Are you a first-time home buyer? Congratulations! Buying a home is an exciting time and at LKR we will help to make the process as simple as possible. We take time to explain the differences in mortgage options, we help you get pre-approved for a loan, complete your loan application, assist you on the search for your new home, help you to lock into your loan and interest rates, price insurance options and more. Below you will see our step-by-step resource for first-time homebuyers. Whether it is your first home ever or your first home in Iowa, we are here to help.
Begin by Getting a Mortgage Pre-Approval
Before you begin looking for your new home it is important to get pre-approved. Getting pre-approved will show you the amount of money you can borrow from the bank in order to buy your first home. Once you know your budget it will be easier to narrow your search results down to the price you can afford.
Time for the Initial Loan Application
After you have been pre-approved for a home loan it is time to complete a mortgage application. Several different things factor into this application. You will need to provide information regarding your current finances, your credit score, your income and your assets. This will help to determine if you are a good investment or not. There will be additional materials that you will need to provide to validate your mortgage application. Contact us today for more information about your loan application. Once this process is complete, it is time to start looking.
Let's Find Your First Home
Now it is time to start looking for your home! You can begin looking through the listings, attending open houses and going to private showings with your Lepic-Kroeger REALTOR®. We can assist you in many ways during your search from sending you new and upated listing alerts in your price range to showing you homes that are on the market on your schedule. Once you have found the perfect home it is time to negotiate.
Making the Offer
Your REALTOR® will help you put an offer in, negotiate the sale terms such as price, possession date, closing costs, earnest money and any concerns the seller might have. When you make the offer you will submit your pre-approval letter along with your initial offer on the house to the seller. Once the final price has been agreed upon you will need to lock in your loan's interest rate.
Time for the Final Loan Application
Once the Seller has accepted your offer and mortgage application, it is time to lock in your interest rate. This will also be the time when the Good Faith Estimate is revised to match the details of the actually agreed upon contract. Your REALTOR® will assist you with this entire process.
It is essential to have homeowners insurance in order to receive your loan monies. You will need to have fire and hazard insurance for the replacement value of your new home in order to satisfy your mortgage contract. If your home is located in a flood zone you will be required to purchase flood insurance as well. You will need to contact your insurance provider as soon as you have confirmation of a finalized offer because you are required to pay the first year's home owners insurance premium directly to your insurance agent before closing.
Have an Inspection
In order to secure a purchase loan you will need to have an inspection for termites. If termites are found in your home it might be necessary to mitigate the problem before moving ahead with the sale. In addition to a termite inspection you should also have a whole home inspection done. This will notify you of any other issues that may exist in the house or foundation. Your REALTOR® can help you decide which inspections to have done on your home.
How Much is Your Home Really Worth?
Before your Mortgage lender will fund your home loan, you will need to have an appraisal done that will justify the price you paid for the home. If it turns out that your home is worth less than you paid for it you may have the ability to renegotiate the purchase agreement with the seller.
Obtaining the Abstract and Title Opinion
The Abstract for your home is a document that shows the history of the property. The history of the property will include it's lien history and any that may be outstanding. Liens consist of mortgages, judgments, mechanical liens. etc. An Attorney will provide a Title Opinion and will require all liens clear before closing so that the title will be clean upon your purchase.
Loan Processor's Review
It is the processors job to make sure that all of the required documents have been submitted and completed correctly. After this review has been completed your mortgage packet will be forwarded onto the mortgage company for a final review.
The underwriter works for the Mortgage company. It is their job to approve the mortgage application. They control the final approval decision and may request additional information regarding your personal finances or additional information regarding the home purchase. Once they have reviewed everything and approved your mortgage application you are almost done.
Once the underwriter has given final approval on the loan the closing process can proceed and the date and time to close is set.
Time to Close
It is time to review and sign the final mortgage documents. The whole process takes about an hour to execute. If you have been required to bring funds for closing costs you will be required to bring them in the form of a certified check. You will also need a valid photo ID.
Congratulations on your new home! It is time to move in and begin your new adventure as a home owner. In the future if you have outgrown your home please contact us about selling your current home and finding your next one.
Ready to Get Started?
Contact us today and we will connect you with an agent that will help you find your first home.