Planning to buy a house for the first time? Or have plans moving into a new home in Maui? This article will explain to you the basic processes involved in buying a home.
Every state requires a slightly different process in buying a home, although they are the fundamentally same when it comes to the basics. Since buying a home is a huge financial commitment, knowing its process will help you pinpoint where to start and create a timeline as to what stages you are in and what specific fees you are going to pay.
- Hiring a licensed real estate agent
You probably would not be able to buy a house on your own. Even if you are simply buying from a friend, as a buyer you need somebody who will represent you known as a Buyer’s Agent. For beginners in home buying, it’s not advisable to rely on the fractional and outdated information that many online sources provide. In many instances, costumers are misled in believing pieced of information that have been abandoned by real estate writers in an effort to make themselves better in other real time aspects. When you get the wrong information, you also suffer from terrible consequences.
However, if you hire a licensed agent that good training, education, and experience, you are in good hands. Look for a good buyer’s agent who can carry out many tasks to the best interest of the buyer such as:
- Advising the client with the pros and cons of specific and even personal real estate decisions during the process
- Recommending a good list of houses based on what the buyer needs and after a thorough assessment of the motivation to buy
- Educating the buyer on the market conditions
- Doing the paper works and handle the ins and outs of the negotiation process
So here’s what you are going to do. Contact your local real estate agent to give you an advice on your current situation. The internet is also a haven of qualified real estate professionals, who can be a good fit for your needs.
- Getting Pre-Approved
Before you meet with your agent, you must go to the bank and get a pre-approved letter. A pre-approved letter contains information such as the mortgage options, debt statement, mortgage ratio, and the amount of money needed to close a deal. These are important information that lets agents know which deal would be right for you.
- Looking for available properties
With a pre-approved letter on hand and other data, your buyer agent will be the one to normally look for houses to recommend to you. However, you can also do it on your own and have your choice assessed by your realtor.
When researching for a house, narrow your search to homes that exactly fit your budget and wanted designs. Ask a comparison of house for sale within your target location from the MLS listings and get additional inputs from your agent of the home you are interested.
- Giving a purchase offer
Once you have chosen a home, the next thing your agent will do is to prepare an offer. An offer will not be immediately final. Its terms and conditions need to be checked and approved by an attorney. The attorney can disapprove if there are disagreements between parties.
- Property inspection
Once both attorneys give the approval letter, you can proceed to the house inspection. The house inspection is done by a professional inspector who will give you a report of issues pointed out during the visits. The report may include structural issues of the house, its component, and life expectancy which are important factors that will help you in your decision.
- Mortgage application
Your agent will send a complete copy of the contract to the bank for the mortgage application but you still need to meet with the lender and formally apply for mortgage.
- Signing the commitment letter
Once the bank approves your mortgage, you will be given a Commitment Letter. A commitment letter is a written agreement that means you have passed the bank’s underwriting guidelines and that you agree to the payment schedule.
- Closing the Sale
Once all the paperwork are done, the final thing to do to finalize the sale is to sign the sales documents. It would normally take a couple days or more for the bank to fund the loan, but once your loan is funded, you are ready to move into your new home.
Buying a home in Maui can be a daunting task. With the variety of homes available and unique advantages, the process can take some weeks or months. With this basic home buying guide in place, you’re sure of the next step and the proper actions you need to take.