Are you looking to buy a home in Bergen County?  If so you will want to review our 12 Steps to Buying a House in Bergen County.  We will cover the main steps to buying a home including attorney review, inspection, mortgage application, appraisal, and more.  If you have any questions about Bergen County Real Estate or buying a home contact us today for a free consultation at 201-685-4788.

Buying a Home in Bergen County

Agree to a Contract with Seller

Step one is getting an agreed-upon contract, it’s finding the house that you want, negotiating with the seller and actually getting a signed contract. It’s about a 14 page document that’s put together by the purchaser’s real estate agent and it is signed by both sides.

Attorney Review

It enters us into step 2, which is attorney review. In the northern part of the state of New Jersey we use attorneys during the buying process. Each side will hire a real estate attorney. It’s very important to hire a real estate attorney not a divorce attorney not a criminal attorney, someone who does this every day.

Those attorneys are going to send back what’s called riders. It’s basically addendums to the contract. They never like all of the wording in the contract. They’re going to make changes that they see fit to protect their clients. Once those riders are agreed upon by both sides they are signed and then we are under contract.

Under Contract

At this point you’re basically committed to purchasing the property unless you don’t get a mortgage unless there are major inspection issues unless the house doesn’t appraise for what you’re purchasing for. You’re basically committed to moving forward and purchasing this house much as the seller is committed to selling it to you.

So when we’re under contract there are a few steps that are going to happen. This process will it basically extend from the day that you are under contract all the way until closing. Hopefully there are no issues during this time and you’re able to actually get to the closing table. Now we’re going go through what steps are going to happen while you’re under contract.

Inspection

The next step in the buying process is having an inspection done of the property. You’re going to hire a licensed inspector who’s going to go through the house and look through the major systems, heating, plumbing, electric. He’s going to look at the foundation, the roof, the overall condition of the home to give you a good understanding of what you’re purchasing.

As the inspector goes through the home you’re going to want to go through and ask questions because it’s also a great opportunity to learn about what you will need to do to maintain your home properly especially if you’re a first-time buyer. Go through ask a lot of question that is what they’re there for to give you information on being a homeowner and give you the overall condition of the home.

Mortgage Application

The next step in the process is sitting down and filling out your formal mortgage application. When you first got your pre-approval the bank did ask for information. They might have asked for tax returns, credit report, bank statements. They might have asked for that information but now it’s a lot more in-depth. They really want to get into your overall financial situation to understand if you are creditworthy and if you are able to get this loan and more importantly to actually make the payments.

You’re going to sit down with your lender go over all of this. In a few days you’re going to get a good faith estimate of what you’re going to need to close. That amount that you’re going to need to bring to the closing table, what your payment is going to be and what all of the fees from the lender are going to be. So it’s a very important step to get through to purchasing a home.

Appraisal

After we have the mortgage application complete your lender will order an appraisal. An appraisal, the intent of an appraisal is to let the bank know that you’re paying fair market value for the home. They will send an appraiser to the home. They’re going to take measurements and pictures and look at the general condition of the home and then they’re going to compare those measurements and that information to comparable homes that have sold in your neighborhood in the last three to six months. So the bank knows that you’re paying the right price for the home and God forbid that you were to be foreclosed on or whatever the bank will be able to sell that home and get their money back.

Inspection Issues

After your inspection is complete you’re going to get your inspection report. And you’re going to have to deal with inspection issues that may have arisen from that inspection. So what you’re going to get is a very detailed report that will go over all of the findings that the inspector found. Now some of those things are going to be minor drainage things and minor crack or things that you’re going to want to take care of in the home. But some of those things could be major they could change the value of the home. That could be things that need to be addressed before moving forward to the transaction.

If these things do arise and you do find that there are things that need to be addressed you’ll talk to your real estate agent and your attorney to determine what needs to be addressed. Your attorney will send a letter to the sellers addressing the things that you want to take care of.

You have a few options to request. You can ask for repairs to be done, you can ask for a credit at closing to cover those costs so you can do the work after closing, you can ask for a price reduction or if it really is bad you can walk away from the transaction. Those are your options in dealing with inspection issues.

Mortgage Commitment

Now we’ve got all of the paperwork in, we’ve done our inspection, we’ve gotten past our inspection reports and all of those issues and now it’s time to get your mortgage commitment. So the bank has looked through all of your documents and it’s deemed you credit worthy and able to purchase the home.

Now there may be a few qualifications on there that they want you to handle. They might want to get a new bank statement. They may want to just reconfirm your employment, a few minor things that do occasionally come up on those mortgage commitments. But if you’ve gotten your mortgage commitment congratulations you’re just about at the goal line!

Closing Documents

After you get your mortgage commitment and it’s about three days prior to closing you’re going to get your closing disclosure. And what this is is it lays out everything, all of the fees and all of the numbers associated with the transaction. You’re your final offer price, taxes that might be due back to the seller or to you, all the numbers that go in, all of the fees are all laid out so you can understand what is going into the purchase of this home.

It will also tell you exactly the number that you need to bring to closing to finish your down payment. So if there are any issues at this point you will have about three days until closing so look over the numbers make sure that they’re right. If there are any issues talk to your lender talk to your attorney and make sure they’re right and make sure you understand them before you get to the closing table.

Final Walk through

Now it’s closing day. The last step that we want to do before a closing day is a final walkthrough. Typically it’s done the morning of the closing or the night before because we want to make sure that the sellers are out and have cleaned the property.

The intent of a final walkthrough is to make sure that the property is in the same condition that it was at inspection. If anything worked at inspection it should work on final walkthrough. If there were any issues that you asked to be addressed and were agreed upon then those things should be fixed at the final walkthrough.

Go through make sure the heat works, the air condition and the lights. All of the things that should be working in the house should be working at the final walkthrough. So go through with your realtor take a look around make sure everything looks right. And you’re just about ready to close.

Closing

Now you’ve gotten through everything else and its closing day there’s still unfortunately a lot of work to do. There’s a stack of papers that you’re going to need to be signing. From closing documents to your actual mortgage to lots of disclaimers and lots of forms basically that the lawyers put together to cover everyone.

So there’s going to be a stack of papers, it’s all going to depend on the particular lender how thick that packet of information is. But your lawyer and your title company will be there to go over everything if you have any questions. Feel free to ask now before you sign but after you sign all the paperwork. Information will be sent to the lender and the funds will be cleared to disperse. At that point you’ve closed, you get the keys, and the house is yours. Congratulations!

Move into your New Home

The only last step to do is to actually get to the house and start moving in. And this the happiest part of the transaction. So those are our 12 steps to purchasing a home.

I hope you enjoyed this Cliff Notes version of how these things work. Obviously it’s never an exact perfect science to get from a contract to actually moving into your home. There are different things that happen along the way. That is why you want to have an experienced real estate professional in your corner working on your behalf that’s been through this and will get you from accepted contract to moving into that home.