The Home Buying Process:The Paper Trail

The home buying process is not simple; it involves a maze of legal work, negotiations, dealing with various professionals, finding a good mortgage deal and worrying about it falling through, as well as actually hunting down your ideal home. This whole process is enough to drive somebody crazy!

A notable characteristic of the home-buying process is the number of papers that you have to go through and sign. The paperwork never seems to end, to the point that you can be forgiven for getting the suspicion that you're simply signing papers to prove that you have signed the previous ones! While some people might thing that this paper trail is amusing, others might get exasperated and possibly give up in the process. However, once you know what to expect in the home-buying process, you will be in a position to handle the stresses in a better way.

So, what kind of paperwork can you expect to deal with when you decide to buy your own house?

The paper trail starts right at the beginning of the home-buing process, and will go on to the end, 15 or 30 years later, when you finally complete your mortgage payments and are given total ownership of the house. There will be paperwork required in order to find out about your credit history and get your finances in order even before you begin hunting for your ideal house. There is also paperwork involved when applying for a loan pre-approval, and even more when you actually get around to making an offer on a house. Once you've made an offer on your home, you'll need to fill out papers for appraisers and inspectors, and you'll get quite a bit of paper in return. By the time you get to the closing, you will have gone through a fair share of papers.

Closing is the point at which the actual ownership of the home changes hands. This is for most people the most exciting part of the hom-buying process. The bad news is that it takes about two hours at the minimum of nothing more than paperwork. I would therefore advise you to go into the closing prepared for this eventuality, and to make sure that you have a very clear mind so that you can through all the papers and understand them. Don't just append your signature to the papers in a hurry to get over the process; the papers that you sign are legally binding, and you must know what you're getting yourself into.

To handle the problem of deciding upon the actual date of departure of the current occupier of the house, you could include a clause in the closing documents that imposes a fine on the occupier if the house is not vacated within the stipulated period. However, remember to be realistic in the time you allow the current occupier to vacate the house, and not to place undue pressure on them. Usually, 30 days would be a good amount of time to give the occupier to vacate the premises after the closing papers have been signed. The addition of the penalty clause will help to ensure that the current occupier takes the departure date seriousy, as the penalties can be quite high.

You now have a better idea of the kind of paperwork that you can expect during the house-buying process. However, don't let the paperwork frighten you away from owning your house. When you think about it, the added 'stress' of a few dozen signatures is really a small price to pay for such a great reward.