Steps to Acquire Your Home
The home buying process below will help provide a general overview. Although the steps below are as standard as possible for day-to-day real estate transactions, no two Real Estate transactions are ever the very same. If you have questions throughout the process, we have an open transparent door policy and we urge you to ask. I hope the general process flow guide below serves to help prepare you for one of the most exciting and rewarding investments you will make in your lifetime.
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- Hire your Real Estate Agent. If you have a sense of urgency in meeting this deadline, it’s important that you’ve chosen a REALTOR® professional who understands and listens to all your needs and timelines. Finding a professional REALTOR® who is loyal to your needs and one who will represent your best interest before their own, is key to successfully becoming exposed to top-notch homes. Agent’s will begin researching and preparing for properties best suiting your needs and wants. But first its advisable to begin with an interview meet and greet.
- Hire your Loan Originator. Contact hire and select your preferred lending institution immediately. Talk to your Real Estate professional if you are not sure who or where to call. We offer you a number of professionals for you to choose the mortgage professional you feel most comfortable in working with. Developing a budget plan to buy the home that conforms goals and needs is effectively completed by your lending professional and is the wisest first step in the home buying process. The difference between a single bank versus a using a loan originator is banks can offer only a handful of lending products, where loan originators have vast resources and access available to help find various loan programs you may be eligible for. To expedite the loan process, we recommend having the following items handy to maximize time and results. 1. Social Security Number 2. Current pay stubs or, if self-employed, your tax returns for the past two years. 3. Bank statements for the past two months. 4. Investment account statements for the past two months. 5. Life insurance policies. 6. Retirement account statements for the past two months. 7. Make and model of vehicles you own with the resale value. 8. Auto loan account information. 9. Credit card account information. 10. Personal loan account information.
- Pre-Qualification Form. Your lender prepares the Arizona Department of Real Estate Pre-Qualification form at which time is given to your REALTOR® professional to being identifying homes meeting your needs. This form is crucial since no offers for property’s will be entertained without this documentation. If paying cash, a proof of financial (POF) eligibility is attached to all offers to present to sellers.
- Schedule Home Showing. To expedite the home looking process, we recommend having the following items handy to maximize time and results
- Your Peronsalized MLS Portal. Reviewing active listings from your REALTOR’S® MLS portal to avoid finding properties on other websites that are no longer available or are already under contract and in escrow. Email the property’s with the most appeal to the evening before your showing appointment may be flawlessly planned by your REALTOR®. Agents must coördinate scheduling and follow every properties unique set of details and instructions upon submitting a request to view properties. Your REALTOR® also routes the homes you wish to see to help maximize time and efficiency.
- View Homes. Take notes on each property to help narrow down the most desirable subdivision. The property’s you do not care for, discard immediately. Viewing homes are usually the most time-consuming part of the process. 20% of a REALTORS® day to day duties involves looking at houses, the remaining is contract execution, research/due diligence and ensuring clients have relevant facts and facts to help make a solid home buying decision.
- Review comparable market analysis before placing offer on property Your REALTOR® prepares a comparative market analysis (CMA) before submitting offers. This information includes recent properties closed within the last 3 to 6 months nearby. This data aids in your decision about how much you would like to offer on the property.
- Submit an offer on the property. Your REALTOR® prepares the Arizona Department of Real Estate Purchase Contract.
- Wait for Seller’s Response. While waiting for seller’s response to your offer, it is important to continue looking at more home options. Have a home A, B, and C to offer the most options in a time sensitive fashion in the event the negotiations do not turn out to your preference.
- Open Escrow. It’s a little too early to do congrats and toast the champagne just yet, however (in a perfect world) seller has accepted your offer. At this time, while you are preparing the certified funds made payable to the title company, the REALTOR® is processing the Purchase Contract packet and opening escrow/title. The certified funds are required to officially open escrow.
- Review Seller’s Property Disclosure Statement (SPDS)/Insurance Claims History Report (if applicable). Review Seller’s Property Disclosure Statement (SPDS)/Insurance Claims History Report (if applicable). Traditional home sellers give you the prospective home buyer with a disclosure identifying adverse details with the property. Seller’s are required to disclose items that would possibly hinder a buyer’s decision to want to buy the home. (Please refer to the Seller’s Property Disclosure Statements in your specific state, as each state laws vary in disclosure requirements. Please note, lender owned properties, sellers who have never resided in the property such as investors do not provide the SPDS. If applicable, the seller provides the buyer with an insurance claims history report or sometimes referred to as, Comprehensive Loss Underwriting Exchange (CLUE). This is also a great time for you to also call your insurance agent to verify rates on the property.
- Schedule Home/Termite Inspection/Home. Your REALTOR® or their transaction coordinator will schedule your home inspection and termite inspection to take place as promptly as possible. This fee is outside escrow and is paid by the buyers. We wait for the reports stemming from the results of the inspections to arrive afterward the buyer evaluates the need for potential and cosmetic versus structural repairs if applicable.
- Buyers Inspection Seller’s Response (BINSR). Your REALTOR® and you go over the results of the Home and Termite Inspection together and analyze the findings and conditional results of the property. At which time, buyer determines via the (BINSR) if the property is going to be accepted in “as is” condition or if the buyer would like to request repairs (typically non-cosmetic) be repaired from the Seller. Upon submitting requests for repair, the Seller has 5 days from that time to agree or stipulate in writing what they will agree to do or opt to not do requested repairs. If the seller only agrees to partial repairs, you as the Buyer then have the opportunity to agree or cancel and withdrawal your offer.
- Appraisal. After successful negotiations of repairs and inspection period are over (10 calendar days from the time the purchase contract was accepted by the seller), the lending professional will contact you to schedule the Appraisal to take place. The appraisal analyzes the current comparable data from an unbiased view to help set up the value to protect the financial institution’s loan amount you are about to borrow from the bank. The process helps to make sure the purchase price you have offered is within a reasonable price range. The appraisal fee is also outside escrow and the buyers pay this through their lending professional. The turn-around time can sometimes take about a week turnaround time (this may vary).
- Lender file. Your lending professional is assembling a clean file with all the requirements necessary to send into “underwriting” to help you receive full approval on the loan for your home. The lender’s and their processors will often need last-minute documentation from you as the buyer. This is to help fulfill all the requirements needed to meet to get your loan fully approved by the “underwriter”. Some lenders prefer to do the full approval before shopping for the home to help speed up your negotiations & leverage when submitting offers..it depends. We as REALTORS® appreciate seeing a “pre-approval” as it helps makes your offer appeal more so to a potential seller, since you as the borrower are further along in the loan process.
- Lender submits your Loan Docs to Title/Escrow. You’re almost there. The lender receives full underwriting approval and the bank can now send those loan docs to the title/escrow company. The title/escrow company (they are the neutral entity between all parties.. buyers and sellers) prepares the Consumer Disclosure (CD) statement. This is a checklist and documents showing how every dollar is spent and credited with the purchase of the home. Lending institutions and escrow companies are under a tight deadline since they are required to give the borrower with three days to check the final settlement before releasing funds to close on the property. Some lending institutions will table fund and again this process varies per lending banks/institutions.
- Switch utilities. A list of all the applicable utilities for the new buyer to have switched into their name effective upon the close of escrow.
- Final Walk Through. REALTOR® coordinates a walk through time and date for you. Please keep in mind the sellers may still be vacating the property. The utilities are left on for you to conduct your final walk through.
- Title/Escrow Signing. After REALTORS® from all parties have reviewed the checks and balances according to the Arizona Department of Real Estate Purchase Contract and Addendum’s, it’s time to schedule a signing. On the Settlement/CD, the amount remaining cash down is due from you as the buyer. At this time, you may choose to wire the funds or collect certified funds for that specified amount. The certified check made payable to the title/escrow company may also be wired upon request of wire instructions. Please familiarize yourself with the wire fraud warnings with the title company.
- Title/Escrow Officer returns signed docs to the lending institution for funding. After all, parties have signed at title/escrow, the loan docs are submitted back to the lending institution for funding approval. Once the lending institution forwards the fund’s title/escrow, the title/escrow.
- CLOSE OF ESCROW. Title/escrow officer submits a request to the Maricopa County Recorders office for office closing. This can take a few hours to officially record. It’s important to make note if it’s a Friday afternoon and any of the processes are delayed..this could possibly delay closing until Monday since County Recorders Office is closed on weekends. This, unfortunately, will delay a buyer’s plans to move should this take place. Due to insurance purposes and ownership pre-possession of homes is not generally not favorable but in rare circumstances may be arranged, negotiated and will need to be contractually executed by all parties.