Obtain a Pre-Approval Letter for a Mortgage Loan
To qualify for a mortgage loan and determine your price range for a home, contact several loan officers/brokers of mortgage companies or banks and select the one that gives you the best rate and service.Obtain a pre-approval letter from the lender. A pre-approval letter gives you several advantages.
You’re assured of looking at a home that you can confidently afford to finance.
Your seller will take your offer to buy the home more seriously if you already have a pre-approval letter from a mortgage company or a bank since you will have a lender committed to backing your offer.
You’ll have an edge over other buyers who aren’t pre-approved in situations where there are multiple offers on a property.
Search for the Home
The majority of the homes for sale are listed with the multiple listing services. Your Sellect Realty real estate professional will search extensively on the First Multiple Listing Service and the Georgia Multiple Listing Service to look for a home that meets your criteria. Just let him/her know your priorities such as the location, price range, age range of home, number of bedrooms and baths, basement or slab, school district and any other features or conditions that are important to you.
Making an Offer on a Home
When you find the home of your dreams, make an offer. It is drawn up on a document called the Purchase and Sale Agreement. Your agent will usually advise you not to offer the seller’s asking price. An offer opens the door for negotiations and the seller may “counter” the offer. When there is a “meeting of minds” between you and the seller and the Purchase and Sale Agreement is signed and accepted by all parties, it becomes a binding agreement or a Contract.An earnest money deposit in the form of a check usually accompanies an offer on a home. The amount varies but a typical amount is 1% of the selling price of the home. An earnest money shows that you are seriously interested in purchasing the home. It is your money and is often applied toward paying your closing costs on the Settlement Statement at closing.
Getting a Loan
Contact your lender again and begin the loan process. The loan officer/broker runs a Good Faith Estimate so that you can get an idea of the total cost and the breakdown of the individual fees in buying the home. If during the Subject to Limited Financing Contingency period it is determined that you do not have the ability to obtain the loan as described in the Purchase and Sale Agreement, you may terminate the Contract and the earnest money will be returned to you.
Inspecting the Home
It is recommended to hire a certified independent inspector to inspect the home for any structural, safety, or code problems. If there are any defects or problems to the home, you have the option to request any repairs or replacements to be completed by the seller. This creates a contingency to the Contract until both you and the seller agree on which items to be repaired or replaced. If both parties cannot come to an agreement, then you have the right to terminate the Contract and the earnest money is returned to you.
Termite Clearance Letter
If a termite clearance letter is required by your mortgage lender, it must be ordered from an extermination company. Should an inspector find termite infestation, the home must be treated before the property could be sold and closed. If a termite clearance letter is not required by your mortgage lender, you may order the letter out of your own initiative.
Appraisal of Property
Your mortgage lender will send out an appraiser to appraise the home’s value. Should the property not appraise for at least the purchase price, you have the right to terminate the Contract.
Homeowner’s Insurance/Hazard Insurance
Your mortgage lender will require that you purchase a Homeowner’s Insurance Policy (Hazard Insurance) to protect your home as well as the lender’s investment. You will need to take proof of insurance and paid receipt to the closing.
You will be inspecting the home with your agent for any items agreed upon to be repaired or replaced a day or two before the closing date.
Settlement Statement Review
Before closing, the closing attorney’s office will send a copy of the Settlement Statement, which will indicate your closing costs. Your agent will review this document with you to ensure that there aren’t any discrepancies.
After your review of the closing costs, check with your mortgage lender if payment with certified funds will be needed (Georgia law will not allow personal checks in excess of $5,000).
Closing on the Home
A closing is a meeting to finalize the transaction. Documents are signed and money changes hands for the sale of the home from seller to buyer.Your agent will be present at the closing to represent you and make sure everything will go smoothly. Should any last minute problems come up, he/she will mediate in order to close.
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