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How to Buy a Home in Georgia

MARIETTA, GA – How to Buy a Home in Metro Atlanta.

Real estate across the country has many similarities from state to state, but in Georgia the process is much easier than in other states. Real estate closings in Georgia are typically conducted by one attorney that represents the lender in the transaction. In an all cash sale, the attorney will represent the Buyer. The attorney is responsible for making sure the title is clear for the Buyer and issuing the title insurance. They also collect the funds from the Buyer (and Lender) and disburse to the Seller after all documents have been signed.

In many states both Buyer and Seller have their personal attorney in addition to their real estate agent. Since Georgia is a one-attorney state, it’s very important that both the Buyer and Seller work with real estate agents to make sure their paperwork is completed properly and they can mitigate their liabilities in the contract.

6 Steps to Answer: How to Buy a Home in Georgia

1. Pick Your Team

Choosing the right team to work with in this can be the make-it or break-it moment for your experience. There are several people the buyer will need on their “Dream Team” of real estate pros. The first is the Real Estate Agent. The buyer should choose someone that knows what they’re doing and has the credentials to back it up. The buyer should ask the agent interview questions like: “how many homes did you sell last year?” or “what sets you apart from other agents?”. Testimonials, reviews, and actual examples of the agent doing a great job should be provided by the agent. Sellect Realty offers complimentary Buyer Consults before showing properties to ensure our Buyers are working with someone they can know and trust.

The second person the buyer will need is the loan officer (LO). This is the person that will be in the buyer’s corner to help line up the financing for the house. We recommend you go with a local professional that has in-house underwriting.  A Sellect Agent can recommend a few LOs for our buyers to interview.

Next, it’s time to find the team of home pros. These people can vary based on the house, but a great home inspector should be on everyone’s list. Some homes will need specialists like a pool inspector, contractor, plumber, roofer, electrician, surveyor, home warranty company, etc. The list here can go on depending on the property. All Sellect Realty Agents have a list of people that our clients have used in the past with much success that they will be happy to share.

2. Get Pre-Qualified/Pre-Approved

There is a real difference between being pre-qualified and pre-approved. Both are acceptable, but a pre-approval requires submitting loan documents, verifying income, and having the file reviewed by an underwriter (the person that says yes or no to the loan). A pre-qualification is a quick review of the buyer’s credit and unverified financials on an application. The pre-qualification does not require an underwriter review. Pre-approvals are going to carry more weight in negotiations when competing against multiple buyers for the same house. Most importantly, if someone can click a button on a phone to get a pre-qualification, there is a high probability that the loan can encounter difficulties. 

We recommend that our buyers apply with 2-3 different lenders to shop the best rate. Buyers shouldn’t worry about having their credit pulled multiple times. If done within a 30 day period multiple credit pulls will be treated as one Credit rating agencies do this to allow the consumer to get the best rate by shopping around.

3. Find the right home

During the pre-qualification, the buyer will discover how much money they can qualify for as a loan. Once we know what our buyer can qualify for, our Sellect Agent gets their time to shine. They will work with the buyer to figure out what their needs and preferences are. Then they qualify the homes and schedule showings of the homes for the buyer. Our agents have tools that can send the buyer properties that match their preferences the moment a property listed which gives our buyer a massive edge over the competition. 

PRO TIP: HOW MUCH A BUYER CAN QUALIFY FOR AND HOW MUCH THEY CAN AFFORD ARE TWO DIFFERENT THINGS – CAREFULLY REVIEW FINANCES BEFORE PURCHASING A HOME.

Once the right home is found, the agent will guide the buyer through the process of writing an offer. They will be available to answer any questions and help the buyer make a decision that they are comfortable with. The agent will draft the paperwork and handle the correspondence and negotiation (back and forth) with the other parties in the transaction. Once terms have been agreed to they will assist in placing the property under contract. The buyer will usually give a check to their agent called Earnest Money. This

Once under contract, the buyer will usually give a check to their agent called Earnest Money. This money will be refundable to the buyer under certain conditions and its intent is to show the seriousness of their intent to purchase. The Sellect Agent will explain to the buyer the terms under which they may terminate the contract and receive a refund of their earnest money.  When the property closes, the buyer’s earnest money will be credited back to them. If the buyer fails to close then the earnest money may go to the seller to help recover some of their expenses.

4. Inspection Period (Due Diligence)

As soon as the property is placed under contract it’s time to start doing what the contract calls for. In a vast majority of contracts, the buyer will have an inspection period when they initially go under contract. This period is called due diligence and, under the GAR contracts, the buyer may terminate the contract without penalty for any reason during this time. The time period varies and is usually negotiated when going back and forth with the seller. The first day of the due diligence period will start the day immediately following the binding agreement date in the contract. For example: if a property goes under contract on December 1st, the first day of due diligence will be December 2nd. These dates are calendar days, not business days.

During the due diligence period, the Buyer should have the property professionally inspected to the best of their ability. It is the buyer’s duty in Georgia to understand everything about their purchase before they buy. This is the time to line up any inspections that the buyer may require. It is the buyer’s responsibility to research and understand the property they are purchasing. Inspection costs can add up, so weigh the cost of the inspection against the risk of finding something after the purchase was complete.

It is the buyers responsibility to research and understand the property they are purchasing.

If the inspection reveals major faults, the buyer may negotiate repairs with the seller, or they may terminate during the due diligence period per the terms of their contract.

5. Post Inspection to Closing

After the inspection period, the buyer will pay for an appraisal of the house for the lender. The lender will base the mortgage amount from the appraised value. A Sellect Agent is able to provide guidance through the appraisal process. After the property appraisal has been completed the buyer will finalize all of the documents that the LO needs to process the mortgage. When complete, the LO will submit the file to the underwriter for a “Clear-to-Close”. Once this is done, the lender will work with the closing attorney to prepare the paperwork for you to sign at the closing table.

During this process, many buyers get excited and start making purchases and open lines of credit in preparation for the move. DO NOT DO THIS. The lender will pull your credit again before closing and large purchases and new lines of credit can throw red flags on your file. Changes in your credit limit by new lines can change your Debt-to-Income ratio or DTI. Changes in a Buyer’s DTI can impact the loan, even after a “Clear-to-Close” has been issued.

 

6. Closing

The loan is clear to close, the attorney has completed the title work and the documents will now be ready for the buyer to sign. Prior to the closing, the buyer will. have received wire instructions from the closing attorney. The buyer should always call the attorney’s office to confirm that the wire instructions are correct. This is a best practice due to different types of fraud that takes place in our industry. Once the funds have been wired the buyer can show up in comfortable clothes and bring two forms of identification. Everyone should arrive 15 minutes early and prepare to sign lots of paperwork. If you want to review the paperwork, request a copy in advance to review. The attorney will be happy to answer any questions you have, but by reviewing in advance we can keep the closing to less than one hour.

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