Buying a House: A 9 Step Guide

Buying a house isn't something people do very often, so it's good to review what's involved with someone who works in real estate every day. Realtors, home inspectors, title companies and real estate attorneys work with people moving through the process of buying a house every week.

This article written by real estate lawyer Charles Palmisano, helping home buyers and sellers in Newburyport, MA, offers a quick summary of the 9 steps involved in buying a house. We hope you find the guide helpful.

… Buying a House: A 9 Step Guide by Charles Palmisano

1. Buying a House: How Much Home Can You Afford?

You will want to start our with some preliminary calculations to see how much of a mortgage payment you can afford. This will help you quickly establish the price range in which you will be searching for that ideal home.

Tip: Don't forget to add taxes and insurance when calculating your monthly payment, which our mortgage calculator will help you do. 

2. Get Pre-Approved for a Loan

A pre-approval allows you to confidently present an offer to a seller when you find the right home. This may also provide you an advantage over other potential buyers who do not have a pre-approval in hand.

Tip: Even an experienced buyer of properties will look in the paper or go on the internet to find the “best rates. A common misconception is that the generic rates you see online or in the paper apply to everyone. These rates are most certainly dependent upon many factors, credit scores, income, type of property, location, employment and special programs.

3. Hire a Realtor When You're Buying a House

Having a Realtor assist you in your search will help simplify the exploration process and allow you more time to focus on those properties of interest. A Realtor has access to numerous resources related to property searches, neighborhood knowledge, and an understanding of local market conditions. You will benefit from their price guidance and experience in negotiations as well as navigating through the paperwork.

Tip: A good Realtor will hold a Seller accountable for not only the “real scoop” on the property but by insisting on “proper” negotiations.

4. Buying a House and Making an Offer

In Massachusetts it is customary to engage in a two-step process when negotiating to purchase a home. you will first submit an offer and then enter a purchase and sale agreement. An offer mainly includes the price you want to pay, the date of the closing, the time frame for an inspection, and obtaining a mortgage. You will leave a small deposit which represents your “good faith” interest in the property.

Tip: The terms included in an offer carry over to the final purchase and sale agreement – so be sure to keep this in mind when including items such as whether you want the window treatments to remain or be removed.

5. Get a Home Inspection When Buying a House

This is where you have the opportunity to determine whether the property meets your expectations. If it does, then you go right to the next step of negotiating the purchase and sale agreement. If it does not, then you and your agent will begin negotiations with the seller for concessions that may resolve your inspection concerns or you may choose to remove yourself from the deal altogether.

Tip: By hiring a good home inspector you can shift the burden of matters needing to be fixed on the property to the seller prior to your purchasing the home.

6. Buying a House Involves Hiring a Real Estate Lawyer

You will be asked to sign legally binding documents presented by various parties involved in the process. A properly negotiated contract will keep your obligations balanced with that of the Seller and effectively protect you and your deposit. A seasoned professional will use their experience and legal expertise to help you sail through the legal component of the process.

Tip: Make sure you pick a lawyer who specializes in real estate and is very familiar with the town where your new home is located.

7. Signing Purchase and Sales Agreement

This is the agreement between the buyer and seller that is negotiated for the purchase of the home after the offer is accepted. This agreement contains the basic terms and conditions of the original offer and a host of additional clauses customarily used in a real estate contract. Once the terms of the purchase and sale have been fully agreed upon, as the Buyer you will place the remaining portion of the deposit for the property with the escrow agent.

Tip: Legal counsel will add clauses commonly used to protect the interests of the Buyer.

8. Buying a House: The Closing

This is where you, your realtor, the seller and the lender's representative meet so that the Seller can provide you with a Deed and where the lender will require you to sign several documents to obtain your mortgage. You will be required to bring any remaining funds due to closing. 

Tip: When scheduling your move based on the closing date, anticipate that the closing date “could” change. Be prepared for this possibility.

9. Buying a House and Moving Into Your New Home

After signing the closing documents there will be a lot of congratulations and the keys to your new home will be given to you.

Tip: Arrange for the electricity and other utilities to be transferred into your name to take effect on the day of the closing.