A Start to Finish Guide to Buying a New Home in the New Year: Part 3
We’re in the final stretch of buying a new home in the new year. Your finances are in order, you know what you want in a home, and now you’ve found a great new home in Shakopee MN. In this final part of the home-buying guide, we look at the art of making an offer, the closing process, and finally signing on the dotted line.
When the search is over, hopefully you’ve found a fantastic house that is within your budget and meets all of your needs and the majority of your wants. Now is the time to make an offer, but this requires a thoughtful approach. It is tempting to make a very low offer, but doing so can upset the seller and make the process more difficult. However, you don’t necessarily want to pay the full asking price, as many list prices include room to negotiate.
The best way to approach making an offer is by looking at the overall market and the specific house. In some markets, where homes sell extremely quickly due to limited supply, you may need to make an offer that matches the asking price or perhaps even goes higher, in order to ensure a chance of beating out other offers. In other markets, though, there may be a glut of homes for sale, which may give you some leeway. However, you also need to look at the neighborhood itself and the prices that similar homes have gone for recently. That will help you get an idea of where your offer should fall in relation to the list price. Of course, if the home has been on the market for a long time, you may be able to get it for a lower price, particularly if the seller is motivated. If the home has only recently gone on the market, the seller is more likely to want an offer closer to the list price.
Once an offer is accepted, it is time to draw up the contract and submit your mortgage application. Having received pre-approval will speed up the mortgage aspect of the deal. Make sure you read the contract carefully and fully understand all the clauses and contingencies. Contingencies are important because they provide ways for you to legally back out of the contract should there be major defects discovered in the home or should financing fall through.
This is also the time to have a home inspection done, which can cost $200-500, but is worth every penny, particularly with older homes. The home inspection can discover issues ranging from a roof that needs replacing to faulty foundations. Any issues that are discovered can be addressed, either by the seller repairing it before the closing or by dropping the price of the home, or, if they are too big, you can then withdraw your offer.
Once the home inspection is completed, you can make the final submission of your mortgage application. Now is the time to make sure you are prepared for the closing costs, which hopefully you’ve saved up for. Closing costs can include fees for attorneys, partial property taxes, and title insurance.
Before you finalize the sale with your signature, request one more walk-through of the home to make sure nothing significant has changed that shouldn’t have changed. You should also request copies of all of the paperwork you will be signing so that you know exactly what you’ll be signing. Don’t forget to have all the necessary funds for the closing in the proper account.
On the day of signing, you’ll need to bring along a photo ID, as well as all of the necessary paperwork, including insurance and inspection documents. You will have to sign a number of documents in multiple spots, but once all of the paperwork is signed, you will then be handed the keys to your brand new home in Shakopee MN