1) Make Offer - This is done via an electronic document and signature.
2) Seller Reviews Offer / Offers
3) Seller Accepts Offer - Contract is considered Executed.
4) Earnest Money (1%) and Option Money $150 are due within 3 days of executed contract. I usually deliver these right away to avoid any delays. The title company holds the earnest money in escrow and the seller receives the option check.
5) Option Period begins the day after the contract is executed. Option period length in days is negotiated in contract. I usually request 5 or 7 days.
6) Schedule Inspection - $350-450. (always done during option period).
7) Negotiate repairs based on Inspection Report (done before option period ends).
8) Appraisal - Lender schedules
9) Loan Underwriting
10) Close on Property - Usually 30 days from Executed Contract
Owning your own home is about more than just being able to decorate any way you like; it's about being prepared to maintain your home over the years, realizing that part of your income and time will go towards repairs and maintenance. It's about being willing to take the risks of home ownership with a realistic expectation of the rewards.
It can be discouraging to find your salary won't stretch as far as your ideal home. However, sacrificing a huge part of your income just to pay the mortgage can very quickly make home ownership a burden rather than a point of pride. It's better to buy a modest home now and look at purchasing your "dream home" in a few years. No one enjoys being "house poor".
This is something that lenders take very seriously. Your overall debt should not be more than 40% of your income, including the projected cost of your mortgage.
Do you like the idea of cleaning your own gutters? Or will you regret giving up your Saturday to mow the lawn? Would you rather pay a monthly fee to a landscaping crew? Do you want your neighborhood managed by an HOA or would you rather live in an area where each owner does their own level of care? The answers to these questions can narrow down the type of property for you.
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