If you’ve been through the process of buying a home, you perhaps know there are a number of steps involved. If you are buying your first home, it’s important to understand the order in which these steps should occur.
Follow this path and you’re much more likely to sail smoothly through the process:
Step 1 – Mortgage Pre-Approval
- Have a price range or monthly budgeted payment in mind.
- Get Pre-Approved! Meet or call one of our Loan Officers before you submit an offer. Many can be done in a day or two.
- Use that opportunity to discuss all the costs involved, including lender fees, third party costs, and prepaid items. Your Loan Officer will also provide an estimate of cash required to close.
- Be prepared to provide financial documents to your lender. A thorough pre-approval should always include a review of your income and asset information.
- Our pre-approval letter will contain a monthly payment amount as opposed to a loan amount or purchase price figure.
Step 2 – Making and Negotiating the Offer
- Provide your real estate agent with your GMB Pre-Approval letter. Share your price range as well.
- Your agent will set you up for regular emails reflecting homes that are both on the market already as well as new listings.
- When you identify a home, ask your real estate agent for a list of comparable homes that have recently sold in the area.
- Be upfront about what you want included, such as curtains, lighting fixtures, appliances, etc.
- Think about a seller credit towards costs if that’s possible.
- Be flexible on the closing date if you’re able to do so.
- Ask the seller to buy you a home warranty.
Step 3 – Inspecting the home
- Find a qualified inspector by asking your Realtor.
- When you make the appointment, you should plan on attending.
- If there are problems, obtain individual inspections by certified contractors and get a bid for the repair work. Your real estate agent should be able to offer some reputable names.
- Ask the seller to correct the problems. You can also consider asking for a reduction to the sales price or credit towards costs.
Step 4 – Loan Approval
- Upon providing the signed offer to us, Great Midwest Bank will provide appropriate disclosures. When you review and accept the terms, we’ll request funds for the appraisal.
- Ask about a rate lock. Generally, if you’re within 45 days of closing, we can lock your rate.
- We likely will request updated financial information if the pre-approval occurred a month or more before your application.
- You’ll receive a copy of the appraisal upon completion. If it is lower than the agreed price, you may be able to negotiate with the seller.
- We work to provide you with a formal Loan Commitment by the date designated on the offer to purchase.
Step 5 – Shop for homeowners insurance
- Be sure to shop around and ask us for a local reference.
- Compare coverage, including personal property and garages.
- Compare deductibles and ask about a claim service.
- Provide your insurance agent with the Loan Officer contact info.
Step 6 – Viewing the home before closing
- Verify that all items you negotiated in the contract are still there.
- Check appliances to make sure they are in working order.
- Turn on faucets and flush toilets.
- Check heating, air conditioning, smoke detectors.
- Check once more for water stains.
- Watch for any trash left in the house
Step 7 – Closing the loan
- We will prepare a settlement statement and communicate a final, exact figure for you to bring to closing.
- We will also compare the actual costs to our original estimate.
- We usually require a cashier’s check or wire transfer of funds. Ask your loan officer for details.
Though the process may seem a bit overwhelming, we take pride in guiding you through the process step by step to make sure you’re able to close on your dream home before you know it. Visit us today. www.greatmidwestbank.com