Getting Prequalified
Before you can make an offer, you’ll need a prequalification letter from a mortgage company. The lender will run your credit report and calculate your debt vs. income. They’ll let you know how much mortgage you can qualify for, and they will list this dollar amount on the prequalification letter. Then we will submit this letter with the offer. 

Making the Offer
Your offer is about 15-20 pages of paperwork to tell the seller what price you’re offering, what type of loan you’re getting, what date you would like to close on the home, and how closing costs will be divided. The seller may change any of those items in a counteroffer back to you

Earnest Money
You’ll submit an earnest money check with your offer. This will generally be around $1000-$2,000. If your offer is not accepted, you’ll receive this check back immediately. If your offer is accepted, your check will be deposited with the title company. The deposit will be credited toward the sales price when you close. If you are unable to qualify for the loan, your deposit will be returned to you, but if you change your mind about buying the home for any other reason, you will forfeit your deposit.

Option Period
An option period may be included in the offer. In addition to earnest money, you’ll also submit an option fee check, which usually ranges from $100-$300. The option period “buys” you a number of days, usually 7-10, during which you can back out of the contract for any reason, forfeiting your option fee, but not your earnest money. The option fee is also credited back to you at closing.

After Your Offer is Accepted
A lot will be happening behind the scenes, but these are the steps you will be involved in.

1. Title Company
   The offer has been signed by both parties and is now considered a contract. The contract and earnest money are sent to the title company that will handle the closing.
2. Application for Mortgage
   Your lender will require you to provide a LOT of paperwork. Bank statements, tax returns, pay stubs, etc. They may also ask you for money up front to cover the appraisal (usually $450-$500). The lender will order the appraisal; an appraiser looks at your house to determine the value. The lender bases their loan approval on the home appraising for the contract sales price.
3. Home Inspection
   We highly recommend you have the home inspected by a licensed inspector. This is different from an appraisal. An inspector will check the electrical, plumbing, roof, attic, foundation, and more. This costs around $300-$600, depending on the size and features of the house. Please note that all the deficiencies noted on the report are actual problems. Some are listed merely because of changes in building codes from the time the home was built. Nothing on the inspection is required to be repaired for closing; this report is for your information only.
4. Termite Inspection
   A termite inspection will be required by your lender. If termites are found, the lender will require treatment before a loan is made on the property.
5. Request for Repairs
   After the inspection is completed you may be able to ask the seller to repair some the items on the list. The seller may be willing to fix everything you ask for, or may not be willing to fix anything at all; most are somewhere in the middle.
   
6. Homeowner Insurance
   You will need to have a homeowner’s insurance policy in place prior to closing. Shop around for rates and be sure to ask about water damage coverage; due to large water/mold claims over the last several years, some companies will not cover water damage. Your insurance policy information will need to be given to your lender before closing so the insurance premium can be added into the closing costs.

Ready for Closing

1. Utilities
   About a week ahead of time, set up utilities to be transferred into your name on the day of closing.
2. Walk-thru
   The day before closing or the morning of closing, we will do a final walk-thru of your home to make sure it’s in satisfactory condition.
3. Closing Day!
   The title company will handle the closing. We will meet at their office to sign all the required paperwork. Prior to closing, the title company will notify you as to the exact amount of money you need to bring with you. You will need to bring a picture ID and certified funds (or bank wire) for any money you owe.
4. Funding
   Funding is when the money transfers from your bank to the title company. This is usually a few hours after closing. You get the keys to your new house after funding.
5. Move In
   It’s a good idea to change the locks on your new home, and the post office will rekey your mailbox at no charge.