HOME BUYING--STEP BY STEP

Home 1.     Finding a REALTOR® Finding a REALTOR®: is the first step in the homebuying process and it is very important to find a REALTOR® with whom you feel comofortable with. You want to feel free to ask any questions and voice any concerns you might have at any time..  It is recommended that your agent also possess the following and, as luck would have it,  Marie Monroy is just that REALTOR® and these services are provided to you, the buyer, absolutely free. An ability to listen intently to gain a full understanding of your needs A willingness to work with you until your needs are fulfilled A sense of professionalism Someone who is dedicated to their profession An above average familiarity with the area(s) in which you have an interest A familiarity with the price range in which you have an interest Professional designations: for example, GRI--Graduate of the REALTORS® Institute, or CRS--Certified Residential Specialist Strong references from previous buyers   2.      Mortgage Prequalification and Preapproval According to the National Association of REALTORS® (NAR), nearly 9 out of 10 buyers in 1999 financed their purchase, which means that virtually all buyers -- especially first-time purchasers -- required a loan. I want to help get the loan that is right for you! Virtually anyone willing to pay lofty interest rates can find a mortgage. However, I want to help you seek the mortgage with the lowest cost and best terms. I suggest that you start the mortgage process well before bidding on a home.  By meeting with lenders -either face to face or online - and looking at loan options, you will find which programs best meet your needs and how much you can afford. I also recommend pre-approvals for another reason: Purchase contracts require buyers to apply for financing within a given time period, in most cases, five to seven days. By meeting with loan officers in advance and identifying mortgage programs, it will not be necessary to quickly find a lender, check credit, and rush into a financing decision that may not be the best option. Pre-approval means you have met with a loan officer, your credit files have been reviewed and the loan officer believes you can readily qualify for a given loan amount with one or more specific mortgage programs.  You may visit as many lenders as you like; however, if each one makes a new credit check, it will show up on your future credit reports, which might affect your  FICO (credit) score at a future date. This "Pre-approval" is important to sellers since they do not want to accept an offer that is likely to fail because financing cannot be obtained.  In a hot market with multiple offers on homes,  it could mean the difference between getting your offer accepted over another. Real estate financing is available from numerous sources and I suggest you check out a number of them prior to making your decision.  As a professional,  I have access to several, competent, competitive,brokers and agents, and would be happy to supply you with the contact information of some to get you started. Contact me today for a list. Once you have selected a lender, he or she will carefully review your financial situation, including your credit report and other information.  The lender will then suggest programs which most closely meet your needs.  For instance, a first time buyer may qualify for state backed mortgage programs with little money down and low interest rates, while a repeat purchaser (someone who has bought a home before) with more equity (money invested in the home) might wan to get a 15 year loan and the lower overall interest costs it represents. 3.      The Home Search I'm here to help you meet the challenge of finding the property which best suits your needs. The housing market is complicated because the inventory of homes for sale is always in a state of constant change.  The list of homes I may present to you may become obsolete by the time we call to preview the property.  Why?  We have an old saying in the real estate industry, "The home you saw yesterday sold today!" In effect, buyers are looking at a moving target in a marketplace that is never static.  Because of this, it is important to know as much as possible about the choices in preferred markets, and the way to do this is by working closely with one agent (guess who?) to find your home. What are You looking for in a home or property?  A home is more than just a collection of bedrooms and bathrooms.  Several properties - each with four bedrooms, three baths, and the same price - may well represent radically different designs, commuting distances, lot sizes, tax costs, interior dimensions, and exterior finishes. Each person is different, therefore it is important to list the features and benefits you want in a home.  Consider such things as pricing, location, size, amenities (extras such as a pool or extra large kitchen), and design (one or two story, Victorian or ranch, etc.). Next it is important to consider your priorities.  If you are not able to obtain a home at your price with all the features you want, then what features are most important to you?  Would you take fewer bedrooms for a larger kitchen?  Would you take less land for the home you want? You should also consider your needs in several years.  If you'll need a larger home, maybe now is the time to buy a bigger home rather than moving or expanding in the future.  If you expect your income to increase, perhaps you should consider a more expensive home financed with a loan program where monthly payments increase in the future. How do I find a home?  You can begin by viewing properties on line right here. Search for homes  and print off your favorites, then make notes for each one - what you like, questions, etc.  Then contact me and I'll be happy to make the appointment to show you any one of the homes you've selected. There's no doubt that selecting the right home is a big decision.  You'll want to do it the right way! Here's what actually happens in the housing market.  A home is placed on the market for which the seller has established an asking price as well as other terms.  In effect, this is an offer.  At this point, you have three choices: Accept the seller's offer and create a contract. Reject it and not make an offer. Suggest different terms and make a counter-offer. If you select the last option, the seller may accept, reject or make a counter-offer. No aspect of the home buying process is more complex, personal or variable than bargaining between buyers and sellers.  This is the point where the value of an experienced REALTOR® is clearly evident because I know the community, have seen numerous homes for sale, know local values and have spent years negotiating real estate transactions. Is this house THE home for you? A house is a shelter, but a home is far more.  It is where you live, relax, entertain friends, raise families, and work.  A home is where you spend much of your life.  It is an enormous decision. How do you know if a house is THE one?  Take your time viewing the homes here on my site, then contact me. I will be happy to help you view all the homes on the Multiple Listing Service.  Together, we'll find just the right home. 4.      The Offer As a member of the California Association of Realtors, RE/MAX By The Sea has elected to use the Real Estate Forms that have been approved by our Realtor Association.  These documents include numerous sale conditions and their wording has been carefully reviewed to assure that they reflect the terms you want to offer.  REALTORS® can explain the general contracting process as well as their role in the transaction process. While much attention is spent on offering prices, a proposal to buy includes both the price and terms.  In some cases, terms can represent thousands of dollars in additional value for buyers - or additional costs.  Terms are extremely important and should be carefully reviewed. How Much Should I Offer?  An offer depends on the basic laws of supply and demand:  If many buyers are competing for homes, then sellers will likely get full-price offers and sometimes even more.  If demand is weak, then offers below the asking price may be in order. Careful evaluation is sometimes necessary, especially if you are obtaining a home loan to purchase the home.  Varying types of loan programs create varying closing costs.  Therefore, even if you are making a full price offer, if the Seller is required to pay some of the Buyer's closing costs, you offer may net the Seller less money than an offer that was for less money but the Buyers are paying cash for the home. REALTORS® assist Buyers in making an offer that will fit their needs and their financial ability.  A seller may counter-offer.  It is extremely important for the Buyer to remain in close contact with their REALTOR® during the negotiation process so that any proposed changes can be quickly reviewed. Once the negotiation process has been completed then any contingencies in the contract need to be addressed in a timely manner.  As your REALTOR®, I will be working closely with the lender, escrow, inspection contractors, etc. to ensure all timeframes are met and that all aspects of the transaction go smoothly. 5.      Inspections A number of inspections are common in residential realty transactions. In California, the most common inspections include checking for termites and wood destroying pests, appraisals to determine value for lenders, title reviews and structural inspections. Structural inspections are particularly important.  During these examinations, an inspector comes to the property to determine if there are material physical defects and whether expensive repairs and replacements are likely to be required in a few years.  Such inspections for a single-family home often require two or three hours, and buyers should be present if at all possible.  This is an opportunity to examine the property's mechanics and structure, ask questions and learn far more about the property than is possible with an informal walk-through.  The contract which we use has 17 business days from the acceptance of the contract to complete the inspection process, unless otherwise agreed to in writing. The inspector will provide you with a detailed written report about the condition of the home.  At this time, you and I will sit down and discuss the items in the report that you want the seller to address prior to close of escrow. As in the original contract, the seller may agree to all of your requests, some of them, or reject them all. There are many variables to this aspect of the transaction, which I will go over with you when the time comes. When an agreement is reached, the seller is responsible for making the agreed upon repairs, and we will do a final walk-through about 5 days before closing to make sure all of these items have been addressed. Once alll the contingencies are removed and your loan is approved, you will need to obtain insurance for your home before close of escrow. 6.      Closing Once your loan is approved, your lender will order the loan documents to be sent to escrow.  Approximately 5-7 days prior to closing, you will meet with the escrow officer to sign your loan documents. At this time, you will also bring in a check for the amount of funds needed to close.  After you sign your loan papers,  escrow returns the documents to the lender for final review.  Once approved they will fund your loan and the title company will take the grant deed to the county recorder, and VOILA!, it's yours. We meet and I hand you the keys. See also: Buying A Home With Good Resale Potential Buying Distressed Properties