The process for buying a home can vary somewhat depending on the real estate laws where you live, but many steps are standard and it’s good to be familiar with them before you get started. You'll feel more confident – and less anxious – about your home buying journey when you understand the order of events and what's required of you.
Caliber has streamlined the process to make it simpler and quicker, but it still requires several steps. Buying your home will not be an impulse buy and that’s a good thing. Going through the process with your Caliber Home Loans, Inc. ("Caliber") Loan Consultant leading the way, you’ll be guided into making mortgage financing decisions that result in purchasing the ideal home for you.
Are you ready? Here we go…
You should start out knowing exactly what your credit reports say about your financial history before you apply for a mortgage. These reports and your credit score play an important role in the loan approval process, but there are also ways to work around it if your credit isn’t stellar. This is an area where your Caliber loan consultant can be an invaluable source, advising you of loan options available for those with less-than-perfect credit.
You might uncover late payments and other mistakes you’ve made in the past. That’s also common; don’t let that prevent you from going forward. You can still most likely qualify for a mortgage.
Making a substantial payment to reduce a credit card balance can bring your credit score up pretty quickly, so pay as much as you can on your debts and don’t be late on any payments, including utility bills. If you’re going to have trouble paying a certain bill, call that creditor and discuss it. They may work out a new payment plan with you that will allow you to pay on time.*
*Caliber is not a credit counseling agency, credit repair organization, or similar service. We do not assist or advise consumers on how to improve their credit scores.
You also need to review your credit reports for mistakes because errors are not uncommon and this is the time to get any mistakes corrected. Correcting mistakes usually involves mailing letters and following up with the credit bureaus.
Addressing credit problems early in the process can bring your score up in time to help with the loan approval.
There are many types of mortgages and it’s a good idea to get familiar with them. You don’t need to learn everything there is to know about all of the different types and options, but learning the basics will help you ask the right questions and understand the process. A good place to start is to read Caliber’s Understanding Mortgage Types. You’ll also find more in-depth information about each type of loan on our website.
Now it’s time to meet with a Caliber Loan Consultant. They can guide you through the different loan programs that might work for you and advise you on which ones to consider. A good loan consultant is an important ally when it comes to successful home buying.
You and your Loan Consultant will look at your current and future income and any long-term debts you’re managing. Ordering a copy of your current credit report is also part of the process.
After reviewing your income, debts and credit score, your Loan Consultant will be able to approximate the amount of loan funds Caliber may provide. This step is called pre-qualification.*
A pre-qualification helps you prepare for homeownership in several ways. In addition to having a clearer view of the type of home you can afford, you’ll save time by limiting your house viewing to properties you can afford. And when you’re ready to make an offer, a home seller may appreciate the fact that you’ve already done your home financing homework, and are serious about buying.
Narrow down what you want or need before you start looking at houses, and differentiate between the two. You can live without the wants, but not so much without your needs.
Don't forget to consider the possibility of resale somewhere down the road. Gauge how likely it is that each property you look at will hold its value or appreciate.
A good real estate agent can help you discover neighborhoods and homes that you weren’t even aware of. An agent will also know if a property is overpriced and can advise you on what kind of offer to make.
Real estate agents represent buyers, sellers or both, and they can work as neutral facilitators for either party in some states. It's essential to understand your agent’s duties and loyalties, as well as your responsibilities to your agent.
Here’s the fun part – the shopping! You'll see lots of possibilities, but since you’ve done your work in the previous steps, you’ll have a more focused view of which homes are worth considering. In addition to looking with your real estate agent, you should look through listings online and take some drives through neighborhoods. These are excellent ways to see what's available and what the going prices are. If you find a home that’s been on the market for a long time, find out why. It could foreshadow a big problem – or it might be something that you can live with.
Deciding whether you want to buy a house involves taking a good, hard look at its structure and its features. If possible, talk to the neighbors to get firsthand opinions of the neighborhood.
There's no one set of instructions that can cover all the differences in real estate laws and customs that exist throughout the United States, so the mechanics of making an offer depend greatly on your location. Your agent should guide you on this.
When making an offer, consider what comes with the house, such as appliances or easements, and how long it’s been on the market. If it’s been available for a long time then the seller may be willing to accept less money.
After your offer is accepted, you should arrange for a home inspection to be done by an independent, professional, third-party inspector. The inspection will determine if there are issues with the property that need to be addressed.
An appraisal will likely be required as part of the loan and is done to ensure that the purchasing price of the home is in line with the home’s true value.
Closing is the event that transfers ownership of the property to you. Some common events during this period include dealing with title searches and insurance and doing a final walkthrough of the property to ensure that it's still in the same condition it was in the first time you saw it.
According to the National Association of Realtors, most home buyers see about 10 homes during a 10-week period before they’re ready to make an offer on one. And this is just one part of buying a home.
At Caliber Home Loans, we take pride in the fact that we can provide some of the quickest closing times in the industry. Caliber has been able to take advantage of the newest technology to create a faster, easier home loan process. By taking this high-tech approach, we’ve taken eligible borrowers from application to closing in record time – sometimes as little as 10 business days**.
**Some loan applications are not suited for digital delivery of asset, income, employment and other documentation required for loan approval. Processing and closing times vary depending on the nature and complexity of the transaction.
As you go through this process, if you encounter issues or don’t understand something, talk to your loan consultant or your real estate agent. Ask as many questions as necessary – they do this all the time and are there to advise you. Once you go through this process, step-by-step, you’ll be rewarded with your new home. Congratulations!
*A pre-qualification is not an approval of credit and does not signify that underwriting requirements have been met. Be sure to ask your Caliber professional where you are in the process, as any documentation you may receive will use different terminology.
© 2023 Caliber Home Loans, Inc. NMLS #15622
|*Closing cost offer available to customers who apply for a new purchase loan. Only available for single family primary residences and existing Caliber customers. Credit provided at closing. The offer is nontransferable and can only be used by the intended recipient. Advertised discount can only be applied toward payment of closing costs up to a total amount of $1,000 subject to product underwriting guidelines. Any portion of the discount amount not used toward closing costs will be waived.
|**A pre-approval does not signify that all underwriting requirements have been met. Actual terms, including interest rate, are subject to change without prior notice and may vary based on eligibility criteria. All products are subject to credit and property approval. Not all products are available in all states or for all dollar amounts. Please contact Caliber for additional details.
|***The lock will be honored up to 75 days total. Your rate is protected for up to 30 days to shop for a home. Once you identify a property, your rate will be locked for an additional 45 days. All rate lock extensions are subject to Caliber’s standard rate lock extension fees All rate lock extensions are subject to Caliber’s standard rate lock extension fees. Not available for all loan products. Please contact Caliber for additional details.
|****Caliber agrees to pay the borrower the amount of the earnest money deposit (up to $5,000) following the home loan closing, if the loan does not close on or before the contract closing date due to a delay caused by Caliber. Void if there are any material changes to income or assets. Offer requires 30 business days from Caliber’s receipt of purchase contract to closing date. Other requirements include: Minimum 700 credit score, owner occupied purchase transaction. LTV and property type restrictions may apply. Available only through the Caliber Retail Channel. Payment may be subject to reporting for tax purposes. Please contact Caliber for additional details.|