Step 1: Financial Prequalification
Sometimes the joy and excitement of a new home can overshadow the financial implications and responsibilities required to turn your dreams into reality. Before you begin, evaluate your readiness – be honest about your current financial situation and prioritize your expectations. Speak with your Realtricity agent about the importance of Prequalification and put yourself in a position to move forward quickly when you find that perfect home.

Step 2: Know What’s Ahead
It is often necessary to improve your credit rating, pay off some credit card debt, consolidate student loans or work a minimum amount of time at a new job to qualify for a mortgage. Applying for a pre-qualification letter will identify any areas you need to address. It’s also important to know that you will incur some out-of-pocket expenses at the beginning of the process in addition to any down payment that is required, including payment of the appraisal fee or loan application fee, structural and pest inspection. You should plan on having at least $2,000 available as you sign your contract for these upfront costs – more if you make a larger deposit. Knowing this will not only help you be better prepared, but will also help you compute how much money you will need to finance your new home. This is useful to narrow down your property search to homes in your price range.

Step 3: Search for the Right Home
Once you decide you’re ready and have established your criteria and requirements, you can begin the search. It can be overwhelming with so many choices, but Realtricity’s streamlined, easy to use Web site and accessible agents will help you reduce the time it takes to find your dream home. You will not only want to search for available properties, but also neighborhood and tax information. Realtricity can help!

Step 4: Make An Offer
After you have found the perfect home and evaluated its condition and all pertinent information, Realtricity will assist you with a purchase offer. We will work with you to determine a fair price based on the condition of the home and comparable values of similar properties in the area. Sometimes the original offer is not accepted by a seller, and our Realtricity agents will continue to negotiate a compromise on your behalf if that is what you desire. The offer is generally submitted on a standard form contract for purchase and sale and in that case is binding once a seller signs it and agrees to the contract terms and conditions.

Step 5: Look for the Property Disclosure Form
Sellers typically complete a Property Disclosure which identifies the condition of the property at the time of sale to prospective buyers. It is important to review this disclosure carefully which should note any defects in the property known to the seller. Receipt of the Property Condition Disclosure will not preclude the need for a structural inspection by a competent professional in the field to ascertain any unknown or unreported structural issues.

Step 6: Contract Contingencies
Once the seller accepts your offer and signs the contract for purchase and sale, you are obligated to buy and the seller is obligated to sell. However, there are protections built into the contract that allow you to terminate the contract if you’re unable to secure mortgage financing or if the home is not structurally sound, for example. Your Realtricity agent will make sure all of the protections available to you are included in the contract.

Step 7: Get a Home Inspection
One of the protections available to you is a home inspection. Any purchase should be contingent on an inspection by a licensed structural inspector. The home inspection will identify potential structural deficiencies (any major repair that will cost more than $1,500), as well as the overall condition of the property. If a seller is unwilling to repair a structural defect prior to closing, or provide a credit to you to enable the repair to be completed subsequent to closing, you will have the right to terminate the contract if you so choose.

The home inspection is a valuable tool and will help you avoid buying a home that requires major repairs that often are not visible or known to sellers. Our Realtricity agents will assist you in this process and provide you with the names of competent inspectors upon request. You are required to pay for the home inspection at the time of service.

Step 8: Mortgage Application and Bank Appraisal
The contract for purchase and sale will require that you apply for a mortgage within five (5) days of execution. It will be important to have copies of bank statements and income tax returns available to submit to your potential lender. Our Realtricity agents will review with you the various banks, credit unions and mortgage brokers available, as well as current interest rates being charged. As part of the mortgage application process, your lender will have the house appraised to determine its fair market value in order to determine that it will support the mortgage loan you have applied for. You may be required to pay an application fee and/or appraisal fee at the time of application as referred to in Step 2. Refer to our mortgage page for information about the various types of mortgages available and note the option to apply for pre-approval.

Step 9: Shop for Insurance
The purchase of your new home is an investment for the future you will want to protect with homeowner’s insurance in the event of fire or other catastrophe. The lender will require homeowner’s insurance in at least the amount of the mortgage, but you will probably want to cover the entire house value or a cost replacement value, which will provide coverage for replacement of your home if it is ever totally destroyed.

Proof of insurance coverage in the form of a binder, naming the lender as additional insured and mortgagee, is required before a closing date can be confirmed. You should arrange all these details ahead of time and have coverage in place so that the binder may be supplied quickly when it is time to schedule the closing. You are usually required to pay for the first year’s homeowner’s insurance premium prior to closing. Thereafter, the premium will be collected and paid out through your escrow account unless you request an escrow waiver.

In addition, title insurance will be required by your lender. Title insurance is issued after a search of your property’s legal history by a professional title searcher. The search reveals any conditions that may exist in the official record about the property such as existing mortgages covering the property or judgments that would need to be paid off by the seller prior to closing. The premium for title insurance is paid for at the closing. You may also purchase owner’s title insurance at the same time. Unlike other insurance, which requires ongoing payments, the title premium is paid only once at the closing. Speak to your Realtricity agent for assistance with coordinating this important part of the process.

Step 10: Closing and Transfer of Title
In the state of New York, after all mortgage conditions are satisfied and the loan is cleared, a closing is scheduled to take place at the lender’s attorney’s office (or seller’s attorney’s office or Title Company, if there is no mortgage). Generally the closing will take place two to four days after it is cleared to close. This time is needed in order to have the closing documents prepared and funds wired into the lender’s attorney’s account. Often wired funds are not available for early morning closings, especially if the wire is initiated the same day as the closing, so it is important to keep that in mind when scheduling to avoid delays.

At closing, the seller will sign and deliver a deed to you, conveying the real property. You will then sign the Note and Mortgage to secure financing with the lender, as well as a number of supplementary documents required by the lender. Closings usually run about an hour, but it is not unusual to take longer. A bank or certified check will be required from you at closing representing the balance of any deposit owed and all closing costs. The amount of this check will be provided to you prior to closing by you attorney or lender’s attorney. When all closing documents have been properly executed and approved by the title company, and the balance of the purchase price is paid in full, the keys to the property will be delivered to you and the closing is complete. You will have ample opportunity to ask questions of the lender, the title company and the seller.

Although Realtricity is not directly involved in these final details, we will work diligently to make sure all mortgage conditions are satisfied, that requirements are timely provided to the lender’s attorney for review and to generally assist with any last minute roadblocks that may arise.