On our page we will prepare you for buying a home. The process may seem mysterious to you. It’s possible that you’ve heard various stories about the process. Our role will be to point out the most important aspects, guide you through the proper order, as well as explain each part of the process in order to help you feel as confident and prepared as possible.
Buying a home is a huge investment. For most people, it is the largest purchase they will ever make. Before you jump into the wonderful world of homeownership, make sure you’re prepared. To begin, learn about credit score requirements, mortgage options and other must-do’s.
Based on our real estate experience, dealing with buyers and sellers, we noticed that people have many questions in the back of their minds that they never ask. In this book, we will try our very best to answer all of those lingering questions.
Each paragraph will cover a different area of a real estate transaction.
Why we should begin the buying process with the preapproval?
Let’s look at the worst case scenario… You go out to look for homes and you find the perfect house, which you were dreaming about. By the time you get the preapproval the home might be gone just because somebody else was ready to submit an offer.
It may take even 24 – 48 hrs to get that document ready and in today’s market you do not have that much time. Remember it is better to be safe than sorry!!!!
So…please before you decide to look for homes talk to your lender to become aware of what you can afford to avoid disappointment in the future.
That lost house can haunt you for your entire home buying process.
Think about it.
Make your wish list
Now that you know how much you can spend on a home you should make a list of must have features. Consider location, type of house, size of the yard, number of bedrooms and number of bathrooms. The layout should suit your lifestyle. Think about style.. condo versus single family home. One offers shared amenities with less responsibility and the other gives you more space and privacy, but much more exterior and yard maintenance.
One more thing…there is no perfect home….do not expect perfection.
Many sellers don’t repaint or re-carpet prior to selling, so if you are shopping for an older home, expect to do some cosmetic work.
Homes that are in need of updating are priced below homes that are move-in ready. Try to look at the floor plan and dimensions and ignore the sellers taste and imagine each room clean and clear of clutter and with your own things in them.
Hire a real estate professional
An experienced real estate agent will assist you throughout the search, comparable homes sold, making an offer, the inspection, repair and appraisal processes as well as help you find the best valued neighborhood and quality for your budget and requirements.
An agent can provide access to more home options than you’ll likely find yourself, as well as set up viewing appointments. Since home-buying can be an emotional process, an agent can also act as a mediator between you and the seller.
The agent can provide access to every home that’s on the market via MLS (Multiple Listing Service) and all other sources, including ones that may not be listed publicly. They knowledge of recent comps (comparable) — what similar properties have been sold recently and for how much and they knows the neighborhoods. They can give you objective professional advice if you have a buyer’s remorse meltdown.
Don’t forget, as a buyer you don’t pay your agent. The seller is responsible for the commission fees so nothing should stop you from receiving valuable professional advice from a knowledgeable agent
Make an offer
So, imagine we‘ve found your perfect home. Before you submit an offer have your agent pull up the most recent sold comparable (cma) within a reasonable radius, similar in size and features. Be aware of what has been recently sold in the area and for how much. Next ask your agent about the market conditions, so you can choose strategies.
In buyers’ market discounts are common because there are the fewer buyers, and more properties for sale. In the sellers’ market homes sell quickly for full price or higher because there are plenty of buyers and few homes for sale. But whether you are in the buyers’ market or the sellers’ market, your goal is to buy the home at a fair price.
Low balling the seller is risky. If the seller feels insulted by your offer, you can lose the opportunity to negotiate. On the other hand some sellers are simply unrealistic about their home value. Maybe your offer will be their wake up call. If the seller’s home is offered at a reasonable price, pay the asking price or close to it. If a home is priced to sell, it will sell quickly.
To show sellers you are serious include a copy of your lenders preapproval. If your offer is conditional, such as you need to sell another property before closing you will have to sweeten the deal, such as a full price offer.
Remember, your real estate professional will help you draft the offer. So don’t forget to ask for advice, we are here to help you.
As real estate agents, we can tell you all about the value, dimensions, locations, number of bedrooms and bathrooms and so on. What we can’t tell you about is the homes condition. That is why an inspector is needed.
The inspector will tell you about the condition of appliances, heat and cooling systems, roofs, electrical and plumbing systems and if your future home is up to the current city codes. He will point out large and small repairs that are needed so you know what you’re facing as the next owner. You should negotiate a repair only if it wasn’t obvious before or when the system is not safe or not functioning.
Your agent can recommend a qualified, certified inspector that you can count on.
What is CMA?
CMA is side by side comparison of homes for sale and homes that have been recently sold in the same neighborhood and price range. This information is further sorted by data fields such as single family or condo, number bedrooms, number of baths, postal codes, and many other factors. Its purpose is to show fair market value, based on what other buyers and sellers have determined through past sales, pending sales and homes recently put on the market.
How is CMA created?
CMA is generated by a computer program supplied by your real estate agent’s multiple listing services (MLS). The MLS is available to licensed members only, including brokers, salespeople, and appraisers, who pay dues to gain access to the service’s public and proprietary data, including tax roll information, sold transactions, and listings input by all cooperating MLS members.
Listing agents generate CMAs for their sellers, and buyers agents create them for their buyers so both sides know what the current market conditions are for the homes they’re interested in comparing.
How accurate are CMAs?
The CMA is a here-and-now snapshot of the market, based on the most recent data available, but it can instantly be rendered obsolete by new listing, or change of status in a home with the same criteria. Why?
The market is constantly changing- new listings, pending sales, closed sales, price reductions, and expired listings.
CMAs can vary widely, depending on the knowledge and skill of the person inputting the search parameters to the software as well as the number and type of data fields that are chosen. That means some features may not be included.
As informative CMA is, it should only be used as a tool and should not substitute for your real estate professional’s knowledge and advice.
So, please if you have any other question regarding CMA or if you would like order one today contact as and we will help you.
An appraisal is a comprehensive look at a home’s location, condition, and eligibility for federal guarantees. For example, a home that doesn’t meet safety requirements, such as handrails on steps will not be eligible for FHA or VA loans until the handrails are installed or repaired. Appraisers use the same data in their market research to find comparable homes as real estate agents do. They are also members of MLS, but they also have additional guidelines from the bank to follow that minimize risk to the bank.
When the appraisal is finished, the bank makes the decision to fund the loan, or it may require the seller to fix certain items and show proof that the repairs have been made before letting the loan proceed. If the home doesn’t meet the lending guidelines, the bank will decline the loan.
The bank appraisal determines market value. If the home doesn’t appraise for the purchase price, the bank will refuse to make the loan unless you negotiate with the seller. If it appraises, the lender will move toward closing.
Despite stricter lending and appraisal standards, most buyers’ loan applications go thru the closing.
One reason for that is that real estate agents are preparing CMAs that are better tuned to lending standards, for sellers and buyers to better understand not only what the market is doing, but how much lenders are willing to finance
The real estate closing can be a mysterious process for first-time home buyers. Most people know that it involves a lot of paperwork. But aside from that, it’s all a big blank. By the time you finish watching us tonight, you’ll know exactly what happens on closing day.
What is a Real Estate Closing?
The real estate closing is also referred to as “settlement”. The two terms are interchangeable, though “closing” is the more common usage. This is the final step in a real estate purchase transaction. It’s when property ownership is transferred from the seller to the buyer.
There will also be a final distribution of funds on closing day. The sellers will receive a check for whatever proceeds they earned from the sale. The real estate agents will receive a check for their commissions. And you (as the home buyer) will have to provide a cashier’s check to cover all of your closing costs. We will talk more about these costs later.
What Happens on the Big Day?
As mentioned earlier, there is a lot of paperwork that goes along with this process. The escrow company will have most of the documents ready to go — they’ll just need to be signed. As the home buyer, you will have a lot more paperwork to sign than the seller. You might sign your name anywhere from ten to thirty times during the closing process. You’ll have to sign mortgage documents, legal disclosures, tax records and more.
Here are some specific things that happen on closing day:
– The buyer (or the buyer’s lender) will provide a check for the amount owed toward the purchase price of the house.
– The seller will sign the deed over to the buyer. This act officially transfers ownership to the buyer. The seller will turn over the keys, as well.
– The title company (or in some cases a lawyer or notary) will register the new deed with the appropriate government office. This record will show the buyer as the new homeowner.
– The seller will receive any proceeds they earned from the sale, once their mortgage balance and closing costs have been paid off.
When all of the documents have been signed, and all funds have been properly distributed, the deed of ownership will be transferred from seller to buyer. This is when you become a homeowner. The seller will hand you the keys to your new house, and then you’re all done. Congratulations!
So do not hesitate to contact us today, we will be more than happy to see you at your closing.