Buying Process

For most people, buying a home is one ofthe biggest financial commitments they will make in their lifetime. Buying a home is an important step toward financial security. With the right help, buying a home is easier than you think!

Passport Realty is a full service real estate firm. With a broad range of services and superior market knowledge, our agents maximize the efficiency of your home search and serve as a trusted guide before, during, and after your move. Our Passport Realty Professionals are dedicated to assisting customers through each step of the transaction.

Experience has taught us that buying a new home involves common stages for all consumers. Prospective buyers must shop for the best house and the best financing they can find. To help you through this process, we have prepared a Home Buyer's Guide to provide an overview from the planning table to the settlement table.

Passport Realty can make buying a home easy, no matter what type of property you are searching for.

Find An Agent

The first step is to hire a real estate professional to help you find your dream home and fine-tune your financial qualifications. It is important to recognize your needs and preferences when beginning the search for your new home. The more your realtor knows about your needs and what is important to you, the easier it will be to find your ideal home. The more closely you work with and communicate with your agent, the better your needs are understood and the more effectively you can be served.

Although all agents are bound by law to deal fairly and ethically with both buyers and sellers, it is worth considering working with a buyer's agent. He or she is legally responsible for representing the buyer's interest in a real estate transaction. The buyer's agent, whose fee is usually paid by the seller, will be able to negotiate the sales price and terms of the contract on behalf of the buyer.

Passport Realty agents coordinate all details surrounding the purchase of your home including; helping you set up a plan of action through an analysis of your needs, conducting a search to find neighborhoods and homes that fit your requirements, scheduling showings to fit your schedule, negotiating the offer, and working with you every step of the way until closing and possession of your new home.

Arrange Financing

Shopping for mortgage rates and terms.

When looking for a new mortgage, it's important to know that a difference of even half a percentage point can mean a huge savings over the life of a loan. For example, the difference in the monthly payment on a $100,000 mortgage at 8 percent vs. 7.5 percent is about $35 per month. Over 30 years, that's $12,600.

Pre-qualification

Once you have selected Passport Realty, the next step in buying a home is pre-qualifying for financing. Pre-qualification is not a full mortgage approval, it is a basic estimate of what you can afford to finance. Along with the down payment , the loan amount will determine what price range will work for you. Having a pre-qualitifcation allows you to move quickly when you find the right home, especially when there are other interested buyers. It also shows the seller that you are serious about purchasing, and that you are able to obtain financing to purchase the property.

Often times, pre-qualifications are confused with pre-approvals, which is a more comprehensive analysis and commitment of a loan program for a buyer. A pre-qualification is not as beneficial as a pre-approval where you have to go through a more rigorous process which includes verification of your credit, income, assets and liabilities. It is highly recommended that you get pre-approved before you start looking for a house. Click here to simplify your loan process and get pre-qualified.

Understanding Mortgages

A mortgage is a loan that the potential homebuyer needs in order to make up the difference between their down payment and the purchase price of the home. Today's financing techniques can be confusing. There are a variety of mortgage programs available, with adjustable time periods and financing options.

It usually takes about 30 to 45 days to process a loan application. The actual time depends on how promptly the lender can get an appraisal of the property, a credit report, and verification of employment and asset information.

To shop for a loan you will need to:

1.Think about how long you plan to keep the loan. If you plan to sell the house in a few years you may want to consider an adjustable or balloon loan. On the other hand, if you plan to keep the house for a longer time, you may want to look at fixed loans.

2.Understand the relationship between rates and points. Points are considered to be prepaid interest and are tax deductible. Each point is equal to one percent of the loan. So for example 1 point on a $150,000 loan is $1,500. The more points you pay, the lower the rate you will get.

3.Compare different programs. Shopping for a loan can be difficult. With so many programs to choose from, each of which has different rates, points and fees, it's hard to figure out which program is best for you. That's where an experienced loan officer can help you make a decision that's best for you.

Which loan is right for me?

Determine what you want

The next step is to examine your lifestyle carefully and create a realistic idea of the property you'd like to buy. What are the most important features to you? Make a list of the features you would like. Refine the lists as you house hunt. It may also be helpful to search online to see what is currently available on the market. You are now ready to begin viewing homes.

View Homes

Our website is a one-stop resource for finding your ideal home, featuring unlimited search capabilities and complete property profiles on thousands of homes. If it's listed for sale on the market, you can find it on our website.

Before you actually hit the road you can search our system to find homes that meet your needs. At Passport Realty, you can register for My Home, which allows you to set search parameters (neighborhood, price range, number of bedrooms), save a list of the homes you're interested in, compare homes side-by-side, and receive regular updates of new homes on the market that fit your criteria. Click here to register for My Home.

Make an Offer

By now you have narrowed your possible choices to one specific home. Now it's time to get serious about the financial and contractual side of the purchase.

Once you find the home you want, you are ready to make an offer for the house. Typically this is a very difficult and trying time since both parties have totally different goals. In most cases it is better to have a third party, such as a real estate professional, negotiate the offer. This is where an agent's assistance is invaluable. They will assure that the negotiation process runs as smoothly as possible. With the experienced assistance of a realtor you can navigate the offer process with confidence.

The offer will consist of the price you are willing to pay, specific deadlines, including an offer expiration date, a closing date, and possession date. You must also include the amount of the earnest money deposit, which you place in an escrow account as a good faith intention to complete the transaction. Your offer may include several contingencies such as financing and inspections. Sell My House.

Negotiating

During the home buying process, your REALTOR® can provide you with valuable negotiating expertise. Your agent will also provide you with assistance in evaluating any counteroffers and contingencies that may arise in the process.

Contract and Warranty

Once your offer is accepted by the seller it becomes a contract, a legally binding document whereby the homeowner and buyer agree to terms under which the buyer will acquire the seller's property. It is customary for both the buyers and sellers to incur expenses during the transaction process. Your lender will be able to give you a pre-settlement "good faith" estimate of specific costs. This estimate is sometimes low so be prepared by taking extra funds or a checkbook to your settlement appointement.

Home Warranty

If you haven't already decided to purchase a home warranty this might be a good time to consider purchasing a home protection plan. These insurance policies can be purchased by the buyer or seller to help protect against unexpected costs or home repairs during the listing period or in the initial years after a home has been purchased. By investing in a home warranty you decrease the chances that you'll have to pay for repairs on a home after you buy it. From water heaters to septic systems, to central air and heating, the home warranties can help protect against the normal wear and tear of your new home's covered major mechanical systems and built-in appliances for a specified period of time after the close of the sale.

Inspection, Appraisal, and Insurance

Once your offer has been accepted and your contract ratified, you and your agent will need to coordinate various inspections depending on your contract. You will also need to arrange for homeowners insurance and finalize the mortgage.

A home inspection evaluates the structure of the house and provides feedback about other items such as the roof, plumbing, electrical systems, heating and air conditioning units, insulation, doors, windows and more. Although a home inspection is optional it is always a good idea to arrange for one conducted by a qualified professional. Money might be tight for closing, but try to imagine moving in and finding out that the air conditioning unit isn't capable of cooling the house, or that portions of the electrical system are substandard, or that the chimney needs immediate repairs.

A home inspection may identify the need for major repairs or builder oversights, as well as the need for maintenance to keep it in good shape. This is a major step in the buying process and there are many potential problems that can be discovered during this period. Your real estate professional will be able to find you a reputable inspector. Once the inspector's report is final, your agent can negotiate any repairs as part of the contract for purchase. If the inspector's findings are acceptable to you, then you can proceed with the closing process.

A home inspection should be conducted by a qualified professional. We highly recommend that the buyers are present when an inspection is performed so that the inspector can describe the process and findings to you personally.

The Inspector should look for any structural, mechanical, and/or other defects in the property. All systems including the heating, air conditioning, electrical wiring, and plumbing will be examined. They will inspect the exterior of the house, including the roof, foundation, and chimney. All appliances and plumbing fixtures will be tested to verify they are in working order. If the home has an attic, it will be checked along with the interior of the home for proper venting, insulation, and electrical outlets. This is not a complete list of all the items included in the inspectors report, but having a home inspection is your first line of defense in finding any problems with the home prior to taking ownership.

Appraisal

An appraisal is an estimate of the fair market value of the property. It is usually completed at the request of the lender and for the lender's benefit. There are numerous factors appraisers consider in determining the value such as square footage, construction quality, design, floor plan, amenities, energy efficiency, lot size, topography, view, and landscaping. Other issues appraisers take into account are neighborhood quality and a property's proximity to transportation, shopping, and schools.

Homeowners' Insurance

Since this is the most important financial investment you will make, you'll want to protect your investment with insurance. Most buyers invest in a comprehensive homeowner's insurance policy, which provides coverage for fire damage, water damage, personal possessions, personal liability, vandalism, theft, and loss of use of the house. If you are financing your home purchase, your lender will require you to buy at least basic hazard insurance, which will cover the cost of rebuilding your home. You should contact your insurance professional early in the buying process so that they may advise you of their ability to provide coverage as well as to quote the rates and terms of the policy.

Closing and Settlement

Before you arrive at the meeting for settlement of the purchase, make sure all necessary paper work and deposits have been completed. If you need to bring additional funds to the closing table, please arrange for a wire prior to settlement or bring cashier's or certified checks.

Once the closing papers have been executed and the deed recorded, the home is officially yours. Congratulations!