Creating a plan and learning what it takes to own your own home can be intimidating. Our team is here to assist you in learning more about your opportunity and helping create your home buying plan.

What follows is essential and pragmatic guidance to ease the experience and leave it as pleasant as possible.  Our goal is to ensure that your homeownership journey is an excellent one with education, support and strategic buying plans.

Our team has over 40 years of experience in guiding families to homeownership and will be with you from start to finish.

The Dream

Have you really thought about why you want to buy a home?  Understanding your why is important as it will keep you focussed as you move through all of the moving parts of homeownership.

Choosing your team to help you through your homeownership journey is important so you will want to interview:

Your Real Estate Agent:  Choosing an agent that will support you through this exciting, but scary time is essential.  You will want to feel comfortable in asking questions,  knowing who to turn to when you want research and how to get the research.  Some questions that you will want to ask are listed below.  However, you can create your own list as well.  You will want to work with an agent that works closely with the lender and that they do not intimidate easily in the negotiation process.

• Is your agent a full-time agent?  How long have they been an agent?
• Does your agent specialize in the area/type of home you wish to purchase?
• What type of training designations does your agent have?  Negotiaton training is one that is recommended.
  
  

Most likely your agent has an established working relationship with a loan officer.  You will still want to interview them as they are going to be the one to help you find the money to purchase the home.  They will create a buying plan and educate you on the plan.  You will want to feel comfortable in talking with them and asking questions.

Your Lender:

• How long have they been in the Lending industry? 
• Do they assist in creating a buying strategy that will meet your fmaily goals and budget?

• Will they educate you on the Buying strategy and review all of the numbers with you to ensure you understand the buying plan and your responsibilities? Once you understand your plan, will they offer you credit approval from underwriting?
  

Many consumers do not know that loan officers are not able to approve a loan.  They can only pre-qualify.  Underwriters are the only ones that can credit-approve a loan file.  The best offer is the one that has credit approval as your offer will be as strong as a cash buyer.  Credit Approval is important....don't let anyone tell you differently.

Cash to Close

Let's clear up a misconception about down payment money.  You do not need 20% as a down payment to purchase a home!  There are 100% financing programs, low down payment programs and even Down Payment Assistance programs.  Below we will discuss some rules that you should be aware about in reference to your cash to close requirements.

Down Payment and Closing Costs.  You will have down payment requirements (that is if the program that you are using requires a down payment) and there will be closing costs.  Down Payment money usually needs to come from your own source, or even a Down Payment Assistance program.  Closing costs are the fees associated with the purchase of your home.  

If your loan officer did their job accurately with you, you will have a clear understanding of those fees and estimates.  If your agent is successful in negotiating the seller to pay for closing costs, that would be permitted.  There are rules of how much in closing costs sellers are allowed to pay and it does depend on your loan type and ownership type.  Again....your loan officer should have explained this information to you already.

When your loan officer reviews your numbers with you, they will be providing you with an estimate of what your cash to close requirements will be around.   And remember...this is just an estimate.  As the author of this eBook and being a loan officer myself, I will always estimate on the high side, this way when we get to the "real" numbers, things improve for the buyer.  

 It is important that you have this money available as without it, the plan will not work.  Cash to close is also regulated by Federal Regulations.  Therefore, all cash to close must be sourced from your own bank accounts or allowed to be used.  For example:  if you took a cash advance from your credit card, this cash would not be permitted to be used to purchase a home.  If you had money at home in a safe, most likely that money will not be allowed either as cash cannot be sourced.  However, if you took out a loan on a secured item, such as an automobile, then that cash would allowed to be used.  Sources of money that can be used are

• Money in your bank account.  Two (2) months of bank statements will be obtained and non-payroll deposits may be required to be sourced.
• Money from your 401K plan, either as a withdrawal or a 401K loan.
• Gift Money from family members.  There are specific sourcing requirements for gifted funds as well, so be sure to check with your loan officer.
  

• Down Payment Assistance programs.
• Using funds from secure loans, such as an Equity Line of Credit on your current home or a loan placed on your auto loan.
• Stocks, bonds, IRAs, Keogh Plans, trust accounts and the cash value of your life insurance policy.

Best Practice:  Review your cash to close with your loan officer upfront so they can guide you of what is acceptable.  And once your entire loan file is reviewed by underwriting, then you will have the confidence to proceed to the next step.

Time to Start Shopping!

Once your loan is prepared for success and you have credit approval by underwriting, your loan officer should communicate your credit approved buying plan with your agent.  If seller-paid closing costs is a part of your plan, then your agent needs to know this.  And please understand that your personal information will not be shared with your agent, just your buying strategy.  This is an important part of the teamwork between your agent and loan officer, as you will want to be sure that your loan buying strategy will match the offers that your real estate agent writes on your behalf.

Your Real Estate Agent will ask you important questions to ensure that they are searching for homes that meet your criteria.  Be sure to give them as many details as necessary to ensure that they are searching in the right area, the correct size, as well as the type of home you wish to purchase.  

“Home is the nicest word there is.”

They will add you to a individualized portal which will send automated emails to you of homes that come to market. You will preview the homes online and when one meets your goals, you will reach out to your agent and let them know. Your agent will schedule a time for you to view the property in person.

Best Practice:  You may want to preview a few homes to make good use of your time and your agents' time.  I would recommend that you makes notes on each home that you see.  Request to see the photos on the home from the MLS so when you go home later you can remember which home is which.  Your previews will blend together so having a system of how to keep them separate will be helpful for you.  I have heard from many of my past clients and I have experienced this myself, when the right home shows up, it talks to you.  You feel it as soon as you walk through the front door.  This is the fun part...finding that special place you will soon call home.

Also..... Remember we talked about your team?  Once you want to make an offer on a home, you will want your loan officer to review the numbers once again.  They will show you where current interest rates are, they will be able to look up the actual Property Taxes on the home, add any HOA dues that the home may have.  What about Solar?  Is there a Solar Lease that you will be responsible for?  You'll want your loan officer to review the numbers to be sure that your loan is good and that you are good with the numbers as well.  

In my opinion, this is a step that many agents do not have their loan officer partners do when consumers are ready to make an offer.  You do not want surprises....you want to understand your numbers, so be sure your loan officer is open to helping with this task when the time comes.  Your loan officer could also support your offer by making a proactive call to the Listing Agent, letting them know how strong of a buyer you are. None of your personal information will be shared, but they will be told that you have credit approval by underwriting. This has helped my clients offers be accepted above others

An appraisal is an unbiased professional opinion of a home's value and most of the time is required whenever a mortgage is involved in buying, refinancing, or selling property.  If the buyer is putting down a large down payment, and the LTV (Loan-to-Value) is low, then if the desktop underwriting system allows, it may waive the need for an appraisal.  This is called a Property Waiver. 

In any event, the appraiser is not responsible to inspect the home as you would inspect the home. That detailed inspection is your responsibility to perform. They are responsible to inspect the home for the value and the report is for the lender. If there are safety issues about the home that needs to be repaired, the appraiser will call out those safety issues on the official Appraisal Report. This is called an "appraisal condition". If an appraisal report is conditioned, then those conditions must be repaired prior to closing. There are some exceptions to this rule as well, so be sure to check with your loan officer.

Processing-Verification

Once your contract was received and your agent provided the fully executed contract to your loan officer, then your loan officer would have added the address to your credit-approved loan file.  At this time, you will have been sent a Loan Estimate, which provides the estimates that your loan officer reviewed with you.  Your loan officer would also be reaching out to your Escrow and Title Officer to obtain their actual fees and hopefully the will send you an updated Purchase Loan Analysis so you had a clear understanding of what your cash to close needs were.  If they do not offer that, you may want to ask for it.

Your loan officer may be requesting updated bank statements from you, as well as updated paystubs depending on how old the files that they have were.  You should be getting those documents to them in a timely manner.

You will want to ensure that all of your financial information stays consistent from the time you obtained your Buyer Ready Credit Pre-Approval.  Do not change jobs, have credit inquires, obtain new debt and move cash around.  You will want to keep all of your financial information intact for a smooth Final Approval.

You will need to shop around for your homeowners insurance plan and once you accept the offer from them, you will want to provide that information to your loan officer. You will not need to make any payments for your insurance premiums for your new home as your Escrow Officer will be paying for that at the close of escrow.

Let's Talk About Escrow

Let's backtrack a bit....remember when your offer was accepted?  You would be providing what is called an Earnest Deposit to your agent.  The check would be payable to your Escrow company and this money is your "good-faith" deposit towards the purchase of your new home.  The money would be applied to your overall cash-to-close needs.

If  you chose not to purchase the home after your inspection period is up, then there is a chance that you would lose your earnest deposit.  If the appraised value does come in at your purchase price or higher or if you no longer qualify for the loan as something went astray in your finances and your lender denied your loan, then your earnest deposit would be refunded to you.  

What is Title Insurance?

Title Insurance is another aspect of your home-buying process and it is important. When your loan officer reviewed your numbers with you at the start of your loan process, they should have explained what Title Insurance is and what benefits if offers you and while a lot goes into it, a simple explanation is that Title Insurance protects you with a clear title of ownership of the home.

Final Approval Process

When buying a home it usually takes between 30-45 days.  And during that time, your loan file is being processed, appraisal reports being completed, Title Insurance being obtained and updated financial documents from you being collected.  

Now that your loan has achieved the "clear-to-close" status, your loan file will be send to the Closing Department.  This is when the team will balance your final numbers with your Escrow Officer and you will receive what is called a Closing Disclosure.

The Closing Disclosure must be signed 3-days prior to your close of escrow date and your loan officer should review that form with you in detail.  You will want to understand your final numbers and your loan officer, during their review of the Closing Disclosure, will let you know when  your first payment is due.  
Here is a link to a sample Closing Disclosure from the cfbp (Consumer Financial Protection Bureau) with a sample of what it looks with definitions.  Once again, you will want to understand your final numbers so when you go to the closing table to sign your documents, you'll have the confidence needed to finalize your purchase.

CLOSE OF ESCROW DATE

So when do you get your keys?
Your loan documents have been signed, your cash to close money has been delivered to your escrow account and the lender just funded your loan.  when do you get your keys??

You will become the legal owner of the home once the Deed of Trust that you signed at your closing is recorded with the County Recorders Office.  Your Escrow Officer will tell  you once that recording takes place along with your home buying team.   And that is when your agent can deliver your keys to you and you are now the proud owner of your new home! 

Checklist Moving Timeline

Two Months Out:

• Make your own timeline. Start planning out your move a couple of months ahead and create a list of things you need to get done.
 • De-clutter. Have a garage sale or make a charitable donation.
 • Coordinate with REALTOR® and Loan Officer on closing dates.

1.5 Months Out

• Get moving supplies: boxes, tape, packaging, markers, etc. 
• Make travel plans. For far away moves, arrange airfare, hotels, car rental, etc. 
• Create a folder for moving expenses - Research moving insurance options.

One Month Out
• Finish up home repairs.
• Start packing. Begin with things you use infrequently. 
• Organize boxes and gather important records. Pack jewelry, valuables and medical or school documents separate. 
• Update your records. Notify bank, insurance company, employer, subscription services and credit cards. 
• Move confirmation. Get date, cost and insurance confirmation from movers. Read fine print. 
• Send copies of school records to new school. Research new medical care, plumbers, electricians, and other service providers in your new area.

A Few Days Out
• Defrost, empty and clean refrigerator. Reconfirm movers’ arrival time and contact info.
• Pack your plants. 
• Get cash for movers’ tip, food and other last-minute items. 
• Drain water hoses on your washing machine and ice maker. 
• Empty oil and gas from grills, heaters, lawn mowers, snow blowers and other tools. 
• Final walk through. Check closets, drawers, cabinets, and garage. Turn off lights, lock windows and doors. 
• Get connected. Make sure you have disconnected your current utilities that day after you move and ensure that your new utility services are connected that day before you move in. Make sure you’re signed up for curbside trash and recycling in your new city.

"I love helping people and I love real estate." -Sarah Row

As a full-time REALTOR in the Valley of the Sun, the Phoenix metropolitan communities, I have a passion for helping families make their homeownership dreams come true. Once we have the buying strategy in place, then I help the family find their perfect home and then negotiate to success.

I believe in homeownership and want to help you with all of your homebuying and home-selling needs.  

Honesty, competence and care are the values that I bring to each and every client that I serve.  

My Lending Partner- Karen Jones

 I am happy to introduce my #1 lending partner, Karen Jones.  Karen helps families understand the financing side of buying a home and prepares them for a successful purchase.  We work wonderfully as a team to help you!  When you are ready to start  your plan, we are here to help!
We look forward to helping you with your homeownership journey!

"Hi and thank you for taking time to learn about the Homeownership Journey.  With over 40 years of experience in the financial industry, I am here to help you create a buying strategy that meets your families goals.  And if you're not quite ready, we'll create an Action Plan, to provide you with a pathway to success.
I invite you to learn more about me on my website. And when you are ready to get started, my team and I will guide you, along with Jeff, every step of the way."
                                                                                                                   -Karen Jones