Buying a home is one of life's most important investments and exciting adventures. Even experienced buyers, however, can find this complex process a bit overwhelming. In addition to the crucial step of locating and presenting properties that match your search criteria, we can help you along the path between "I want this house!" and "I own this house!"

You should start your search by determining your price range, and how much can you afford. While lenders use different formulas for arriving at this figure, a general rule of thumb is that you should plan to spend no more than 28% of your gross monthly income on housing costs (including principal, interest, taxes and insurance), and no more than 38% on combined total monthly house and other long-term debt payments. However, each person's financial picture is unique.

Understanding the Asking Price

Many factors influence the price that a seller expects to get for their home, but only you can decide how much you feel comfortable offering for a property. Some factors that may influence price include:

• How long the home has been on the market.
• Whether the price has been reduced and by how much.
• The prices for other comparable homes in the area.
• If there are multiple offers.
• Other items that might be included in the sale - furniture, hot tub, etc.
• The "list to sale price ratio," – a comparison of asking to selling prices that  indicates how competitive the market is for homes in this area.
• Why the seller is selling.

Getting Your Mortgage Application Started

Being pre-approved by a lender can put you in a much stronger negotiating position because it shows the seller that you are a committed buyer, financially capable of purchasing the property and more likely to close on the property. Pre-approval is different from pre-qualification, which is merely an estimate of what you may be able to afford. Pre-approval occurs when the lender has reviewed your credit and believes that you can finance a home up to a specific amount. However, neither pre-approval nor pre-qualification represents or implies a commitment on the part of a lender to actually fund a loan. We put you in touch with lenders who have worked well with our other clients and help guide you through the process.

Negotiating the Offer and the Contract

We will help you determine whether you should make your offer subject to certain terms or contingencies, including securing of financing or perhaps the sale of your current home. We will work with you to make the contract subject to various inspections by both you and professional inspectors. Most contracts include some standard provisions, such as property taxes, insurance costs, utility bills, and special assessments, which will be prorated between buyer and seller.

Inspections

Real estate contracts sometimes contain contingency clauses that allow buyers to inspect the property. Certain inspections are required by lenders and others are a matter of observation and what is particular to a region or area. Which party pays for these inspections is negotiable. The two most common types of inspection are:

• Wood Destroying Pest and Organisms (Termite) Inspection
• General House Inspection

Title Search Process

A title search spells out who has the right of ownership for a property. It is considered "clear" if there are no claims or liens against it. In order to make sure nothing will prevent transfer of the property to you, a title company will conduct a title search and prepare a preliminary title report that indicates what recorded matters affect the title to the property and if the title insurance company is willing to insure the title. At the close of escrow, the title company will issue an Owner's Policy of Title Insurance to protect you against losses that might arise from covered claims on the title.