Buying a home is a major financial commitment. For most people, it is the largest single purchase they will make in their lifetime. Beyond the financial commitment, homeownership is an important milestone in a buyer’s life. It is an expression of lifestyle, as well as the place that will shape their family life for years to come. With so much at stake, buyers want a trusted guide who can help them make good decisions and minimize risks. With the internet there is a world of information out there about real estate. However, the average American will buy or sell a home every 5 to 7 years. As a full time REALTOR®, I’m involved in the buying and selling of homes each and every day. There is a lot more involved in a real estate transaction than what can be found on the internet or learned from your family and friends that have gone through the process. As your REALTOR®, I will guide you through the “Keys” to a successful Home buying experience.
Keys To A Successful Home Buying Experience
Finding the right
Previewing homes, making an offer and negotiating
Get pre-approved for a mortgage loan
Due diligence and contingencies
Preparing for closing day
Finding the right Buyers Agent
What do I offer that makes me different?
I am a REALTOR®! What is The REALTOR® Difference? Not every licensed agent is a REALTOR®. The term REALTOR® is a registered collective membership mark that identifies a real estate professional who is a member of the NATIONAL ASSOCIATION of REALTORS® and subscribes to its strict Code of Ethics. To earn the designation, a REALTOR® has taken coursework and demonstrated specific skills, performance and knowledge in a particular area of the real estate industry. There are around 50,000 active agents in the state of Georgia, less than half are REALTORS®. Why am I a REALTOR®? Because, I choose to differentiate myself, set higher expectations and provide my clientele with the best experience possible in a real estate transaction.
As a REALTOR® I have access to Georgia specific legal contracts. This will give you peace of mind knowing your transaction is in complete compliance.
I hold designations as both ABR (Accredited Buyers Representation) and SRS (Seller Representative Specialist). It’s important to understand the mind of a Seller when you’re representing the Buyer. Whoever you hire, make sure they carry both the ABR and SRS designations. There are only a couple of 1000 agent’s in Georgia who hold both. The annual cost of professionalism, of being a REALTOR®, ABR, and SRS is minimal when compared to its impact on my business and my industry.
It is an honor and a privilege to serve you! Thank you in advance for your trust!
Services I will provide as your Buyers Agent
As your Buyer’s Agent, I will assist you with the following, all at NO cost to you. In most instances the compensation comes directly out of seller’s proceeds.
– Counsel with you to determine wants, needs and abilities.
– Facilitate the loan approval process
– Search for your ideal home in the MLS
– Create a personalized on-line interactive tool for Homebuyers
– Provide you with a CMA (Competitive Market Analysis) on homes you are interested in
– Write an offer and negotiate to get you the “best deal” on the home you want
– Help you arrange a Home Inspection, and attend that inspection with you
– Handle details during closing; “trouble shoot” problems
– Attend the closing with you and be there to hand you the keys to Your New Home
As we begin to move forward with the process, we will meet to review the Buyers information packet that I have prepared for you that includes sample forms we will be using during the process and other helpful information. In today’s market homes can go under contract quickly once they are listed. We need to make sure that you the buyer have a clear understanding of all the forms and documents ahead of time so that when your dream home goes on the market we can act immediately. During this meeting we will also compile a list of important criteria for your future home. I will provide you with access to the same multiple listing services that I use and show you how to create a search using your criteria. In addition you have the ability to search homes directly from my web site.
Understanding the Buyer Brokerage Relationship
It’s important to understand Georgia real estate law prohibits a Broker from representing a buyer as a client without first entering into a written agreement with a buyer. In order for a Buyer customer to become a Buyer client there must be an Exclusive Buyer Brokerage Agreement completed and signed by all parties. In the information page below you will find a great explanation of differences between the two. I will also go over and review the Exclusive Buyer Brokerage Agreement with you in person before signing.
Get Pre-Approved for your Mortgage Loan
The next step in the home buying process is getting pre-approved for your mortgage loan. This should be done before you begin to preview homes for a couple of reasons. First, so that you know your buying power to determine what price range you’ll be looking in. Second, because most sellers today will not consider any offer unless it is accompanied by a pre-approval letter from a reputable lender.
I have several trusted lenders that I have worked with over the years and have proven to get the job done. It’s important to have a lender that provides an open line of communication and weekly updates on the progress or your mortgage loan.
Please contact me for a list of reputable lenders.
The information below is usually required during the loan process:
- Your Social Security card & Drivers License
- Past 30 days pay stubs
- W-2’s and COMPLETE past 2 years tax returns
- Bank statements from the past 2 months (all pages)
- Investment account statements for the past 2 months (all pages)
- Life insurance policy
- Retirement account statements from the past 2 years
- Credit card account information
- Auto loan information
- Personal loan account information
If you currently own Real Estate the following information will also be required:
- Mortgage account information
- Homeowners insurance policy information & property tax information for all properties owned
- Home equity account information (if applicable)
There are some things you should absolutely not do during the home buyer process:
- Do not quit your job
- Don’t buy any large ticket items
- Don’t make any unusual deposits, all funds must be traceable
Any of these could cause loan denial. Just be aware and discuss with your lender upfront the details you need to be mindful of.
Previewing Homes, Making an Offer and Negotiating
Now the fun begins! Let’s find your new home! I will ask you to prepare a list of homes that you are interested in previewing using the home search we created together. From that list I will contact all the listing agents to schedule the showing appointments. It’s important to understand that most homes are still occupied and an appointment will be required.
It is possible to find what you are looking for the very first day you go out, this happens more often than you would think. Don’t let this scare you. Let’s go ahead and get that offer submitted. In a hot market, if you go home and sleep on it, you may never sleep in it!
I believe when you walk into the home that is meant for you, you will know it!
When in doubt use the 80/10/10 Rule. If you find a house that has 80% of what you are looking for, 10% of things you can change and 10% of things you can live with, it’s a keeper.
Making an Offer
In order to prepare a good strong offer, there are many items to consider:
- How long has the home been on the market, has it been under contract previously, are we in a buyer’s market or a seller’s market, what is the current inventory of homes for sale in that area?
- How much should you offer?
- How many days of due diligence will we ask for?
- How soon can you close?
- Are you paying cash or will there be financing contingencies?
- Are seller contributions needed?
- How much earnest money should be submitted?
I will counsel you on making an effective offer that will land you the home of your dreams. The offer will include a deadline for the seller to respond. Once the offer has been completed and signed, I will send it over to the listing agent. The listing agent will review with the sellers and they will either (hopefully) accept or prepare a counteroffer. When the buyer and seller have reached an agreement and all documents have been signed by all parties, we now have a binding agreement.
5 Biggest Negotiation Blunders
According to the 2011 National Association of Realtors® Profile of Home Buyers and Sellers, the second most popular reason buyers use a real estate agent is to help with the negotiation process. However, buyers can negatively impact the process making mistakes which lead to them losing their dream house. Don’t make these negotiation blunders:
- Not entering with a negotiating strategy: Before submitting an offer, try to remember that the seller has already decided how much money they want from the sale of their property. Knowing how to negotiate effectively is the key to getting the best deal. Without a plan, you might risk losing the house you want.
- Giving up too soon: Buyers might get discouraged when they are competing against multiple offers on a house. However, the biggest mistake a buyer can make is panic and withdraw their offer. You should stay involved for at least one round of negotiations, but also establish your maximum price.
- Not providing earnest money: Earnest money is a cash deposit you make when submitting your written offer on a property to show your “good faith.” Sellers are understandably suspicious of offers that are not accompanied by such a deposit.
- Having too many contingencies: A contingency is a term or condition that must be met for an offer to become a binding contract. Home buyers with too many contingencies tend to weaken an offer. Some examples of contingencies are securing a job transfer, selling your current home or obtaining specific financing terms.
- Weak negotiating position: Sellers usually like to go with a strong bargaining position. Some examples of strong positioning is being pre-approved for a mortgage or having little to no contingencies. “With these factors in your favor, you may be able to negotiate a lower price. On the other hand, in a ‘hot’ seller’s market, if your ‘perfect’ home comes on the market, you may want to offer the list price (or more) to beat out other offers.
Due diligence and Contingencies
Most contracts contain a due diligence period, which is typically anywhere from 7 to 14 days from the binding agreement date and expires at 11:59pm of the last day. The number of days will be determined during the negotiating process of the contract. There are times, although rare, that a buyer will elect not to include a due diligence period. During the due diligence period the buyer can inspect and evaluate the property and terminate the contract without penalty, receiving a full refund of their earnest money.
Home inspections are performed to evaluate the condition of the home. Other inspections that may also be done are termite inspection, septic system inspection, radon test, mold test, pool inspection and possibly a water test if the home is on well water.
Once the inspections have been completed, most homes will have a few items that need to be repaired and/or replaced. At this time the buyer can submit an Amendment to Address Concerns with the Property and the negotiating begins again. The buyer may ask for repairs and/or replacements of some items, a reduction in the sales price in or additional seller contributions. I will assist you in negotiating the fairest solution to keep us moving in the right direction. The buyer and seller must come to an agreement and the Amendment to Address Concerns signed by all parties prior to the end of due diligence. If no agreement is made, the Buyer can either terminate the contract or purchase the home as is.
If the Buyer is obtaining financing to purchase the home, the contract will also include a Financing Contingency and Appraisal Contingency. The Appraisal Contingency may or may not be included in a cash purchase.
The Financing Contingency and the Appraisal Contingency period will start from the binding agreement date and expire at 11:59pm on the negotiated date. The amount of days will be negotiated during the same time as the purchase and sale agreement. Typically they are both 21 days from the binding agreement, but may vary.
Financing Contingency – The buyer will have the negotiated amount of days of the financing contingency for the lender to determine if the buyer has the ability to obtain a mortgage. Although a buyer should have already been pre-approved or at least pre-qualified before we go under contract, there are still conditions that the lender will ask to be met during the financing contingency. During the financing contingency period if the buyer is unable to receive conditional loan approval from the lender, the buyer will have the right to terminate the contract without penalty providing a loan denial letter from the lender.
Appraisal Contingency – The buyers obligation to purchase the property is contingent upon buyers receipt of an appraisal of the property, performed by a licensed Georgia real estate appraiser, showing the value of the property to be equal to or greater than the purchase price.
After the housing market did its thing in 2008, appraisals are handled much differently today. Lender’s can no longer have any type of relationship or contact with the appraiser. When the lender receives a copy of the executed contract, an order for the appraisal goes to the middleman known as an appraisal management company. Using this process they hope to prevent inflated appraisals and perhaps another housing bubble. If the Property does not appraise for a minimum of the purchase price, we then go back to another round of negotiating. The buyer does have the right to terminate the contract without penalty by providing the seller a copy of the appraisal and written notice to terminate. The buyer or seller also have the right but are not obligated to, propose that the purchase price be reduced. The buyer may also chose, but again is not obligated to; pay the difference between the purchase price and the appraised value in cash at closing.
Preparing for Closing Day
As we approach closing day it is very important to keep things moving in a timely manner. The lenders underwriting department will continue to ask for documents possibly right up to the day before closing. Please keep in mind that a prompt response will assure that we stay on track.
Below is a check list of items to be taken care of before closing:
- Homeowners Insurance: call the company you currently have auto insurance with, they usually give discounts for combined home and auto policies. I recommend getting quotes from several other companies for the same combined policy. The lender will need to know as soon as you have decided on the company.
- Moving Company: go ahead and schedule the moving company.
- Utilities: schedule to have the utilities switched over into your name effective the day of closing. I will be sending you the list of all utility providers.
- Change your mailing address: this can be done on-line at www.usps.com
A few days before closing, your lender or closing attorney will notify us of the amount of money that is required from you to close. Because of internet scams, please follow the instructions below when wiring your funds to close.
Best Practices – Wiring Transfer
- Contact the attorney by phone!
- Discuss any and all concerns with the closing attorney regarding the wire transfer.
- While you are on the phone with the attorney’s office. You should ask for the instructions to be emailed. Prior to ending the call with the attorney’s office, verify the correct wiring instructions were received by confirming the bank name, account number and routing number.
On closing day remember to bring your drivers license and one other form of ID. Also, bring a personal check; sometimes there can be a slight difference in dollar amount on funds needed for closing.
I will be there to support you at the closing table and hand you the keys to your new home!
I can’t wait to see you achieve the American Dream!