What’s the First Step to Securing My New Property?
The very first step that I would strongly recommend you take is for you to talk to a lender and become what is called “pre-approved”. This means that a reputable lender will determine both the sales price you are qualified to buy based on your income, assets, and credit history as well as the payment & loan program that you will be most comfortable with. This is an essential beginning of the process as you will know what price range we need to look at, your offer will be stronger once we locate your property, and all that will be required next will be to find your property with no further delay!
What If I Have to Sell My House Before I Buy?
It will be important for you to know how much equity you have in your current house. In that case, I can provide you with a Market Analysis on your home. Then you can explore the options available to you for purchasing a home with and without selling your current home. If we need to sell your home in order for you to buy another property, we can make a Contingent Offer. In that instance and depending on the market, we will want to proceed as quickly as possible. Depending on the market conditions, the Seller may not wish to accept a Contingent Offer. In that case, we can put your home on the market, ask for a longer than typical closing date on your home, and potentially extend the closing date on your current home to allow you time to secure a house. I work with a lender who, if necessary, could close on your new loan in less than 10 working days.
How Do We Start the Search for My Property?
Next you will share with me what you want in your house including size, square footage, location, school district, and so on. I will begin searching with you and can give you information via telephone, e-mail, fax, or personal delivery (depending on where you live!). We can even set you up on a few different Web Sites so that you can search along with me.
When Can We Start Actually Seeing the Inside of Homes or Properties?
As soon as we find something you might be interested in and upon my receipt of your pre-approval letter we can begin. The process for scheduling times to look at houses is easy yet time consuming. In addition to locating houses for you to consider, when it’s time to look, in advance I’ll be contacting the Listing Agents to verify home availability, and will call Sellers to schedule appointments. Seldom am I available on the spur of the moment to look at houses, unless we’re talking a single house or two, so we‘ll really need to set up an appointment a day or two in advance.
What Can I Expect When I Am Looking at Houses?
Be prepared to remove your shoes inside of other people’s homes and wear slip-on shoes for your convenience. This is a courtesy that I’m sure you would want others to abide by in your home. Usually we’ll ride in my car. Children are an important part of the buying process, should you have them, and you’re welcome to bring your children. Please use caution when we go through occupied homes. We don’t want to worry about breakage.
What Happens If I Change My Mind About What I Want?
You are free to change your mind about anything at any time prior to mutual acceptance of your Purchase & Sale Agreement . After that, there may be financial implications. This is not a waste of anyone’s time, as this just means we’re getting more specific about what we want. Sometimes, you will find that you can’t find every single thing that you desire in your price range but maybe the lot size ends up outweighing your desire for a 3rd car garage, and so on. Do let me know as some items become more important than others to you.
Once We Find The Right House, What’s Next?
We will sit down together and discuss what kind of an offer you wish to construct. I can provide you with comparable sales data for the house although usually, by then, you’ll have seen enough properties on the market to have an idea of what a fair price is for the house you want. Then, based on the condition, location, and amenities, we can construct an offer to purchase the home you want.
Can I Always Get The Sellers to Reduce Their Price?
No, you cannot always get a price reduction. Depending on the market and availability of desirable homes in the price range we’re looking at for you, sometimes you’ll even have to pay more than the asking price. For instance, if we find the house you wish to purchase yet there are very few homes on the market, we may end up competing with one or more other Buyers and have to include something called an escalation clause to obtain the house. On the other hand, if there are a lot of homes on the market in your price range, the chances of securing your home with a price reduction actually increase. This supply/demand basic economic situation will result in either a Buyer’s or a Seller’s or neutral market.
Once The Offer Is Written, How Do The Sellers’ Receive It?
It depends. Some Sellers only care for their listing agent to present all offers. In that case, I prepare a very thorough cover letter introducing you and outlining the offer & the offer/letter/pre-approval letter are delivered in person or via fax. There are other times when I can present the offer directly. If I can do this, I will.
What Are The Next Steps, Once I’ve Secured My House?
There are several next steps to completing the purchase of your home.
Whether you’re buying your dream home, your first home, an investment property or raw land, you need to make sure that you are aware of the condition of the structure or house, and that you know what defects exist as well, in some cases, that the zoning is appropriate for your use, and so on. In a raw land or investment purchase, this step is called a “feasibility study”. By the end of our inspection period we will need to let the Sellers know, in writing, what, if anything we would like them to repair. This is called an inspection notice. They have a time frame (usually 3 days) within which they must respond to our request.
You’ll want to investigate the neighborhood to ensure you’re satisfied with things that the Seller is not obligated to disclose or may have no knowledge of such as sex offender locations, crime rate compared to other areas, and so on. This usually is complete within 1 – 3 business days.
Complete Loan Application:
By this point, you may only need to deliver a copy of the Purchase & Sale Agreement to your lender. I can take care of this for you.
If this property has a well and/or septic system, at a minimum we’ll want a bacterial water test from the well and proof that the septic tank has been pumped & the system inspected. Additional information that we might want to ask for includes a well flow test or separate well inspection, organic compound test, & so on.
On occasion, if your credit scores are fabulous and you have a substantial down payment on your house, the lender will waive getting an appraisal. Usually, however, an appraisal is required. An appraiser’s job is solely to establish market value and not address condition. From time to time, a house might present itself in an appraiser’s eye as maybe needing an outside specialist in a particular field to assess a particular situation. An example of this would be if a roof looks like its on it’s last legs, an appraiser might order a roof inspector to certify the roof for 5 years. You may even have to pay for this special appraiser ordered inspection.
Pay attention to the time frames. There is currently in existence a national data base for insurance companies called the “CLUE” system which keeps track of home claims when those claims are determined to be caused by a construction type problem. For example, if a house has had a severe water issue and had a claim for repair, this data base will have that claim in the system. This may mean that the insurance rate for the house is higher than average. The Purchase & Sale Agreement has specific time frames for you to apply for insurance and then specific time frames for your ability to back out of a transaction based on specific insurance pricing in excess of ½% of 1% of the sales price. Pay attention to this, because if these deadlines pass, you cannot rescind on your Purchase due to insurance costs.
Final Walk Through:
I like my transactions to include the ability for you to walk through the house within 5 days prior to closing to verify that the house is the same condition as when first viewed.
Is The Closing Date Considered To Be The Day I Sign My Closing Papers?
No. There might be a rare occasion when you can sign your documents on the day of closing but most lenders send their escrow instructions to the Escrow Company 2 – 3 days prior to the closing date. Escrow then prepares your note, deed of trust, and other documents, has both Buyer & Seller sign documents, then sends them back to the lender’s funding & review department. The time period for funding & review is usually 24 -48 hours, or 1 – 2 business days. They then contact escrow, release your purchase to be recorded (title transfer at the County Assessor’s Office), and then wire transfer funds to the Escrow Company. We will be notified when the funds have arrived and the deed has been transferred. Usually, we’ll get the call between 3 and 5 p.m.
When Do I Get My Keys?
The Purchase & Sale Agreement states that the Seller must deliver the keys on the day of closing. A typical way for these keys to be delivered is for them to be left for you at the office of the listing agent. I usually like to deliver the keys to you personally. By that time we may feel like we’re almost part of each other’s family. There have been many times when small children think I’m moving in the house with them. I do promise not to do that 🙂
When Do I Call the Utility Companies to Transfer Utilities to My Name?
I would recommend that you contact the Utility Companies identified on the Utility Addendum 1 week prior to closing, and schedule those transfers to 9 pm on the day of possession.
How Clean Can I Expect My New House To Be When I Move In?
Some people are cleaner than others. The standard language in the Optional Clauses Addendum to the Purchase & Sale Agreement calls for the Seller to remove personal debris & property prior to closing and to clean the interior. If you have any concerns about this aspect at all, I would recommend we ask the Sellers to clean carpets and/or have the interior professionally cleaned prior to closing. Otherwise, you will probably want to plan on some additional cleaning prior to moving in.
When Can I Move In?
At 9 p.m. on the Possession Date specified on the Purchase & Sale Agreement. Rarely, a Seller might move out earlier than the actual possession date agreed upon. In that case, we will be able to get you into your new home early.
During this process, I am very involved in communicating with all parties. You will know what’s going on and what you can expect to happen next. I will provide you with a calendar of events and copies of our contract documents for your reference.
Throughout this exciting process, please feel free to contact me with any questions. I’ve tried to outline what I would anticipate would be the most common questions, however am sure I haven’t covered everything! So if you have any questions, do ask!