A Little Perspective

 We’ve all taken vacations that didn’t turn out exactly as planned. Delayed flights, lost luggage, and unseasonable weather are commonplace. And while these surprises challenge our patience at the time, we try to take them in stride and, in the end, are happy with the trip. Sometimes, in retrospect, we even find the adventure more memorable because of the “detour” in our plans. Home buying experiences can be a lot like this. As you venture into the home buying process, be prepared to make some adjustments as you encounter the unexpected. A flexible attitude, along with a good road map, will keep you moving forward toward your desired destination and will make the journey more gratifying.

GETTING STARTED

Choosing a REALTOR®

• Choosing a REALTOR® - Whether you select a REALTOR® by referral, or by an interview process, working with the right agent reduces the stress and confusion that often accompanies the purchase of a home. Good communication with one person is key.
• Discuss Agency - With the REALTOR® you have selected, take time to define the part he or she will play throughout the process. Your REALTOR® may represent you, the seller, both you and the seller, or neither party. This discussion is crucial and mandated by State Law.
• Identify Your Priorities - Your REALTOR® can now help you rank or prioritize a list of property features. In this step, “required features” become distinguishable from those that are merely “wants” or “wishes.”
Possible Documents: Agency Disclosure Statement, Buyer Agency Agreement,

GETTING YOUR FINANCING FIRST

Pre-approval First is a Must

• Multitude of Possibilities - Take your pick! For example: FHA, VA, Rural Development, Conventional Fixed or Adjustable, PMI Fixed or Adjustable, Balloon, etc. Ask your lender for some guidance.
• Which Lenders Should I Consider? - Compare the rates, fees and lending policies of those financing institutions that have the experience required to efficiently process and deliver the type of loan you desire.
• Become the Next Best Thing to a Cash Buyer - Sellers generally respond more favorably to offers from “pre-approved” buyers. Also, imagine shopping with the assurance that you can buy any home in your preapproved price range. Possible

Documents:
Good Faith Estimates
Lender’s Application Checklist
Loan Application
Credit Report, VOE, VOD
Pre-Approval Letter or Certificate

GETTING THE RIGHT PROPERTY

Searching for the right home

• Your Home Search - Discuss with your REALTOR® the best search strategies for the kind of property you are shopping for. Listing Brokers enter property information into the MLS which is shared with your REALTOR® and hundreds of other websites. You should discuss with your REALTOR® how you can get direct access to the MLS to stay current on accurate information. You may also want to discuss which other websites may be beneficial in your home search.
• Viewing Homes – When you find a home you want to view, contact your REALTOR® sooner rather than later to set up a showing. Keep in mind that there can be several other parties involved in scheduling a showing (the seller(s), other agents and buyers).
• Back to the Drawing Board - If you are still shopping and not getting any closer to finding the right match, it may be time to review and adjust your priority list and re-examine your options.
• Disclosures & Use Restrictions - When you have successfully narrowed the field to your top choice, obtain a copy of the Seller’s Disclosure Statement, Lead Based Paint Disclosure and Use Restriction Information (Public and Private) for that property and examine thoroughly before drafting an offer.
• Offer to Purchase - Bring your checkbook for the “earnest money” deposit. With your REALTOR’s® help, read and complete the Buy and Sell Agreement.

Possible Documents:
MLS Property Data Sheets
Seller’s Disclosure Statement
Lead Based Paint Disclosure & Pamphlet
Plat/Deed Restrictions Zoning Ordinances
Buy and Sell Agreement
Agency Addendum
Wire Fraud Notice
Counteroffer Form

GETTING YOUR INSPECTIONS

PEACE OF MIND AND UNDERSTANDING

• Wood Destroying Insects - In Southwest Michigan, there are several types of insects that damage wood. Make sure a licensed pest inspector checks the property carefully for wood destroying insect activity.
• Investigating the Property - Most homes need minor repairs or improvements. To reduce major surprises, hire a qualified professional to inspect and help you become more familiar with your future home. You may want to test for radon as well!
• Well and Septic - If your chosen property is not serviced by public water and sewer, a local health authority or private evaluator should make sure you have a system that properly provides acceptable drinking water and a system that properly discharges wastes. Review the report with the sanitarian if you have any questions or want recommendations for water testing beyond the typical tests for nitrates and bacteria.
• Environmental - Discuss the need for environmental inspections with your home inspector, the local health sanitarian and any other state or local government personnel that may be aware of hazards in your area.
• The Property - To identify potential boundary problems you should obtain a survey report. A report could include: approximate boundaries, recorded easements, setbacks, building locations, elevations etc. The information provided by a survey report can vary widely depending on the type: mortgage report, stake survey, ALTA survey etc. To identify potential use limitations you should obtain a copy of the preliminary title commitment and copies of all documents (deed restrictions, oil and gas lease, easements etc) as well as inquire with the local municipality about how the zoning impacts the property.

Possible Documents:
Investigation Reports
Wood Destroying Insects
Structural/Mechanical/Safety
Radon Test Other (mold, lead-based paint)
Well/Water Septic
Estimates of Repairs/Remediation
Survey Investigations Addendum
Preliminary Title Work & Copies of All Documents

GETTING THE GO AHEAD FROM YOUR LENDER

CHOOSING YOUR LENDER

• Application - Your lender will want to get to know you very well. Obtain a list of the items you will need for your loan application, which may be in-person, over the phone or online, depending on your chosen lender.
• Appraisal - Your lender may hire an Appraiser to ensure there is enough value in the property to secure your loan.
• Verifications - Your lender must verify everything to best serve and protect the investor that is providing the money for your purchase. Cooperation with the process can really speed things along.
• Final Conditions - Often a lender will issue an approval subject to certain conditions being satisfied. Typical examples include paying off a debt, making specific home repairs, and providing the lender with additional verifications, copies of the inspection reports and a home owner’s insurance policy.
• Approval - Your lender is now prepared to provide the funds you need to complete your purchase. Be advised, these funds are normally available for a limited time.
Possible Documents: 
Loan Estimate
Requested Documents
Appraisal
Mortgage Title Insurance Commitment
Surveyor’s Mortgage Report
Closing Disclosure
Inspection Reports/Repair Verifications

GO AHEAD! COMPLETE YOUR PURCHASE

• Pre-Closing Walk-Through - A quick walk-through before closing will reassure you that the home you agreed to purchase has not changed significantly.
• The Closing - This is the day you take ownership of your new home. Allow approximately one hour to sign the necessary papers. Be sure to bring certified funds, photo ID, and appropriate home owner’s insurances papers.
• Possession Arrangements - Before leaving the closing, make sure arrangements have been made to obtain all keys for the property and transfer all utilities and services into your name.
• Move in and enjoy your new home! – Please remember to file your change of address (post office), and follow up on your Principal Residence Exemption (PRE) with your municipality.

Possible Documents: 
Closing Disclosure
Homeowner’s Insurance Policy/Binder PRE (Principal Residence Exemption) Form Property Transfer Affidavit Home Warranty Change of Address Form

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