Buying a home is a big step and there can be a lot to consider. Here we run through the typical buying process you will go through when purchasing your new home.
Sorting out your finances
The first step before buying a home is to ensure you have a deposit saved. Most lenders will require you to have a deposit for your home loan. However, most lenders have loan products to borrow up to 100% of the property value if you qualify.
You may also like to create a budget to determine what you can realistically afford to spend on mortgage repayments.
Approach lenders to get finance pre-approval so that you know what price range you can look at for your new home.
Doing your research
Start to look at neighborhoods and communities that would suit your needs and your budget. A great place to start is online. There are lots of property comparison sites on the web which will give you an indication of the average sale price of houses, land and units in an area.
Also start attending open homes and show houses. Take advantage of an open home and use the time to perform a thorough property inspection.
How to make a formal offer
The best way to make a formal offer and avoid any confusion is to make the offer in writing. A sales consultant will most often provide you with a purchase agreement to start the process which will also highlight any contingencies of sale. The consultant will then present this offer to the sellers.
After your offer is accepted
If you’re offer is accepted, and all parties have signed the purchase agreement you will be asked to pay a deposit if required.
The Seller will normally nominate an Escrow Company.
Property Purchase Costs
Financial fees vary greatly, depending on such matters as what percentage of the property value that you will be borrowing, the amount of the loan, the amount of the purchase and which bank you are borrowing funds from. If you speak to your local Harcourts agent or Financial Services representative you can quickly ascertain approximate costs for your particular circumstances.
Possible expenses you may incur are:
- Bank fees
- Escrow/Titles charges may include legal searches
- Home protection insurance
- Miscellaneous costs (building inspection, HOA rates, movers, etc.)
Completing the purchase
Before closing the escrow officer will undertake the necessary searches with respect to the property and your financier will prepare the mortgage documentation.
On closing your escrow will conclude the following:
- Monies, Guarantees
- Transfer documentation
Possession of the property usually takes place on the day of closing although the seller and buyer can agree for these dates to be different.
One of our team members will contact you to arrange a pre-closing inspection - known as a 'walk through'. This is your opportunity to ensure all appliances at the property are in working order and that the property is as you recall from the time you signed the purchase agreement. If issues arise at this inspection, you should immediately contact escrow to postpone closing until your concerns are addressed.