STEP #4: The Agreement.

At this point, you and the seller have agreed on a sale price, and earnest money has been put into escrow. The lender will want to make certain that your offer and the seller’s acceptance comply with all agreements previously made. This helps to keep any surprises from arising later that could hinder the sale or loan.

STEP #5: The Price Is Right.

During this stage, the property will be appraised to make certain you’re paying a fair market price. Mortgage lenders have homes appraised to make sure you’re not overpaying, based on its market value. The appraisal compares your new home’s price against prices of other similar homes in your area.

STEP #6: Researching The Title.

Many times, the home you are buying has been owned by someone else. They had title to the property until they sold it and transferred the title to the new owner. This may have happened many times. Purchasing title insurance protects you and the lender against any claims that arise from arguments about legal ownership of the property from an outside party.

STEP #7: Protecting Your Purchase.

You will be required to purchase homeowner’s insurance that will go into effect upon transfer of the title. This insurance policy combines protection against damage to the house and its contents, or negligence or inappropriate action that results in injury or property damage.