Home buying can be a stressful time, and the Bay Area housing market can present its own set of challenges. We are an expert group of local real estate professionals, here to help you navigate the home buying process, for a smooth, streamlined experience.
Your financial situation will have an impact on your buying options, if you’re planning to take out a mortgage for the new home. Before buying, make sure the following are in good shape:
Location is one of the most important factors when looking for a new home. Consider the following when deciding what area is best for you:
After you create a list of neighborhoods that are within your budget, and have good long-term investment potential, you can look at how each will fit your personal lifestyle needs and preferences.
Your real estate agent will be a key resource and main ally during the home buying process. They will find and show you homes, and can also make recommendations for other services, like CPAs, lenders, and escrow companies. Once you find a house, your agent will be the one who can help you get a great deal. A good agent will be able to get you the information and guidance you need to help you find what you’re looking for.
Schedule a time to meet with and interview your potential agent, to see if they will be a good fit. Know that you can schedule showings with an agent before signing a buyer’s agency agreement. It’s a common practice, and a good way to see if an agent will fit your needs before you commit to working with them.
Sellers are looking for buyers who are serious and financially ready to put in an offer, so getting pre-approved for a mortgage is an important step in giving you and the seller the confidence that you’ll be able to get a loan and close the transaction at the end of the sale process.
There are many available mortgage terms, but most conventional loans are for 15, 20, or 30 years. A shorter-term will give you a lower interest rate, but a higher monthly payment. As an example, here is how the numbers break down for a home worth $685,000 (with a 20% down payment):
|15-year Mortgage||30-year Mortgage|
|Interest Rate/APR||2.49% / 2.58%||3.375% / 3.391%|
Choosing A Lender
Your mortgage lender will have a big role in the closing of your home. You can work with a direct lender, or with a mortgage broker that can help guide this part of the process. No matter what, make sure you work with a lender who can give you a full picture of your situation, and your chances of having a successful closing.
Maintaining Your Credit
Once you have been pre-approved, any changes to your finances or credit score can void your pre-approval. If you need to make a big purchase or have your credit checked, make sure to do it before you are pre-approved. Here are some tips to help keep your credit status from changing:
Finally, the fun part! Start viewing homes that fit the criteria you’ve set up for yourself, and remember the following as you are looking:
Housing InventoryThe time of year when you start house hunting can impact what options are available to you. In California, there are historically more homes on the market, while in November, there are about 20% less. You may have to adjust your expectations if there are fewer houses on the market.
So, you found a house that you really like. It’s time to make an offer to convince the seller to sell to you. Learn when to make an offer, and how to make it attractive so that the seller will accept it.
|Pros for Buyers||Pros for Sellers|
|Seller Concessions||Closing costs included in mortgage||Higher sale price|
|Repair Credits||Control over repairs||No risk of repairs going over budget|
|No inspection contingencies||Faster closing||Less chance of the deal falling through|
|Letter to the seller||Stand out from other buyers||Confidence that the home will be in good hands|
After a seller accepts your offer, there are some due diligence steps you will need to take to make sure the home you’re getting is what you signed up for. After inspections and appraisals, you’ll have another chance to negotiate if something unexpected comes up.
A licensed professional checks the house for any unseen, unexpected, or potential issues. This is an important step that will give you peace of mind about the condition of the property. They should check:
In addition to looking at the condition of a home, an appraisal looks at home’s value. If you’re getting a mortgage, lenders require an appraisal to make sure the house is worth the money they are lending to you.
You’ll be able to do a final walk-through of the property when it’s time to close, to ensure that it is still in the expected condition. Though it may feel like you’re nearing the end of the buying process, it’s important to stay focused at this time, so you don’t miss anything. Make sure you go through the following checklist during the walk-through:
On closing day, be prepared to sign a lot of paperwork. Your agent and your escrow officer should explain every document before closing, but be sure to ask any remaining questions you have before signing.
Hiring a Real Estate Lawyer
Consulting with a real estate attorney for every part of a home sale is not a requirement in California, but hiring one can be helpful if you’re looking for an additional professional perspective.
Buying a house is a time-consuming and often complex process, but it doesn’t have to be an overwhelming one. When you’re familiar with the process and when you work with the right agent, you’ll be prepared for the home buying journey towards the home you’re looking for.
Buying a house: Tools and resources for homebuyers
Consumer Finance Protection Bureau
The Complete Homebuying Guide
Renting vs. Owning
Rent vs. Buy Calculator
408-223-3350 ext. 5
President / Broker / Realtor
408-223-3350 ext. 4