Book an appointment with a Signature Realty NJ agent and begin the process.
Buying your first home is one of life’s major decisions that brings with it tremendous wealth building benefits and comes with some risks. Whether you’re starting a family or have just decided to own rather than rent, the process can be intimidating if you’ve never done it before. It’s totally worth it, especially as rents continue to rise at historic rates. Rest assured, working with an experienced Signature Realty NJ agent will make buying your first home smooth and successful..
Here are the major steps involved in the first home buying process:
- Selecting an Agent
- Obtaining Financing
- FHA loan programs with only 3.5% down.
- Using your IRA/401K retirement funds to finance your down payment.
- Specialized State programs for first time home buyer.s
- Section 184 loans for Native Americans.
- Special veteran loans through the VA.
- Going Shopping!
- Making an Offer
- Home Inspections
- Attorney Review
The first step, selecting an agent, is the most important decision first time home buyers can make. It is critical that you have an experienced agent exclusively on your side to represent your interests when purchasing property; this is especially true for first time home buyers. Signature Realty NJ agents are knowledgeable about special programs, including down payment assistance and how to obtain the best loan products, available only to first time home buyers. We have a proven track record, depth of talent and experienced agents ready to meet your specialized needs.
With online search and the proliferation of websites designed to simplify, streamline and lower costs, it’s tempting to think buying direct, without having an agent representing you, is the way to go. This could be a very costly mistake and the more you learn about the home buying process the more you will understand why.
As a first time home buyer looking to obtain financing, you have many, many choices. Signature Realty NJ working with our agents will introduce you to our preferred lenders who have specialized programs you can take advantage of. It’s important to remember as you work with any lender to secure financing that you have to be resourceful! First-time home buyers can benefit from extremely low down payments and special first time home buyer loan products, long term fixed rate loans and all the various government programs including FHA and VA backed loans available to buyers. There are literally thousands of financing options available. Here’s a few:
The process of obtaining financing ends once you have a pre-approval letter from a lender.
At last, it’s time to go shopping! With your budget now clearly defined, a firm idea of what you’re looking for and geographic boundaries in place, it’s time for you and your agent to identify the best properties and start making offers. Here it’s critical to work with your agent closely, not only to define exactly what you’re looking for, but what you’re not! Consider deal breakers and things you will not accept. You can also find out from them how any preconceived ideas you might have could get you in trouble and let your agent’s experience be of benefit to you. Your agent will generate searches and send you properties to consider and make appointments to go see homes together. We also have off market inventory that you want to ask your agent about that are properties not available to the general public and not listed on apps like Zillow, Trulia, Realtor, or any other apps or websites.
Once you see the properties and after going over details with your agent, you’re ready to make offers!
When making an offer, you can rely on your experienced Signature Realty NJ agent to be your negotiator. They will advise you on how much to offer and help you navigate all the conditions and terms that apply. The seller could accept your initial offer, or present a counteroffer which you can accept or make your own counteroffer. Ultimately, your agent’s goal is to help you, the buyer, get the property you want to purchase “under contract” at the price you want to pay with terms that are favorable to you.
Getting a professional home inspector to do a thorough inspection and provide a certified inspection report is an essential requirement during the process of buying real estate. A property that may seem perfect could have problems that go overlooked. A professional inspection ensures that you’re purchasing a property without any major issues or unknown defects that could cost you in the future. This step is especially true for first time home buyers who have less experience and could get themselves in trouble without the wisdom and experienced professionals who are on their side. There are many more due diligence items that we want to complete before buying a home. Here are a few.
-Underground Tank Sweep (This is to detect any underground abandoned oil tanks, septic tanks, or other items that might have been hidden underground that could be potentially hazardous and costly)
-Radon Test
-Sewer Line Scope
-Survey of property (To make sure there are no easements, encroachments, testing wells, etc)
If the property has a septic tank or well we would also recommend those to be inspected. In NJ, the seller is responsible for testing the well water but if it is a bank owned property or a distressed sale then the buyer should get it done just to make sure there is no contamination in the water. Septic inspections are paid for by the buyer. We also need to call the health department for that municipality to verify how many bedrooms the septic tank is approved for. If the house has four bedrooms but the septic is only approved for 3 bedrooms then the septic needs to be upgraded which could be a significant cost.
Due diligence is super important to make sure that you are buying what you think you are buying, a good home that won’t give you a ton of issues after the fact. In today’s competitive market, offers often are pushing the financial ability of the borrower so we can’t afford to have additional expenses after closing. You have to trust the process, buying a good home is amazing, but canceling a deal because we found out that a home had a ton of issues we didn’t know about is also a win if the seller wasn’t willing to repair the items or issue a fair credit.
After the buyers’ offer is accepted by the seller, we are officially in attorney review. In NJ there is an attorney review provision in every contract and during the attorney review period both parties attorneys make changes to the contract. Any party can cancel the contract during this time. This is important to understand because if we delay in getting out of attorney review you could still lose the house to another party that submits an offer during this time. Using an attorney that specializes exclusively in real estate closing is super important. If you use an attorney that focuses on anything else many times this will create many problems and delay the process which could result in the deal dying. We did a ton of work up until this point to get your offer accepted, what you don’t want is now the deal dying over something insignificant or worse because of someone’s ego. Trust us this happens more often than you may think. We can give many examples of how some attorney’s kill deals because they are unfamiliar with the current state of the market and although their intentions are good, buyers often are very upset when the attorney has to break the news that the seller canceled the deal in attorney review.
Once we get through an attorney review we are officially UNDER CONTRACT which means the seller cannot accept another buyer’s offer. As long as we hit all of our deadlines in the contract and the financing comes through the house will be yours. Our agents help ensure all these deadlines are hit and we get ahead of any issues. We will also help you navigate through any inspection credits or repairs that we want to request after thoroughly going through the home inspection and other due diligence items.
The attorney will then order the title to make sure that the home will be free and clear of any liens for closing.
SUMMARY
Buying a home is incredibly rewarding, so much better than renting and will help you build wealth. Congratulations on making this important step! The process can be exciting, but also challenging. It requires you, the buyer, to beware and actively participate in a complex multi-step process. Working with one of our experienced real estate agents, an expert, is absolutely critical to help you develop a strategy to meet your needs and flawlessly execute this important purchase.
Get in touch with us today and find an agent who will be on your side from start to finish!