If you’ve been house hunting for a while, you know that the process can be lengthy, frustrating, and complex. A lot of time is put into finding the right home and the search can feel never-ending!
Step 1: Find a Realtor
The first step in closing on a house is finding a realtor. The realtor will help you find the perfect home and negotiate the best price. They will also help you with the paperwork and closing process.
Step 2 – Find the Right House
The second step in the process is finding the right house. This can be a daunting task, especially if you’re not sure what you’re looking for. There are a few things to keep in mind when searching for a home:
– Location: You’ll want to consider the location of the home carefully. It’s important to find a neighborhood that you feel comfortable with and that is in a good school district.
– Size: Make sure to pick a size that is comfortable for you. You don’t want to end up with a home that’s too small or too large.
– Budget: Don’t forget to stay within your budget! It’s easy to get caught up in the excitement of finding a new home and spend more than you intended.
Once you’ve considered all of these factors, start your search! You can look online, work with a real estate agent, or drive around neighborhoods that interest you. Once you find a few homes that meet your criteria, it’s time to move on to step three.
Step 3: Write an Offer and Plan for Closing Costs
Assuming you’ve found a home you love and are ready to make an offer, it’s time to start thinking about your financing options and how you will come up with the money for closing costs.
Your real estate agent will help you determine what type of financing is best for your situation and guide you through the process of making an offer. Once your offer is accepted, you’ll need to get pre-approved for a loan and begin working with a loan officer.
Closing costs are the fees associated with finalizing your mortgage and can range from 2-5% of the loan amount. These costs can include things like appraisal fees, title insurance, and origination points.
You can expect to pay some or all of these costs upfront, so it’s important to factor them into your budget when planning for your new home purchase. Your loan officer can help you estimate your closing costs and give you guidance on how to plan for them.
Step 4: Closing Day Checklist If You’re Buying or Selling
There are a few key things you need to do on closing day if you’re buying or selling a house. First, review the loan documents and make sure everything is in order. You’ll also want to bring a certified or cashier’s check for the balance of the purchase price, as well as any other required fees or deposits. If you’re selling the house, you’ll need to provide the keys to the buyers and sign over the deed. Finally, make sure you’ve taken care of any final utility bills or other loose ends.
Step 5: The Agreement of Sale or Purchase (Depends on Who’s Selling)
The agreement of sale or purchase is an important step in the process of closing a house. This document outlines the terms and conditions of the sale and is signed by both the buyer and seller. It is important to review this document carefully before signing, as it will be binding on both parties. If you are selling your home, you will need to provide a copy of this document to your real estate agent. They will then present it to the buyer’s agent. If you are purchasing a home, your real estate agent will obtain this document from the seller’s agent.
Step 6: Earnest Money Deposit, the Home Inspection, and the Appraisal
Once you’ve found a home and negotiated the price, it’s time to make an earnest money deposit. This is a deposit that shows the seller you’re serious about buying the home and is typically 1-2% of the purchase price. The earnest money is held in escrow until closing, at which point it goes toward your down payment or is credited back to you.
After the earnest money deposit is made, the buyer has a certain number of days to complete a home inspection. The inspection is an important step to ensure that the home is in good condition and identify any potential problems. Once the inspection is complete, the buyer can choose to move forward with the purchase or walk away from the deal.
The next step in the process is ordering an appraisal. The appraisal will determine the value of the home and is used by lenders to determine how much they are willing to lend. The appraisal process can take a few weeks and must be ordered by the lender.
Once all of these steps are complete, it’s time to head to closing!
Step 7: Closing on Your New Home!
The average home closing takes 41 days from start to finish. The first step is to get a mortgage pre-approval, which can take up to two weeks. Once you’ve found a home and made an offer, it usually takes another two weeks to get the loan approved by the lender. The next step is the home inspection, which can take up to two weeks. Finally, you’ll need to sign the paperwork and close on the loan, which can take up to four weeks.
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