1. Evaluate Your NeedsYou’re emotionally and financially ready to buy a home, but wonder where to start. Your first step should be to evaluate what you need in a piece of real estate. Do you want more square footage for your family? Would you prefer to reside in an urban, a suburban or a rural area? Is an outdoor space important to you? What amenities are necessary and what can you live without? Make a list of wants and needs to help facilitate the entire home-buying process.
2. Get Pre-ApprovedOnce you've decided to purchase a home, you should contact United Heritage Credit Union to get pre-approved for a mortgage loan. A pre-approval is a written commitment from a lender affirming that a borrower would qualify for a certain loan amount based on credit information and income under a lender's guidelines at that time. This means that the lender has reviewed and verified your information to determine your borrowing power.
Obtaining a mortgage loan requires the lender and borrower to work closely together from loan application to closing, so be prepared to provide information and documentation to the lender as needed. If you choose United Heritage for your home loan needs, we’ll guide you step-by-step through the entire mortgage loan process – from pre-approval to move in. Learn more about UHCU mortgage loans.
There are numerous reasons why it’s a good idea to get pre-approved early in the process of purchasing your home. A pre-approval can:
- Provide you with an accurate idea of how much you can borrow.
- Demonstrate your financial strength and ability to follow-through with the purchase.
- Give you an advantage over those who aren’t pre-approved in a competitive real-estate market.
- Help speed up the underwriting and loan approval process.
- Allow you to recognize and fix potential, unknown errors on your credit report.
3. Work with a Real Estate ProfessionalWe strongly recommend you use a Realtor to help you find a home that meets your needs. Realtors have access to information you may not be able to obtain on your own. Take time to meet with a few Realtors before committing to one and ensure you’re comfortable with whomever you choose. A good Realtor will communicate with you frequently, helping you stay focused on homes that meet your specifications and are in your price range.
4. Search for a HomeAfter you’ve firmly established your borrowing power with a pre-approval letter from United Heritage and determined a prospective house payment that fits within your budget, you can work with your Realtor to begin house hunting. It’s important to start looking at neighborhoods before narrowing your search to individual houses. Consider factors such as each neighborhood’s proximity to your workplace, quality of the schools (if you have or are planning to have children), traffic flow, medical care availability, demographics, as well as distance to shopping and restaurants. Remember to remain flexible and accept that you may not find every feature you’re looking for in one place – refer to the prioritized list you made in Step 1 and make a decision that best suits your needs.
5. Make an OfferOnce you find “the house”, it’s time to make an offer! After consulting with your Realtor, you will determine how much to offer the seller in a written agreement or contract. A few items that may influence the amount you offer the seller are: the asking price, market conditions, recent home sales in the area, condition of the property and how badly you want the home. Your Realtor will prepare the documents that will make your offer official and will present it to the seller, or the Realtor who represents the seller. This contract is designed to protect you and the seller throughout the sales process.
6. NegotiateOnce you make an offer, the seller can respond by agreeing to your offer, declining your offer or making a counteroffer. A counteroffer provides you with what the seller is willing to negotiate. At this point, you can either agree with their terms or make another counteroffer. The seller can also decline the counteroffer. This process continues until you come to an agreement that satisfies all parties. Negotiable items include purchase price, closing costs, closing time period, repairs, landscaping, appliances, furnishings, painting and financing.
7. Hire an Inspector and Obtain Homeowner’s InsuranceAll offers should be contingent upon a thorough home inspection. For your own protection, it’s important to hire a qualified professional home inspector to go over every inch of the house you want to buy. The inspector will administer tests and give you insight regarding the home’s actual condition. If there are any serious issues with the house, you can request the seller make needed repairs, renegotiate the purchase price to absorb repair costs or withdraw your offer.
You will also need to provide proof of homeowner’s insurance at the closing, so you should work with your insurance company to obtain coverage beforehand. It’s important the lender’s investment, the equity in your home and your personal possessions are fully insured. You may also want to consider additional home warranties for such things as plumbing, wiring and structural defects.
8. Prepare for ClosingYour United Heritage home loan representative will make sure all necessary documentation is prepared and delivered to the appropriate title company location on the appropriate date. You will receive a document that outlines the costs and fees you’ll pay at closing. You’ll need your valid driver’s license, a certified check (if applicable) and any additional documents your individual circumstances require. In most instances, you will take a final walk-through of the property before the closing to ensure the home is in an agreed upon condition for transfer of possession. Because of the complexity of the transaction, you may need to allocate a few hours to sign all of the documents and complete the closing.
9. Close the SaleClosing the sale is when home ownership is legally transferred from the seller to the buyer – it’s a real estate sale and a mortgage transaction. At the closing, you will sign documents that will put you in possession of the home and finalize your mortgage loan.
10. Establish Residential ServicesOnce you’ve closed the sale of your new home, it’s time to establish the services you’ll need when you move in – such as electricity and/or gas, water, cable/satellite/internet, and trash/waste. In addition, you may need to start paying homeowner association fees, other annual taxes or landscaping costs.
The best first-time homebuyers do their homework beforehand and are prepared for each stage of the purchasing process. By following the steps we’ve outlined above, buying your first house can be a thrilling and an enjoyable experience. At United Heritage, we want to make financing your home as simple as possible. Get pre-approved today with no upfront costs! Apply now.