Deciding to Buy

Purchasing a property is most likely the biggest financial decision you will ever make. Whether this is your first purchase or you are an experienced buyer, this decision must be made carefully.

Why Do You Want To Buy?

Are you tired of paying rent? Have you decided to pay your own mortgage and not your landlord's? Have you outgrown your current home? Are you looking for an investment portfolio? Are you looking for a rental property? Would you like a larger yard? Would you rather live in a different area? Do you want to shorten your commute? Having a clear sense of your reasons for buying will help you choose the right property.

Has Your Income Grown?

Property ownership is an excellent investment; whether you are looking for your dream home, a rental property, or to expand your investment portfolio.

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Preparation

Before you start shopping for your property, it is a good idea to make some preparations.

Build Your House File

A house file contains all your important financial documents. You will need it to secure financing for your property. The typical house file should contain:

• ● Recent financial statements
• ● Bank accounts and statements
• ● Investments
• ● Credit card information and balances
• ● Auto loan and balance
• ● Recent pay stubs
• ● Tax returns for two years
• ● Copies of leases for investment properties
• ● 401K statements, life insurance, stocks, bonds, and mutual account information.

List of Home/Property Needs and Wants

Another suggestion is to make two lists. The first should include items you must have (i.e., the number of bedrooms you need for your family, a single story home if accessibility is a factor etc.). The second list is your wishes list or things you would like to have (pool, den, etc.) but that are not absolutely necessary.

Lending

Your credit score will have a huge impact on what type of property you can buy, and at what price. It is first recommended to check your credit rating with an experienced lending institution so that we can determine what you can afford. The lender will research your credit ratings from the three credit reporting agencies. Look for a qualified lender that can assist in finding the right mortgage for you.

Ask friends and associates who have refinanced or purchase recently for recommendations. You?ll want to find a loan officer who is energetic, flexible, and knowledgeable about finance and loans. Someone who has your best interest in mind. I will be happy to recommend experienced, knowledgeable lenders in the residential, construction, commercial, and investment real estate fields.

Knowing how much you can afford is the first step. Sellers will be much more receptive to potential buyers who have a pre-approval letter from a lender to include with the contract to purchase a home. You will also avoid being disappointed when looking at homes that are out of your price range.

Be Careful With Your Finances

Now is not a good time to make sudden career changes or large purchases. You want to approach your property purchase from a position of financial stability.

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Choosing a Realtor®

Buying a property requires making many important financial decisions, understanding complex issues and completing a lot of paperwork. It helps to have an expert in your corner when undertaking such a large purchase. I can guide you through this process, and also provide you with access to property listings before they hit the general market.

Here are some factors to consider when choosing your real estate professional:

• ● Look for a full-time agent ? one who has experience completing transactions similar to yours.
• ● Interview agents: Are they familiar with the area in which you are interested?
• ● Ask how much time the agent will have for you, and if they are available at night and on weekends.
• ● Ask about their credentials and education: A good agent will continually strive to improve and gain knowledge of the latest real estate trends and hold the highest designations in their respective fields of expertise.
• ● Using state of the art communication tools.
• ● Does the agent return your calls promptly? Time is money when attempting to buy a property.
• ● Ask for a list of references.
• ● Choose an agent who listens attentively to your needs and concerns. Pick an agent, with whom you feel comfortable.

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Time to go Shopping

Once those preparations are out of the way, it is time to find the right property for you.

Take a Drive

Get to know the neighborhoods, complexes, or subdivisions, which interest you. Drive around and get a feel for what it would be like to own a property in the area. Start getting a sense of the properties available in those areas.

Narrow Your Search

Select a few properties that interest you the most and have your real estate agent make appointments to visit them. Ask your real estate agent about the potential long-term resale value of the properties you are considering.

Time to Buy

Once you have picked out the property you want to purchase, your real estate agent can help you make an offer that the seller will accept. A good agent will investigate the potential costs and expenses associated with the new property. An agent can also help you structure your offer in a way that may give you the advantage over another offer.

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Title Escrow, Inspection and Appraisal

The Process, Step-by-Step

The Initial Agreement and Deposit

An effective agreement is a legal arrangement between a potential purchaser and the property's seller.

Some important tips to keep in mind to streamline the process:

• ● Keep written records of everything. For the sake of clarity, it will be extremely useful to transcribe all verbal agreements including counter-offers and addendums and to convert them into written agreements to be signed by both parties. I will assist you in drafting all the paperwork for your purchase and make sure that you have copies of everything.
• ● Stick to the schedule. Now that you have chosen your offer, you and the seller will be given a timeline to mark every stage in the process of closing the real estate contract. Meeting the requirements on time ensures a smoother flow of negotiations so that each party involved is not in breach of their agreements. During the process I will keep you constantly updated verbally and also with a written timeline, so you will always be prepared for the next step.

The Closing Agent

Either a title company or an attorney will be selected as a closing agent. The closing agent will hold the deposit in escrow and will research the complete recorded history of the property to ensure that the title is free and clear of encumbrances by the date of closing and that all new encumbrances are properly added to the title. Some properties are subject to restrictions, which limit various activities such as building or parking restrictions. There may be recorded easements and encroachments, which limit the rights to use your property.

Inspections

Once your offer is accepted by the seller, you will need to have a licensed property inspector inspect the property within the timeframe that was agreed upon in the effective contract to purchase. You may elect to have different inspectors inspect the property, if you wish to obtain professional opinions from inspectors who specialize in a specific area (e.g. roof, HVAC, structure). I can recommend several different inspectors.

Depending on the outcome of these inspections, one of two things may happen:

• ● Either each milestone is successfully closed and the contingencies will be removed, bringing you one step closer to the purchase, or
• ● The buyer, after reviewing the property and the papers, requests a renegotiation of the terms of contract (usually the price or repairs needed that were found during inspection).

Appraisal and Lending

It is imperative that you keep in close communication with your lender, who will let you know when additional documents are needed to approve your loan application and fund your loan. If the agreement is conditional upon financing, then the property will be appraised by a licensed appraiser to determine the value for the lending institution, via a third party. This is done so that the lending institution can confirm their investment in your property is accurate.

Appraisers are specialists in determining the value of properties, based on a combination of square footage measurements, building costs, recent sales of comparable properties, operating income, etc. Always stay in touch with your lender to be sure the loan will go through smoothly and on time.

Property Insurance

If you are obtaining a loan, you will be required by your lender to purchase a certain amount of insurance on the property. The value will depend on the lending institution and the purchase price of the property. You may be able to save on homeowners insurance by shopping around for insurance. This will need to be done in the option period to make sure the home is insurable.

Home Warranty

Home Warranties are an option and cover almost everything in the home. They also may be negotiated into the purchase offer and paid for by the seller.

Closing Day

If you have come this far, then this means that it is almost time for a congratulations, but not yet. Do not forget to tie up these loose ends.

Final Walk-Through Inspection

More of a formality than anything else, the final inspection takes place a day before, or the day of the closing. You will visit the property to verify that all is in working order, everything is the same as when you last viewed the property that there are no extra items left behind, and that everything included in your purchase is still at the property.

Home Services and Utilities

I will provide a list of useful numbers for the activation of home services and utilities after the closing occurs.

Be Prepared

I'm ready to assist you should an unforeseen glitch pop up, even at this last stage. Something at the property breaks down, or some other minor detail - no need to worry. I have encountered these problems before so I know how to handle them efficiently and in a stress-free manor.

Closing

The closing agent will furnish all parties involved with a settlement statement, which summarizes and details the financial transactions enacted in the process. You and the seller(s) will sign it as well. I will review this with you line by line certifying its accuracy.

• ● If you are obtaining financing, you will have to sign all pertinent documentation required by the lending institution.
• ● If you are unable to attend the scheduled closing, then arrangements can be made for a mobile closing (your office or a restaurant on your lunch break).
• ● If you are bringing funds to the transaction, you can elect to either have the funds wired electronically into the closing agent's escrow account, or bring a certified bank check to the closing in the amount specified on the settlement statement.

I will contact the seller?s agent and arrange to have all property keys and any other important information for you at the closing so that you may receive these items at that time.

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Moving In

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