Homebuying 101
First off, this information will probably spark more questions than it answers, and that’s totally fine! It’ll give you a solid understanding of the process. After you review it, reach out via call, text, or email with any questions. Let’s chat and get you closer to finding your new home!
1. Find a lender.
Let’s be real: there’s no sense in falling for a home you can’t afford. Start with getting pre-approved—that’s essential before you can make an offer! I highly recommend James Komro (503.680.4784), Faith Watkins (503.997.1964), John Werner (503.550.8842), and Ramona Martine (503649.9566). You'll want to have two years of W2 and 30 days of pay stubs (if you're self-employed your last two years of tax statements), two years of rent or mortgage payments, the name and address of your employer and a two-year employment history, and three months of bank statements for all accounts.
1a. How much do you need to have up front?
You don’t always need a 20% down payment! FHA loans can be as low as 3%, and there are even zero down programs out there. You do need to budget for "closing costs," though - things like loan origination fees, title reports, and insurance. We'll get an accurate number from your lender. You may also need to have available funds to pay my commission; my baseline is 2.75% but this is negotiable and can also be requested as a concession from the seller.
Once your offer is accepted, you’ll need liquid funds for earnest money (a percentage of your down payment, paid up front) and inspections, which typically run under $3k.
2. Start looking at properties that fit your criteria.
This is where the fun begins! I’ll set you up with a search on the local Multiple Listing Service and send you listings that match your needs. Remember, your wants might evolve as you explore, and that’s totally okay! Just keep me in the loop so we can find the perfect place for you.
2a. Buyer Broker Agreement
Just as I have a contract with sellers to limit the number of agents, I’ll sign an exclusive agreement with you. This contract outlines our partnership and how I’m compensated. It’s all about making sure we’re on the same page!
3. Found something you love? Write an offer!
The process takes about an hour, and I’ll walk you through each section of the contract at your pace. If you’d like to review it in advance, just let me know, and I’ll send you a copy. When I submit the offer, I’ll include your lender so they can provide the approval letter.
4. Wait for a response.
This part feels really uncomfortable. I promise I’ll let you know within an hour or two after getting the response—unless it’s after 9 PM, then you’ll have to wait until morning.
5. Negotiate as needed.
This part can be scary but guiding everyone into a win/win is one of my superpowers. There’s something satisfying about crafting solutions that everyone can celebrate!
6. We have mutual acceptance! Hurrah! Now what again??
- You: write your earnest money check and deliver to escrow within 3 business days.
- Me: schedule inspections to be completed withing 10 business days (calendar days if we're in Washington).
- Regarding inspections: I always recommend general, sewer scope, and radon; you may add as you like/want to pay for. I strongly recommend you review the Oregon Buyer Advisory regarding inspections.
7. Negotiation round two, based on repair needs.
It’s important to clarify what the seller will cover, what you’re responsible for, and what’s negotiable. Ideally, you want the seller to either fix the issues or provide a credit at closing, rather than reducing the purchase price. A price reduction doesn’t leave you with enough funds to handle the necessary work.
8. Next up: appraisal.
Your lender will handle this, and it’ll take about a week. Wait for the appraisal to come back at or above value before giving your notice. If the appraisal is low, you could end up without a place to go!
9. Wait. Wait wait wait.
This is the bank’s underwriting phase, so there’s not much we can do. Focus on packing, call your utilities to schedule the name change, and avoid any spending that could impact your credit score!
10. Signing documents!
We’ll get a call from the bank saying "docs are at title." That means it’s time to sign a stack of papers about an inch or two high—plan for about an hour. I’ll be there for moral support! Bring your ID and a cashier’s check or wire transfer paperwork for your closing costs; given the fraud out there, I recommend the cashier’s check. This will probably happen one or two days before closing.
11. CLOSE, which means YOU GET YOUR KEYS!!
