Step 1:  Contact Mike Smith

Step 2:  Pre-Qualify for the Best Financing

Step 3:  Search ALL Available Homes

Step 4: Let Mike Negotiate Your Offer

Step 5: Exercise 'Due Diligence'

Step 6: Close on Your Choice Home

               Keller Williams Partners Realty

               1307 Aeroplaza Dr

               Colorado Springs, CO 80916

               719-955-1971 (Office Phone)

               719-641-1957 (Cell Phone)

               mikesmithsells@kw.com

The goal of this step is to attain a "Blank Check" for the purchase of your new home.  To understand the significance of this step, it is important to discern the difference between "Pre-Qualification" & "Pre-Approval":

               

	Pre-Qualification	Pre-Approval
What does it mean?	Your lender will check your credit-worthiness & your debt-to-income ratio using your credit report.	Pre-Qualification checks PLUS the lender will verify your income & source of downpayment.
What will your lender need?	Your full name, 2 years of addresses, social security number, latest pay stub, & written permission to pull your credit report.	Pre-Qualification requirements PLUS 2 years of tax returns, 2 months of pay stubs, 2 months of bank statements, & borrower-specific information.
What level of certainty does it provide?	Not much.  Since many less-reputable lenders will provide a "pre-qual" letter based on empty information, many brokers are suspicious of pre-qual letters.  Your lender's specific reputation will determine the weight of this letter.	A pre-approval letter will be "conditional" upon a few specific requirements such as a completed appraisal, but is essentially a commitment by the lender to provide you with a specific amount of purchasing power.

For the same reason that Pre-Approval is important to the seller of your new home, it is important to me.  I will attach your Pre-Approval letter to the offer on your chosen home, which will add significant strength to our initial negotiation.

Once you are pre-approved for your financing & have decided on a price range for the home you want, it is time to take your pre-approved "blank check" & browse the home market.

There are essentially 3 considerations in searching for your home:
1. Price
2. Location
3. Features
 These are factors that you should think about before searching the market in order to focus your efforts.  Many times, you will find homes that meet 2 of the 3 but will have to compromise on the last.

For example, you may find a home in the school district that you desire (location) & under your price limit of $275,000 (price), however, it only has 4 bedrooms instead of 5 (features).

Search ALL available homes that meet your needs
The following links will take you to several different search buttons to: search the local MLS, foreclosed homes, government-owned homes, HUD Homes  & newly constructed homes; Do not settle for only MLS-listed homes - you may miss out on a great deal on that home that you are looking for!

Request showing appointments
 It’s time to see the neighborhood, the curb appeal of the home, & most importantly, the home itself.  Call me with the list of homes that you would like to see & I will make appointments to privately view the homes.  The more homes you see, the more seasoned that you will be to our home market & the more confidence you will have when you ultimately decide.

This is the fun part!

Once you have found that one house on the market that you would like to purchase, then your next step is to analyze the fair market value of the home & determine what would be the appropriate offering price.

The first step is to prepare a comparable market analysis (CMA).  The CMA will compare your chosen property to other similar properties in the neighborhood that have sold in the past 6 months.  With this comparative information, we can determine the fair market value of the home, which is often-time different than the seller's asking price.

I will typically recommend opening negotiations with an offer 2.0 - 2.5% below this fair market value with terms beneficial to the buyer.  This will give the seller the opportunity to counter the terms or the price, but usually not both, if they are interested in the offer.

Of course, every negotiation is different based on the seller's situation, the buyer's situation, market activity, & economic conditions; yet, my goal always remains the same:

To negotiate the best price with the best terms in the shortest amount of time in order to put the property under contract.

Step 5: Exercise 'Due Diligence'

Although your family will be very excited to have that perfect home under contract & scheduled to close, be careful not to let your enthusiasm override your good judgment.

Once you have a home under contract, you will have typically a 3-5 week contract period, or what I prefer to call a "Due Diligence Period." You probably have heard the expression "Caveat Emptor" which is Latin for "Buyer Beware." Even though Colorado law dictates that a seller of a home MUST disclose any material defects in their home known to them, it is your responsibility as a buyer to take the due diligence to verify the condition & discover any defects unknown to the seller.

Sound intimidating?

Well, it is if you try to do it on your own. I firmly recommend that all of my clients hire a professional home inspector to conduct a "foundation to chimney" inspection of their contracted home. A home inspection incurs a nominal cost; however, this cost is dwarfed by the potential expense of undetected problems discovered after the sale.

Specialized inspections can also be ordered, such as radon, termite, soil, roof, & many others. These should be commissioned if you have any concerns about these special areas of your home.

A home inspection does not guarantee that your home will be in perfect condition upon purchase; however, it will reduce your risk of buying somebody else's problem. In Colorado, a home inspector incurs very minor liability; so do not confuse a positive home inspection with any sort of guarantee. Thus, it is vitally important to choose a reputable home inspection company, to do your best to be present during the inspection. Besides your supervision, it is a remarkable way to learn a great deal about your new home!

You've made it!
You qualified financially, you found the perfect house, you took due diligence in inspecting the property & now finally you are here... at the closing table.

"Closing" is just what it sounds like: the finalization of the contract to buy & sell the home.  It is the culmination of our combined efforts to complete your goal of home-ownership.

At closing, several things happen simultaneously:

1. Your lender will deliver your loaned funds to you.
2. You will pay your lender the agreed-upon closing costs necessary to process & deliver the loan.
3. You will give the loan amount, plus your down payment, to the sellers for the agreed upon purchase price.
4. The seller will sign a deed that will transfer title to the property to you.
5. You will sign a promissory note with your lender to repay the loan under the agreed-upon repayment terms.
6. Your lender will record a "mortgage lien" against your property as collateral for the loan.
7. You will get the keys to your home!

I will be present to review all of your documents in order to ensure that they comply with the terms of the contract & to answer your questions throughout the course of the closing.  Congratulations & enjoy your new home!