Buyer’s Guide to FAQ
Q: What does a Real Estate Professional do for me?
A: Many Realtors are buyer specialists who focus on helping people successfully find and buy the homes they’ve always wanted.. And that’s just the first step.
Buying real estate is a complex matter at the best of times, given that there are so many factors to consider and no two homes or transactions are alike. However, with all the unique opportunities and potential pitfalls of the current market, it’s even more important for you to contact a REALTOR®once you’ve definitely decided to buy.
A REALTOR®can guide you through the property search, financing, negotiation and transaction processes.
- Educate you about Buyer Agency, outlining their professional responsibilities to you, including complete Disclosure, Loyalty, Confidentiality, Obedience and Accountability
- Evaluate your specific needs and wants and locate properties that fit those specifications.
- Help you explore your financing options and, if required, refer you to some excellent mortgage professionals so you can make the best possible mortgage decision
- Save you time by regularly searching the market for affordable homes that meets your criteria
- View homes with you and provide comparative analysis. They can also refer you to expert home inspectors that will provide more in-depth analysis and advice
- Provide consultation in relation to your written offer to purchase a home, with all terms approved by you.
- Reviews and explain all legal documents to you.
- Negotiate the best possible price and terms for you and take care of all the documentation details. This also applies for New Homes. Remember the Sales Persons at a builder are representing the Builder and the Builder’s best interest.
- Keep you fully informed about all activities that lead to the transaction closing
- Assist you, if necessary, in finding any home-related services you need.
In short, they’ll provide you with comprehensive, high-quality buyer’s service.
So when you decide to buy a home, or if you hear that any of your family and friends are looking to buy, be sure to take advantage of the knowledge, experience and professionalism of a REALTOR
Q: What is the home buying process?
A: If you’re like most people, buying a home represents your single biggest investment – and debt. As such, the home buying process can be one of the most exciting, but sometimes also stressful, experiences you ever go through. And this is true whether you’ve bought many homes or you’re looking to buy your first, whether you’re in the market for a new primary residence, an investment property or that perfect vacation getaway.
Moreover, never has the real estate market offered more great opportunities, or been fraught with more risks, than now. There are so many factors to consider and so many decisions to make. That’s why, when buying, it’s crucial for you to have all the available resources necessary to make a well-informed decision, together with the time required to make complete use of them. That’s why you should enlist the help of a trusted REALTOR® who’ll be able to provide you with expert consultation at each step of the buying process.
Generally, finding and purchasing a home includes the following steps:
- Define Your Goals and “Needs” and “Wants”
- Contact A REALTOR®
- Get Pre-Approved For a Loan
- View Homes and Select THE ONE
- Make an Offer
- Negotiate With The Seller.
- Contracts and Addendum
- Earnest Money and Option Fee
- Secure financing
- Close the Deal
- Utilities and Phones etc.
- Home Owners Insurance
- Home Warranty
Q: How can I make the Buying Process Easier?
A: Define your Goals, Needs and Wants…
Prepare yourself as much as possible in advance. This means clearly determining why you’re buying and what kind of home you’re looking for. You may want to do this yourself, but you may also benefit by consulting an experienced REALTOR® right from the start.
Make a list of needs as well as a list of desires and discuss it with your Realtor when you first meet.
Your team will work best for you if you are up front and honest with your Realtor and lender about your credit history.
Whether your credit is good or bad, affects everything from your down payment to your interest rates.
Your Realtor and/or a Professional Mortgage Consultant can often advise you as to how you can get credit problems cleared up before you apply for financing.
Q: How do I get approved for a loan?
A: Your Realtor will arrange for a meeting with a lender. It is highly recommended that you get pre-qualified for a loan before you start viewing homes with the serious intention of buying. The pre-approval process involves meeting with a lender and authorizing them to examine your current financial situation and credit history. On the basis of this examination the lender will provide you with a document that details how much you can borrow to buy a home.
The benefits of pre-qualification include:
- You’ll have information about what you can afford and be able to plan accordingly
- As a qualified, motivated buyer you’ll be taken more seriously when you make an offer on a home
- Lenders can tell you whether you qualify for any special programs that will enable you to afford a better home
- Real estate financing is available from many sources, and an experienced REALTOR® will be able to suggest lenders with a history of offering excellent mortgage products and services.
Q: How can I view Homes?
A: There are many benefits to starting the search process at a real estate website like www.Century21A-One.com You can view all homes and their details, take video tours and access neighbor-hood info.
It’s also very important to view homes in person. While their property details may seem similar online, homes can actually be very different in terms of layout, design, workmanship and other aspects. In addition, you should ideally view homes with the help of an experienced and eagle-eyed REALTOR® who’ll notice things you might miss, provide expert analysis, and act as an impartial sounding board.
Your Realtor also has access to all New Homes and Custom Builders which are not always shown on Websites.
Q: How do I make an offer on a home?
A: Now that you’ve found the home you’d like to buy, it’s time to make an offer.
Your local real estate association, working with legal counsel, has developed the contracts that are used for transactions in your area. These contracts enable you to specify a sale price and also include many clauses for specifying various terms of purchase, such as the closing and possession dates, your deposit amount, and other conditions. You should carefully review these clauses with your REALTOR® to ensure that they express your desired offer. In addition to drawing up the contact, your REALTOR® will be happy to address all your questions about the offer process.*
Once you’ve written the offer, your REALTOR® will present it to the seller and the seller’s representative. At that point, the process – given that a home’s eventual sale price is subject to supply and demand – will depend on the kind of market you are currently in. Generally though, the seller can accept your offer, reject it, or counter it to initiate the negotiation process.
Successive counter-offers, with deadlines for responding and meeting conditions, will be exchanged between you and the seller until a mutually-satisfactory pending agreement is reached or the negotiations collapse.
Negotiations can involve many factors relating to different market conditions, homes and sellers,
Indeed, your future may depend on it. As the old saying goes, ‘let the buyer beware’. Particularly in these times, when so many buyers are suffering the consequences of having not fully understood their financing decisions, it’s crucial for you to work with people you trust. In this regard, a good REALTOR® can be a true friend for life.
Q: After I signed the contract what are the next steps?
A: First, get the home Inspected
Your Realtor will help you find a Professionally Licensed Inspector.
The Inspector will accompany you through the home and point out repairs or discrepancies if they exist and issue a report on the condition of the home.
The seller will be notified of the problems and negotiations start over about repairs to be completed before the closing date.
Then, set up an appointment with your mortgage consultant who will guide you through the approval process. Be prepared to pay an appraisal fee at this time if you have not already done so.
Next work with your Real Estate Professional to select a Title Company.
The Title or Settlement Company has the responsibility of making your transaction legal.
They will do the title work, examine the survey, prepare mortgage documents and all the necessary closing paperwork.
You will need to provide proof of homeowner’s insurance at this time. You have the right to choose your own insurance company or work with your Realtor for a referral to a reputable company. Be sure to get a quote from Judge Fite Insurance, too.
Obtain certified funds for the settlement. The title company will be able to tell you in advance the fees that will be due.
Last step before closing, Conduct a final walk through of the home. Be sure to note any discrepancies from the home inspection that has already been completed. By taking the time to go through this process in a timely manner, your transition into your new home will be easy and stress-free.
Now is the time to transfer all utilities into your name.
Q: Newly built homes. Can an agent help me?
A: DON’T FORGET the salesperson for the builder works for the builder’s best interest, NOT YOURS!
Cost to you is NOTHING
Any compensation given to a Realtor is recognized by the builder as a marketing fee and has no impact on the final cost of the home you buy.
A Realtor can help you find SAVINGS
Are you getting what you’re entitled to have…quality, value and savings?
When represented by a Realtor you have an advocate on your side to help you see the good and in some cases the not so good that can cost you down the road.
Are you paying too much? What is a fair offer? A Realtor will advise you and will negotiate on your behalf.
Builders look at a client as a one-time investment. A Realtor is repeat business to the builder and expects to get more clients through the REALTOR and hope for future business. This gives a Realtor a unique position to negotiate the best possible deal for you.
Q: What is an Agreement of Sale?
A: Also known as contract of purchase, purchase agreement, or sales agreement according to location or jurisdiction. A contract in which a seller and buyer agree to transact under certain terms spelled out in writing and signed by both parties.
Q: What is an Appraisal?
A: A professional appraiser’s estimate of the market value of a property based on local market data and the recent sale prices of similar properties.
Q: What is Assessed Value?
A: The value placed on a home by municipal assessors for the purpose of determining property taxes.
Q: What is a “Closing?”
A: The final steps in the transfer of property ownership. On the closing date, as specified by the sales agreement, the buyer inspects and signs all the documents relating to the transaction and the final disbursements are paid. Also referred to as “The Settlement”.
Q: What are Closing Costs?
A: The costs to complete a real estate transaction in addition to the price of the home, to include: Points, Taxes, Title Insurance, Appraisal Fees and legal Fees.
Q: What is a contingency?
A: A clause in the purchase contract that describes certain conditions that must be met and agreed upon by both buyer and seller before the contract is binding.
Q: What is a Counter-Offer?
A: An offer, made in response to a previous offer, that rejects all or part of it while enabling negotiations to continue towards a mutually acceptable sales contract.
Q; What is a Down Payment?
A: The money paid by the buyer to the lender at the time of the closing. The amount is the difference between the sales price and the mortgage loan. Requirements vary by loan type. Smaller down payments, less than 20% usually requires mortgage insurance.
Q: What is Earnest Money?
A: A deposit given by the buyer to bind a purchase offer and which is held in escrow. If the property sale is closed, the deposit is applied to the purchase price. If the buyer does not fulfill all contract obligations, the deposit may be forfeited.
Q: What is Equity?
A: The value of the property, less the loan balance and any outstanding liens or other debts against the property
Q: What are Easements?
A: Legal rights of access to use of a property by individuals or groups for specific purposes. Easements may affect property values and are sometimes part of the deed.
Q: What is Escrow?
A: Funds held by a neutral third party (the Escrow Agent) until certain conditions of a contract are met and the funds can be paid out. Escrow accounts are also used by loan servicers to pay property taxes and homeowner’s insurance.
Q: What is Residential Service Contract?
A. Provides protection against high cost of repairs to your systems and appliances and is negotiated as to who pays for the first year of service on the contract.
Q: What is a Home Inspection?
A: Professional inspection of a home, paid for by the buyer, to evaluate the quality and safety of its plumbing, heating, wiring, appliances, roof, foundation etc.
Q: What is Homeowner’s Insurance?
A: A policy that protects you and the lender from fire or flood, a liability such as visitor’s injury, or damage to your personal property.
Q: What is a Lien?
A: A claim or charge on property for payment of a debt. With mortgage, the lender has the right to take title to your property if you don’t make the mortgage payments.
Q: What is Market Value?
A: The amount a willing buyer would pay a willing seller for a home, neither party under pressure. An appraised value is an estimate of the current fair market value.
Q: What is the Possession Date?
A: The date, as specified by the sales agreement that the buyer can move into the property. Generally, it occurs within a couple of days of the closing date.
Q: What is the Principal?
A: The amount of money borrowed from a lender to buy a home, or the amount of the loan that has not yet been repaid. Does not include the interest paid to borrow.
Q: What is a Purchase offer?
A: A detailed, written document which makes an offer to purchase a property, and which may be amended several times in the process of negotiations.
When signed by all parties involved in the sale, the purchase offer becomes a legally binding agreement or also known as “Executed Contract”.
Q: What is Title?
A: The right to and the ownership of a property. A title or deed is sometimes used as proof of ownership of land. Clear title refers to a title that has no legal defects.
Q: What is Title Insurance?
A: An Insurance policy that guarantees the accuracy of the title search and protects lenders and homeowners against legal problems with the title.