First-time Home Buyers: The Basics


Start the process by brushing up on the basics of home buying

We’re excited that you are embarking on the beautiful journey towards home ownership and we’ve compiled some basic tips to help you feel informed and empowered during the process.

Prepare and Learn

What do you already know? Perhaps you know the area you’d like to buy in or you have a vision for what the house or land looks and feels like? These initial insights are not only key to the successful start of your journey, but also lots of fun to contemplate. It is also important to remain open to your tastes and desires changing as you learn more about the practical side of the process.

No matter your experience level, you are on your way by reading this article because a major first step is digging into the wealth of knowledge that exists out there to support you in making the decisions that are right for you.

 Working out your finances is crucial first step in this process, and will give you a realistic range of homes and areas you can realistically afford. Instead of seeing this as a limitation, it can be a great way to narrow your search and be led to the perfect home for you at this time.

Working with your preferred banker you can obtain a pre qualification letter that will outline what a lender believes they can lend you based on your credit score, income, and tax bracket. This letter will give you head start on the offer part of the process, and also allow your offer to be taken more seriously resulting in quicker responses.

People and Allies

Let’s talk a little bit about the other people you’ll be collaborating with on your home purchase. As the buyer, you have the option of working with a Buyer’s Broker who will represent your interests, and will be able to point out any potential issues with the deal as well as shepherd your purchase through to the finish line. This agent will get to know your needs and have a legal fiduciary duty to serve your interests -- and the best part is that their fee doesn’t come out of your pocket (it’s paid for by the seller.)

A Seller’s Broker is the agent that lists the property and can also become a dual agent that handles both sides of the contract signing. If you’re absolutely comfortable with the purchasing process, and don’t see a need for your own buyers agent, this is an option if the seller is ok with it.

A competent, local attorney should be engaged after the offer is accepted to ensure the contracts are in compliance with the laws and that you remain protected the whole way through. Going with a local attorney offers you someone on your team who can answer any location specific questions, like building regulations, and may have crucial information on the seller or seller’s property you may not find out otherwise.

The Process

Though every purchase is slightly different (that’s part of the fun!), there are steps that you can be aware of at the start so you can feel in the flow as they come up along the way. 

Finding viable properties is one of the most fun parts, this is when you get to see and learn about what’s out there in the areas that excite you. Don’t rush into a neighborhood because you found what seems like the perfect place. Instead, rent a nearby airbnb, give yourself a chance to experience the neighborhood as a local by biking, walking into town, go shopping in the local grocery store before deciding.

Everyone knows about Zillow and Trulia, and those are great places to start. You can harness the power of the MLS right from your own home, and take your time with the search. We also suggest finding a real estate firms that specialize in homes in your chosen region, and coming with your own list as a starting point is a great idea. This will help your buyer’s agent easily understand what types of homes and features you are after. Additionally, a good broker will also be on the lookout for off-the-market properties that you won’t see on Zillow, or will see it after it’s been put under contract. 

With your list of prospects in hand, your broker will set up the showings. Remember not to overdo showings in one day, this can become tiring and take a lot of the joy out of the discovery process. Clustering showings in a relatively close area helps keep the driving to a minimum and the showing to maximum. 

Once you’ve been shown something that fits your needs and is within your budget, it is time to submit an offer. Again a broker comes in handy and can help you decide on a good initial price that feels right for you and has a real chance of being accepted. Depending on the demand in that neighborhood and what similar properties have recently sold for, your broker will be able to gauge what will work balancing a reasonable offer that will be seriously considered with making sure you pay the lowest price for your new home.

When your offer is accepted it’s not quite time to celebrate as there are still a few steps to go until this property is firmly confirmed to be yours. The next part of the process is your attorney drafting the contract. This is when any provisions can be clearly set out and agreed upon by all parties. For instance, perhaps you are only willing to complete the sale if your independent appraisal shows that the house is worth a certain amount - something that will help you feel secure in the amount you are are borrowing from the bank. Perhaps the seller would like to sweeten the deal by including small renovations or repairs as part of the sale, or leaving over valuable built-ins, appliances or utility vehicles, these must be written into the contract. This is the time where a lawyer comes in handy and will advise on anything you do not understand, and modify the agreements until both you and the seller feel great about the contract and it’s time to sign, and hand over a check for the down payment. 

The good news here is that the check will not reach the seller until a few more steps that are built in to protect you are accomplished.

Signing the contract brings the deal into a new phase called escrow. The seller is no longer seriously entertaining other offers and both sides are committed to the purchase once the final steps are completed. This is the time for inspections and due diligence to make sure the property is being sold at the right price and that any promised renovations or repairs are completed before the closing. 

Which brings us to the final step, the closing. You should be feeling confident in your purchase and excited to make this new house your home. On the date of closing, the ownership of the property is transferred to you and the seller receives the financial payment agreed upon for the purchase. This is also the date when all deed and loan documents will be signed and filed with the local property offices, because it is now official - you will have the keys on hand by the end of this final meeting and are free to open the front door and throw your keys down wherever you please.