Guide To Buying A Home In Bellingham

Buying A House In Bellingham, WA? What You Should Consider:

If you’re buying a home in Bellingham or a nearby town in Whatcom County, there are things you should consider before you start your home search.

What Are The Home Buying Steps?

Location is by far the most important part of buying a home. You can change the interior or exterior of a home, but you can’t change the location of a house. If there is one thing, a buyer should never sacrifice its location. The location of a house should be the number one want on a buyer’s list.

You need to work with a local real estate agent who knows the details of the location you’re considering.

Are you Searching for a home for sale in Whatcom County? Check out these cities below.

HOMES FOR SALE BY CITY

• Bellingham
• Birch Bay Homes
• Blaine Homes
• Ferndale Homes
• Lynden Homes

When buying a home, the process can be confusing – especially if you navigate the process alone. However, with a bit of help and a trusted real estate agent, you can easily walk through the home-buying process. From pulling together your finances to feeling the satisfaction of keys in your hand, below is the guide to buying your first home.

Steps For Buying A Home

By breaking down the process into bite-size steps, you can better understand how to prepare confidently for the home-buying experience! Partner with an experienced Realtor to help you successfully work through each stage.

Financial Preparation

Before you jump in and start looking for your dream homes online, preparing yourself for the financially is essential. One step that often surprises potential homebuyers is discovering that the house they love differs slightly from their price range. Knowing the price range you can afford will give you a good idea of what homes to look at once you start house shopping.

The steps of financial preparation are:

• Select A Mortgage Lender & Get Pre-Qualified
• Gather All Your Needed Financial Documents Home and get a Loan Qualification  

Discover Your Credit History

Many first-time homebuyers are surprised that their credit score and history need to be at the level they need to receive the home loan and interest rate they want. Refrain from assuming that your credit is in good shape.

Save yourself a headache and look up your credit history and score before moving forward. Three credit reporting companies (Equifax, Experian, and TransUnion) will give you one free credit score and history report each year. You can get a higher home loan or a lower interest rate based on your credit score – typically ranging from 500-850. Before pulling your report, double-check with your mortgage broker.  Pulling your credit report should be kept to a minimum.

Learn Your Debt-to-Income

How much home can you afford? 

One way that mortgage lenders use to decide on your pre-approval is your primary debt-to-income ratio. This ratio is calculated by comparing your average debt to income each month. Most lenders want you to maintain a debt-to-income ratio of 43% or below for pre-approval. Learning your debt-to-income ratio can give you an idea of how much your mortgage payment should be.

Select A Mortgage Lender & Get Pre-Qualified

Speaking of pre-approval, one of your first financial steps should be to decide on a mortgage lender and get pre-approved for a mortgage. Once you decide on a mortgage lender, a loan officer will guide you through pre-approval.

Pre-approval usually requires essential financial documentation, such as previous years’ tax returns, employment verification forms, and bank statements. The lender will also calculate your debt-to-income ratio along with the data on these forms to give you an idea of the amount of mortgage you are pre-approved for. Once pre-approved, you can enter into offer conversations on potential homes with the confidence that you will be approved for a mortgage – something sellers love to hear! If you need a recommendation for a local loan officer, please feel free to contact us, and we can help you find one.

Gather Your Mortgage Documents

Once pre-approved and ready to look at potential homes, you should start collecting the financial documents necessary for your mortgage application. Your lender will give you a full list of documents they need to complete the application, which usually includes:

• Tax Returns
• Employment Information
• Bank Statements
• Credit Report
• Pre-Approval Letter

If pre-approved, you will likely have started gathering these documents to complete the loan. The faster you can collect this information and submit it to your lender, the quicker you can lock in a mortgage rate and move forward with a potential contract.

 Choosing A Home

Once your finances are in order and you are moving ahead in the mortgage process, it’s time for you to start looking seriously for potential homes!

This step in the process is exciting but can also be stressful and overwhelming if you need more preparation. Starting with finding a real estate agent, you will want to follow the following steps to find the best home for your family and your finances:

The five steps of choosing a home are:

1. Partner With A Real Estate Agent

2. Select A Specific Area To Search For A Home

3. Visit Homes For Sale

4. Submit An Offer

Partner With A Real Estate Agent

Before looking for homes, you should partner with a local real estate professional to guide you through the home-buying process. While you can search for possible homes independently, a realtor will have the resources and experience to help you find the right home based on your wants and needs.

Give us a call. We’d love to discuss your home-buying needs.

Just like you would a mortgage lender, do your research to choose the best real estate agent for you and your family. From personality fit to experience, every agent offers something different to the process. However, the goal is the same – help you find your next home!

Select An Area To Search For A Home

Your realtor will first sit down in person or have a phone interview with you to discuss what you are looking for in a home and what neighborhood you would like to search in.  We recommend that our buyers focus on a couple of communities vs. multiple cities or counties. Together, you will look at aspects of the area, such as schools, home prices, access to shopping and restaurants, and more. They will also help you look at homes currently available in the area, giving you a list to visit in person. Your agent can give you insights into the potential prices for certain homes and their feelings on the market.

You can also take advantage of online home listings on www.joshandjolene.com to help you see what homes are available and at what price. In addition, our online listing site will often allow you to see pictures of a home; some even provide video tours to help you see the house before you visit.

Visit Homes For Sale

This step can be one of the most fun! Once you have a list of potential homes you would like to visit in person, your realtor will work with you to set up showing times when you can see the house yourself. Your realtor will work for you to set up times to visit with other agents and ensure the home is scheduled for your visit.

This step is essential for you and your family to understand what a home looks and feels like. As you visit each home, keep notes and take pictures so that you can revisit each one in detail later with your agent. This will help you narrow down the homes you may want to visit again before placing an offer. We also offer a video walk-thru for our out-of-town buyers.

Submit An Offer

Have you found a home that fits your price and desires? Once you are ready, you can work with your realtor to put together an offer to submit to the seller. To determine the best offer price, you and your realtor will consider the home’s asking price, the comparable home values in the region, and any potential updates or fixes that may be necessary.

Your agent will help you submit an offer that sellers can consider. It is essential to note the market you are buying in and other offers that may be on the home, as these factors can help guide your expectations. The seller may accept, decline, or ask for other offers. Sometimes, a seller may offer multiple buyers another chance to offer a new price before they select an offer. There- may be a multipoffer situation, which requires even more thought when structuring the offer details.

If your offer is accepted, congratulations! You are one step closer to closing on your new home! But before you get the keys, there are the last steps to complete—contracts, inspections, mortgage approval, and closing!

Closing On A Home

Once your offer is accepted, it’s time to lay out the terms of your home purchase contract and move toward closing day. Through this last portion of the process, you will finish your mortgage application, schedule necessary inspections, and prepare for closing on the purchase. Then, with the help of your agent, you will take the steps toward getting the keys in hand in no time.

The five steps of closing on a home are:

1. Negotiate A Contract

2. Deposit Earnest Money

3. Schedule Inspections

4. Complete The Appraisal

5. Close On The Home

 Negotiate A Contract

After the home seller has accepted your offer, your agent will help you create and submit a contract for both parties to sign. Typically, there will be terms to the contract that must be negotiated and agreed to before signing:

• Final Home Purchase Price
• Seller Concessions
• Earnest Money Deposit Amount
• Inspection & Appraisal Deadlines
• Closing Date

Preparing and negotiating the contract properly ensures that the rest of the process moves smoothly. Trust your realtor to help you prepare the contract and set a closing date that fits your moving timeline. You must also prepare for inspections, appraisal, and the ” earnest money deposit.”

Deposit Earnest Money

A step that surprises many buyers is depositing the earnest money once the contract is signed. This amount will vary and is often negotiated by the buyer and seller in the contract.

As a down payment on the home purchase, the earnest money will be deposited into your escrow account. This gives the sellers confidence in moving forward with you before they take their house off the market. It’s important to note that in most contracts, walking away from the purchase of the home will mean the seller receives your earnest deposit.

Schedule Necessary Inspections

When it comes to buying a house, don’t skip inspections! Your contract will include inspection periods during which you must schedule a licensed inspector to come out and look closely at home. An inspector will look at the entire interior and exterior of the home for any potential issues, as well as items such as:

• Mold
• Pests
• Structural Issues

Depending on your area, there may be other inspections that you will need to schedule. Again, your agent will help you connect with an inspector and schedule the visits.

Once the inspections are completed, you will receive a report on the home that will lay out any problems or concerns the inspector noticed as they surveyed the property. You can work with your realtor to renegotiate the contract and address any issues. A back-and-forth may ensue as you and you, the seller, try to work out how to handle any serious problems.

Perform An Appraisal

One of the last steps before closing is to order an appraisal of the home you will purchase. Your mortgage company will require that a licensed appraiser verify the property’s actual value to protect the lender in the loan process.

Should the home come back at a value different from the contract’s, you may choose to terminate the purchase or renegotiate the asking price. Make sure to order the appraisal quickly, as late appraisals are one of the main reasons home purchases fall through.

Close On Your New Home

Contracts have been signed, inspections have been completed, and the appraisal looks good… all that remains is to wait for the closing! You will have decided on a closing date on your contract, and all loan documents must be completed and your mortgage approved before closing.

When you come to your lender for closing, you must bring a valid identification form. You must also bring any financial documents, money orders, checks, or other items that the lender requires at closing. Your agent will work closely with you to ensure you have everything ready well before your closing date.

At closing, you will sign documents to finalize the purchase. Your mortgage company should have already funded the purchase with your loan at closing, so the only step left is to take possession of your new home!

With keys in hand, you can breathe a sigh of relief! Congratulations! Your home is purchased, and you are now a homeowner. Now it’s time to prepare for move-in day! (We will leave that part up to you!)

Buy With Confidence By Having An Experienced Real Estate Team

Want to work with us? We would love to hear from you!