You're Ready to Buy a home.

Congratulations! This is a big step and a huge deal. Deciding that you're done renting (paying someone else's mortgage!) isn't a simple decision, but it comes with so many benefits. Foremost, it's an investment - and in a market like Fort Lauderdale home prices are soaring. In fact, in a recent article by Forbes, Fort Lauderdale is listed in the top 10 real estate markets to watch, so if you can get in now you're ahead of the game!

Fort Lauderdale Condo

Buying a home is as exciting as it is intimidating. Though I can't detail the entire process in one blog post, I hope to be able to give you a comprehensive overview and have big plans to release a first time homebuyer's vlog series. Although I have helped customers buy and sell (and rent!) houses, I have never purchased a home myself and would love for you to come with me on this journey!

What is the first step?

Though there is a lot of financial planning, saving, and other preparations that go into the decision to purchase a home, the first official step in the buying process is to get a pre-qualification or pre-approval from a qualified lender. The simplified difference between the two is that a pre-qualification is an

estimated loan amount based off of answers provided by the buyer whereas a pre-approval is a more firm estimate given once a lender has done a hard credit check and reviewed financial documents such as pay-stubs, tax returns and bank statements among other qualifiers.

Having a pre-approval letter in hand before viewing property is essential. First of all, most sellers will not review an offer without a pre-approval or, in a cash transaction, proof of funds to cover the offer amount. In a fast-paced market like Fort Lauderdale, not having everything necessary to make an offer can cause you to lose out on your dream property. It is also important to know how much you will qualify for and what kind of loan you intend on using due to restrictions and requirements on some kinds of properties. While loans are a subject matter (and coming blog post!) of their own, there are three major types of loans frequently used: Conventional, FHA, and VA.

Okay, we have our pre-approval. Now what?

Now comes the fun part! While I'm sure you've already thought of what you're looking for in a home, what areas you like and that you've done your fair share of online home-browsing, the next step is to discuss these requirements with your Realtor so they can schedule showings. And when you've found the right property - your Realtor will fill in a contract, submit your offer and negotiate for the terms you want.

Ugh. The only contract I've ever signed was for the gym.

While contracts are long and complicated, here I will discuss a few important decisions you will have to make. First and foremost, your offer; your Realtor will be able to look at comparable recent sales in the area and give you an opinion on what they believe the home to be worth. Then, how much of a deposit you are putting in escrow, and you will have to indicate your preferred closing date.

How long will it take to close?

There are many factors that impact the amount of time it will take to close. A cash deal with no inspections or a short inspection period can close more quickly, while a financed purchase will usually have a longer inspection period (on average around 15 days) and an appraisal that all must happen before the buyers get their loan commitment which can take up to a month (but is usually much quicker). If issues come up on the inspection, you can choose to negotiate, cancel the contract, or move forward as-is, as long as repairs are not required as a condition of the loan.

You must also indicate on the contract who chooses the title company (and pays certain closing costs), and the final step is for the title company to complete the lien search among various other steps in order to be able to give the buyers clear title. Then you are ready to close!

Who plays closing costs?

That's a great question! Both the buyer and seller are responsible for certain closing costs, with some of them being negotiable. There are also some sellers who will, at the right price, offer closing cost assistance in the form of a credit to the buyer at closing.

Is that really all?

Yes and no. There is a lot more to it as well as various issues that can arise that I will break down into dedicated posts, but this is a general overview of the process. Of course, every purchase (and every home!) is different, so nothing can replace the support of a Realtor familiar with your specific transaction or legal advice from an attorney.

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