So, you’re ready to buy a home?

• This is a general overview of a home purchase. Every purchase is unique to the property, buyers and sellers involved.

• Once under contract, the typical closing process takes 30 days.

• There are several negotiable lengths of time in a real estate contract that impact the overall length.

Here are the steps:

1. Talk to a lender. A lender will review your finances checking for red flags as well as figure your debt to income ratio. Your credit score coupled with the debt to income ratio weigh heavily when lenders determine a loan amount. Once we find a property we will then shop multiple lenders for the best deal. Remember these are YOUR finances and not the lenders, if you want to buy a car or take vacations you must factor these into your calculations. Unless the lender gives you specific instructions DO NOT MAKE ANY CHANGES. This includes opening or closing credit cards, buying a car, getting another loan without first speaking to the lender or myself. *Please be aware there is a possibility of wire fraud, do not anyone money unless you speak with me over the phone (not email).*

2. Start market research. This is when we start talking about bedrooms, bathrooms, yard size, location etc.. Now that we have established a price range we can establish a realistic expectation. Having this information you can now make an informed choice if a home purchase is right for you at this time.

3. Find your home. The Austin housing market moves FAST! It’s better to start looking at homes sooner than later to familiarize yourself with the process. Most buyers don’t know what a home of 1400 sq. ft. feels like compared to a 2000 sq. ft. property. The quicker you get comfortable the faster you can pull the trigger on your dream home.

4. Make an offer. We’ve found the home and you’re ready to move forward. We will craft an offer specific to this home and the seller’s needs in order to give you the highest chance of making a deal. This is a great time to start shopping lenders.

5. Execute the contract – Once all parties sign the contract it is considered executed and the clock starts. We will need to deliver two checks; the option check to the buyer and earnest money to the title company. The option check buys you an unrestricted right to terminate within a predetermined time period known as the option period. The second check will be the earnest money. The earnest money is your “skin in the game” if we don’t perform our obligations per the contract the seller has the right to the earnest money.

6. Open title. A title company makes sure that the title to a piece of real estate is legitimate and issues title insurance for that property. Title Insurance protects the lender and/or owner against the property that result in a dispute over title. The title company will hold and eventually release funds upon closing.

7. Hire a home inspector. $400-$600. The first 1-7 days (negotiable) in the contract is our option period. We will have the home inspected by an expert for any issues. The typical issues are roofing, electrical, plumbing, foundation and HVAC (air conditioner). If there are issues we were not aware of in the initial offer we can choose to renegotiate or terminate. I have several home inspectors to recommend.

Here are a few, more upon request;

• http://www.excelinspects.com – great family owned business

• Triple Pass Home Inspection. Ross is a one man show and does a very thorough inspection. – http://www.triplepasshomeinspection.com.

• Austin Property Inspections (Sam Lucas only) – http://www.austinpropertyinspections.com. I use Sam.

8. Underwriting. When (if) we make it through the option period our primary job is keeping the lender busy. Post option the lender will move to phase two of the loan process and start asking for personal documents. They will also order the appraisal at this time.

9. Appraisal. ($400-$600) The appraisal is a market analysis from a third party to verify our contract price is market value or below. The lender will loan on the lesser of the two values, contract price or appraisal.

10. Closing. Once title and the lender have approved all documents they will release the Closing Disclosure. This disclosure contains all numbers relevant to the real estate purchase, you have four days to review this document. Once the four days have passed we can sign papers and close on the property. This is a good time to set up utility transfer.

11. Funding. When the lender approves the signed documents they release funds for title to disburse. We get possession upon funding, in most cases that happens the same day we sign closing papers but not always.

12. House warming party. I expect an invite.

13.  File for homestead exemption. January 1st of the following year you are eligible to file a homestead exemption. I will send you the appropriate documents and walk you through the process.