THE ROAD TO BUYING A HOME
Perky & Jody Magee, CBR, CRS, GRI, RMM
Senior Associates
Vms: 781-479-4143 781-479-4169
Ems: p-jmagee@comcast.net
Website: jodymagee.com
We work only as a buyer's agents. Our combined forty-five years of education, experience, commitment, and fiduciary responsibilities are devoted solely to helping our buyer clients achieve their real estate goals. P & JM
1. Deciding to buy
A well thought out decision that you want to purchase a home is your first and most important step. Once you start looking, you may not find the most suitable property immediately. You need to prepare yourself for a buying process that is detailed, possibly lengthy, requires a serious time commitment, and can be an emotional experience.
2. First meeting to discuss financing, your interests, and the housing market place
I will discuss with you the need to get a pre-approval letter from a bank (lender). Getting a pre-approval letter is critical . It will help you determine exactly how much money a bank (lender) will loan you. I f you do not know your proper price range, deposit requirements, and the other costs involved, the result may be much wasted time, energy, and disappointment (from spending time looking at homes you may not be able to get a loan for). Lenders have strict loan qualification guidelines, and buyers must have verifiable incomes and good credit histories . Being pre-approved for a mortgage is essential when you make an offer to purchase a property. Sellers require them. I once had a client who lost a property, because they didn't have a pre-approval letter to accompany their offer. By the time they got it, another offer had come in. That pushed the price up, and my clients eventually lost the bidding, and the property. It was an extreme disappointment for them. Please let me know if you need any help getting a pre-approval letter. I can give you good advice.
After determining your home search price range, we will discuss what you want and need in a home. Wants are what you would like to have; needs are your requirements. When put in perspective with your lender's qualification range, it will be apparent which wants and needs are realistic given the present market . Important Point : During your home search, you need to remember that buying a home will require compromises . No home will be everything you need, or want it to be. Given the enormous number of variables involved, when a property has 70% or more of what you need and want, you should give it some serious consideration.
3. Looking at property
This is about your money, your future investment, and is the only way you can "determine value" in the housing market place. Helping you "determine value" is the most important thing I can do for you. Seeing the housing inventory is important, if you are going to make a good, buying, business decision . Though the excitement of looking at property wears off quickly, it is essential for you to see as many properties as possible that fall within your guidelines. Important Point : With the exception of new construction, you will be buying a used product . Inspectors are hired to find the unknown present or potential problems a property may have, however big or small.
4. Making an offer
Before putting in an offer, you should try to know as much about the property as possible. Usually, owners are aware of their homes' imperfections and shortcomings. The asking price, and the offer they would accept, should reflect that.
During your last viewing of the property, note anything needing repair, e.g. windows, condition of roof, gutters, appliances, bathroom fixtures, furnace and hot water systems, wiring, foundation, fences, and insulation (See #5 paragraph 1 re: inspections/inspectors).
Standard parts of an offer are the price, amount of the deposits, and, the dates for the inspection, signing of the purchase and sale agreement, financing, and the closing. Boilerplate dates put on an offer are: 10 days for the inspection, 10 days for the signing of the purchase and sale agreement, 21 banking days for the financing, and 60 days for the closing. These dates can vary, however, depending on personal situations, the market place, and what can be negotiated.
When you make an offer, a check (made out to the marketing real estate company) for $1000 is needed. If an agreement with the sellers cannot be reached, the check is returned. If an agreement is reached, the check is deposited in the real estate company's escrow account, to be applied toward the selling price of the property.
5. When an offer is accepted
You will hire a professional home inspector to go through the property with you. He/she will determine if there are any major problems that you aren't already aware of (your knowledge of the property prior to the offer will greatly reduce that from happening). Inspections are expected to be completed as soon as possible. Usually, an inspector can come within 24-48 hours' notice. Important Point : Remember, with the exception of new construction, you are be buying a used product . Inspectors are hired to find the unknown present or potential problems a property may have, however big or small.
6. Signing the purchase and sale agreement
A purchase and sales agreement is a more detailed summary of the offer. The main body of a purchase and sale agreement is a boilerplate type of document. A check for the agreed upon second deposit (usually 5% of the sale price) is expected when the purchase and sale agreements are signed. The money will be held in the Realtor's escrow account and be applied toward the purchase price at the closing. Although most purchase and sale agreements are fairly straight forward, it is prudent to have a real estate attorney review it before signing.
7. Financing
When getting your loan commitment, your lender will want to see a copy of the signed purchase and sale agreement and other information. It pays to stay in regular contact with your loan officer. Time is essential, because the purchase and sale agreement calls for you to get your financing commitment by a certain date.
Loan application fees vary from lender to lender, as do interest rates and closing costs. In looking for a lender, the experience and professionalism of the loan officer and organization are important. Given you probably will not be living the rest of your lives in any one home, the best service and loan programs don't always come with the lowest interest rates, and, refinancing is always an option should interest rates go down.
There are many things a lender will need to do before the closing. Their attorney has to do a title search, an appraisal of the property has to be done, a plot plan needs to be made, and a check for any liens on the property is necessary. These costs and others (such as points) make up your closing costs. Closing costs usually average from 2-4% of your loan amount. They represent additional cash you'll need, besides your down payment, at the closing.
8. The closing
By closing time, you need to have all the utilities of your new home put in your name. You should also notify the post office, and make arrangements for telephone service. Don't delay in contracting with a mover. They often need a minimum lead-time for scheduling purposes.
The actual closing, which normally lasts about an hour, takes place at your lender's attorney's office, or any other mutually agreeable place such as the Registry of Deeds. We will be with you at the closing. You will be required to sign a large number of standard documents for the lender. Each one will be fully explained by the attorney. Examples would be the mortgage , the mortgage note , and the truth-in-lending disclosure.
Any necessary adjustments between the seller and you are made at the closing. Examples would be current water and sewer charges, oil remaining in an oil tank, and prepaid or unpaid taxes.
The three things you'll need to bring to the closing are: a homeowner's hazard insurance binder stating the lender as the beneficiary, a certified check (made out to yourself) for the balance of your down payment and closing costs (you will sign it over to the lender), and your checkbook for any adjustments.
Last, the sellers will give you keys and a signed deed conveying ownership of the property. Right after the closing, the attorney will record the deed at the registry.
CONGRATULATIONS! YOU'RE A NEW HOME OWNER.
All Realtors Are Far From Being Equal. 10% Of All
Realtors Do 90% Of All Real Estate **
** NATIONAL ASSOCIATION OF REALTORS