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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. 

  1. The first step is to have an offer accepted by the seller. 
  2. Once an offer is formally accepted, a contact will be signed by the buyer and seller. 
  3. 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. 
  4. 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. 
  5. 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.
  6. 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.

  1. You will first submit an official application for the mortgage. This is done on your own or with the help of a mortgage professional.
  2. 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. 
  3. 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!

  1. 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.
  2. The final papers for transferring the title will be prepared. 
  3. A final closing that works for everyone involved will be scheduled. 
  4. 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. 
  5. 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. 
  6. The buyer and seller will now sign all documents, usually at the closing meeting. 
  7. The buyer will pay all remaining funds to an attorney or title-company representative. Final payment is usually done with a cashier’s check. 
  8. The transaction is now recorded with the city or county. 
  9. 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. 

 

Downpayment Assistance Programs in Kansas

Buyers in the state of Kansas can find downpayment assistance (DPA) from a wide variety of organizations. These include options from the state government, as well as DPA programs from city and county governments. Some non-profit groups provide assistance as well.

Statewide Downpayment Assistance Programs

Kansas Housing Resources Corporation
One of the larger DPA organizations in Kansas, the KHRC provides a first-time homebuyer downpayment option. This support is available throughout the entire state except for a few select areas, mostly within certain cities. Qualifying buyers can receive a downpayment loan worth as much as 15% to 20% of the home’s purchase price. The amount of assistance largely depends on your income, but the loan can be forgiven over an extended period.

KansasDPA
KansasDPA provides homebuyers with grants up to 5% of the purchase price. For many loan options (FHA loans, for example), this could likely cover the entire downpayment. Some programs significantly limit the purchase price, but this program allows purchases of $647,200. (The current conforming-loan limit as of writing this article.)

Local and Regional Downpayment Assistance in Kansas

Leavenworth Home Ownership Program
Near the Kansas City metro area, Leavenworth offers homebuyers one of the top downpayment programs in the state. This program can provide an eligible homebuyer with up to $8,000 in assistance, which comes as a grant that does not need to be repaid. This program is an important part of Leavenworth’s efforts to increase citywide owner-occupied homeownership which, according to their latest information, is less than 50%.

Topeka Opportunity to Own
As the capital of Kansas, Topeka attracts individuals, families, and businesses of all types. Many need assistance to purchase a home, and they can find support through Topeka’s Opportunity To Own program. Known as “TOTO,” this option provides as much as $10,000 in downpayment assistance.

Common Requirements for Kansas DPA Programs

The most common requirement for these programs is related to income. Because they are meant for cash-strapped homebuyers, you need to be below a certain threshold to use this option. In many programs the income restrictions are tied to family size. (Larger families have larger income caps.)

Other programs may require that you have a certain credit score. Many require at least a 640, while others may go as low as 620.

Some programs require that you make at least a small contribution of your own cash. For example, the KHRC program requires that you contribute at least 2% of the purchase price. This would mean buyers of a $150,000 property would need to contribute at least $3,000 in personal cash.