Buying a Home?
The decision to purchase a home is a big one, and one that should not be taken lightly. When you approach the buying process in a careful, methodical way, and when you have the right people on your team, buying a home can be a wonderful experience. If you approach the buying process haphazardly, however, it can bring you a lot of unnecessary headache and aggravation. Remember that when you purchase a new home, you're not only investing in the property itself, but in your financial future.
When you're ready to buy your new home, you're bound to have a lot of questions about everything from the house-hunting process to the potential size of your monthly payments to the projected time frame from searching to closing.
When you work with me, you will benefit from my use of up to date technology to help locate properties in your ideal neighborhoods, designs, and price range; including email updates. While technology will work wonders for us in your home search my commitment to client education ensures that you'll feel knowledgeable and secure through every step of the home buying process. So whether you're a first-time buyer or a long-time real estate investor, let the me help you buy your next home!
If you are interested in working with me, please call me at 901-604-5838 or click here.
Advice for First-Time Buyers
The process of purchasing a home is often the most confusing for first-time buyers. But it doesn't have to be that way. If you educate yourself about the process, you're sure to have a much more enjoyable home buying experience.
Here are some things you need to know about when you're buying your first home.
Before you start looking get pre-approved.....pre-approval is different from pre-qualification. For more information on the pre-approval process or questions about financing options click here.
Make a list.....in fact, make two lists. One list should include the features you absolutely need in any home you choose: number of bedrooms and bathrooms, square footage, lot size (especially if you have pets), storage space, etc. The other list should be your 'wish list', and should include features you would like to find in your ideal home: in-ground pool, granite countertops, hardwood floors, bay windows, master suite. When you're buying your first home, you probably won't be able to find (or afford) all of the features on your 'wish list', but it will give you an idea of what amenities are important to you and which you can comfortably live without.
Find a real estate agent.....a buyer's agent is an important asset to all home buyers, but especially to first-timers. A reputable professional agent, like myself, will use the Multiple Listing System (MLS) among other upt to date technologies that can help you find properties in your ideal neighborhoods and price ranges; sometimes properties before they ever hit the market. TIn addition they will arrange showings, research properties, offer information on values and advice about the current market conditions.
They will be there to help you navigate the entire home purchase process and what I feel is the most important aspect of a buyers agent is they will act as an advocate for you when it comes time to enter price negotiations and decide on seller contingencies.
Keep your focus.....Once you start your search create a file for all paperwork that pertains to your home search, including your pre-approval letter. This will prevent any important documents from getting lost. Other useful items include:
A blank notebook and pens. Take notes on searched properties and jot down impressions of properties you've viewed. Also take notes on the area: are there any neighborhood features you like (shopping areas, parks, highway access) or dislike (abandoned homes, excessive trash, adult businesses, noisy street)?
A digital camera. If you see a home you're interested in, snap a photo of it from the street. Also, take pictures (with the owner's permission, of course) of homes you like at showings or open houses. This will keep your memory of the properties fresh.
Maps, brochures, and articles. Especially if you're searching in master-planned communities, brochures will help you remember neighborhood features and amenities. Maps can help you remember the locations of properties you like, and show you nearby amenities.
Visualize yourself living in a property.....when you go to a showing or an open house, try to visualize your own furniture, accessories, and art set up in the home. Ask realistic questions. Are there enough windows? Are the hallways too narrow? Are the ceilings too high or too low? Try to determine which negative points about the home can be corrected with simple touches like fresh paint, and which would require a major commitment to fix. Also, if you have a lot of oversized furniture, you may find it helpful to take measurements (with the permission of the seller).
Be objective.....don't make an offer on the wrong house simply because you're in love with its charm. When you fall head over heels for a property, ask yourself if it really meets your needs. Refer to your list of 'absolute must-haves' if you find yourself slipping. Remember, buying a home is a big commitment; you want to be sure that you won't regret it a year from now.
Be skeptic.....if you're unfamiliar with a neighborhood, scrutinize it from all angles. Drive through the area at different times of the day. Some areas that look inviting in the sunlight may not be so appealing after dark.
Be thorough.....when you find your perfect home make sure that you have all appropriate inspections performed, and that the seller has met all inspection requirements and contingencies specified in your purchase contract. If the seller was required to make major repairs (like roofing, siding, foundation sealing) prior to closing, you may want to have a professional home inspector check out the property a second time. The additional cost is well worth it to ensure that all repairs are to code and of reasonable quality.
Be Patient.....it's not always a quick step to closing once you've found your perfect home. It's important to remember that each step in the process is important, and that rushing things may cause greater delays and expensive problems in the end.
When you buy a home for the first time, you'll want a professional real estate agent on your side through the entire process. If you would like an oportunity to meet with me, please call me at 901-604-5838 or click here.
Ready to make your offer?
When it comes time to negotiate the sale price for your new home, it's important to be prepared. With my knowledge of the current real estate market, as well as a firm understanding of your personal financial capabilities, we can make sure that the negotiations reach a conclusion you're comfortable with.
Here are a few guidelines when dicussing the offer:
Shape your offer.....when you're ready to submit your initial offer on a home, your offer price should be based on a number of factors. Consider your offer price carefully. An offer that's too high can cost you money, while an offer that's too low may induce the buyer to refuse you outright. What you're aiming for with your initial offer is a platform for mutually beneficial negotiation. Here are some factors to consider in your initial offer.
What is the current market condition in the area? In this particular neighborhood?
What have similar properties in this area sold for during the last 12 months? Your agent, hopefully me, will provide this information.
Why is the homeowner selling? Does the homeowner need to make a quick sale? Sellers who need to move fast may be willing to take a price cut in exchange for a short sale. This is good information to have but may not always be available.
What is the sellers' time frame? What is the estimated closing date? In some cases, the sale of a home is contingent upon the seller purchasing and moving into their new home. Decide how long you'll be willing to wait to move in to your new property.
How long has the home been on the market? If it seems like an inordinately long time, there may be problems with the home, the neighborhood, or even with the seller's disposition. Your agent, hopefully me, will provide this information.
Are there any major defects in the home that will need to be addressed immediately? An outdated kitchen can be fixed at your leisure. A leaky roof needs to be taken care of right away. Your offer should reflect the need for immediate attention. You will also have to decide whether you or the seller will be responsible for the repairs. When dealing with Bank Foreclosures, you will be responsible for any needed repairs; in most cases.
How much did the seller pay for the home? In what year was it purchased? Knowing this information can help you determine the seller's flexibility; sellers with a big mortgage to pay off don't have as much room to maneuver. Also, if the seller paid more than they're asking for the property, determine if the decline is due to a real estate downturn or a problem with the area.
Keep your advantage.....As the buyer, you want to maintain the advantage in any negotiation. Here's how to do it.
Don't get personal.....you do not want to reveal too much about your own circumstances. Never disclose personal information like the amount you're able to afford for a down payment, or the time frame in which you need to move out of your current property. Ask your agent not to reveal these details to the seller or the seller's agent.
Practice your poker face.....even if you're in love with the property, it's not a good idea to let the seller know how much you want their home, because that will give the seller the upper hand. Once again, ask your agent not to reveal these details to the seller or the seller's agent.
Don't get emotional.....There are a lot of emotional ups and downs that can occur during the home purchasing process. It's best to keep your frustration (or your elation) tightly under wraps or between you and your agent. This might be one of the best reasons to hire a Agent to represent you.....it keeps your emotions among you and your Agent and out of the sight of the seller.
Frame your timeline
If the seller feels pressured to sell their property, as the buyer you will have a singular advantage at the negotiating table. Still, it's best to be cautious, since you don't want to be rushed into buying a property you're uncertain of just because the price is right. Rushed sales often mean big problems, so pay close attention to any contract concessions, and schedule a thorough home inspection by a reputable area professional.
Sign on the Dotted Line
Once you've negotiated your final offer on a home, and you've signed the purchase agreement, you've officially started the process. For many buyers, this is the time when panic sets in. But as long as you remain organized and calm, and follow the expert advice of your agent, everything between now and closing can go as smooth as silk.
So what do you do next?
So that you can prepare and schedule accordingly, here's a list of things you'll need to do after you sign your purchase agreement.
Deliver your "earnest money".....The delivery of your earnest money shows that you are a serious buyer. This amount will be dictated by your purchase agreement, but it is often 1%-2% of the total purchase price. This money is considered a deposit and will be applied to the total purchase price of the home. Your check will be cashed and the monies held by the seller's attorney or by the broker's trust account. Make sure that you have enough money in your account to cover this check – or better yet, get a certified check or bank check.
If for any reason the sale does not go through, you may be able to reclaim your deposit, minus standard cancellation fees. If the sale is forfeited through actions on your part, the seller may be able to keep this deposit as "liquidated damages." When negotiating your purchase contract, you may want to consider adding a liquidated damages clause to cover any unforeseen events.
Meet your obligations.....You'll probably be in the clsoing process for about 30-45 days, although that period is prone to vary. Over the course of those 30-45 days, every contingency specified in the purchase contract must be met. Although each purchase contract is different, most will include the following standard contingencies:
1. Inspection contingencies: this requires that the property be inspected by a professional home inspector to ensure that the property has no undisclosed defects. You should schedule the inspection as soon as possible to ensure that you are satisfied with the condition of the property. If you are dissatisfied with the results of the inspection report, you may choose to cancel the purchase contract.
2. Financing contingencies: this applies to you, the buyer, and states that you must secure financing within a specified period of time. If you're already pre-approved for your ortgage, you're one step ahead; you should have a letter of commitment from your lender in hand. If not, you will need to be approved for a mortgage before escrow is opened, or risk forfeiting your deposit. If you need additional time to secure your mortgage, the seller may provide you with a written extension.
3. Title contingencies: this contingency states that the seller must provide marketable title. Have your attorney review the title to ensure that the seller's ownership of the property is clear, so you don't run into trouble down the line. Check into local and state property transfer laws to make sure that both you and the seller have complied fully with them.
4. Insurance contingencies: in some states you will be required to produce a binder, or proof of insurance coverage, before you can close. In order to avoid possible complications, it is best to apply for insurance as soon as your purchase contract is signed. Special coverages like earthquake, flood, or fire insurance may take longer to acquire.
5. Schedule a final inspection.....this may consist of a simple walk-through with your agent. If the seller was required in the contract to complete repairs, you may wish to have a home inspector pay a second visit, to ensure that all repairs are up to code. Make sure that all applicable permits for completed repairs are valid.
Now it's on to closing, after which you'll be the proud owner of a new home!
If you have any questions please feel free to call me at 901-604-5838 or click here.
