Learn Each Step to the Home Buying Process in Kansas City
We know that buying a home in Kansas City has many questions, so we are here to help you with your home purchase. Whether you are a first-time homebuyer or an experienced homeowner, purchasing a home can be stressful.
Choosing the right Kansas City Mortgage Lenders can take the stress off your shoulders by communicating at each milestone and close on time without the hassle.
Our experience and expertise in the industry qualify us to assist you in finding the home loan financing that is best for your specific needs. Take a look at the different home purchase loan options, and contact us at any time when you want to discuss purchasing your next home.
Check out our First-time Home Buyer Guide
Step 1: Kansas City Mortgage Pre-approval
Obtaining a pre-approval letter is the first step before purchasing a Kansas City home. We never charge a fee to get pre-approved for a mortgage loan. Learn everything you need to know about obtaining a Kansas City mortgage pre-approval.
This is an excellent time to review the Do’s and Dont’s and start your mortgage pre-approval letter. A pre-approval letter can take one to two business days to prepare, once all items have been received.
Step 2: Buying a Home
Once you are pre-approved and ready to buy a house, it’s time to search for real estate professionals. You want to find a real estate agent that can navigate you through the housing market. We work with hundreds of top real estate agents in Kansas City and can provide you with a list upon request.
Once you have chosen an experienced real estate agent, you are ready to start your home search. The agent will draw up the offer and submit it to the Seller.
Typically, an earnest money deposit is required at this time to show that you’re serious about wanting to buy a home. The earnest money deposit is usually about 1% of the sales price.
The Seller might counteroffer, so expect to negotiate until you reach a final purchase price. You have a legal contract as soon as both parties accept the written offer and counteroffers. Now it’s time to get started on your loan application and notify your Loan Officer.
You will be sent a loan application package and a request for documents needed for processing. It is in your best interest to provide copies promptly.
Step 3: Home Inspection
Metropolitan Mortgage encourages every buyer to get a Kansas City home inspection. The home inspector is usually hired immediately after the contract has been signed. It would be best if you didn’t become too attached to a house until you’ve had it inspected by a certified professional.
An inspector is sometimes confused with a real estate appraiser, who determines a structure’s condition, whereas an appraiser determines the value of a property. Only through the home inspection will you discover if the home requires minor or major repairs.
Any work required for the foundation, heating and cooling system, plumbing, or electrical systems, could prove costly. This upfront information can give you some negotiating power or an acceptable reason to back out of the deal.
Once inspections are complete, your Real estate agent will submit a list of items that you want to be addressed (Resolution of Unacceptable Conditions) to the Seller. Please let us know once you and the Seller have agreed so we can order the Appraisal Report.
Step 4: Homeowners Insurance
Now it’s time to shop for homeowner’s insurance coverage on your dream home. Once you have chosen the insurance company, we will need your agent’s name and number, and we will need to provide them with our loan number and loss payee information.
Step 5: Home Appraisal
Once you have completed the Home Inspection and feel confident to proceed, you or your Realtor® can request that we order the appraisal report. Metropolitan Mortgage will place the order for your home appraisal and charge the credit card provided at this time.
An appraisal provides you and Metropolitan Mortgage with the fair market value of the Kansas City home. The appraiser will schedule an appointment with the Listing Realtor® to inspect the house.
The appraiser will obtain information on similar homes in the Kansas City area sold within the last six to twelve months to determine the market value.
The appraisal primarily documents obvious visual conditions, along with a cost and size comparison to other homes. You should receive your appraisal report email within 5 to 10 business days.
Step 6: Mortgage Underwriting
This is the final step in the loan approval process. Kansas City lenders use mortgage underwriting to determine if the risk involved in offering a mortgage loan to home buyers is acceptable.
Once the loan processor submits the file for underwriting, the underwriter will review your income, assets, debt, appraisal, and credit to ensure your loan fits the lending guidelines. The underwriting process typically takes between two to five business days.
Once the underwriter reviews the loan, a conditional pre-approval is issued. Conditions are additional documents the underwriter must review and approve before publishing the final approval.
Once all conditions have been satisfied, the underwriter will issue the final approval, and you are ready to close.
Step 7: Closing Process
Metropolitan Mortgage will answer your questions, stay involved and guide you through the loan process to closing.
You will receive and must acknowledge receipt of the Closing Disclosure (CD) at least three (3) business days before closing can occur. The CD lays out the terms of the loan, including an itemized list of fees associated with the closing.
Tell us if you believe there are mistakes and ask about anything you don’t understand.
The Loan Closing
The “closing” is the last step in the home buying process. The “closing,” also called “settlement,” is when you and all the other parties in a mortgage loan transaction sign the necessary documents.
What You Will Need to Bring
Everyone on the Kansas City property title must attend the closing and bring a government-issued identification card with a photo.
Please bring a certified or cashier’s check made out to the title company to cover the remaining amount due (i.e., down payment, closing costs), as reflected on your final Closing Disclosure (CD).
Learn about Buying a Home
Buying a Home FAQ
How much money should I save before buying a house?
If you’re getting a mortgage, an intelligent way to buy a house is to save up at least 5% of the sale price. This amount will cover the down payment and closing costs only. Keep in mind that you would also need funds for moving expenses. So if you buy a home for $300,000, you would pay about $15,000.
Can I afford to buy a house in Kansas City?
To calculate ‘how much house can I afford,’ a good rule of thumb is using 43% of your gross income. This debt-to-income ratio covers the total allowable debts, including your new mortgage payment, credit cards, auto, and student loans.
Is buying a house always worth it?
According to the Federal Reserve’s 2020 Survey of Consumer Finances, homeowners have a net worth that is more than 40 times greater than their renter counterparts. As a homeowner, your payment can remain fixed while gaining a deduction for property taxes and appreciation. Whereby renters can expect rent increases over time.
How do I buy a house with no money?
How to buy a house with no money down:
- Apply for a zero-down VA loan or USDA loan.
- Ask for a down payment gift from a family member.
- Get the lender to pay your closing costs (“lender credits”)
- Get the Seller to pay your closing costs (“seller concessions”)
Is it hard to buy a home for the first time?
An experienced Loan Officer and Realtor navigating the process will help make a smooth transaction. If you need help finding a professional, ethical Realtor, please let us know,
Who qualifies as a first-time homebuyer?
To qualify as a first home buyer, you must not have owned a home in the last three years and must occupy the home you are purchasing as your primary residence. Additionally, you may need to take an online homeownership education course.