So today is the day! You drove by the house you have always loved and decided you were going to look at it and buy it. You call the number on the sign, set up an appointment and walk into your dream house! On the spot you decide to buy it. You write the offer and it gets accepted. Whoo hoo!! NOW you go and get your loan only to find out… can’t afford it! You are not able to get a loan for it and now you have set yourself up for disappointment and risk losing the money you put down. What should your first step have been and how do you know that you’re ready to buy a home?

For most people this answer will vary as everyone has different reasons for purchasing a home. Here are some of the basics to break it down for you.


Step 2: Find a Realtor! (you can also find your Realtor and then your Lender as they may have some recommendations for you)

Step 3: Begin your search! Using the internet is the way that most people will begin. According to the National Association of Realtors, 90% of homeowners found their home AND Realtor online. A note about new construction, the agents on duty at a model home represent the seller and the interests of the seller. They do not represent you so it is important to have a Realtor by your side that does. If you do decide to go into a new home community without your agent, take your agent's card with you and provide it to the onsite sales agent and/or write their name on the registration card to let them know that you are working with a Realtor. 

  • Start off by making a list of wants and needs including, size, location and features. Remember that wants and needs are very different from each other and in most cases you may need to compromise something in order to get the house that you need.
  • Set a realistic budget of what you can afford, this may vary from your pre-approval.
  • Do your research! Don’t just assume that the house you found is as pretty as the picture. This is going to take a bit of leg work on your part but you will be glad you did.
  • Compile a list of properties that you like and have your Realtor research them. Get all of the information up front to avoid surprises later.
  • Take it to the street! Grab your list of homes, your notepad and your camera and go see those houses!

Step 4: Make an offer! Once you have found your home you need to write up that offer! Your Realtor will sit down and go over the offer with to be sure that you understand and accept all of the terms. In the case of new construction, the price is not always negotiable but there may be incentives offered. Your agent will do a market study to determine if the price listed is the fair market value of the home and they will negotiate on your behalf to be sure that you get the best price for that house. Remember that an offer is a legal document and should be taken seriously. An offer is also accompanied by an Earnest Deposit. Be sure to discuss that with your agent prior to submitting your offer.

Step 5: Conduct a home inspection! This is a crucial part of the process that should NEVER be overlooked! If you need a list of qualified home inspectors your Realtor would be a good resource for you. Whether it’s a 20 year old home or new construction, you should ALWAYS have a home inspection. Be sure to do your wood destroying insect inspection as well. You as the buyer will pay for these inspections at the time of service but the peace of mind you get knowing that your new home is in good condition is well worth the investment!

Step 6: Close on your new home! Once you have jumped through all of the hoops involved in buying your home you will go to closing. This is at an attorney’s office. The attorney does not represent anyone in the transaction and simply covers the information in the closing documents making sure that you understand what you are signing. Once the papers are signed and filed with the court you will receive the keys to your castle!

A quick side note: Out of pocket expenses that most buyers don't always think of include the following items:

1. Earnest deposit: This amount varies depending on what a buyer would like to offer. This can be anywhere from $500 to $2,500 and up depending on the buyer and what they are able to put down. This money is not paid directly to the seller but rather held in an escrow account, usually with an attorney. To learn more about Earnest Deposits be sure to talk to your Realtor.

2. Appraisal Fee: Though most people understand that they must have an appraisal when financing, they may not always know that this is not considered a closing cost or a fee paid at closing. This is an out of pocket expense for the Buyer paid directly to the appraisal service. The amount varies but can cost $545 on average. 

3. Condo Certification Fee: This fee ONLY applies to condos and is a lender requirement. This may also vary but costs about $300 on average.

4. Cost of a home inspection: Home inspections are also out of pocket costs to the Buyer paid directly to the inspection company. Depending on the size of the home and the scope of the inspection you select you can expect it cost $350 to $550 and up with additional inspection options like infrared, mold, etc.   

Have additional questions on the homebuying process or want to know more about buying new construction? CONTACT US!