There are many steps involved in the home buying process. To follow is an summary of items you will encounter when buying your home. Your real estate agent will be able to give you more detailed information about the process and will help guide you through any problems you might encounter. Be realistic and keep a cool head during this adventure. Good luck and happy hunting!

Reviewing your Credit Report

The first and most important thing you need to do is get a copy of your credit reports and review them. Any mistakes on your reports needs to be corrected before you apply for a mortgage, since your credit report plays a big part in the interest rate and other terms of your loan. Keep in mind that any errors will take time to correct, so make sure you start this process with plenty of time if you are on a deadline. It is best to get a copy from each of the three credit bureaus to assure complete accuracy. Not all lenders use the same bureau, so you need to be prepared.

Determine what type of house you want

Make a list of all the features you absolutely must have in your new home. Consider anything from how many levels to how many bedrooms and which school district you want your new home to be in. Be realistic and take into consideration your budget. Next, make a list of all the features you would like in your new home but are not essential. And last, write a list of all the items you absolutely will not want your new home to have. Once you determine exactly what you want, looking for a house and making a decision will not be too hard.

Shop around for a mortgage loan and get pre-approved

When ready to apply for a mortgage, make sure you shop around. Consider what each particular bank charges for closing costs and other fees, as well as the interest rate they offer. Getting pre-approved can give you an edge on the buying process. If there is another offer on the house you want and you are already pre-approved, your offer might have a better chance of getting accepted.

Choose a real estate agent

Most real estate transactions require you to be represented by an agent. There are some exceptions, like when buying a home for sale by owner. Choosing a real estate agent should be like interviewing someone for a job. Call different agents and ask any questions you might have about the home buying process. Agents should take time to answer your questions without an assumption of representation. Once you feel comfortable with someone, you will need to sign an agreement in order for him or her to represent you.

Begin searching for a house

Once you have chosen an agent, he or she will give you listings to review. You can also look in the newspaper, or search the internet for available homes. Another source of listings can be found in magazines specializing in Houses for Sale. You can typically find these magazines outside of grocery stores and gas stations. They are free and contain very current information. Most of these magazines come out on the first week of the month.

Choose a home and make an offer

When deciding which house to choose, take into consideration all other aspects of the particular house you want. Are there any deed restrictions, and can you live with them? What is the resale value of the house? Are there any association fees? What comes with the house? What are the yearly property taxes? etc. Once you have answers to all your questions and you pick a house, you are ready to make an offer. Include with your offer any items you might want included in the house like refrigerator, stove and microwave. Most listings will specify the items included with the house; this should give you a starting point for your list. If the house listing is not clear on specific items you might want, add them to your list. Your real estate agent will submit the offer and with a little luck, it will be accepted. Do not get discouraged if your offer is rejected and you have to start over. You probably will have by now a few other choices to reconsider.

On your way to closing

Once your offer gets accepted, there will be many details to take care of. You lender will require certain items, like an appraisal and home inspection. Some of the procedures and requirements vary from state to state. Your agent will be able to tell you the exact steps needed for your area. The following are some of the requirements.

• The appraisal plays a big role in the home buying process. If your appraisal comes in low, there are some things you can do to correct the problem. Your agent should be able to guide you through this process, but keep in mind this could be a major problem since your lender might not approve a loan for a certain amount if the house appraised lower than the price of the house.

• The home inspection is very important, since it will tell you if there is something major wrong with the house. Sometimes, home inspections are not performed until after closing, again, this depends on your particular area and your agent or lender will give you instructions. Once the home inspector identifies problems with the house, you can ask the seller to repair them before your closing date. Keep a list of the items you asked to be repaired; you will need it on your final walk through.

• A title search must be performed prior to closing. The title search is performed to ensure that the seller really has a right to the title on the property he is selling. There could be linen on the house which will prevent the transaction from taking place or there could be other problems. In most transactions today, title insurance is purchased for security. The buyer will feel assured that he has purchased a clear title.

• Another requirement from the lender is that you purchase hazard insurance prior to your closing. Hazard insurance will pay for the cost of rebuilding your house in case of fire or other disasters. Additional insurance will be required if you live in an area prone to natural disasters. Your lender will let you know what they require.

There are some other inspections and test that might be required by your state. Check with your real estate agent for items pertaining to your particular area.

Final walk-through

Sometimes you final walk-through will be done a few days before closing, and sometimes it will be done on the same day. Take your list of requested repairs with you to ensure that all repairs have been completed, although it is recommended you check the repairs as soon as the seller notifies you they are complete. Also, you want to make sure the house is in the same condition as it was when you made the offer. Make sure nothing has been damaged and everything that came with the house is there (appliances, fixtures, etc.).

Final recommendations

Keep in mind that this is only a basic overview of the home buying process. Depending on your area, things could be a little different.

One of the things you need to watch out for is making a major purchase prior to applying for a mortgage. Wait until after closing on your house to make all purchases that will require someone to check your credit.

Make sure you get everything in writing. You don’t ever want to take a verbal promise as a fact.

During the entire process, you need to stay on top of things because no real estate transaction goes without problems. By staying on top of everything you will know right away if there is a problem you need to resolve. The longer you wait to take care of problems, the more complicated the process gets.

Your real estate agent will be a big help in your home buying adventure. Remember it is the agent’s duty to keep track of the many details involved. Make sure you contact him or her with any questions you might have.