Your Guide to Buying a Home in Kansas
- In Kansas, real estate transactions are generally closed by title companies, real estate agents, lenders, or attorneys. Any one of these can complete the transaction.
- The title search must be completed by a licensed abstracter, a title examiner who has passed specific state testing.
- The entire state of Kansas is under the base limits for conforming loans.
Phase 1: Negotiations in Kansas
While you may have come to an agreement on price, there are still many details to work out. These include negotiations for repairs to the home, as well as completing inspections and making changes based on the results.
- The first step is to have an offer accepted by the seller.
- Once an offer is formally accepted, a contact will be signed by the buyer and seller.
- The seller will provide disclosures. These are simply statements of known issues with the home, and may include past repairs or current damage to the property. They will vary, but may cover environmental issues with the property as well as structural issues to the home. Sellers usually benefit from providing disclosures as soon as possible, as the information can be worked into the contract from the beginning. This can reduce complications during the negotiation process.
- As the buyer, you now have the chance to conduct a variety of inspections, which need to be completed by a specific date specified in the contract. The types of inspections you complete will vary, but most Kansas homebuyers will want to have a general home inspection, as well as a pest inspection, radon inspection, well testing (if the property has a well, of course) and a mold inspection.
- Based on the inspections, you can request changes to the contract. If problems are discovered (that were not part of the disclosures) you can request a reduction in the sale price or ask for repairs to fix the problem. The seller then has a choice to make: they can either accept the request, deny the request, or offer a negotiated settlement. The buyer and seller will negotiate back and forth until an agreement is reached. Rarely an agreement cannot be reached, which means both parties can leave the purchase.
- As part of the negotiations, you can request a home warranty. Funded by the seller, this covers the cost of repairs for a short period, usually about six months to a year.
Phase 2: The Rhode Island Mortgage
At the same time as Phase 1, you should start Phase 2, which covers the mortgage. This phase is often the longest, and requires the most steps, so start collecting your information as soon as possible to complete the mortgage application in Kansas.
- You will first submit an official application for the mortgage. This is done on your own or with the help of a mortgage professional.
- In about three days, the lending group will provide a “Good Faith Estimate.” This is an estimate, to the best of their knowledge and as accurate as possible, of the final costs you will need when the deal is closed. The final number may be slightly different, but most estimates are relatively close to the final tally.
- Before you can complete the mortgage application and reach final approval, you’ll need to provide a wide variety of documents, including:
- Information for all of your bank accounts. (Bank statements)
- Tax returns for the past two years. (Possibly more.)
- Information on current debts and financial obligations.
- Pay stubs and employer contact information.
- Disclosures that impact your financial situation. This may include child support, alimony, legal judgements, withholdings, and more.
- Explanation of any credit inquiries.
- Substantiation of large deposits. If lenders see a large deposit that is outside of your normal income, they will want information on the nature of the deposit. If the money is a gift that will be used towards a downpayment, the lender will likely request a gift letter.
- Repeat information for any of the above documents. Lenders want as much information as possible, so don’t be surprised if they request more documents on your financial situation, including recent pay stubs, more tax returns, or other evidence of your ability to repay the loan.
4. The lender will eventually render an approval decision. Assuming you are approved, the loan contingency can be removed from your contract. If there is any trouble with financing, you can request an extension to this date.
5. The mortgage approval will usually come with conditions, including the completion of an appraisal. This is important to lenders, and if the appraisal comes back low, the lender may require changes to the purchase or loan, such as a lower price or a larger downpayment.
6. Homeowner’s insurance is ordered and proof of insurance is delivered to the lender, which should finalize the mortgage for your Kansas home.
This phase, while extensive, is fairly simple and straightforward. However, you should start as early as possible to ensure you have a smooth, seamless process. Gather your documents early to make sure you reach final approval on your Kansas mortgage loan.
Phase 3: Final Closing in Kansas
The closing can take place at the office of the attorney, real estate agent, or lending official who is overseeing the process. It usually involves the seller and buyer together at the same time. Once all the documents are signed, you can take possession of your new Kansas property!
- The first step in the final closing is a title search, which must be completed by a licensed abstracter. This step will verify that the title is clean and can be sold, without conflict from another party, by the current owner.
- The final papers for transferring the title will be prepared.
- A final closing that works for everyone involved will be scheduled.
- A cash figure is calculated for the closing costs. Depending on the details of your purchase, this may include a downpayment, agent fees, origination fees, and more.
- Most buyers will complete a final walkthrough of the property to make sure it’s still in good condition and that there has been no damage since it was last seen.
- The buyer and seller will now sign all documents, usually at the closing meeting.
- The buyer will pay all remaining funds to an attorney or title-company representative. Final payment is usually done with a cashier’s check.
- The transaction is now recorded with the city or county.
- Congratulations! You can now take possession of your new Kansas property!
Kansas Loan Limits (Conforming Loans)
Conforming loan limits are set by the Federal Housing Finance Agency, which determines limits on a county-by-county basis. In high-priced areas, the limits can be higher than the limits for most of the country.
The entire state of Kansas is under the base limits. From Cherokee County in the southeast to Cheyenne County in the northwest, from Morton County in the southwest to Doniphan County, which borders Nebraska and Missouri, the limit for a single-family home in Kansas is $647,200.
It’s also possible to use a conforming loan to purchase a multiunit property. The limit for a two-unit property, or a “duplex” is $828,700. If you want to purchase a three-unit with a conforming loan, the limit is $1,001,650, while four-unit properties have a limit of $1,244,850.
Remember that these are not the limits for all loans. If you need financing above this amount, you can use a jumbo loan in Kansas. Regardless of your specific needs, contact our team for information on the right loan for your needs.