GETTING STARTED

INCOME

Most loan programs require the lender to verify all of your income sources. Typically you will need to provide paystubs, your W-2, and copies of your tax returns.

ASSETS

A critical piece in the mortgage loan application process is to verify the sources for your down payment, closing costs, and assets, as well as documenting income and debts.

CREDIT HISTORY

All lenders review a borrower's credit history to determine the type of credit used, the amount owed, and the borrower's history of repaying debt.

THE BUYING PROCESS

Once you have found the home you can see yourself in, there are several steps to the buying process you will go through before you can officially call it yours.

HELPFUL CHECKLISTS:  PRE-APPROVAL  |  HOME NECESSITIES  |  MOVING

PRE-APPROVAL

Meet with one of our Preferred Home Lending mortgage representatives to become pre-approved. This process will not only pinpoint the price range for your search, but give you a negotiating position for when you put an offer on the house.

NECESSITIES

After you pinpoint the features you are looking for including size, style, features, location, accessibility to schools and other personal preferences, you're ready to meet with an agent.

HOME SEARCH

Your agent can provide you with homes that match your criteria, but you also have full access to the MLS System through this site. Register for Property Watch to save your favorite homes, store notes and receive automatic emails of new homes that match your search. Set appointments with your Select Properties agent to tour any home in the area.

Your agent can supply information on real estate values, taxes, utility costs, municipal services, neighborhood demographics, school data, and even alert you to proposed zoning changes that could affect your decision to buy.

PURCHASE AND SALE AGREEMENT

Once an offer on a property has been made by a buyer and accepted by the seller, they enter into a legal contract known as a Purchase and Sale Agreement. This document outlines the specific terms and conditions of the transaction and is acknowledged by both parties.

INSPECTIONS

Once a buyer and seller reach a mutual agreement on a property, a home inspector is brought in to determine if the home needs any repairs. An inspector will check items, such as the roof, basement, heating system, water heater, air-conditioning system, structure, plumbing, and electrical. Afterwards, buyers will have a chance to negotiate with the sellers to cover the costs of certain repairs or to ask for concessions.

NEGOTIATIONS

Negotiations can involve everything from settling on a sales price to concessions and financing. Select Properties agents are great negotiators whose job it is to represent your interests during the entire real estate transaction.

FINANCING

You should already be pre-approved, but now that you're closer to the actual purchase price, you will be working more in-depth with your lender on your final loan approval. To learn more about this process, pay a visit to our Mortgage Center.

TITLE INSURANCE

You will receive a full report detailing the property history for you and your lender to ensure there are no legal problems between a new owner and the property being purchased.

ESCROW

Once the offer is accepted and a closing date agreed upon, escrow allows the buyer and the seller to have an outside party ensure all parts of the contact are complete. Your agent can help coordinate the completion of all forms to the escrow company and monitor the escrow process until the completion of the transaction.

CLOSING

At closing, all of the paperwork is signed by the buyer and seller- both parties pay any settlement fees and the documents are officially recorded. Prior to closing, you'll receive a settlement statement outlining any fees which may apply to you. After closing is finalized and recorded, the home is yours! Enjoy!

HOME LOAN PROCESS

LOAN APPLICATION

This is when your lender takes your application and reviews your credit history. They will also discuss your reasons for homeownership. This information is helpful when evaluating which loan fits your needs the best.

LOAN CHOICES

With so many loan programs to choose from, it can be difficult deciding which loan is best for you. During the application process, your lender will walk you through all of the options in order to match your needs with the best loan program.

SECURE RATE

If you have a Purchase and Sale Agreement, you can lock-in your interest rate. In most instances, you have the choice to either lock your loan at a set rate and fee for up to 30, 45, or 60 days, depending on the lock-in period you’ve selected, or you can let the loan float. Your lender can help you decide, but the final decision is up to the borrower.

LOAN PROCESSING

Once you have completed and signed your loan application, your lender will work with you every step of the way to get your loan approved and closed in a timely fashion. After you have provided the necessary financial information, your lender will arrange for an independent appraisal and preliminary title report.

UNDERWRITING

In many cases, loan approval can be completed at the time of application. For certain loan programs, your loan file is sent to an underwriter for review. Your underwriter may request more specific details about the property or your financial information before approving a loan.

CLOSING PREPARATION

After your loan package is complete, the file is prepared for closing and sent to your closing agent.

SIGN

Your closing agent will call you to set up an appointment to sign the final papers. At that time, you will be asked to bring a certified check for the closing costs and down payment. After you sign, the closer will prepare the final loan papers so that they can be legally recorded.

EXPENSES

Whatever your final moving cost may be, it's often higher than you anticipated. Moving can be expensive, in part because you aren't just hiring movers. You're uprooting your life, whether you move across the globe or a few neighborhoods over, and budgeting for that can be a challenge. Here are some moving costs you might not have considered.

EARNEST MONEY

You will need to provide a check for your earnest money deposit when writing your offer.  This deposit shows the sellers you are “earnestly” intending to purchase the property and is usually between $500—$2,000. These funds are applied to your closing costs on closing day.  

DOWN PAYMENT

Most mortgage lenders require a down payment of at least 3%. FHA loans (mortgages insured by the Federal Housing Administration) require a down payment of at least 3.5%. Depending on your credit history, the type of dwelling and your reason for buying, the minimum down payment could be 5%, 10%, 20% or more.

INSPECTIONS

Generally you will have to pay for your building inspection ($400 average, depending on your purchase price), termite inspection ($65-$95) and any other inspections you chose to have performed up-front.  Occasionally there are inspectors that will allow you to pay for the inspection at closing.

CLOSING COSTS

Closing costs are due at the time you close on a home and are approximately 3% of the total sales price.  There may be times when, as part of your offer, you request the seller to pay all or a portion of your closing costs.

MOVING SERVICES

Don’t forget to consider moving expenses which may include packing materials, a moving truck, and travel expenses if your move is a long distance move.

STORAGEIf your move takes longer than expected because a house closing is delayed, for example, you might have to put some of your belongings in storage.

UTILITIES

Some utility companies insist on deposits or connection fees.

REPLACEMENTS

It may sound insignificant, but keep in mind the cost of replacing all of the items you threw away when you moved, like cooking spices and cleaning supplies.

THINGS TO REMEMBER

Each month you will be required to make payments to the mortgage company on the borrowed amount and interest accrued. Your mortgage payment will depend on how much money you put down and the interest rate you get for your loan. At the beginning of your loan, your monthly payment will be mostly interest, but with each year more and more of the payment will be applied toward your principal.

Remember your monthly payment will need to include the factors of tax and home insurance. These factors are always built-in to your mortgage payment. Most online calculators do not reflect these two items so make sure you manually add them in for an accurate picture of your monthly payment.