Step 1 – Getting Pre-Qualified Prior to Shopping for a Home
Getting pre-qualified has many beneficial factors and is an essential first step.
First off, it gives you the opportunity to talk to us at Pioneer about your loan options. Different loan programs require different down payments, mortgage insurance requirements and interest rates. Check out your loan options page or feel free to call us to discuss your options as well. Once we have a good idea of what type of loan best suites you and the down payment you are comfortable with we can move forward to calculating your price range.
It’s very important to know how much home you can afford (and more importantly what fits your budget) when looking for a home. Sometimes on paper our clients are approved for a lot higher payment than what they actually want to pay every month. We will help you keep your budget inline by taking the loan type and down payment you selected, run a calculation and give you a very good idea of what your “sweet spot” is for your purchase price.
This personalized strategy session with a trusted mortgage professional at Pioneer should address all of your initial loan approval questions, as well as uncover any potential challenges that can complicate the entire transaction.
Step 2 – Decide on your new neighborhood and finding the right property
Hiring a real estate agent to assist you can save you time and money. Of course you can do this on your own, but keep in mind that most sellers have retained an agent and you would be negotiating with that agent on any home you are interested in. That agent is working with the seller and is looking out for the seller’s best interest. This is where having an agent in your corner helps out. In addition to sharing his or her knowledge of neighborhoods and available properties, a real estate agent can help negotiate a better price with the seller. Pioneer Mortgage works with a few realtors and can help you choose if you do not have an agent lined up yet.
Step 3 – Purchase Offer Submitted
Let’s say you and your agent have decided to make an offer on a home. Assuming that you’ve already been given a mortgage pre-approval and have a firm understanding of the type of loan you are pre-qualified for, your agent will submit your purchase offer to a listing agent or seller.
Here’s where your pre-approval comes in.
Sellers know that an offer from a pre-approved buyer is solid. Your pre-approval gives you an advantage over home buyers who wait until after they find a home to get pre-approved. Sellers also appreciate that buyers like you can close quicker with a smoother home loan process. Your agent will prepare the documents that will make your offer official and will present it to the seller or to the agent who represents the seller. Usually the seller will have a few days to make a decision. Here are a few things to keep in mind:
The purchase agreement is a binding document that your agent will supply that indicates the amount of your offer. It may also include details like which appliances will stay with the home, and when you’d like to take possession. When your agent presents the seller with your offer, sellers can do one of three things:
– Agree to your offer
– Decline your offer
– Make a counteroffer
A counteroffer is the seller’s response to your offer – made in part to continue negotiations toward a purchase agreement.
Sellers can counteroffer with their desired amount – typically within 24 to 48 hours. At this point you can either agree with
their terms or make another counteroffer. This process continues until you come to an agreement
Once you receive an accepted offer, the due-diligence period starts a series of timelines for final mortgage approval, appraisal, inspections and other requirements which would be spelled out in the terms of the contract.
Step 4 – Arrange for a home inspection.
Even though Pioneer will have your home professionally appraised, it’s always a good idea to hire a professional home inspector, especially if you’re buying an older home. If any major problems are found, you may be able to negotiate repairs or a repair allowance with the home’s seller.
Step 5 – Conditions and Paperwork
At this point you will meet with us at Pioneer again. We will have your initial disclosures ready for you to review and execute. Also, if you have not already provided your credit documentation in the pre-approval process, now will be the time. The documents that we will need are dependent on how you generate income. A list of documentation needed can be found on the things we need from you page. This is not a all-encompassing list, but will definitely get the ball rolling.
Pioneer will then have your loan underwritten, order the appraisal, title documents and any other required items from you.
Once all the items have been reviewed and approved by underwriting we will have final approval and can get ready to close your loan!
Step 6 – Closing – The big day’s here!
During your closing, you’ll sign your loan documents and present funds to cover your down payment and other costs.
All that’s left is to collect the keys to your home and celebrate!