Buyer Tips

Beginning the Process

You’ve already started – you’ve found my page. I’m guessing you’ve already done some searching/research online, talked with people around you, see ‘For Sale’ signs driving around town, and maybe even been to some ‘Open Houses’ and visited Model Homes at New Home Developments. Whatever your reasons for buying, finding the Right Home, in the Right Location, and for the Right Price is NO easy task. I am a licensed professional and helping people like you is my Full Time Job.

I would be honored to help you through one of the Most Expensive Purchases of your life but first, you have some homework to do. First and foremost, find out how much house you can afford. If you do not know a Loan Officer I can provide you with referrals who can help you determine How Much of a Down Payment you can afford, along with a Monthly Payment you qualify for and other loan-related issues (to help determine how much house you can afford see the ‘How Much Home Can I Afford’ section below). Second, make a list of Everything You Want in a Home. How many bedrooms? How many bathrooms? What about closet/cabinet/pantry space? Do you need a yard for kids and/or other animals? Rambler or palatial estate? Fixer-upper or not so much? Once you have your list complete you’ll need to separate it into ‘Essentials’ and ‘Nice-to-Haves’. Having put some thought and organization into this list will be a key time saver for you when we meet face-to-face (if you need a jumping off point for brainstorming I would be happy to provide you with a questionnaire).

After you’ve determined how much house you can afford and we meet to go over your list, the next step is to start looking for Your Home. We will go over your options together in the office and then arrange to visit a number of Homes and/or New Home Developments that you are interested in exploring further. I will provide you with materials to take notes on so you can keep track of the homes we view (houses become a blur very quickly). Take notes and feel free to snap some shots with your camera phone of aspects you do(n’t) like. Look beyond the Furniture and Cosmetics of the Home and try to envision Your Family and Belongings in the Home. Also, try to get a sense of the Cost of Repairs (for more information on Assessing a Home’s Condition, see ‘Home Inspections’ below).

How Much Home Can I Afford?

Before you find yourself Face-to-Face with an experienced Realtor, it is best to find a Target Price Range that you can afford. A mortgage lender will want to make sure you can Qualify for the Down Payment, Plus a Monthly Mortgage Payment made up of Principal, Interest, Taxes, and Insurance. For a quick estimate there are lots of calculators available with a quick web search and I can provide you will recommendations of Qualified Loan Officers who can help you Assess What You Can Afford. Keep in mind that How Much House You Can Afford MAY NOT be House Much House You Want to Afford.

PURCHASE AND SALE AGREEMENT

Once you’ve found the home you want to buy, together we’ll complete a purchase and sale agreement.This is the contract in which you and the seller outline the details of the property transfer. The purchase and sale agreement usually consists of the following pages:

THE CHEMISTRY OF ESCROW

Closing Costs, Points, and Title Insurance

• WHAT ARE CLOSING COSTS?   Closing costs are charges paid to various entities during the real estate transaction. They can include escrow fees, document preparation fees, the cost of an inspection, and lender fees.
• WHAT IS A POINT?  A point is equal to one percent of the loan principal. Some lenders charge points, in addition to interest and fees, at closing.
• WHAT IS TITLE INSURANCE?  Title insurance protects against loss from any defects in the legal title, liens against the property or other adverse claims. The lender usually requires title insurance.

Home Inspections

When you find the home you’ve been looking for and you’re ready to complete a Purchase and Sale Agreement, your offer will generally be Contingent on a Home Inspection. A Home Inspector makes sure that the Home’s General Systems operate properly and will make note of Any Major Repairs that are needed. They also report of the Overall General Condition of the home.  Among other things, the Home Inspector will provide you with a Report that shows a review of the conditions of the Home’s Heating and Cooling Systems;  Interior Plumbing and Electrical Systems; Roof, Attic and Visible Insulation; Walls, Ceilings, Floors, Windows and Doors; Foundation, Basement and Visible Structure. The inspector will also look for Cracks in Cement Walls, Water Stains that Indicate Current or Past Leakage, and any indication of Wood Rot. A Home Inspection Report generally also points out some of the Positive Aspects of the Home as well as some of the Maintenance Necessary to Keep it in Good Shape. I have a list of Qualified Home Inspectors you can choose from if you do not already currently know any of these professionals. Remember, No Home is Perfect; if problems are found, I Will help you Negotiate the Process.

 SETTLEMENT–WHO PAYS WHAT

During the negotiation stage of the transaction, a mutually agreed-upon date for closing is determined. “Closing” is when you and the seller sign all the paperwork and pay your share of the settlement fees, and the documents are recorded.

Settlement obligations vary widely due to specific contract language, local laws and customs.

Prior to closing, the closing agent (usually an escrow or title company or attorney) will complete a detailed settlement statement for both buyer and seller.

THE BUYER WILL RECEIVE:

• Earnest money deposit

• One-half of escrow or legal fees paid to the attorney or escrow company for preparing the closing (In California, the party paying escrow fees varies from county to county)
• Document preparation fees
• Recording and notary fees
• Title search and title insurance (paid by either the seller or the buyer)
• Local transfer taxes, if any
• Repairs or inspections the buyer has agreed to pay for
• Loan fees
• Appraisal fees
• Credit report fees