The Homebuying Journey

Apr 12, 2024

Attend home buying courses. Here’s a great resource on how to find them, and why they can help: https://www.mainehousing.org/education/home/homeworks-homebuyer-education-classes. You can also look for informational sessions put on by your bank or credit union.
Research online the types of property you’d like to buy and price ranges of homes you might like. Think about your financial goals and how much you can afford for a monthly payment. When you are looking at your home budget, make sure to think about things like insurance, taxes, mortgage insurance, and any repairs or remodels you may need to do.
Prioritize saving for a down payment and building good credit!

Sit down with a loan officer to determine how much you can borrow or what steps are needed to get preapproved, different loan options, interest rates, your maximum monthly payment estimation, how much money (cash) you would need at closing for down payment and closing cost.
Lender will complete a credit-pull application and collect income and asset documents from you.
Receive Pre-Approval Letter to share with your real estate agent.

Interview real estate agents to see who best serves your needs.
Discuss the home buying process, local market insight, types of homes you’re interested in, location, home budget, and your goals.
Attend open houses, and schedule tours of homes you’re interested in. Once you find a property that best matches your criteria, make offers, and enter negotiations!

Once your offer is accepted you will likely need to provide your real estate agent with an Earnest Money Deposit (EMD) check – this is a security deposit that will be held in escrow and go towards your anticipated down payment.
Let your mortgage loan officer know that you are now under contract!

The inspector will visit the property and meet you as scheduled.
They will walk through the property, taking pictures, and identify issues that may need to be addressed.
A couple of days later, they will send you an Inspection Report with their findings and recommendations.
This may lead to negotiations w/ the seller. Utilize your real estate agent’s expertise to help guide you.

Once an offer has been accepted, you will receive a “Purchase & Sales Agreement” (a contract between you and the sellers). Provide this contract to your loan officer.
Chat with your loan officer to discuss the specifics of your contract, next steps, and the loan process ahead: the price, loan amount, down payment, interest rate, payment, closing date, and services to be ordered (title and appraisal).
Your lender will provide an initial Loan Estimate, ask you to sign disclosures, and request additional documentation, such as: updated paystubs, bank statements, copy of the earnest money deposit (EMD), etc.

The loan process takes 30 to 60 days (will be according to your closing date).
Your lender will order an appraisal and title (YOU HAVE THE RIGHT TO SELECT YOUR OWN TITLE ATTORNEY/COMPANY!).
The Title attorney/company selected will work with your lender to manage the legalities and paperwork of the transaction, such as; liens, current owners, transfer of title, property taxes, title insurance, zoning, preparation of closing statements, etc.
An appraisal of the home will be completed, and you will receive a copy of the appraisal report within 3 business days from the time your lender receives it.

Your lender will require that your new home be insured. You will want to shop around for insurance companies and discuss different coverages and premium options. Make sure you know all the types of insurance your new home requires!
The insurance premiums are paid annually. You may either pay this premium upfront and provide a receipt to your lender or pay it at closing.
Once you have selected an insurance company, provide your lender with the declaration page and their contact information.
Usually, future annual premiums will be paid by your mortgage company, along with your taxes via your escrow account, funded by your monthly payments.

Once all your paperwork is in, reviewed and accepted, and all conditions are met, the appraisal is in, and the title work is cleared....your loan will be Cleared to Close!!!
A time and location will be set for the closing where you will meet with the sellers, the real estate agents, your lender, and the title attorney to go over all the paperwork.
3 days prior to closing, your lender will send you a “Preliminary Closing Disclosure” to sign as acknowledgement of receipt. This is a final estimate of all costs and payments tied to your mortgage.
You will meet with your real estate agent the day of (or day prior to closing) at the property to do a final tour of the home.
Lastly, you will attend the scheduled closing, sign all the paperwork, and get the keys to your new home!

Financial Wellness