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Buying A Home

Whether you're in the process of buying a home or looking for answers, we’ll guide you with data and expertise throughout the entire process.
01

Choose a Realtor

Your Agent’s Primary Role
  • Guide you through your home search and help find relevant inventory
  • Advise you on pricing, contracts, and the transaction process
  • Negotiate on your behalf, with your best interest in mind
What To Look For in an Agent
  • Communication style
  • Industry knowledge
  • Neighborhood expertise
Principles of Buyer Agency
  • Disclosure, Confidentiality, Diligence

Home Buyers Guide

I created this free resource to help guide you through the entire process of buying a home, from financing, to making an offer, all the way to settlement. 

When You're Ready

Contact us to schedule a confidential consultation.

    02

    Get Pre-approved

    Determine What You Can Afford
    • Figure out how much cash you have for a down payment.
    • Find out your credit score and whether you need to take action to remediate.
    Calculate how much you’d be comfortable spending.
    • Consider your lifestyle and how this purchase may impact your monthly budget.
    Meet with a lender to discuss your options.
    • They will look at your credit, all accounts, income, and debt history to calculate what you can realistically afford.

    The Costs of Homeownership

    Buying a home is more than a down payment and figuring out the monthly mortgage. A range of out-of-pocket expenses can arise during and after the transaction, so be sure to discuss these with your lender and your agent

    to be prepared.
    Lender Fees
    • Loan Application; Credit Report ($15–30*)
    • Appraisal ($400–600*)
    Home Inspection
    • Home inspection ($400–800*);
    • Radon inspection ($100–250*);
    • Termite inspection ($50–100*);
    • Well & Septic inspection ($400–800*);
    Closing Costs
    • Rough estimate is about 3% of the sales price. This includes recordation taxes,
      title insurance, all lender fees and settlement charges.
    Moving Fees
    • Repair and Maintenance Costs
    * Numbers are a general estimation and may not be guaranteed.

    Mortgage Loan Types

    These are the three most common loan types when buying a home in Maryland. If you're buying an investment property, building a new home, or are interested in other loan products and assistance programs, we can help with those too!
    Conventional

    3 - 5
    % down

    • Typically 15–30 year fixed rate
    • Good credit
    • Proven steady income

    FHA

    3.5
    % down

    • Typically 30 year fixed rate
    • Lower credit scores
    • Homeowner occupant only
    • Stringent home inspection
    • May take longer to close
    VA

    0
    % down

    • Typically 30 year fixed rate
    • Veterans and spouses only
    • Homeowner occupant only
    • Home condition requirements
    • May take longer to close
    *These are general guidelines, and can vary in some cases. Ask your lender for more information about down payment requirements for your loan program.
    03

    Find Your Dream Home

    Why are you Buying a Home?
    Understanding your motivation for the move will help keep you focused on your priorities.
     
    • Understand home types and their pros and cons
 (Condos vs. Co-ops vs. Fee Simple)
    • Make a list of your must haves and deal breakers
    • Think about the type of neighborhood you see yourself in 

    • Anticipate how long you want to live in this home
    • Communicate with your agent about your needs
    • Be flexible and open to alternatives
    04

    Make an Offer & Negotiate

    Comparative Price Analysis
    • Your Realtor® will pull a list of all the homes that recently sold to give you a better idea of the market.
    Competition
    • Is this a “Hot Home,” is it under-priced, are there other offers? The amount of competition will determine how aggressively you want to structure your initial offer.
    Understanding the Contract
    • Make sure you speak with your agent about all terms of the contract and to understand deadlines, liabilities and clauses that allow you to terminate the
      agreement, etc.
    Earnest Money Deposit (EMD)
    • Decide how much you’re comfortable putting down as an act of good faith. Typically the deposit will be held in escrow by the title company and subtracted from your balance at the end of the transaction.
    • Depending on the jurisdiction, the EMD commonly ranges between 1–5% of the sales price.
    Negotiations
    • Once you have submitted the offer, the seller may reject, accept or counter
      your offer.
    • Be prepared to go back and forth until you reach a suitable agreement for both parties. When all terms are agreed upon, the offer is signed by both parties and officially ratified.
    • Negotiations are not necessarily over at ratification of the contract. They can
      also go on during the inspection and appraisal periods.

    Terms of the Offer

    Price is obviously an important factor, as it will determine how much the seller nets.
Work with your agent to figure out the value of the home and how much you’re
comfortable spending.

    Contingencies are terms that need to be met in order for the contract to go to closing. 
The more contingencies, the higher the risk for the seller. By waiving a contingency, 
you strengthen your offer. However, you may be risking your EMD, as the contract
may not protect you if such contingency is not met.

    Considering the length of each term is very important when submitting an offer. Every
day that a house is under contract, the home is essentially “off” the market. The seller is “taking a risk,” by waiting for each term to be met.

    There are certain risks that come with accepting an offer where a mortgage loan is being borrowed as opposed to a purchaser using cash with their proof of funds provided.

    Amount a seller is willing to credit back to a buyer to help with closing costs. Check with your lender for maximum % of sales price; asking for credit will often weaken the offer as it lowers the seller’s net sales price.

    In highly competitive situations, buyers will conduct a pre-inspection prior to submitting an offer, and waive this contingency. However, if you do request a home inspection, aim to schedule it within 7 days of ratification.

    Assessment of value conducted by the lender—usually conducted within 21 days of ratification. By waiving this contingency, you may be responsible for the difference between the appraised value and sales price, if the house is assessed at a lower value.

    If your offer is contingent on financing, the sooner you receive a commitment letter from the lender, the more confidence you can instill in the seller that the deal will reach closing.

    Under 30 days is ideal, but some loan programs take longer to close. The closing date 
is important, as this is when the seller receives the funds for the transfer of the deed.

    *Please note that the closing date is not necessarily the same as possession date. In some cases, sellers may want to rent back the property for a period of time. Most lenders will allow for a 60 day Maximum Rent Back Period.

    05

    Inspections & Appraisals

    Best Practices
    • Home inspections can be nerve wracking, but they are an important part of the process. There are many types of inspections depending on the location and home you are looking to purchase.
    Be Present
    • Take the time to attend the inspection so you can have a better sense of how the home works, see which areas will require maintenance, and assess whether you will need to consider home improvements down the line. Don’t be afraid to ask questions!
    Be Realistic
    • Expect to have a list of items from your inspector in a couple days. Don’t panic! Every home has a list of potential repairs, and most will be minor.
    Be Practical
    • Home inspections are another opportunity to negotiate. Speak with your agent about what items they recommend asking for repair. Focus on the items that matter the most. Keep in mind that the seller is not obligated to make all the requested repairs, unless required by a lender (FHA, HPAP, VA etc.).
    Assessing Value
    • This is the assessment of value on the home by a third party appraiser. It lets the lender know how much they will be able to lend for the home.
    1. Negotiate to bring price down to appraised value.
    2. Bring more money to settlement to make up the difference.
    3. Walk away, but you may lose your EMD.
    1. Congratulations, you have instant equity! Since the buyer pays for the appraisal, there is no reason to share this with the seller. Your agent will inform the other side that the appraisal met value and your lender will proceed to finalize the loan.
    06

    Settlement

    After you’ve completed your final walk through, it’s time to sign some papers!
     
    During settlement, the title attorney will go through your final settlement statement, line by line.
     
    The title company will be in charge of disbursing the funds to the seller and the
    bank (if they still owe a balance on their mortgage).
     
    Don’t forget your government-issued ID, cashier’s check or certified funds (if amount you owe isn’t wired to the title company prior to the settlement), and personal checkbook for any small last-minute expenses.
     
    Make sure you receive all copies of the keys.
     
    Once you’ve signed all the documents and the deed, you can officially call yourself the homeowner!

    Schedule a Consultation

    I look forward to speaking with you about buying a home!

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