There is a process for buying a house in Chicago or any city. When you are learning how to buy a house it’s essential to understand the overall process. This article will outline the 9 steps for buying a house. Buying a house is more than finding a new place to live. It can be one of the best investments you might ever make in your lifetime.
9 Step Process For Buying A House
1.) Hire a Realtor. This will be the best thing you do as long as you have good representation. You should always the take time to sit down and interview an agent and have him or her explain the home buying process to you. Make sure your personalities align as you may be spending a lot of time with one another. Ask you agent if you are realistic based on the price you are willing to pay. Hire the RIGHT agent and you should have no worries
2.) Go see homes! You should get pre-approved for a loan before you start viewing properties. This is a very important part of the process for buying a house. There are many lenders who will give you a dollar amount that you are pre-approved for, but that does not mean that is what you should spend. You want to take into consideration all monthly housing expenses included to homeownership. That should include property taxes, your mortgage, private mortgage insurance, home insurance, and home owners association dues if applicable.
Once you have a budget, you can determine the proper purchase price you are comfortable with considering all monthly housing expenses. It’s not fun being house rich and cash poor so make a budget! Once you have a purchase price you are comfortable with then it’s time to see some properties. You will know the house you want when you see it! You will get an inner feeling that tells you, “this is the one”. It’s most important to be prepared when that happens. Sometimes you may find your dream home on your first time out and other times it can take months.
3.) Write an offer! Once you find the home you want it’s time to put in an offer. Your offer should be constructed by a few things. Your agent should compile a Comparative Market Analysis to help educate you on what your starting price should be. He or she will study the market time of the home for sale and do any additional homework. If you feel good about the numbers then move forward and put it in writing. It’s okay to get a little nervous. Everyone gets a little anxiety when buying a home.
You will want to have a good idea of what your total monthly payment will be so that you can make an educated decision how much room on price you can have. Negotiations can give you a little anxiety waiting to hear if you get the offer accepted or not. This is probably the most nerve wrecking step in the process for buying a house.
4.) Offer Accepted! You are halfway through your process for buying a house. Once you get an accepted offer you will put down your initial earnest money and get seller signatures on your purchase agreement/contract. You are now under contract on a house, but there’s still a lot more to do. Your contract should be contingent on a couple things: First, it will be contingent upon getting a home inspection (more on that next). In Illinois the contract will also be contingent upon the attorney approval period, which is typically 5-7 business days after the contract has been accepted by both parties.
5.) Home Inspection! You or your agent will schedule a licensed home inspector to come to the property and perform a non-invasive examination of the condition of the home. They will fully inspect the house and if anything comes up they will let you know. If there are any issues you have the right to ask for the seller to fix them or give you credit so that you can get it fixed.
All of these requests can be communicated through your attorney during the attorney approval period. The home inspection is contingent upon a satisfactory home inspection to you as a buyer. Depending on the size of the property you are going to buy this can take 1-3 hours. It is your responsibility to pay for the home inspection and this is one of the costs of doing business.
6.) Apply for Loan! As you are getting the home inspection out of the way you also need to start getting the loan paperwork going. You need to meet with you mortgage broker or lender right away! They will need to collect all of the pertinent financial documents they need to get the loan approved. They will let you know exactly what is needed for the loan, but plan on giving them tax returns, pay stubs, and other financial information. When you were pre-approved for a loan your lender should have told you what they needed. Expect them to ask for the same documents they asked you for before, but updated within 30 days. You may have to pay an application or appraisal fee for the property.
7.) Receive a Clear To Close! This is the one of the most exciting steps of the process for buying a house. Most of the work is done at this point other than waiting for your lender to produce a firm mortgage commitment letter. This means your lender has given you the green light to close on the property and you have met all of the “closing requirements” for the them. In your purchase contract for the home you have a mortgage commitment deadline that you and the seller agreed upon. Your lender must produce a mortgage commitment letter by this date. Your contract should have been contingent upon you getting a mortgage commitment by the date specified in your purchase agreement. If you do not receive a mortgage commitment letter by this date, you or your attorney can request for an extension from the seller.
8.) Schedule Final Walk-Through! The process for buying a house is almost over. The last step is to schedule the final walk-through prior to closing. This is generally done day of or the day before the closing. You want to make sure everything was the way you last left the property.This should only take 20 minutes or less. If all is satisfactory to you, then you are ready to head to closing!
9.) Closing! This is where you sign off on your mortgage if you are getting a loan and the deed and title transferred to your name. Your attorney will attend the closing and will review all loan documents and closing documents before you sign. If you are in a non attorney state your title representative should do the same. You will leave with the keys as long as everything runs smoothly at the closing. Now you just have to move in. This is the process for buying a house!
Congratulations you just bought a house. I hope this information helped you understand the overall buying process. Should you have any questions please reach out to me.
If you are looking to buy a new home and want an aggressive bulldog Realtor, then check me out. I promise you nothing but the best results or I’ll literally help you move. It’s only a conversation and you can see if I know what I’m talking about.
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