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You can go online right now and buy a car – boom, done – so why not buy a house online, too?
More people than ever are buying homes online.
Sure, there’s more involved in the home buying process than there is for a car.
But if you know what you’re looking for in a house and you need (or prefer) to buy it from a screen, it’s a more realistic option than ever.
Is Getting a House Online Crazy … or Crazy Smart?
Spoiler alert: It’s totally sane.
The real estate industry has been embracing digital tech for a while now. During the pandemic, that trend took off as sellers, agents and buyers all adapted to doing everything remotely.
There are plenty of reasons why home buyers want to buy online.
Some are buying a house in a different state and don’t want to go through the hassle of moving into a rental between houses.
Others are investing in a vacation home or a flip property on the other side of the country.
Or maybe they just don’t have the time to go through the usual process of buying a house.
Whatever your reason for buying a house online, make sure you know the pros and cons first.
The Pros and Cons of Buying a House Online
|Pros 👍||Cons 👎|
Get around anything that’s physically keeping you from viewing houses in person, whether it’s your job, location, health or anything else.
|A total lack of feels|
You won’t know if the house feels like HOME until you’ve already moved in – let alone if it feels peaceful or creepy inside.
Maybe now is the best time for you to buy a house, but not the best time for you to attend showings and other appointments.
It’s harder to know if you’ll like the house’s street or neighborhood (Google Street View can be outdated) or if the neighbors have any weird outdoor habits. Yikes!
The cons can mostly be overcome by teaming up with a real estate agent who’s got the skills to help you feel confident every step of the way.
Buy a House Online in 5 Steps
There are a few things you’ll need to do after you click “interested” on the house of your dreams and before you get the keys IRL:
1. Get preapproved
Getting preapproved for a mortgage could give you an advantage over other buyers who haven’t been preapproved.
When you’re preapproved for a mortgage, lenders let you know how big of a loan they think they can give you. This’ll help you confidently type a max house price into a real estate site’s filter.
Pro tip: Enter the amount you’re preapproved for into an online home affordability calculator first. You’ll see if it calculates a monthly mortgage payment you’re comfortable with.
Do your research: Check out ‘no cap’ (authenticated) reviews 🧢
There are a lot of mortgage lenders online. If you’re going to go with an online lender, make sure you have all the information you need to get the best experience.
Comb through their online reviews that are attached to real profiles.
You can also look for reviews on the Better Business Bureau site to get a better idea of who you’ll be dealing with.
2. Get a real estate agent who can’t stop, won’t stop
This is ALWAYS one of the best things you can do for yourself before starting your house hunt. When you buy a house online, it’s even more important.
Let me be clear:
You need an agent who’s so passionate and hustles so hard that they blow you away right through your screen.
Typically, you can get matched up with a local agent through the same sites you might use to look up houses – or you could go the Google route. Just make sure you pay more attention to their reviews than their bios.
When you’ve got a few on your names list, reach out. Don’t be afraid to interview them like a boss. Also, just see if the vibes are right. They don’t have to become your BFF, but you should feel comfortable talking to them.
Make sure your agent is:
- Experienced at helping online buyers
- A fast and clear communicator
- Good at recording videos on a phone (and sharing files)
- Detail-oriented when looking at houses for you
Don’t be afraid to ask questions. They’re used to it, and it’s your dream house on the line.
Once you have your real estate agent on board, they’ll provide all the local knowledge you’ll need if you’re buying in a different city or state.
They’ll also go and check out the houses for you. If you can, FaceTime or Duo with them when they go. You can ask questions or request close-ups of stuff while they’re there.
P.S. Make sure they let you know how many signal bars they get in the house!
3. Get shopping
House hunting is starting to feel a lot like online dating. Pretty much all first-time home buyers are on the hunt for homes online, swiping and scrolling until they match.
Here’s a quick look at a few popular sites in alphabetical order (not picking any favorites):
Where to Buy Houses Online
|National Association of REALTORS®||Prides itself on its comprehensive database of house listings|
Connects buyers with real estate professionals who are members of the National Association of REALTORS®
|Redfin||Provides you with one of their agents|
Refunds eligible buyers a percentage of the purchase price toward their closing costs – in select states – an average of $1,500 (but with lots of terms and restrictions)
|Rocket Homes®||Makes it easy to find an agent, search for a house and apply for a mortgage – all on the same site|
Offers its easy-to-read Neighborhood Trend Report to help you scout price trends where you’re looking
|Trulia||Has interactive maps that show nearby crime data, local shops and nightlife|
Gets deep with unique filter criteria you can use to further customize your search
|Zillow||Has a design that’s easy to navigate|
Gives you a Zestimate® of a house’s actual value under the listed price (real talk: the accuracy of this tool is hotly debated)
We suggest trying out at least three sites to see which one you like the best.
You’ll end up sticking with a go-to. You know, that one site you check on your phone in bed, in line at the grocery store, in the bathroom and – yeah – in the middle of company-wide meetings.
But keep in mind that it can help to bounce around between sites to get the benefits of each. Maybe you like how one site serves up neighborhood info, but you prefer the photos on another site.
There are also specialized sites for home buyers who want to try buying a house through online auctions. Sites like Xome and Hubzu let you bid on houses that sellers want to sell quickly at a low price. Many of them are flips or foreclosures (houses repossessed by the lender after the homeowner couldn’t keep up with mortgage payments).
Take virtual tours and review floor plans
You have a lot more options for virtual tours these days. In fact, many online property listings will include virtual tours. If they aren’t available, talk to the seller and to your agent about taking a virtual tour on Skype or FaceTime. They’re not quite like the real deal but they can help you get a sense of the property – warts and all.
Also, be sure to ask for floor plans, explore every corner of the house and visualize yourself in that space. Break out a measuring tape and do some test measurements to see how your furniture may (or may not) fit into your new space. All of this gives your mind a good sense of what the home is like and makes it easier when it’s time to move.
4. Make an offer and get it accepted
Congratulations! You’ve found the one. Now, go out there and get it!
Your real estate agent can help you figure out what you want to offer for the house.
The whole process of making an offer, negotiating and signing a purchase contract can be done online with e-signatures.
Lean on your agent to help you make an offer that’s attractive to the seller but doesn’t break your heart or your savings account. They’ll also help you decide if you should negotiate for anything special.
In the way of negotiating, maybe it’s worth asking the seller to do something like:
- Cover all or some of your closing costs
- Provide a 1-year home warranty
- Repair something at their expense before closing day
- Move the closing day earlier or later than proposed
Then again, you might not want to risk scaring off the seller. Use your agent (and your gut) to feel out what you can ask for. The seller will probably make a counteroffer, but your agent will be there to negotiate until everyone’s happy.
When your offer is fully accepted, your agent will type up a digital purchase contract for you and the seller to e-sign.
5. Get ready to close on your new home
The closing process starts as soon as the purchase contract is signed.
This limbo period can feel weird. Most of the time, you feel like dancing for joy! But then again, you have a ton of stuff to get done before your lender approves your mortgage.
The whole process usually lasts a month (or more), and it ends on your closing day. You know – that deadline day all parties legally agree on and put in the purchase contract.
So, now it’s a race against time. You can work online or over the phone to take care of all the steps required to close on the house. Work with your agent and your lender to nail down some important milestones:
- Home inspection: You hire a qualified inspector to check for any issues the house may have. Depending on what they find, you may want to ask the seller to make repairs or lower the final price.
- Appraisal: Ordered by the lender. This confirms that the home isn’t worth less than the amount you plan to borrow.
- Title search: Checks the ownership records to make sure the seller has the right to sell you the house.
- Homeowners insurance: Usually required before you buy – it covers fire, theft, flood or accidents after you move in.
You’ll also need to go through the underwriting process.
The loan officer will contact you to collect the necessary documentation for your application. This can include everything from proof of employment and income to a breakdown of your savings and investments to a record of your past and current debts.
Keep in mind, if you’re self-employed, get paid based on seasonal work or commission, own a business or earn an income based on investments, you’ll need to provide more documentation than you might otherwise.
An underwriter then assesses how risky it is for the lender to cut you a check. They’ll verify your ID, check your credit and comb through your finances – including your income, cash reserves, assets and anything else that might impact your ability to pay back the loan.
If the underwriter has any questions, they or your loan officer may come back to you requesting even more documentation. It’s nothing personal, you understand. It happens to everyone and it’s just part of the process.
If everything checks out, and your mortgage application is approved, your lender will send you the Closing Disclosure that tells you exactly what you’ll owe in closing costs and what your monthly mortgage payments will be.
6. Closing day and moving
And before you know it – it’s closing day. This is the big day when the house becomes yours. Apart from knowing what to expect on closing day, there’s a small catch for digital buyers: You can’t close online.
But, you can still close remotely.
Remote closings were a thing before the pandemic, and now with the expanded use of online meeting platforms like Zoom and expanded use of e-signing documents, they’re even more common.
Some states allow you to connect with your notary online using remote online notarization.
If you don’t live in a state that allows for remote online notarization, your agent or lender can help you arrange to have a notary public meet you at your house (or somewhere nearby) to witness you signing the legal documents for closing.
Depending on whether the documents are signed electronically or signed on paper, this is referred to as in-person e-notarization or a hybrid e-closing. If you’re signing all your documents online, you’re good to go. If some or all of your documents are on paper, you can then mail the signed docs to the appropriate attorney.
Paying closing costs
Instead of bringing a certified check to an in-person closing, you can transfer the money you owe for closing costs directly from your bank using a wire transfer or electronic funds transfer.
Finally, the purchase is official!
You just bought a home online and it’s all yours. The easy part is over. Now comes the hard part: getting all your possessions packed and moving them into your new pad. If only that was as simple as buying a home online.
From Virtual to Reality: You Bought a House Online
You’ve taken all the steps and bought a freaking house online! Whaaaaat???
If your friends aren’t like, “Whoa!” – that’s on them. But you can still invite them to the housewarming party – which you could have online, too – but that’s a different article.