First-Time Homebuyers Guide: Understanding the Process

Buying your first home can be overwhelming and intimidating, but it’s one of the most exciting and fulfilling milestones in life. As a first-time homebuyer, you want to ensure that every choice you make is the right one and you are getting the best value for your money. You also must understand the steps and process involved in buying a home to ensure a seamless and successful transaction. So whether you're buying a starter home, a fixer upper, or forever home, knowing how the process works can help you make more informed decisions and avoid any financial pitfalls along the way. This information will provide you with a guide to understanding the home buying process.

Get Pre-Approved

The first thing before starting the house hunting process, is to get a preapproval for a mortgage. You’ll then understand your budget and can determine how much the bank is willing to lend you. Start by gathering essential documents to prove your income such as pay stubs, bank statements, and a list of your debts. Shop around to different lenders and compare rates and terms. Once you’ve chosen a lender, submit a pre-approval application. Once approved, you will receive a pre approval letter. This letter states the terms and amount they are willing to lend you by taking into consideration your income, debts, and credit score. Please note, a pre-approval is not a guaranteed mortgage, You’ll need to complete a full mortgage application once you’ve chosen a home.

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Do your research

Now that you know your budget, you can start researching the market and begin your hunt to find the perfect home. Make a list of important and non-important features for your future home. This usually includes features such as, lot size, number of bedrooms or bathrooms,location, and schooling districts. This criteria will help you and your agent find homes that you would consider, versus wasting time on homes that don’t fit your needs. Here at Santa Sells Houses, we have some of the best on our team to help you find the perfect home.

Hire a real estate agent

Hiring a real estate professional provides you with guidance and expertise to make informed decisions. When making the largest purchase that most make, you want someone who is experienced and knowledgeable to guide you through the process. Real estate agents have the ability to navigate complex purchase agreements and know how to negotiate. They can help find you the perfect home and get the best possible price. Your agent will send you listings that match your criteria, take you to showings, help examine the property for any damages or needed repairs, help with paperwork and legalities, and provide emotional support throughout.

Make an offer

Once you think you’ve found the property that first within your budget and has all the things you are looking for, it’s time to make an offer. Now with the help of your agent, this process will seem a lot less daunting and scary. Your agent will negotiate terms, conditions, and price. Once your offer is accepted, you sign the paperwork, and fulfill any conditions to close the deal. Deals are either firm or conditional. A firm close is when buyers purchase the property without any conditions or contingencies. A conditional close is where there are conditions that must be met before the buyer agrees to purchase the property. These often include home inspections, financing, sale of their current home, The buyer takes on more risk when closing a firm sale, and a home inspection is always a good condition to include.

Final Steps

Once an agreement of sale has been signed by both parties, you then will submit the deposit via cash, cheque or electronic transfer to the seller or seller's brokerage account. The deposit is typically held in a  trust account until sale is final. If you haven’t already hired a lawyer by this step in the process, you will want to do so as soon as possible.  Lawyers can provide you with legal guidance throughout the home buying process and go over any documents with you before you sign. Once an offer has been accepted and conditions are met, the lawyer will be able to transfer ownership of the property.

Even after you’ve signed the papers, moved in and the place is starting to feel like home, there are many costs associated with owning a home. The more information you can educate yourself with beforehand, the smoother the process will be. By getting pre-approved, doing your research, and hiring an agent, you’re one step closer to owning your first home. This guide is designed to help get a better understanding of the process so you don’t feel like a fish out of water.