1. Get Pre-approved for a Loan
Before you start house hunting and making offers, you’ll need to begin the process of getting pre-approved for
a mortgage or loan. Pre-approval means you won’t waste time considering homes you cannot afford, and
ultimately makes your purchase offer competitive. You’ll need: copies of recent pay stubs, statements, and
copies of your past two W-2’s. We can recommend several excellent lenders.
2. Decide on Your Budget
Calculate your down payment, your ability to qualify for a mortgage, and the closing costs associated with your
transaction to figure out a number you’re comfortable with — and how much home you can afford. Most loans
today require a down payment between 3.5-25% depending on the type and terms of the loan. There are zero-
money-down programs that you may qualify for, however, you will need to consult with your preferred lender to
determine which best suits your needs. Your mortgage payment to the lender can include the following items:
a. Principal and interest on the loan
b. Property taxes
c. Homeownerʼs insurance
d. Private Mortgage Insurance (PMI) if you put less than 20% down
3. Explore Potential Neighborhoods
Exploring neighborhoods at different times of day (morning/mid-day/evening/weekdays vs. weekends) and
visiting local shops, restaurants, and parks can help you get a great feel for a neighborhood. Yelp reviews,
Google Reviews, and Google Maps are helpful tools for investigating everything from local school ratings to
average commute times.
4. Start House Hunting
After loan pre-approval, you’ll be ready to kick-start the search. Be prepared to discuss with your REALTOR®
what you’re looking for in a future home. You’ll also need a list of your preferred neighborhoods or
communities. Think about your must-haves, like-to-haves, and deal breakers.
5. Submit the Offer
Once the Paras Team help you find a home you love, you’ll work with us to create an offer. You’ll need: a pre-
approval letter from your lender; a personalized offer letter detailing what you love about the home (these are
particularly helpful in multi-offer situations); to decide on an Earnest Money deposit amount; to strategize
contract deadlines; and a list of comparable sales or Comparative Market Analysis report (your Paras Agent will
provide this for you).
6. You’re Under Contract!
The offer has been submitted, negotiated, and accepted: you’re under contract! The process from here to the
finish line is generally around 30 days. Remember: within the first 4 days of acceptance, you’ll need to deposit
your Earnest Money check or wire at the Title Company.
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7. Lock in Your Interest Rate
Now that the home-buying process is off to a good start, be sure to call your mortgage lender to lock in your
interest rate. This will help prepare you for potential surprises at the closing table. Remember: do not make
any large purchases or open any lines of credit during the next 30 days! This could affect your credit and your
ability to obtain the loan.
8. Home Inspection
You’ll have about 14 days to inspect the house during your Due Diligence Period. Find a home inspector you
trust to examine the home from top to bottom; we can provide a list of recommended inspectors. Consider
testing for radon gas, meth, mold, lead, or structural issues. You’ll want to be present during the home
inspection so you can ask questions and see potential problems for yourself before deciding which repairs to
request. Home inspections typically range from $300-$700 and are paid for by the buyer.
9. Ask for Repairs
Once home inspections are complete, you’re ready to ask the seller for repairs. Consult with the Paras Team
to make sure you negotiate for the essentials — and skip the small stuff that could put your purchase at risk.
Next, your lender will request an appraisal. As a buyer, you can’t do anything to influence this process, but it’s
a good idea to confirm that an appraisal has been requested. Appraisals range from $400-$600 and are paid
for by the buyer. When appraisal is complete — assuming the value is in line with the agreed-upon price —
the mortgage will continue. If not, you may be headed back to the negotiation table. Appraisals are part of the
Financing and Appraisal Deadline.
11. Homeowner Insurance
As you approach Settlement, you’ll want to comparison shop to secure homeowner insurance on your new
home. Don’t skip this important step.
12. Paperwork Prior to Settlement
A few days before Settlement, your paperwork — including the appraisal, income statements, and assets —
will be shared with your loan underwriter for final review. Two days before your Settlement date, your loan will
receive final approval and the loan documents will be ordered. The day prior to Settlement, an escrow officer
or closing attorney will calculate final costs and credits for both the buyer and seller.
Be prepared to hand over your closing costs (which range between 2-5% of your mortgage loan amount) and
down payment, and be ready to spend at least an hour signing documents. Remember: you will not get your
keys at the Settlement meeting. You’ll get your keys when possession terms from the contract are met (usually
1-3 business days after Settlement).
14. It’s Official! You’re a Homeowner!!!
Once everything is signed and processed, the loan closes, property transfer is recorded, and possession terms
are met, the keys — and the home — are yours!
Remember: The buying process is intense, but with the right tools, preparation, and a stellar agent in your corner, it can also be fun!