways:

An appraisal only gives you an estimate of how much your home is worth. An appraiser looks at things like overall property values in the neighborhood and the general condition of the property. Mortgage lenders require appraisals because they need to know that they aren’t lending you more money than your home is worth.

You have a few options if your appraisal comes in lower than what you offered on the home. You can:

·         Renegotiate the purchase price with the seller

·         Bring a larger down payment and lower the amount of money you’re borrowing

·         Request a new appraisal

·         Cancel the sale and continue pursuing a different property

An inspection gives you a more intimate look at the inner workings of your home. During this process, a home inspector will walk through your property and test things like the electrical system, plumbing, and other amenities. They will also look at the condition of the home’s roof, foundation, attic, and basement. At the end of the inspection, the inspector will present you with a list of everything they found. You can use this list to request repairs from the seller before closing.

Though an inspection usually isn’t a requirement to get a mortgage, it’s a good idea to include a successful inspection contingency in your offer.

7. Closing

After your home passes inspection and undergoes an appraisal, you’re ready to close. Closing involves signing all the necessary paperwork on your mortgage and taking control of the property.

Before closing, you’ll receive a document from your mortgage lender called a closing disclosure. These documents include the final terms of your mortgage loan, what you owe in closing costs, and your interest rate. Read and acknowledge your closing disclosure. Your lender will arrange a closing meeting once they know that everything looks correct.

Bring your ID, closing disclosure, and cashier’s check or proof of a wire transfer for your down payment and closing costs to your closing meeting. A neutral third party called a closing agent will lead the process. You’re officially a homeowner as soon as you sign all of your paperwork.

 

Summary

Buying a home can be a complicated process.

 

·         I am on your side to assist you before you start to compare properties. Take a look at your income and debt and decide how much you can afford to take on in a loan. Get a mortgage preapproval once you have a rough idea of how much home you can afford. It’s a good idea to choose a preapproval and not a prequalification.

 

·         You may begin looking at homes once you have a preapproval. I  can help you find homes in your price range and neighborhood of choice. Put in an offer with the seller once you find the right property. Negotiate with the seller if you need to.

·         1- Reach Out To Me For Your Home- Leslie Woods-Hulse hoe Buying Guide

·         2- Reach Out to Tina Purcell for your Pre-Approval 

·         3- Let's Get Started for your Perfect Home ! 

·         4- Call Me any Time I am here for you - 703-728-7370 or email me at lmwh@c21redwood.com

 

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Leslie Wood-Hulse

Leslie Woods-Hulse has been buying and selling Virginia residential and commercial Real Estate in Virginia since 1995. She is an active member of the Dulles Area Association of Realtors, a Member of....

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