You are ready to buy your dream home, or a close facsimile. These tips assume you have already located a realtor and have a pre-approval in hand.
Before we start looking for your dream home, here are some things I like to cover with each buyer:
You will get tired of looking at multiple homes, and possibly making multiple offers before getting one accepted. We are in a sellers’ market after all. So put a little faith in the process. You will need to learn patience, and work on your flexibility when making offers. Your offers will need to be creative; you and your agent will have to be creative in this crazy market.
In a seller’s market there is a good chance you will face a bidding war. This is when you and your team will need to pull out the stops and present your best offer. Work together, talk through creative ideas what will make your offer stand above the rest.
Many buyers are unaware that the realtor fee is paid by the seller, and there is generally no fee paid by the buyer to the realtor. Now some agents do charge a small transaction which is due at closing.
Most buyers spend a good amount of time on the internet looking for homes. Perusing Zillow for hours on end. You may not know this, but your realtor has the most current database not Zillow or realtor.com. Those apps, get their information from the databases your agent is already paying for. So, if your agent has set up a search for you that search should have what you need all in one tidy spot.
You and your agent are a team, your agent has a fiduciary responsibility to you the buyer. This duty obligates a realtor to always act solely in the best interests of his buyer. If you feel that this is not happening, you should speak to your agent, and if things don’t change look for another agent.
Now its time to think about what happens after you receive an accepted offer.
The first thing you will need to do is deliver earnest money for escrow. If this doesn’t happen by the allotted time the contract is void. So, your earnest money needs to be liquid and immediately available. Earnest money is part of your calculated down payment.
You will also need money for a home inspection. I know some people are waving inspections on their offers in this market to stand out. Even if you make this type of offer, I suggest you still get an inspection after you move into your home, so nothing catches you off guard. The money for the inspection is in addition to your down payment.
Generally, you will need to pay for an appraisal of your new home. Again, this should be part of the money you have set aside for your down payment. Make sure to discuss this with your loan officer.
The last item I normally cover, should be covered by your loan officer. That is closing cost. Your down payment does not include closing cost.
I always ask the buyers if they have discussed with their loan officer about the cost of closing. No one needs to be surprised a few days before closing with another bill.
With every buyer I work with, I make sure to cover what they can expect and what is involved in the process. The way I look at it, we make up a home buying team. The more informed all the team members are, the better our chances for success.
By R. Jones
