We are currently working with the SWEETEST couple buying their first house ever. If you had asked us a year ago, we would have told you that the first time buyers we were closing THEN were the sweetest couple ever. There’s a reason for that: First time buyers are FUN! Maybe it’s because we’re moms, but helping excited young people make sound financial decisions while we all imagine their future dogs and/or kids playing in the yard holds a special place in our hearts!
That said, we typically work with seasoned buyers (whom we love, by the way – please continue to refer your friends and family!). With those buyers, there is an implied understanding that they know the ropes when it comes to buying a house. We still educate, because real estate changes every day. But timelines and responsibilities are usually understood and can be monitored with ease by all parties.
This got us thinking, however, that maybe it would be a good idea to give a refresher on the steps to homeownership. While every deal is unique, there are some basics to getting from Point “I have a preapproval and I’m ready to look for houses” to Point “Unload the moving truck!”. In that spirit – here is a primer on the steps to buying a home (at least in Georgia!):
- Making the offer: Step one obviously begins way back when you’re pulling up listings on your phone and dreaming about granite counter tops and finished basements. But if we fast forward past all the property showings and decision making, we eventually start with an offer. This will involve your REALTOR (us, ideally) helping you determine the true value of your top pick, the best starting offer price, and what concessions you would like from the seller. This varies depending on how hot the property is. Sometimes we ask the seller to help you pay closing costs, offer a home warranty, and certify that the septic tank works and the home isn’t infested with termites. But if there are several other buyers eyeing the home, we might suggest you ask for fewer concessions to sweeten your offer.
- Negotiation: This usually involves a bottle of Tums and a few sleep aids for both the buyer and seller, and this is where choosing the RIGHT buyer’s agent pays off big time. Your agent needs to be knowledgeable about the LOCAL market: what homes are selling for, what concessions are standard in the area, and how agents tick in their little neck of the woods. Armed with this knowledge, your agent will get your offer accepted while keeping everyone happy in the process.
- Starting your financing: If you have buckets of cash, this doesn’t apply to you. But for the rest of us, this is when you need to tell your lender that you are under contract and spend at least one full day finding paperwork, copying, scanning, (and maybe cursing and likely saying aloud to whoever will listen that you changed your mind and you’re not buying a house because OH MY GOSH WHY DO THEY NEED SO MUCH DOCUMENTATION!!). But it will be worth it – we promise!
- Inspections: In Georgia, your agent will write in a specific period for you, as the buyer, to do your “due diligence.” During this time, you need to schedule any inspections you desire and also look at the neighborhood, schools, commute times, amenities, and anything else that is important to you as a homeowner. If repairs need to be made, your agent will help you determine what’s reasonable to request based on their expertise and what repairs may be too costly to proceed without the seller addressing (again – WE ARE WORTH OUR WEIGHT IN GOLD!!). This negotiation is at least as important and oftentimes more tense than the negotiations at the time of the offer. But your agent has done this dozens of times, will not get emotional, and will watch the clock to make sure all of these decisions are wrapped up prior to the end of due diligence.
- Appraisal: Once you know you’re proceeding with the purchase, your agent will have your lender schedule the appraisal. No matter how much you love the home and are willing to spend, the bank is only going to loan you money based on the appraisal. Think back to your original negotiations: if your agent, who you chose based on their expertise (and yes, there is a recurring theme here), felt like you got a good price, then you’re probably going to be fine on appraisal. If not, everything is negotiable and since the buyer, seller, and both agents really want this deal to work out, there’s a good chance it will.
- Closing: Finally the big day arrives! In Georgia you’ll meet with the sellers and an attorney to sign on the dotted line and promise, in writing, what will seem like 18 dozen times, that you will pay your mortgage on time for the next 15 to 30 years. It’s way more exciting than it sounds. You’ll get keys and garage door openers and the seller will explain how to wiggle the lock on the back gate just right to get it to open.
That’s it! There will be bumps in the road and you will feel like you’re on an emotional roller coaster for approximately 28 to 45 days, but if it’s the right house and you have the right agent, purchasing your first (or fifth) house should be an exciting and rewarding experience! Plus, you’ll have a new house and a brand new beginning when it’s all said and done!