You've found your dream home: Time to act quickly
There are things you can do to help make homeownership a reality. Learn more about what happens after you've found a potential home.
Whether it required months of research, or you fell in love at your first open house, it's time to act once you've found the right home. Here's how to position yourself for a winning offer.
Consider obtaining a mortgage prequalification or preapproval.
Ideally, you should do this before you look at your first home. Depending on your lender, you may be asked for information and documentation of your financial health to obtain a prequalification. This may include proof of income, bank balances, and investment statements. Be honest and accurate.
Sellers may worry about a buyer's ability to close the deal after their offer is accepted. A prequalification may help give the seller higher confidence in your offer. In a competitive situation, it could propel your offer to the top of the heap.
Put in an offer.
Your real estate agent should be able to guide you through an offer reflecting the comps — real estate lingo for the prices paid for comparable homes in your market. Of course, the offer should reflect your budget.
Consider how long the home has been on the market. You might stick a little closer to the asking price if it recently went up for sale. The seller might be inclined to entertain a lower offer if it's been available for months.
Your offer should have an expiration to produce some urgency. Depending on the situation, it could be measured in hours or weeks.
Consider including a letter with your home offer.
Sometimes offers are better received when they're accompanied by a letter. Explain how you arrived at your number, along with some personal information bringing you to life as a real person.
Share what you like about the home. Include details that may tug at the seller's heartstrings. This is a delicate balancing act: If you come across as too head-over-heels in love with the home, the seller could react with an aggressive counteroffer. Speak with your real estate agent for guidance.
Get your checkbook out.
Once you enter a purchase agreement it will need to be accompanied by an earnest-money deposit. Depending on the market, it could be 1% to 3% of the offer price, but sometimes less.
This money doesn't go to the seller. It's usually held by a title company, attorney or real estate broker. In some cases, it may be returned to you if the deal unravels. Please refer to your purchase agreement for more details. You may be required to pay a cancellation fee.
Schedule a home inspection.
After your offer is accepted, it's time to get an objective, third-party evaluation of the home to identify defects or problems. Your real estate agent may recommend an inspector, but be sure to ask about their price, experience and credentials.
Though a thorough inspection takes hours, you may want to schedule a time that you can show up. It's easier to understand the inspector's findings when you're looking at them together. This will give you an opportunity to ask questions about any concerns you have.
Keep in mind the inspector's job is to provide you with facts about the home's condition. It's not to tell you whether you should buy the home. Inspections can also help negotiate repairs. If major items come up on the inspection, you can counter with the seller to have them fixed prior to closing or to adjust your asking price or request concessions. Consider conducting specialized inspections for things such as pools, sprinkler systems, etc.
Keep your communication channels open.
To keep things moving, promptly return phone calls, texts and email. Pay attention to details when responding to information and other requests.
Be patient but persistent.
Shoot for just the right sense of urgency. Feel free to follow up with the team — real estate agent, lender, title company, inspector — to make sure things are progressing. Understand that each step will take time to complete and you're in a queue of other eager buyers.
Get your cash together.
Before closing, you'll need ample cash for your down payment and closing costs. That may require selling investments. Do this well in advance to make sure the money is available, and the bank doesn't put a hold on it while waiting for funds to clear. You'll also need to gather documentation on the sale of investments and other sources of closing funds.
The USAA Advice Center provides general advice, tools and resources to guide your journey. Content may mention products, features or services that USAA Federal Savings Bank does not offer. The information contained is provided for informational purposes only and is not intended to represent any endorsement, expressed or implied, by USAA or any affiliates. All information provided is subject to change without notice.
