How to Buy a Home with Mario Cottman
How to Buy a Home with Mario Cottman
Buying a home is a major milestone, and I’m here to guide you through every step, making the process as smooth and stress-free as possible. Below is a step-by-step guide to help you understand the process and how I will assist you before, during, and after closing.
Step 1: Financial Preparation
Before you start shopping for a home, it’s crucial to get your finances in order. If this is your first time searching for a home, this blog could be informative found HERE.
Saving for a Down Payment
The down payment is a large, one-time payment toward your home purchase. While a 20% down payment is often recommended, many loan programs allow much lower amounts:
- Conventional Loans – As low as 3% down.
- FHA Loans – Require at least 3.5% down.
- VA Loans – No down payment is required (for eligible military members and veterans).
- USDA Loans – No down payment is required (for qualifying rural homebuyers).
💡 How I’ll Help:
- Connect you with lenders to explore all loan options and down payment assistance programs.
- Help you determine a realistic budget based on your financial situation.
Closing Costs
In addition to the down payment, you need to save for closing costs, which typically range from 2-5% of the purchase price. These cover lender fees, title insurance, appraisal costs, and more.
💡 How I’ll Help:
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- Estimate your closing costs upfront, so there are no surprises.
- Negotiate seller concessions that can reduce your out-of-pocket expenses.
Debt-to-Income Ratio (DTI)
Your DTI is a key factor lenders consider when approving a mortgage. It’s calculated as:
📌 DTI = (Monthly Debt Payments ÷ Gross Monthly Income) x 100
Most lenders prefer a DTI below 50% for mortgage approval.
💡 How I’ll Help:
- Review your DTI and suggest ways to improve it before applying for a mortgage.
- Connect you with financial professionals who can help you lower your debt if needed.
Credit Score & Mortgage Approval
Your credit score directly impacts your ability to qualify for a loan and the interest rate you receive:
📊 Minimum Credit Scores for Loan Types:
- Conventional Loans: 620+
- FHA Loans: 580+ (or as low as 500 with a 10% down payment)
- VA & USDA Loans: No strict minimum, but typically 620+
💡 How I’ll Help:
- Guide you in improving your credit score before applying for a mortgage.
- Refer you to credit specialists if needed.
Step 2: Understanding the Market & Starting Your Search
Before you start visiting homes, you need to define your wants and needs.
📌 What to Consider:
- Price range – What can you afford based on your pre-approval?
- Home size – How many bedrooms/bathrooms do you need?
- Location – Proximity to work, schools, amenities?
- Home condition – Move-in ready or fixer-upper?
- Additional features – Garage, backyard, pool, etc.
💡 How I’ll Help:
- Provide a detailed market analysis of home prices in your preferred areas.
- Set up automated home searches so you receive alerts for new listings.
- Arrange private showings and attend open houses with you.
Step 3: Getting Pre-Approved & Shopping for Homes
A pre-approval letter from a lender shows sellers you are a serious buyer and gives you a clear budget.
✅ Required Documents for Pre-Approval:
- Recent pay stubs (for W-2 employees)
- Last two years of tax returns (for self-employed buyers)
- Bank statements
- Credit report review
💡 How I’ll Help:
- Recommend reputable lenders and mortgage brokers.
- Help you gather the necessary paperwork for pre-approval.
Once you are pre-approved, I’ll begin scheduling home tours based on your needs and preferences.
📌 Key Factors to Evaluate When Touring Homes:
- Property condition and potential repairs
- Neighborhood safety and amenities
- Property taxes and HOA fees
Step 4: Making an Offer
Once you find a home you love, I will guide you through the offer process to ensure you get the best deal.
✅ What’s Included in an Offer?
- Purchase price – How much you’re willing to pay.
- Earnest money deposit – Typically 1-2% of the price, showing your commitment.
- Contingencies – Conditions that must be met (e.g., home inspection, financing).
💡 How I’ll Help:
- Research comparable sales to determine a competitive offer price.
- Handle all negotiations with the seller’s agent.
- Ensure the offer protects your interests.
Step 5: Escrow & Due Diligence
The home enters escrow once your offer is accepted, which usually lasts 30-45 days.
Home Inspection
A home inspection uncovers potential issues. Common findings include:
- Roofing or foundation problems
- Electrical or plumbing issues
- HVAC system concerns
💡 How I’ll Help:
- Recommend trusted inspectors.
- Negotiate repairs or credits based on inspection results.
Home Appraisal
Lenders require an appraisal to determine the home’s market value. If the appraisal comes in lower than the offer price:
- Renegotiate with the seller.
- Make up the difference in cash (if possible).
💡 How I’ll Help:
- Challenge a low appraisal if necessary.
- Advise you on whether to renegotiate or walk away.
Step 6: Closing on Your Home
🏡 Final Steps Before Closing:
- Final Walkthrough – Ensure agreed-upon repairs were completed.
- Signing Closing Documents – Takes place at the title company.
- Receiving Your Keys – Once funds are transferred, the home is yours!
💡 How I’ll Help:
- Guide you through the closing paperwork.
- Make sure all contract terms are met before finalizing the sale.
After Closing – My Ongoing Support
Even after you move in, I will remain your trusted real estate advisor.
📌 Post-Closing Services:
- Home Maintenance Tips – Seasonal checklists for upkeep.
- Contractor & Service Recommendations – Plumbers, electricians, landscapers, etc.
- Property Value Updates – So you know when it’s time to refinance or sell.
Find Your Dream Home!
I’m committed to making your home-buying experience as smooth as possible. Let’s start the journey today! Get started HERE
📞 Mario Cottman
🏡 Realtor, Call It Closed Realty
📍 Serving the DFW Area
📧 move@mariocottman.com | 📱 214-554-7743
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