What are all the steps you have to take in order to buy a house?

Question

I'm interested in buying in the near future and im working on my credit right now so i will be able to do so. But im not sure what all you have to do in the banking process. Someone please give me some details.

Answer 1

There's a lot involved. You should get a book which covers the whole process, like the Idiot's Guide to Buying a House (no reflection on you, it's a helpful book!)

Answer 2

First thing is to make sure you have the best credit rating you can get this is the most important first step it will save you 10sof thousands of dollars in the long run. After you feel you have the best credit score you can get find a lender with the lowest interest rate and ask to be preapproved for a home loan this will tell you how much you can borrow and the kind of house you will be able to afford after that happy house hunting.... Also I dont know were you live but I am in Florida and we use A-aaa mortgage broker we refinanced brought a second home took out a new mortgage and it was so easy and worry free this way that I would do it again in a heartbeat if I needed to they can also preapprove you too you dont have to go to a bank and somtimes it is better not to hope this helps you and good luck

Answer 3

First, you have to figure out how much you can afford. The new rule of thumb is don't try to buy a house that costs more than four times your annual gross income. So if you make $50,000 a year before taxes, your upper end limit should be $200,000.

Before you go shopping for a house, go to lendingtree.com and put in an application. You'll get calls and E-mails from several lending institutions. When you contact them, tell them you're just looking into buying a house and ask them how much they'd be willing to lend you (also, be sure to ask them what the monthly payments will be -- that'll depend on your income level, your credit score, the amount they're willing to lend you, and how much money you have as a down payment). They'll have you fill out an application and they'll probably ask you for W-2's for the past two years, your last two pay stubs, a copy of your drivers license, and maybe a few other things.

Once you know how much house you can finance and have chosen a lending company, go out looking, find a house you like, and make an offer on it. NEVER agree to give someone what they're asking for the house -- even if the house needs little to no repairs/renovations/other work, you should offer $5,000 to $10,000 less than what they're asking. You'll probably end up negotiating on the price, but once you have agreed on a price, you need to contact the lending company and have them write it up.

They may ask you for an appraisal of the house, which you will have to pay for (costs around $300.00) and you'll have to coordinate with the seller to have that done. But once the lending company knows the sale price of the house, the appraised value of the house, and how much they're going to finance, they'll do all the paperwork and then schedule an appointment for a notary to sit down with you and sign all the mortgage documents. They try to make it as easy as possible on you; just be prepared to sign about 50-100 pages worth of stuff.

Does that help?

Answer 4

You've got one of the two most important preliminary steps: improve your credit. The other is save for a down payment and closing costs. You can get 100% financing with sellers paying closing costs if you have to, but you'll end up paying more. $380,000 leaves more cash in the seller's pocket than $400,000 with $20,000 closing cost credit. You also get better rates with a down payment.

When you're ready, find out how much of a loan you're likely to qualify for. From that, you know how much you can afford to pay for a property. Then start interviewing buyer's agents, and make sure they understand your budget. You can work with any number of buyer's agents if you refuse to sign an Exclusive Agency Agreement (do sign non-exclusive agreements with every agent you work with. This gives them motivation to work for you without tying yourself to them if they don't get the job done). Fire them, as in refuse to work with them any longer, if they try and show you properties that do not fit within your budget. Of course they are more desirable - that's why they're more expensive!

When you find one you want at a price you can afford, make an offer. Bargain. If and When agreement is reached, get appraisals and inspections done fast. I'll bet money that both parties will be happier with a transaction done in two or three weeks than one that takes three months. Apply for a loan and a backup loan, in case the primary loan officer is lying or a flake. This gives you a lot more leverage at closing. Stay in touch with your realtor and your loan officer. At closing, read everything, but apply especial care to the Note, Trust Deed, and HUD-1 form. If they don't gibe with the Good Faith Estimate (Mortgage Loan Disclosure Statement here in California), it's time to give that back up loan a go. If they're good, sign, cooperate with the escrow officer, and when the transaction records, enjoy your new property.

Answer 5

You must get pre approved for a loan - so you get an idea of how much you can buy. also to check out your credit. Also that way if you find a property you pretty much have the money in hand.

Shop for Mortgage companies - the interest rate is pretty much pre determined but it really makes a big difference who you work with.

next find a Real Estate Agent - make sure you get along - if you are pre approved for 100k and he wants to sell you a 200 k property - he is not the one. If you want a brick ranch and he is trying to sell you something else - you need to be looking for someone else... quick.

For the first time it may be worth your time to get yourself a Real estate lawyer to review your documents...

Answer 6

Save your money, at least 10% but 20% is better, as most lenders charge a fee PMI if you put less than 20% down

Answer 7

HUD (dept of housing & urban development) has tons of resources for the first time buyer.

http://www.hud.gov/buying/index.cfm