The 33 Steps to the Home Buying Process

The 33 Steps in the home buying process

For many, buying a home can be a very stressful and confusing process.  Whether first time home buyers or experienced buyers, your professional Realtor® should be relied on to guide you through the process, protect you and your finances, be mindful of contingency dates and ultimately get you the closing table with as little stress and worry as possible.  Many of the steps completed in the buying process you may not even be aware of, but are a critical part of the process and very often completed behind the scenes buy your Realtor®, lender or title/escrow company.  Curious about everything that takes place, I've put together this step-by-step guide taking you through the entire process start to finish.

  1. The buyer speaks with a lender and is issued a loan prequalification letter.  This prequalification letter will be needed by your Realtor® in order to present an offer to the seller.  You should also discuss monthly payments, budgets and loan programs at this time and choose what options work best for you.
  2. Potential properties are viewed by you and your Realtor® and ultimately your perfect home is identified.
  3. Your Realtor® will prepare a written offer, review the details with you and then present the offer to the sellers agent.
  4. Once all negotiations are complete between the buyer and the seller via their agents, the contract is ratified and is now legal and binding.
  5. Your Realtor® will now "open escrow" with the chosen title/escrow company and escrow officer.
  6. Buyer completes the loan application in full and the lender will prepare and deliver the "CD" or closing disclosure which outlines all of the fees involved in the transaction.
  7. Purchase contract is reviewed with the Realtor®, the buyer and the lender and all contingency dates are noted.
  8. Buyer deposits required "earnest money" funds into the escrow company's account.
  9. The title company orders a "preliminary title report".
  10. Realtor® orders the home inspection on behalf of the buyer.
  11. Lender orders a credit report for the buyer and is reviewed and approved.
  12. The lender orders the required appraisal through the "AMC" or appraisal management company.
  13. Preliminary title report is received and reviewed by the title company, the Realtor®, the buyer and the lender.
  14. Full disclosure package is provided to the buyer from the lender and is approved and signed.
  15. Home inspection is reviewed and a buyer's repair request is prepared if needed and presented to the sellers agent.
  16. The repair request is negotiated, an agreement made and this contingency is now removed.  The seller can either agree to make all or some of the repairs, decline all of the repairs or offer the buyer a credit in lieu of the repairs.
  17. Loan documents are gathered by the lender and the loan is submitted to the underwriting department for review and any additional loan conditions.
  18. Appropriate title report items are cleared and removed by the title company.
  19. Loan is approved, remaining loan conditions to be met by the buyer and final loan package re-submitted to the underwriter for final loan approval.
  20. Final loan approval is issued and final closing disclosure is issued to the buyer.
  21. Loan contingency is removed.
  22. Appraisal is received back by the lender and approved.  If the appraisal received is lower than the agreed upon purchase price the seller can agree to reduce to purchase price to the appraised value, the buyer can agree to cover the difference themselves or the purchase agreement can be mutually cancelled.
  23. Appraisal contingency is removed.
  24. All invoices, payoff demands and statement are delivered to the escrow company for settlement.
  25. Lender prepares the final loan documents and they are sent to the title/escrow company.
  26. Buyer signing appointment is scheduled with the title/escrow company and final loan documents are signed including the final closing disclosure. Note-Cannot occur less than three days after closing disclosure is received by the buyer.
  27. Signed loan documents are sent back to the lender for review and final approval.
  28. Final settlement funds are deposited into the escrow account by the buyer.
  29. Loan funding package is reviewed by the lender's funding department and loan funds are issued.
  30. The title/escrow company sends all documents to the local recorders office for recording.
  31. Escrow is closed, final accounting is completed, checks issued and dispersed and final settlement statement is issued.
  32. All parties are notified of a successful closing and recording.
  33. Keys are issued to the buyer.

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