I WANT TO BUY A HOME, WHERE DO I BEGIN?
Buying and selling a home is one of the largest business transactions most of us will make. I would love to help you with the process to make it as smooth as possible. After reading the 10 tips on preparing to purchase a home, you should have a better idea of what to expect and how to set out to buy a home feeling prepared and ready to go!
HERE ARE 10 TIPS ON PREPARING YOU TO PURCHASE A HOME
1. Choosing your Real Estate Professional
Look for an agent who listens well and understands your needs, and whose judgment you trust. Agent knows the area(s) well and has resources and contacts to help your search. Overall, you want to choose an agent that makes you feel comfortable and can provide all the knowledge and services you need.
With my guidance you'll know what to expect and be in control every step of the way, and you can sign on the dotted line with peace of mind. You'll see that buying a home can be exciting and rewarding, as it should be!
As your buyers' agent, I will be your representative and putting your interests above all others. With your "wish list", I will search for homes based on your criteria and provide them to you in a timely manner.
I have state of the art technology on my website to enable you to search properties, school and community information, and calculators to help understand your financial qualifications. With "My Home Finder" you can save your search criteria and run it as often as you like. You can even arrange to be notified immediately by email when a new property that matches your search comes on the market. My goal is to provide you with incomparable customer service and professional expertise.
I will provide multiple listing sheets to review. I'm sure you'll pick up House For Sale magazines and read classified ads in your local newspapers. You'll probably spend time surfing the Internet for homes. You might even plan an afternoon drive to preview neighborhoods. Those are all excellent ways to see what's available. Remember call me with the MLS number or address and I can schedule a showing for you at your convenience.
2. Pre-approval- Select a lender to get pre-approved. This means the lender will look at your finances to establish the amount of the mortgage you can afford. At that time, the lender will give you a pre-approval letter. Our goal is to help you be the "Best Buyer" on the market so that you can fulfill your dream of homeownership.
What you can afford depends on your income, credit rating, current monthly expenses, down payment and the interest rate. Pre-approval helps you in other ways. Consider this scenario. A home seller gets two similar offers. A letter accompanies one from the buyers' lender that states he/she is pre-approved for a mortgage in the amount of the offer. The other has no supporting documents. Which offer do you think the seller will consider first?
Some of the things you will need to have with you the first time you meet with a lender are:
Pay stubs for the past 2-3 months
W-2 forms for the past 2 years
Tax returns for the past 2 years
Recent bank statements
Your sources of income with verification
Proof of financial assets
Information and details on all bank accounts, loans and other debts
Purchase agreement or address of property you wish to buy
Your lender will give you a good faith estimate. This is an estimate that lists all fees paid before closing, all closing costs, and escrow costs you will encounter when purchasing a home. The lender is required to give you this within three days of your application so that you can make accurate decision when shopping for a loan. Keep in mind this is an estimate.
There are many types of loans available today and your lender will discuss those based on your situation. There are also first time homebuyer programs available to assist first time homebuyers.
An escrow account is established by your lender to set aside a certain amount of your monthly payment to cover your annual fees for homeowners insurance, mortgage insurance (if applicable), and property taxes.
3. Searching for your new home. What area(s) do I want to live in?
"Location, location, location" It is important to research a particular area before viewing lots of homes there, or making an offer on a house. If you decide it is not the kind of neighborhood you would enjoy living in, then you could save yourself a lot of time and effort by doing so early in the process. Remember you can always make changes to a house but not to the neighborhood.
Today, Approximately 75% of the buyers use the Internet to begin their search. Your challenge is to find the Internet website that provides the most information and is easiest to use. Be sure to create an account on my website so that you can take advantage of the extra features having an account ensures. Many of the best listings come on and off the market before traditional means of marketing expose them. You will want to be registered so that you are notified of any new listings meeting your criteria.
Select a community that will allow you to best live your daily life. Many choose communities based on schools. Do you want access to shopping and transportation? Is access to local facilities like libraries and museums important to you?
Here are some questions to ask:
What is the neighborhood like?
Is it the kind of place you can imagine yourself feeling comfortable in?
What does the community have to offer?
What kinds of amenities are there locally?
If you have children, look at the local schools. Do they have a good reputation? (Click on the School Information link to the left to receive in-depth school reports)
How easy is it to reach the workplace?
What kind of condition are the other houses in the area?
Simply touring the area can give you a good idea of what it is like.
4. What do I want in my home? (Criteria)
Your home should fit the way you live, with spaces and features that appeal to the entire family.
Once you've decided to buy a new home and found out how much you can afford, it is worth sitting down and thinking hard about what you want from your new home and what your needs are.
What should I look for when walking through a home?
- Is there enough room for both the present and future?
- Are there enough bedrooms and bathrooms?
- Is the house structurally sound?
- Do the mechanical systems and appliances work?
- Is the yard big enough?
- Do you like the floor plan?
- Will your furniture fit in the space? Is there enough storage space?
Make a "wish list", a list of features and amenities that you find most appealing in a new home. These could be:
1. Price
2. Location
3. Size
4. Style
5. Design
6. Amenities
Give this information to your Real Estate Professional. This information will be used to research for your home. You will receive MLS information on homes that match your criteria. Review these and decide which of them you'd like your agent to show you. As you view these homes, take notes on your MLS printout.
If there is a home you are considering, then review the residential property disclosure, lead base paint and any other pertinent information available on the home. If you have any additional questions, your Real Estate Professional can obtain answers for you.
Remember there is no perfect house…when you find a house/property that is consistent with your top few priorities—consider writing an offer. Seldom does a buyer find a property that has more than 85% of what they want/need. The popular properties, priced right, go quickly!
5. Making an Offer on a Home
Offer a realistic price for the property that you think the seller might accept. Be careful not to include too many terms, conditions & contingencies that might make your offer less desirable to the seller. Only include those terms, conditions & contingencies you really need or want.
There are three steps in selecting a home: accept the seller's asking price and have your agent write up the contract, reject the seller's asking price and have your agent make a different offer (counter offer), or agree to different terms and have your agent write an offer. This is all part of the negotiation process.
As your buyers' agent, I will develop a CMA (Comparable Market Analysis), revealing at what price similar properties in the area have been listed for and sold for.
Earnest money is money put down to demonstrate your seriousness about purchasing a home. It is to demonstrate good faith and is usually between 1-5% of the purchase price (though the amount can vary with customs and conditions). If your offer is accepted, the earnest money will be deducted from your down payment or closing costs. If the offer is rejected, your earnest money is returned to you.
Home Warranties offer you protection for a specific period of time against potentially costly problems, like unexpected repairs on appliances, plumbing and major systems, which are not covered by homeowner's insurance. The cost is negotiated in the purchase agreement between the buyer and seller.
Proposed closing date & possession dates are also negotiated in the purchase agreement.
Don't be surprised if and when you get buyers remorse.. an uneasy feeling about your buying decision. Most people question their decision to purchase at some time during the process.
6. Home Inspections and Other Inspections
A home inspection is an objective visual examination of the physical structure of a home, from the roof to the foundation. The standard home inspector's include an evaluation of the condition of the home's heating system, central air conditioning system (temperature permitting), appliances, interior plumbing and electrical systems and visible insulation: walls, ceiling, floors, windows and doors: the foundation and visible structure.
Home Inspection (Optional) The purchase of a home is probably the largest single investment you will make and should learn as much as you can about the condition of the property and any necessary repairs that may be needed before you buy, so that you can minimize unpleasant surprises afterwards. Of course, a home inspection will also point out the positive aspects of a home and the maintenance that will be necessary to keep it in good shape.
A home inspector is typically called right after the contract or purchase agreement has been signed, and is often available within a few days. A home inspection is typically the buyers' expense.
Be sure to attend the home inspection. One picture is worth a thousand words; make every effort to attend your home inspection. Be sure to follow the home inspector and ask questions. No questions are foolish; learn as much as you can from the home inspector during the home inspection.
The home inspector engineer will summarize the findings and have a full detailed written report available to you the next working day.
Make your offer contingent on a home inspection. Most real estate contracts include this contingency.
The Inspector does not evaluate whether or not you're getting good value for your money.
Other Inspections
Termite Inspection is typically done so that the homebuyers are well informed about the condition of the property. Of the many inspections a buyer might order, a "termite" report is a virtual certainty.
Some loan programs require a notice of completion from the termite company indicating that the property is free of any active infestation or damage.
Radon is a colorless, odorless, tasteless radioactive gas that's formed during the natural breakdown of uranium in soil, rock, and water. Radon exits the ground and can seep into your home through cracks and holes in the foundation. Radon gas can also contaminate well water.
Health officials have determined that radon gas is a carcinogen that can cause lung cancer. Studies show that radon is more of a risk to smokers, but nonsmokers have a slightly elevated chance of developing lung cancer, too. The only way to find out if a home contains radon gas is to perform a radon test.
If the radon levels are above 4 pCi/l, then EPA recommends the mitigation techniques to reduce the radon levels in the home.
Molds are fungi that reproduce by releasing tiny spores into the air. Spores that land on moist objects may begin to grow. There are thousands of different types of mold and we encounter many of them every day, in our homes and outdoors.
There are products available that are designed specifically to clean up mold.
If the mold problem is severe you will likely need the help of a mold remediation company, someone who specializes in mold removal.
7. Insurance
Insuring your home is like making an investment in your future. You work hard to have a home and homeowners insurance protects you and your family from someone or something from taking it all away.
Homeowner's Insurance - protects your home from fire, theft and other liable coverage.
Be sure to shop around among several insurance companies. You will need to contact the insurance companies as soon as you've purchased a home. The insurance process takes some time and you don't want to delay your closing. If you are financing your home, your lender will require you to obtain home owners insurance and provide a paid receipt for the first year of coverage.
Flood Insurance - protects your home from flood damage.
8. Closing Procedures
The closing process is the transfer of the title of the property from the buyer to the seller. The buyer will receive title and deed to the property, while the seller receives payment for the property. This is usually done at a real estate title company.
The closing process is also referred to as "settlement" or "escrow" in different parts of the county. With increased technology, most closings are completely automated and both parties do not have to be present at the same time to sign.
Closing usually takes about 30 days to complete. This mainly depends on the buyer's financing availability, successful home inspection completion, and various lender conditions (ex: title search, title insurance, termite inspections, surveys and appraisals).
The title company will issue you title insurance - which protects you in the event that the title on your property has a lien, unpaid taxes, or other legalities that would make it invalid.
9. Transferring Utilities – Dates
If you have immediate possession of the property after closing you will need to begin transferring the utilities into your name. As your Real Estate Agent I will be glad to provide you with a list of the utility companies. The effective date will be the date you take possession of the home. If you have 30 days after closing until possession, you will need to verify the transfer date with your Real Estate agent. In some cases possession can be sooner than the 30 days.
10. Moving day / keys
Your Real Estate Agent will co-ordinate getting you the keys to your new home. If you've ever moved before, you know the endless preparations and decisions can be a bit overwhelming. Completing many tasks and arrangements ahead of time will make moving easier.
Here are some moving tips:
Use the proper packing materials. It will payoff in the long run! Sturdy boxes, packing tape, bubble wrap, and packing peanuts can be purchased at local moving or shipping companies and hardware stores. Other great types of padding for your boxes include wadded up newspaper, old pillows and blankets.
The following is a list of tools and materials to make your packing go more smoothly:
· Razor knife and/or scissors
· Note pad
· Dark, water resistant marker
· Boxes of all sizes
· Packing Tape
· Bubble Wrap/Newspapers
· Peanuts
Pack one room at a time labeling each box appropriately (on top and side) with a description of its contents and which room the box belongs in. Also label boxes containing breakable or sentimental items with Fragile. Keep a detailed list of what items are packed in each box to make unpacking easier.
Put heavy items in small boxes so that they're easier to carry.
When packing the truck, make sure the items you'll need first are loaded in last (i.e. kids toys, kitchen items, telephone and radio) to make access easier.
Plan ahead for what you'll need the first day after your move. Packing a separate bag with your toiletries, a change of clothes, etc. will avoid unnecessary scrambling or a run to the local store.
ENJOY YOUR NEW HOME!!!
