The Step-by-Step Process To Buying a House

Making a commitment to being a homeowner is one of the smartest things to do with your money and for your future.  Looking for the right house takes time and having the guidance is important.

Finding a home can be very difficult and frustrating at times but it doesn’t have to be.  That ‘s one of the many reasons why you should first explore your options with a AMDC International Consultant.  We have many years of experience in the business to help guide you through the steps of Homeownership.

First thing’s first.  The First Step to homeownership is deciding to own for yourself and taking the responsibility to earn money for yourself rather than for someone else.  Once you have made your decision, don’t ever look back.  You cannot lose if you do it the right way.  Properties are appreciating every month so what you buy today will not be worth the same next year.  If properties can appreciate between 5-10% annually or even more (depending on the area, also make sure that your job raise is the same, if not) buy now and you can save yourself a lot of money on the appreciated value in the coming years.

The Second Step is to speak with Aristotle dela Cruz to get pre-qualified by phone by calling 773-807-0910.   This stage will give you an idea over the phone of what you can qualify for.   Keep in mind that before you call, we will be asking for several items.  Please help us help you give a better qualification by providing us with complete documents on what we need.   Be prepared to assist us in getting the information about the following: 

Pre- Qualification Analysis

Date        __________________________________________________

·         1040 / W2 for the last 2 years

·         Most recent 1 month Pay Stub

·         3 Months most recent Bank Statements for all Banks

·         2 forms of a valid ID

·         Sales Contract (Front and Back)

·         Divorce Decree

·         DD-214

·         Certificate of Eligibility

·         SS Card / Alien Card

·         H/O Ins. Declarative Page

·         Mortgage Note

·         Current Mortgage Statement

·         HUD-1 / RESPA

The Third Step is to get Pre-Approved.  During this stage, you will schedule an appointment with Aristotle dela Cruz and bring all the necessary information needed to process your loan application.   You and a co-borrower (if applicable) will sign documents to start the process of your loan application and will need to pay for an application fee which will go towards your credit report and the appraisal of your new home.  In the event the lender is unsuccessful in processing your loan, the lender will refund you your application (if any: appraisal fee only, less the cost for your credit report).

This stage prepares you to do the smartest thing when obtaining financing.   The difference between getting pre-qualified and being pre-approved is that being pre-approved is being guaranteed for a mortgage.  This process makes you a Cash Buyer.  With so many competitions in the market right now, being pre-approved can help you win a bidding war.  A bidding war happens when multiple offers are presented for the same property with different prices.  As a pre-approved Cash Buyer, a seller is more likely to accept your offer before a pre-qualified buyer.  This will guarantee the sale of the transaction and allows a faster closing.  After a couple of days, you should receive a pre-approval for your loan application.  Once approved, you are now ready to move forward to the fourth step.

The Fourth Step is to find a house.  Let Aristotle dela Cruz, CIPS help you to start looking for your new home.  Now that you have finished one of the most important steps as an educated soon-to-be homeowner, looking for a house with confidence is great!  Be proud of yourself at this point because you have the advantage to choose the home of your dreams and to know that you can afford it.  Keep in mind that the bank also guarantees you that they can finance your new dream house.

Working with the right Real Estate Agent is very important.  They may negotiate the Real Estate Contract for you and may ask the sellers to pay some points towards the down payment or closing costs for your loan.  If the sellers agree to the negotiated price and terms of your Real Estate Agent, this step will save you thousands of dollars.  This will tell you if your Realtor is working in your best interest.  Keep in mind that not all transactions are that easy.  You will need a Professional to help you with this type of transaction. 

Once you find a house and have made an offer that is accepted by the sellers, you now have a Real Estate Contract.  During the offering of the contract, Aristotle dela Cruz or his staff will fax a copy of your Pre-Approval Letter to the selling or listing Real Estate Agent.  This will notify the sellers and the seller’s agent that you are a serious buyer and you have already been pre-approved for a mortgage.

Your Real Estate Agent can guide you through the contract and will be able to answer your questions about the property taxes and other pertinent information that’s related to the property.

The Fifth Step is to schedule an appointment again with Aristotle dela Cruz to go over your financing options.  By this time, you should have an idea as to what type of financing fits your financial profile.  Everyone’s situation is different so loan programs may vary and should be suggested to you by your Loan Originator.

This step is important and will review everything you went over during your Pre-Approval stage.  Just a reminder, this is the time when you should shop and purchase a Homeowners Insurance Policy if you are purchasing a single-family residence, townhouse or 2-4 Unit buildings.   Please provide us with the copy of the policy and paid receipt for the insurance.  You need to inform your lender (your processor) of the insurance agents name and number, or have the insurance company contact us to prepare the papers necessary for your closing.

During this stage, the appraisal is ordered for your home.  An Appraiser will go to the property that you will be purchasing and will determine the current value of the property.  The report that they create is called the appraisal report.  This is the report that will be one of the deciding factors as to what amount the bank is allowed to lend you.  Please be aware that you will need to pay the appraiser directly when you meet him at the subject property.

Please feel free to call your assigned Processor or Aristotle dela Cruz at anytime if you do not understand a procedure or simply have a question.  We feel that since you are investing a lot of money into your new home and your future, we would like to contribute to your investment by the service we can provide for you.  There will be times when we may ask for additional information.  Please help us get the information needed so that we may close your loan as quick and smooth as possible.

The Sixth Step and final step is the closing step.  Your attorney and the seller’s attorney will schedule a time when both parties are available to meet and sign the closing documents.  You may call your attorney for a more accurate amount of what you will need to bring 24 hours before you go to closing. 

This will cover the balance of the down payment, closing costs, title expenses, pre-paid and escrow reserves.  You may close either at one of the attorneys’ office or at the title company.

Since the attorneys are scheduling the closing date, the title company is reviewing the final figures; your attorney will follow up with the title company when final figures are estimated.  Final figures for closing are to be given by the title company 24 hours before you go to closing. 

The purpose of that is to have an exact figure as to how to prorate your taxes and pre-paid expenses (If the title company prepares it ahead of time, by the time you go to closing, figures may change due to change of insurance or programs of loan application). 

Please bring the final amount of money needed to close to the closing as a cashier’s check made payable to you.  You heard that correctly, made payable to yourself.  You will then sign the back of that same check to yourself and give it to the title agent.  He/she will take the check and disburse it accordingly.  For more information, please consult with your attorney. 

You may expect to see the sellers, the seller’s Real Estate Agent, the seller’s attorney, your attorney and a title representative at closing.  Your Loan Originator may sometimes have to be in the office to make sure that all papers needed are at closing.  If the closing agent needs any other information, your Loan Originator will be there to answer their questions.    If not, he or she may need to send any other necessary information needed for closing faxed over to the bank. 

After all papers are signed, you should be able to receive the keys to your new home and begin celebration!

Commonly asked questions for loan qualification:

1)      What did you earn for 2006 Gross Income (Please look at your W2 Form)?

2)      What did you earn for 2007 Gross Income (Please look at your W2 Form)?

3)      How much do you make per hour or per year?

4)      How long have you been employed at your current job?

5)      Where is the money coming from for your down payment? 

6)      How much can you afford to invest for your new home?

7)      How much do you feel comfortable making payments for your new investment?

8)      How is your credit?

How does anyone qualify for a mortgage loan?

Simply stated, you either need to have a job or a down payment for your dream house.  With the many programs that are available for first time homebuyers to current homeowners, there are so many ways to get mortgage financing for you.   We can help you even if you don’t have good credit, no credit, no down payment, or not even enough money.   Please call us to see if you qualify at no cost to you.  Each scenario is different and can be dealt with accordingly.

• In order to process your loan application as smoothly as possible, please have all your documents ready.
• If you do not understand what else to bring to your initial appointment, please feel free to call Aristotle or his staff to answer any or your questions at 773-807-0910.

• Call Aristotle at 773-807-0910
• Get pre-approved first
• Find a home and sign the contract
• Choose a mortgage loan program if needed
• Wait for the closing
• Attend the celebration!