Tricia & Pete’s Home Buyers Guide
So you’ve decided to buy a house…Congratulations! Real Estate is one of the best and most stable investments you can make. It can also be one of the most stressful things you will ever do. We want to make it an enjoyable experience for you. So, let’s begin!
First of all, Thank you for considering us in the purchase of your new house. We bring over 15+ years of experience to you. We are highly trained in helping people assess their needs so that we can help you make the best decision for yourself.
Do your service cost me any money? No, it usually does not cost you any money. Normally, our fee is paid by the seller or builder and is based on the selling price of the real estate.
Why should I use a Buyer Representative? If you are like most buyers, you will probably only purchase three or four homes in your lifetime. Purchasing real estate is a complex and major transaction with many details to be handled. We are Accredited Buyer Representative’s who work for your best interests through the entire real estate transaction, not the Sellers.
Research by the National Association of Realtors has shown that when a buyer’s representative was used, the buyer found his home faster than the consumer who did not use a buyer’s representative. Benefit to you: We can save you time and money!
Where do I begin? To make the entire process more manageable and less overwhelming, we have broken it down to these simple steps:
Get Pre-Approved for your Mortgage This will tell us what you can afford!
Give us your Wish List Form! What do you Want and Need in a House?
Set up an appointment with us We’ll discuss the Process and Your Wish List!
We will set you up on an automated Email Account You will receive notification either by email or phone of new houses that fit your criteria
Look at houses until we find one you want to call home!
Our promise to you: We are committed to helping you find that special home. We will devote our time, expertise and money towards that goal. To better serve our clients, we only work with a select number of buyers at a time. In return, if you decide you would like us to represent you, we will ask you for your commitment.
Evaluating A Neighborhood
· Drive Around
▫ Does it look like a place you’d like to live?
▫ Is it near places you’d like to go?
▫ Is it too near places you’d rather avoid?
▫ What will it look like during commuting time?
▫ What’s it like at night?
· Quality of Schools
▫ What is the school performance?
▫ Average test scores?
▫ College bound percentages?
▫ National merit finalists?
▫ Spending per student?
▫ State rankings?
· Education/Income Profile
▫ What is the household income?
▫ The education level?
▫ Family type?
· Crime Rate
Compare neighborhoods on a per-capita basis for homicide, rape, robbery, aggravated assault, burglary, larceny and auto theft.
· Cultural Amenities
Proximity to museums, galleries, universities, seasonal entertainment, theaters, orchestras, etc. Even if you don’t frequent them, they help set the tone for the area.
· Property Values
Steady or increasing values generally mean a sound investment. It is almost always best to buy the smallest, least expensive home in the best neighborhood you can afford.
· Future growth
If you are not planning on staying in your new home for a number of years, an abundance of new construction being planned could affect your resale. Equally true, however, is the existence of higher end properties could increase the value of yours.
Your REALTOR is your best source of information on property and neighborhood information. There are also numerous Internet sites, such as REALTOR.com, Homes.com, Homeadvisor.com, schoolmatch.com and others, that can assist you in your research.
Home Buying Guidelines
· If you have to resell soon, don’t buy an unusual house.
· Even if the quality of the school district doesn’t matter to you now, remember it might someday to another buyer.
· Brand new homes may be lower in maintenance costs, but can be higher in out of pocket expenses.
· There are no perfect homes. Be ready to make compromises and concessions. Know what’s most important to you and ‘give’ on those things that aren’t.
· Location, location, location – some things don’t change.
· Supply and demand is a critical issue. Be ready to move quick when you find what you want.
· Pay attention to floor plans. Changing layouts of rooms can be costly.
· Get preapproved for your mortgage prior to making an offer.
· Be an educated buyer. Learn as much as you can about the market before you buy.
· Always make your offer to the seller contingent on having a home inspection – it’s money well spent.
· Compare mortgages – an artificially low interest rate could have enormous hidden costs.
· When interest rates are low – go for a fixed rate mortgage.
· Redoing kitchens and baths can be very expensive – check these out carefully.
· Imagine the home vacant. Do not be swayed by decorating – the furnishings will leave with the seller.
· Vacant homes appear larger than they are. It may be a good idea to measure to make sure your furnishings are going to fit.
· Landscaping is there not just to make the home look good – it can save thousands of dollars over the years in utility bills.
· Buy the best home you can afford in the best neighborhood you can afford. You are almost always better off with the least expensive home in the area rather than the most expensive.
· Pay attention to the original listing date of the properties you look at; sellers tend to be more flexible the longer the home is on the market.
· Be honest and open with your agent; he or she works for you and can best help you if they have a good understanding of your needs.
· You’ll know the right home for you when you see it and it will have very little to do with logic – don’t ask us how that works – it just does!
Interviewing Agents Checklist
What to look for in an agent
Questions to ask a prospective agent
Principles That Affect Value
· amount spent to buy or build
· history – not today’s value
· amount presently being asked
· may or may not be reasonable
· may or may not reflect market
· determined by seller
¨ Market Value
· estimate of benefit of ownership
· most probable selling price
· determined by buyers
· owner over-improves for neighborhood
· most expensive home in area
· won’t sell beyond top of area price range
· lowest priced home in area
· quickest to appreciate
· higher priced homes pull up value
· sets upper limit of value
· buyer won’t pay more than cost of acquiring elsewhere
· value decreases as number increases
· as with substitution, varies by marketplace and buyer demand
It’s Time to Make an Offer
· Put yourself in the sellers shoes and imagine how they will react to everything you’re about to put in your offer.
· Oral promises are not legally enforceable when it comes to the sale of real estate. Please be sure you have communicated everything you want in the offer to your agent.
Have your REALTOR do a comparative market analysis for you. That will show you the fair market value of the property. The following factors could affect your offer price:
▫ Property condition
▫ New home improvements
▫ Market conditions (that old supply and demand again)
▫ Seller’s motivation
▫ Seller concessions – do you want them to give you a carpet allowance or are you asking them to help you with closing costs? If you are – expect to pay a little more!
· Earnest Money
You will be putting up some money to show the seller you are sincere about purchasing his home. Your agent can give you guidelines for how much this should be.
· Financing Contingency
You will probably need to get a mortgage. Even if you have been preapproved the lender will still need time to have the appraisal done, order title, etc. Your agent can advise you as to how much time you need.
· Home Inspection
Don’t skip this, whether it’s because you think you can check out the house yourself or you want to save the money a professional inspector charges – it’s money well spent in the long run. But remember, no home is perfect and small maintenance-type things found by the home inspector should not be part of any renegotiations with the seller. And don’t skip your final walk-through just because you had a home inspection.
Make sure you received all the proper seller disclosures. Federal law requires the seller give you a lead based paint disclosure if the property was built prior to 1978 and most states or local areas require the seller to disclose any material defects of which they have knowledge. Look over these documents carefully – your recourse once you signed them is limited by the laws that govern them.
· Multiple Offers
It doesn’t have to be a ‘hot’ market for a seller to have the luxury of choosing between multiple offers on their property. If you find yourself in a multiple offer situation don’t panic and don’t withdraw your offer – you may be the highest bidder and won’t even know it if you pull out. Go through at least one round of negotiations before you decide to withdraw. Have a price in your mind of where you want to go and stay in the game until that price has been reached. Too many buyers lose the property by pulling out too soon.
From Offer to Closing
Once your offer has been presented to the seller the negotiating process begins. There are liable to be numerous counter-offers going back and forth between you and the seller. There are a few important things to remember:
· Your offer is just that – an offer – until it has been accepted and agreed to by both you and the seller. At any time during the negotiating process another offer could come in and cause you to be in a multiple offer – or worse – lose the house completely. A wise buyer will try to come to an agreement with the seller in a reasonably short period of time.
· Many contracts have stipulations on when the buyer must make his mortgage application. Please be sure to check your contract and abide by its requirements.
· If your contract calls for a home inspection and attorney review, please choose both of these as quickly as possible and let your agent know who they are. Your service providers have a limited amount of time to protect your interest.
· Be sure to comply with all requests of your lender after the mortgage application has been done. Not producing the documents or information they need can jeopardize your getting your mortgage on time.
· Generally, the buyer accompanies the home inspector at the inspection. Please allow at least 2 to 3 hours for an average inspection. More time may be necessary for a large home.
· Your agent will act as coordinator for all activities from this point and will keep everyone in the loop as far as what is going on. The lender, home inspector, both attorneys, the other REALTOR, the title company (or escrow agent) will all be performing necessary duties during this time.
· If necessary your agent and your attorney will work together to negotiate any repairs that were noted during the home inspection. Remember, routine maintenance items are not the type of thing that should be noted and negotiated.
· Your walk thru will be scheduled as per your sales contract. Your agent will schedule this with you, the seller and the listing agent. It should happen just prior to the closing.
· If all of this sounds a little overwhelming – don’t worry – you’re in good hands. Your agent has been through this many times and will be there for you during the entire process. Relax and enjoy the experience.