Courtesy of Cara Realtors
Simple Steps in preparing first time home-buyers for buying their first home is easy if you educate them about the process. Here is a list that I created that helps both of us streamline the process:
1. Give home-buyers the names of at least three reputable lenders. 2. Make sure that they have all of their financial information handy for the lender. 3. Tell them to let the lender check their credit score. 4. Make sure if they have student loans, they are current and in good standing. 5. Make sure they are current with any auto loan payments. 6. Make sure that they don’t have high credit card balances and that they pay their bills on time. 7. Tell them to ask their lender to give them a pre-qualification letter stating how much of a mortgage they can afford. 8. After determining what they can afford, identify the area that they would like to live in. 9. Explain to them that they will need at least $5,000 to $7,000 to cover their closing costs i.e; attorney’s fees, home inspection, title insurance, survey, application fee for mortgage and appraisal fee. 10. Explain to them that their mortgage payment will consist of a principal and interest payment, homeowner’s insurance and real estate taxes, (unless they chose to pay their own homeowner’s insurance and real estate taxes) so they can plan their budget. 11. Now they can look for houses in their price range with confidence because they know exactly what they can afford. 12. When they find the property that they want to purchase. Explain the contract and attorney review process. 13. If they don’t have an attorney, give them the names of at least three and let them make the choice. 14. After attorney review has been completed give them the names of some home inspectors in the area. Explain the home inspection phase of the process. 15. After the home inspection phase has been completed. Make sure that to ask them to follow-up with their lender to see if they need any additional paperwork from them. 16. Have your clients get quotes for homeowner’s insurance from more than one insurance company. 17. When the lender approves the mortgage and issues a mortgage commitment, it is time to get ready to close. 18. On the day of closing, go through the house with your clients and make sure they are happy with the condition of the house. If the walk-through goes well, proceed to the closing. 19. Congratulate your first time home-buyers on the purchase of their first home and tell them how proud they should be of themselves for achieving this monumental goal in their lives. 20. Check in with your new homeowners a week or two later and ask them how everything is going.