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Whether you are a first-time home buyer or an experienced homeowner, buying a home can be an exciting and emotional experience. You may be wondering along the way—what am I missing or what can I expect? Here’s how the buying process works from start to finish.
Begin with preliminary online research. Check what homes are selling for in the areas you are interested in. This will give you an idea of what to expect in the current market. It will also aid you in communicating your wish list with your real estate agent.
Find an agent. Not all real estate agents are created equal. An experienced real estate agent will help you navigate the process every step of the way. You will want an agent who knows the market, is seasoned in negotiation, and proficient in contracts. Please browse the reviews of satisfied clients who can attest that this is not just our side hustle here at Rincon Rising Real Estate.
Budget. An online mortgage calculator can be a helpful tool to aid you in determining your monthly mortgage payment. However, a discussion directly with a local loan officer is significantly better. Some additional considerations include, utility estimates, HOA dues, home insurance, property taxes, and commute expenses.
Get pre-qualified. Get connected with a lender. If you’d like recommendations for reputable local lenders, just ask! Your lender will guide you in gathering all the necessary documents. Remember, the qualifying maximum amount is not what you have to spend.
Find your home! Our agents can set up a search within the local Multiple Listing Service to assist in finding you the right home. As you view homes, your Realtor will customize your search based off your feedback and preferences. Timelines can vary depending on market conditions and buyer needs.
Make an offer. Completing the steps above will facilitate your ability to act quickly when needed- this is sometimes advantageous. Your agent can provide you with market analysis information to help you submit a strong, reasonable offer to the Seller. You can view a sample AAR (Arizona Association of Realtors) contract here.
Negotiation. Once your offer has been submitted, the Seller has a specific amount of time to respond, typically within a day or two. The Seller can respond in one of three ways: Acceptance, Counter Offer, or Rejection. Your Realtor will be your advocate during this time to protect your interest while also being fair and respectful to the seller and their Realtor.
Acceptance/Open Escrow. Congratulations! The next step will be opening escrow, which is typically done through a third party Title Company. This is done by depositing Earnest Money or good faith funds. These funds usually amount to 1% of the purchase price, however, it varies with each contract. This process can last 30 - 45 days for financed transactions from opening escrow to closing. Are you curious if you will see your earnest money again if the contract falls through?— Continue reading to learn about contingencies.
Contingencies. The following events allow you as a buyer to gain a greater insight into the details of your prospective home. Certain outcomes may elicit your decision to cancel the contract and receive a refund of your earnest money.
Inspections. No home is perfect, but you don’t want to be surprised by major defects upon move-in. There is no substitute for having professional inspectors review the property for quality, safety, and general conditions of your potential home.
Common inspections ordered by buyers include:
General Home ($350-$600+ depending on home size)
Termite/Pest ($50-$100)
Roof (typically no charge)
Sewer ($100-$150)
HVAC ($100-$150)
Pool/Spa ($100-$175)
While the expense of these inspections are laid upon the buyer, the advantage of the services rendered outweigh the potential risk of hidden defects. If the inspections reveal defects, you have an opportunity to request the seller to make repairs, discount the selling price, or other various contract modifications that are acceptable by both parties.
Title review. The title company will provide you with more information regarding the prospective home such as recorded liens, easements, and other pertinent details conveyed with the property.
Appraisal. If you are purchasing with a loan, the lender will require an appraisal in most cases. The appraisal is intended to support the value of the property. It is paid for by the buyer unless otherwise negotiated. The contingency is triggered if the appraised value is less than the purchase price. The loan will not be approved at which point the buyer could cancel the contract, bring additional funds to make up the difference, or re-negotiate terms with the seller.
Loan Approval. During the purchase process, the lender will guide you and request additional information and documents as necessary. In the event the lender discovers a reason you are no longer eligible for the loan, you will be permitted to cancel the contract and receive an earnest money refund. Be sure to communicate honestly with your lender and hold off on other large purchases during this time. You don’t want to end up with a new vehicle or furniture without the new home to put them in!
Pre-Closing Walkthrough. No later than three days before closing, you will review the property to ensure it is in the same condition as it was during contract acceptance and any repairs agreed upon have been completed. Having an experienced Realtor is essential to finding the proper solution should any discrepancies occur.
Closing. You’re almost there! A time will be set for you to sign closing documents at the title company. Your Realtor will let you know when everything has been recorded, and make plans to hand over the keys to you. Time to celebrate!
