Buying a home for the first time is one of the most exciting and significant steps you will take in your lifetime. And at the same time, it comes with a lot of uncertainty and overwhelm, as there are many steps involved from start to finish. But it doesn’t have to be stressful!
To help you navigate the home buying process with ease, we’re going over the many steps in the process, from the initial search to making an offer and passing inspection to closing day, so you know exactly what to expect. And of course, if you’re working with a Realtor, they will provide expert guidance along the way, answering any questions you might have as a first-time home buyer.
Let us be the first to congratulate you on making one of the best, most gratifying decisions you’ll ever make!
Amidst all the decisions associated with buying a home, picking the right real estate agent is at the top of the list. Your agent will act as your representative throughout the entire process, from the initial search to signing papers on closing day. They will be available to answer any questions you might have, make sure you sign all the right paperwork, give advice on the local market, and sometimes even negotiate with the seller’s agent to get the best deal. There are so many reasons to work with a real estate agent when buying a home — including the human connection and emotional support you’ll receive, as there will likely be ups and downs to maneuver along the way.
Of course, if you live in Northern Colorado, we suggest working with a Realtor at The Group! The Group has a roster of Realtors working throughout Northern Colorado, including Fort Collins, Loveland, Greeley, Timnath, Windsor, and more — including Steamboat Springs. Our agents are extremely knowledgeable about the communities they serve, including everything from school districts to local attractions. They have received the best training available in the industry and have access to the most advanced real estate technology and an unrivaled network of professionals. Contact us to get connected to one of our brokers!
Most buyers need financing to purchase their home and if that’s you, getting pre-approved for a mortgage before you begin your home search is a crucial first step. This allows you to be taken a little more seriously as a buyer and will cause sellers to consider you over someone who hasn’t already been pre-approved for a loan. Pre-approval involves an in-depth review of your financial situation, based on a verification of your income, credit, and assets. With pre-approval, you can shop for a home with assurance because you will know in advance how large a loan you could qualify for.
Group Mortgage is a joint venture between The Group Real Estate and Cornerstone Home Lending committed to on-time closings and a satisfying home-financing experience. Click here to learn more and call (970) 419-2374 to speak with a lending officer.
Now comes the fun part! From the comfort of your home — or wherever you are — you can begin the search process, utilizing our Advanced Search and Map Search tools to search for homes that fit your specific criteria, including location, number of bedrooms and bathrooms, square footage, and various features, like a pool, finished basement, fenced-in yard, and more.
Our brokers can connect with their clients on My HomeSearch!, a tool created exclusively for The Group. Once you create an account, you will receive notifications as soon as properties that fit your criteria hit the market. You can add the homes you like to your Favorites, and easily share properties with your friends and family. Plus, you can easily communicate with your agent by adding notes about specific features you like and don’t like.
All the while, your Realtor will also introduce you to homes that fit your criteria and make appointments with sellers to look at homes you are interested in. Your agent will accompany you at these showings to answer any questions and point out significant things you might not be aware of, both good and bad.
This is also a good time to go to open houses to see a variety of potential homes, taking note of some of the features and styles you do and don’t like. After you walk through the home, be sure to walk around the neighborhood to get a sense of the location, since location is one of the most important factors — if not the most important factor — to consider.
Once you find “the one,” it’s time to make an offer! This is where you will lean heavily on your Realtor to determine a fair, reasonable and competitive offer. Not only will this include the price you are willing to pay, but also the details of the purchase, including how you intend to finance the home, the down payment amount, who will pay the closing costs, terms of cancellation, repairs you are requesting, date you would like to take ownership of the property, how disputes will be settled, any contingencies, and more. Your Realtor has put together countless offers and will do everything in their power to create a compelling, competitive offer that stands out from the rest.
Once your offer has been submitted, you must wait for the seller to respond within the “deadline” included in the offer, which is typically within 48 hours of submission. The seller can either accept or reject the offer — or choose to counter with a different price or other changes, like a later closing date or changing who pays the closing costs. This begins the process of negotiation, which continues until both parties come to an agreement or decide to go their separate ways. Again, your Group Realtor will use their negotiation skills to assist with this process.
Hooray! You are now under contract. This period typically lasts 30 days, but can be either shorter or longer, depending on the agreed-upon length. This is when you will complete a number of tasks, all with the guidance of your real estate agent, like depositing earnest money, getting your home appraised and inspected, and obtaining home and title insurance. You can also put together a plan for moving, which might include hiring a moving company, communicating with your current landlord, or asking for time off work for closing day.
One of the first things you’ll do after you go under contract is deposit earnest money. Also known as a “good faith deposit,” earnest money is a sum of money that demonstrates how serious you are about buying this home. You’re essentially putting skin in the game by putting actual money behind the purchase. Earnest money is almost like a deposit for the property, as the amount ultimately goes towards the full purchase price.
A professional licensed home inspector will then inspect the property. The inspector will examine the condition and overall safety of the property, from the plumbing and electricity to the roof and crawl space. They will provide an in-depth report, which highlights any major issues, safety concerns, minor repairs, and other discoveries. If there are significant problems uncovered during the inspection, your Realtor can help you come up with a plan, which might include backing out of the sale (if an inspection contingency is in place) or requesting that the seller either take care of the repair or lower the sale price to make up for the repair cost(s).
The property will also get appraised, which is a professional estimate of the value of a property to ensure the bank is lending the proper amount of money. Conducted by a third-party appraiser, appraisals are required for any home purchase, sale or refinance. The appraiser will determine the actual value using a variety of data, including the square footage, amenities and features, and floor plan, as well as local housing trends, similar home trends, and the surrounding neighborhood. If the value is equal to or greater than the sale price, the sale continues, but if it is less, the buyer may negotiate. If the seller is unwilling to negotiate, your lender may not approve the mortgage for a higher amount than what the home is actually worth. In that case, you could either walk away or pay the difference with cash.
You will also purchase title and home insurance during this time. Homeowner’s insurance is similar to renter’s insurance, as it protects you from taking on major costs if something were to happen to your property. This form of property insurance covers damages and losses to the residence, including both the interior and exterior, loss or theft of possessions, as well as personal injury that occurs while on the property. Title insurance protects both the lender and buyer from any financial loss related to a defective title, including any liens, encumbrances, or other defects. These things will be uncovered during the title search, which determines who currently owns the property and who has the legal right to sell it.
The contract will include all the contingencies and deadlines that must be met in order to stay “in contract.” Thankfully, The Group has a trained staff in our escrow department that helps the Realtor stay on top of all details within the contract. This is just another safeguard in place to ensure your contract closes on time!
Before closing, you and your Realtor will visit the home to ensure it has been left in the expected condition. You will make sure all items, including the kitchen appliances, light fixtures and other expected items are left in the home as set forth in the contract. You will also make sure nothing has changed since you last walked through, like fire damage or a flooded basement, because once ownership is transferred, those things will now be your responsibility! Should any problems arise, your Realtor will assist in correcting the situation.
At last — the day you’ve been waiting for: closing day! You will meet with your agent at an agreed-upon location, which is usually your lender’s office. Here, you will review and sign documents, which will all be explained as you go. You’ll sign the property deed, the bill of sale, the mortgage note, the closing disclosure, and much more. And once you’ve signed everything, you’ll receive the keys to your new home, as it is officially yours! You might commemorate the occasion by taking a photo with your lender and Realtor.
Congratulations on making one of the most important decisions of your life! You are officially a homeowner — and the benefits are substantial and significant. All that’s left to do is celebrate!
Looking for Help on Your Home Buying Journey?