A Step-By-Step Timeline for First-Time Buyers

A Step-By-Step Timeline for First-Time Buyers

If you're planning to purchase your first home, you're bound to have questions about the process. Below, we walk you through each stage, from getting preapproved to your closing day celebration, so you know exactly what to expect.

Step 1: Getting Preapproved (1-3 Business Days)

Getting preapproved gives you a budget to work within as you look for your next property. It also shows sellers that you're serious about purchasing and gives you extra negotiating power. Make sure you have your financial documents organized ahead of time to speed up the process.

Step 2: Finding Your Real Estate Agent (1-3 Business Days)

If you haven't already worked with a real estate agent, now is the time to do your research. Look for an agent who is knowledgeable about the neighborhoods you're considering and current market trends. Review their recent sales history and client reviews to find a good match.

Step 3: House Hunting (Days to Months)

Streamline your hunt for the perfect house by starting your journey with your realtor and start building a must-have list and a wish list. This will help narrow down the properties you'll tour in person.

Step 4: Making an Offer (1-3 Business Days)

Once you've found the right home, get ready to move quickly. Have your agent draft a competitive offer with your purchase price and contingencies. Keep in mind that most sellers counter the first offer they receive, so be prepared to negotiate.

Step 5: Reviewing Contracts (3-5 Business Days)

While this step is optional in some states, it's still a good idea to have an attorney review your purchase contract. Fees for this typically fall between $500 and $1,500, but it can save you thousands of dollars and plenty of headaches in the long run.

Step 6: Applying for a Mortgage (1-3 Business Days)

Congratulations, your offer was accepted! Now, it's time to turn that preapproval into a mortgage application. Make sure to have updated income verification, bank statements, and the signed purchase agreement ready for your lender to review.

Step 7: Loan Processing (3-4 Weeks)

The loan processing stage covers several important evaluations. The home inspection and appraisal usually take place during the first two weeks, followed by a title search and insurance coverage.

Step 8: Underwriting (Approximately 2 Weeks)

After loan processing, your loan will move to an underwriter for final review. Avoid any big financial changes during this process, such as switching jobs, opening a new credit card, or making a significant purchase, since these actions can cause delays.

Step 9: Reviewing Your Closing Disclosure (3 Days Before Closing)

You'll receive your closing disclosure at least three days before your closing date. Carefully review the final loan terms, monthly payment, closing costs, and total cash needed for closing. If anything is incorrect, notify your lender immediately.

Step 10: Completing Your Final Walkthrough (1-2 Days Before Closing)

During your final walkthrough, you'll get one last chance to ensure the condition of the property meets your expectations as laid out in your contract. Verify that any agreed-upon repairs have been completed and that there isn't any new damage. Remember that you can still negotiate at this stage.

Step 11: Celebrating Your Closing Day

It's time to celebrate! Get ready to sign your documents and transfer your down payment. Once your closing costs are covered, you'll receive your keys and start the move-in process.

Now that you know what to expect, you can confidently search for your dream home. If you still have questions or if new inquiries come up along the way, don't hesitate to reach out to your real estate agent. They're there to guide you and make the process as smooth as possible.

Sources: Agcu.org