Complete Home Buyer’s Guide

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The decision to buy a home is an exciting one. Unfortunately, it can also get overwhelming with the industry specific terminology, all the moving parts & various parties involved in the transaction. Our reason for writing this buyers guide was to help teach you what's going on when you buy a home, as well as relieve the stress that can be associated with these types of transactions.

The Simple 10-Step Purchase Process

1.) Contact Your Realtor

Determine your requirements, preferences & final qualifications for a home.

2.) Get Pre-approved for a Mortgage

Contact a loan officer, discuss financial resources and obtain pre-approval package.

3.) Find the Perfect Home

Tour available properties with your Realtor. Decide on an offer and arrange for an earnest money deposit.

4.) Present & Negotiatio Offers

Discuss a strategy with your Realtor. They will present and negotiate your offer with the listing agent.

5.) Open Escrow

Submit your loan application to the lender, underwriting and appraisal are done, receive the preliminary title report, all inspections are done and contingencies are removed.

6. Get Homeowner's Insurance

Determine your requirements, preferences and final qualifications for a home.

7.) Sign Documents

A mobile Notary will come to you to sign loan documents. Please allow approximately 45 to 60 minutes to complete the signing.

8.) Down Payment & Loan Funding

Wire your remaining down payment and closing costs to escrow.

9.) Record/ Transfer Title

Deeds are recorded at the county recorders office.

10.) Close Escrow!

Congratulations! You are officially a homeowner! Now take a deep breath, and relax in your new home!

Who is Involved?

Have you wondered just how many people it takes to get you into your dream home? Well this list is not inclusive of everyone in a typical transaction, but these four are the most essential for every home buyer’s purchase.

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Agent

An agent acts as your advisor during the whole homebuying process. They help you understand the current market conditions and handle the full negotiation process. They help you find the perfect home and connect you with the right third party resources such as lenders, inspectors and appraisers.

Cover of A Title Report

Title

A title agent investigates the status of property titles during real estate transactions, ensuring that a property is free of any obstacles that jeopardize a sale or interfere with a buyer's rights to the property.

Escrow

Escrow is a neutral third party that assists in a variety of tasks that are essential to the completion of property transactions. They perform tasks that include: preparing escrow instructions, holding and disbursing funds, preparing title documents and obtaining parties' signatures on paperwork,

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Lender

Loan officers evaluate and authorize approval of business, real estate, or credit loans, They are specialists at evaluating the financial status of a loan applicant. Their duties include: updating account records and reviewing loan files.

What is an Escrow???

Escrows is a common word thrown around amongst real estate professionals, but what is it exactly? We break it into 4 key parts below to help you understand. 

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The Escrow

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Image Depicting an Escrow Company's Building

The Escrow Company

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How is the escrow opened?

As soon as the buyer and seller execute the purchase agreement, the real estate agent will open escrow. At that time, the buyers will send their deposit into the escrow trust account.

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How long does it take to complete escrow?

The length of an escrow is determined by the terms of the purchase agreement. It is normally 30 to 45 days, but can range from a few days to several months.

5-Things NOT to Do During the Closing Process!

Change Marital Status

How you hold title is affected by your marital status. Be sure to make both your lender and the title company aware of any changes in your marital status so that documents can be prepared correctly.

Change Jobs

A job change may result in your loan being denied, particularly if you are taking a lower paying position or moving into a different field. Don’t think you are safe because you received approval earlier in the process, as the lender may call your employer to re-verify your employment just prior to funding the loan.

Make Any Large Purchases

A major purchase that requires A withdrawal from your verified funds or increases your debt can result in your not qualifying For the loan. A lender may check your credit or re-verify funds at the last minute, so avoid purchases that could impact your loan approval.

Pay Off Existing Accounts

If your loan officer advises you to pay off certain bills in order to qualify for the loan, follow that advice. Otherwise, leave your accounts as they are until your escrow closes.

Switch Banks or Move $ to Another Institution

After the lender has a verified your funds at one or more institutions, the money should remain there until needed for the purchase. Also do not make large cash deposits without lender approval.

Frequently Asked Questions

After all the conditions of the escrow have been met, and when the documents are received from your lender.

It’s a good idea to call your current insurance agent and start shopping as soon as escrow is opened. It is important to know the age of the home, type of construction, type of roof, number of square feet and other details about the property.

An estimate of your closing cost will be provided to you pursuant to the real estate settlement procedures act after you submit your loan application. An itemize list of charges will be prepared when you close your transaction and take title to your new property. Usually no more than 3% of the purchase price.

You will usually be paying for things such as appraisal fees, loan fees, escrow charges, advance payments such as property taxes and homeowners insurance, title insurance premiums, passed inspections and the like.

This bill is the result of a one time assessment. This is the result of a change of ownership or completion of new construction. The amount of the supplemental assessment is the difference between the new appraised value of your property in the prior appraised value.

The supplemental bill is in addition to your regular annual tax bill. The amount of the bill has been entered on the county tax roll and is payable by the due date shown on the bill. If your property taxes are paid by lender or tax paying agent, contact them about paying this bill. No notice of this bill will be sent to them.

Your escrow instructions represent your written statement to the escrow holder (title company) protecting your interests. Your escrow instructions specify, and a debit and credit format, the disposition of your purchase funds. They also provide for the title protection of your home.

Your escrow officer, or agent will contact you to make an appointment for you to sign your escrow instructions and final loan papers. At this time, the escrow officer will also tell you the amount of money you will need (in addition to your loan funds) to buy your new home. Your loan funds will be sent directly to the escrow by the lender.

After you have signed all the instructions and documents, the escrow officer will return them to the lender for final review. This review usually occurs within a few days and upon completion, the lender is ready to fund the loan and advises the escrow officer.

Real Estate Terms Buyers Need to Know!

A determination of the value of something, in this case, the house you plan to buy. A professional appraiser makes an estimate by examining the property, looking at the initial purchase price, and comparing it with recent sales of similar property.

All settlement or transaction charges  that home buyers  need to pay at the close of escrow when the property is transferred. These typically include lender’s fees and points or prepaid interest, a prorated share of the property taxes, transfer taxes, credit check fees, homeowners’ and title insurance premiums, deed filing fees, real estate agent commissions, inspection and appraisal fees, and attorneys’ fees.

increase in the value or worth of an asset or piece of property that’s caused by external economic factors occurring over time, rather than by the owner having made improvements or additions.

A computer-based service, commonly referred to as MLS, that provides real estate professionals with detailed listings of most homes currently on the market. The public can now access much of this kind of information through websites like

The local laws dividing cities or counties into different zones according to allowed uses, from single-family residential to commercial to industrial. Mixed-use zones are also used. Zoning ordinances control  size, location, and use of buildings within these different areas and have an effect on traffic, health, and livability.

The holding of funds or documents by a neutral third party prior to closing your home sale. This is typically done by a title company.

an examination of the condition of a real estate property. A home inspector assesses the condition of a property, including its heating / cooling systems, plumbing, electrical work, water and sewage, as well as some fire and safety issues.

Ownership of real estate or personal property. With real estate, title is evidenced by a deed (or other document) recorded in the county land records office.

A deposit made to the seller showing the buyers good faith in a transaction. Typically held in a trust or escrow account.

A provision in a contract stating that some or all of the terms of the contract will be altered or voided by the occurrence of a specific event, usually by specific dates leading up to the closing.

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