Buying a home – whether it’s your first home or fifth – is never a cakewalk. The process is rife with complexities, high-stakes negotiations, sizable money transfers and tight timelines. Cutting through all the noise to receive concise, actionable advice can feel like searching for a needle in a haystack.
Certainly, finding the right representation helps (more on that below). But before you start working with a real estate professional, it’s best practice to bone up on the basics of home buying. In this pocket-sized guide, let’s review the major steps in the home-buying process, from pre-qualification to closing.
Mortgage Pre-Qualification and Pre-Approval
If this is your first time buying a home, you will likely begin with pre-qualification and pre-approval. It’s worth noting: These are not the same thing.
Pre-qualification is a relatively casual process. You (the borrower) answer a series of questions established by the bank or private mortgage company (the lender) to assess your general qualification as a borrower. Since information is user-submitted, it tends to be viewed as untrustworthy in negotiations. Pre-qualification is more for illustrative purposes – to give you a sense of how much you can borrow, if at all.
Pre-Approval is the next step, and it’s decidedly more intensive. For pre-approval, you will submit several verifiable documents to the lender (bank statements, employment letters, tax returns, etc.). In return, the bank tells you how much you can borrow and locks in an interest rate that’s good for a few months. Pre-approval is essential as you get serious about making bids.
Finding a Real Estate Agent
Traditionally, finding a real estate agent was like playing darts in the dark – you had to hope you hit a bullseye. Thankfully, real estate technology has streamlined the search process.
Head over to Nobul, a real estate digital marketplace where you can enter your criteria for a realtor (minimum verified review rating, transaction history, etc.) and view your options. Nobul’s proprietary algorithm will send you a shortlist of ideal realtors for your lifestyle and criteria, allowing you to make an informed decision.
“I want to help the millions of people who buy and sell real estate across North America have a good experience and not feel like they’re being ripped off,” says Nobul CEO Regan McGee. “I want them to feel like they have an outstanding partner in the biggest transaction of their lives.” And we want the same.
Searching Listings and Attending Viewings
You can stay on Nobul throughout the home search process, as the platform offers curated listings and an IM platform for booking viewings with your realtor. Or, you and your real estate agent can strike off on your own path.
As you search listings, take care to evaluate every bit of data available: the age, previous history, original list price (if applicable), neighborhood statistics, taxes, strata fees, potential liens, etc. Regard this information holistically to make a rounded, informed decision. And as you attend viewings (whether virtual or in-person), carry a notebook or notes app to flag any pros or cons that surface as you tour the property.
Making Offers and Closing
Here’s where the advice of an online article reaches its natural limit. No one can give you a one-size-fits-all recommendation for making offers. Your offers are ultimately contingent on a) your risk tolerance, b) your confidence in achieving financing, and c) your desire to outbid competitors. Talk to your real estate agent about the risks/rewards of subject removals, bully offers and other competitive tactics.
Once successful in your bid, you can turn your sights to closing. You will need a lawyer or notary public to execute agreements and hold your deposit in escrow. And you may want a home inspector to inspect the property (if you’ve included a subject to home inspection).
Once you break it down like that, it doesn’t sound so scary. Yes, buying a home involves a lot of little steps and hurdles, but you have ample support along the way. Use a real estate digital marketplace, lean on your real estate agent for help, and surround yourself with trustworthy third parties. You’ve got this!
