I am new to this and I have been pursuing my leads using a realtor because I am not familiar with the process of purchasing a home on my own.
Is there a course, book, online resource, or a good article that describes the process from making an offer to obtaining the property?
For example, if I am to approach FSBO property and hand the current owner a contract, I know I need to deposit ernest money with a title company. But once the offer is accepted, I am not sure what I need to do up to the closing.
It depends. Most people make thier offers contingent upon, appraisal, inspection and financing. Before you make an offer you want to make sure that your financing is secure. After the offer is accepted you want to give the contact to your lender and have them order the appraisal. Inspection is generally an option left up to the buyer, but it is advised. If the appraisal and inspection are in order then you close as soon as your finances allow.
Try this site. It gives the nine generic steps to buying a property.
I am familiar with the contract process and I have my finances lined up.
So correct me if I am mistaken, here are the steps I would need to take:
- Write a contract with the required continguencies and submit it to the seller
- Offer is accepted
2.a. I would give my lender a copy of the contact to order the appraisal
2.b. Give Ernest money to my title company (how will the seller know this happened?)
2.c. Request from my title company to perform title search
- Find an insurance company
- Title company indicates title is clear and scheduled closing date? or who schedules it?
- Show up at closing date and pay the closing costs
Is that the process from beginning to end or am I missing something?
Before even thinking about investing you need to get your financing lined up. Get pre-approved. Then start the property search process as explained by Patrick;
Most people make thier offers contingent upon, appraisal, inspection and financing. Before you make an offer you want to make sure that your financing is secure. After the offer is accepted you want to give the contact to your lender and have them order the appraisal. Inspection is generally an option left up to the buyer, but it is advised. If the appraisal and inspection are in order then you close as soon as your finances allow.
Keith, that is a great link!
As I stated previously, I do have my financies in check. I went through the approval process not just pre-approval, I have savings, average credit score of over 760, no existing lones other than a $10k car loan, and over $100k salary.
To also clarify, I do have management experience where I do manage large projects in different industry and I have experience dealing with people and clients. I have managed multi million dollar projects and teams and i feel that is an asset I have when it comes to dealing with contractors and potential buyers and sellers.
I just would like to figure out the process of closing without going through an agent since I cannot find clear explanation anywhere.
sorry. You must have been posting your response when I was posting mine. Your explanation was not there yet. :-[
Anyway, who are you using for your financing? They will handle the process for you.
Take the Lender/Broker the signed purchase agreement and they will take care of the rest for you.
They will find funds, order title, etc.
Oft times the seller picks Title company
You will need to find Insurance Agent.
Wait for Bank to approve loan, title company will arrange closing time and place.
Ahhh thanks! That was the missing piece for me. Thanks for the explanation
In this state the process of doing a FSBO would be to make an offer with earnest money. As there’s no realtor involved you should probably get your attorney to draw up the offer. If you’re already pre-approved, you should check with the lender and see how much the closing attorney would charge to also represent you as the buyer. You sometimes save on attorney fees when there’s just a single attorney representing the bank and you although there’s some debate that there may be a slight conflict of interest there, but usually there isn’t on a simple sale.
The seller’s attorney can hold the deposit in their escrow account until the property closes. Once you’ve done the home inspection and everything is satisfactory, the seller’s and buyer’s attorney can work out a satisfactory P&S.
You then take the P&S to your lender and they do their thing. In certain areas of the country you may also be required to get a pest/termite inspection by the lender. Some home inspectors are qualified to give you the pest inspection form.
Oh can someone explain to me what a title company does in the rest of the country? Around here I don’t think they’re called that or do the same thing. Typically either the attorney or the realtor will hold deposit money in escrow.
From what I have seen in Texas, the title company holds the escrow deposit. From what I understand, they operate as the closing agent.