Buying a Home Is A Team Project
It May Not Take a Village But It Takes a Team
If you have decided to transition from renter to homeowner, you are probably feeling excited and nervous at the same time. That is perfectly normal because it’s a big decision. Some think it is the litmus test for adulthood. While I’m not sure that is true, I will admit that it means taking on a whole new set of responsibilities. Heck by the time I bought my first house, I was already working in real estate but still had the jitters.
While you may find the home buying journey intimidating, thankfully, it’s not a solo adventure. You are going to have lots of professionals helping you along the way. Some of them you’ll interact with regularly and others you will never meet. Yet they will all be doing their part to get you across the finish line. Let me introduce them to you.
The Real Estate Agent
Your agent will scout out homes for you, pointing out the positives and negatives of each one. Once you have found the property you want to buy, he will do a comparative market analysis so you can decide on your offer. He will prepare the purchase agreement and help with the negotiations between you and the seller.
In a nutshell, your licensed real estate professional will answer your questions, provide guidance, make recommendations, advocate in your best interests, provide emotional support, and help keep the whole process of buying a home on track. Your Realtor is a valuable resource in assembling the other professionals you will need to complete your home buying journey.
Since you are going to be communicating regularly with your realtor, work with one you trust and who makes you feel comfortable. Also, be aware that a buyer’s agent represents the interests of the buyer exclusively while other agents own their fiduciary to the seller. As a buyer, it’s to your advantage to have a buyer’s agent agreement with your Realtor of choice.
The Loan Officer
Your mortgage person is one of the first people to bring on to your team. The role of the loan officer is to guide you through the entire process of obtaining a mortgage from preapproval through closing. You will learn how much you can borrow and discuss different loan options for which you qualify, steering you to one that is best suited to your particular situation.
The Home Inspector
Are unpleasant surprises like unexpected, expensive home repairs on your bucket list? I didn’t think so. Then once you have an accepted offer on a home, you will want to have it inspected from bottom to top, inside and outside by a professional home inspector.
Your inspector will look for major structural issues, water damage, roof problems, and code violations. He will inspect for water disbursement, plumbing or electrical issues, check your HVAC system, inspect the basement or crawlspace, attic, windows, and chimney. When completed, your inspector will provide you with a written report of the findings.
The Home Appraiser
Although you will probably never meet face to face, the appraiser plays a vital role in your home buying team. The lender wants reassurance that should you default on your loan; they can recover the money you borrow. The appraiser’s role is to determine the market value of the home you want to buy. To learn how much the home is worth, the appraiser will consider the location, size, amenities, condition, and features in comparison to similar homes that have most recently sold in the area.
The underwriter will evaluate the risk of lending you money and will approve the loan on behalf of the lender. In the underwriting process, your loan application is checked for veracity. Your credit history examined more carefully. The underwriter will review the appraisal value, and want proof that the seller has a clear title to the property.
Today most underwriting is done by automation and usually doesn’t take more than a few days. However, it will be on you the buyer to provide all the documentation requested in a timely fashion.
The Insurance Agent
Before you can close on your home you will need to have home owner’s insurance. If you already have an insurance agent that you use to insure your car, you may want to start there as you will generally receive a lower premium on both insurance plans when you use the same company.
The Closing Agent
The closing agent, or escrow officer, works for the title company you choose to search the title and facilitate the final transactions. The closing agent will prepare all the documents, review the title work and facilitate the closing.
The Real Estate Attorney
Some states require a real estate attorney to handle the final documents and closing. If you live in Alabama, Connecticut, Delaware, District of Columbia, Georgia, Kansas, Kentucky, Maine, Maryland, Massachusetts, Mississippi, New Hampshire, New Jersey, New York, North Dakota, Pennsylvania, Rhode Island, South Carolina, Vermont, Virginia, or West Virginia, you will add a real estate attorney to your team.
With assistance from your real estate agent, you have your team. You feel more confident and empowered knowing you’re not alone and feeling more excited and less nervous. You’re ready for anything. Bring it on!
As always, `thanks for reading.
You know where to find me – Joe Houghton