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Buying a home is most likely the largest purchase you will make.
It's in your best interest to be educated. Pay close attention to every detail.
My Real Estate Agent's responsibility is to make sure you succeed by avoiding the top sixteen errors purchasers most commonly fall prey to.
As Your Real Estate Agent it is my responsibility to help you succeed in buying your home quickly, painlessly, and for the most competitive (lowest) price.
After all, my Real Estate Agent's reputation depends on referrals generated from 100% client satisfaction!
 Buying a home can be an emotional, time-consuming, and complex process. There are a few things that you can do to help make the process go as smooth as possible:
 Six Things To Ensure a Smooth Home Purchase
Buying a home can be an emotional, time-consuming, and complex process. There are a few things that you can do to help make the process go as smooth as possible:
1. Check your credit.
Before you apply for a home loan, regardless of your credit, it's a smart idea to obtain a copy of your credit report from the three major credit bureaus and review the information. If there are errors or things that need to be addressed, it's easier to address them before you have found a house, than after you have found a house and are trying to close your loan.
If you know that there are a few blemishes on your credit, let your lender know what they are, why they are there, and why you are a still good credit risk. Lenders look at your credit to determine how likely you will pay back the loan. If you had extenuating circumstances - like a loss of a job or medical bills - let them know so that they understand that it is not likely to happen again in the future.
2. Get approved before you buy.
An approval means that a lender has reviewed your credit history, verified your assets and employment, and has approved your loan before you have found a home to purchase. As long as the home appraises for at least the purchase price, the loan should close.
Getting approved also gives you an advantage over other buyers. Your firm approval makes it easier for you to negotiate on the price of a home, than a person who is not approved or is pre-qualified.
While getting pre-qualified may sound official, it is really just getting an idea of what you can afford. Its having a person plug in a few numbers that you give them - your monthly income and your monthly debt - and getting an approximate payment calculated. From the payment, the calculator can approximate the house price range that you can afford. No information is verified. Because your assets, income or credit is not verified, a pre-qualification has little value when purchasing a home.
3. Find a great buyer's agent.
Traditionally real estate agents represent the sellers in a transaction. When you are not working with a buyer's agent, they are less likely to negotiate the best price or contingencies for you.
A buyer's agent's job and fiduciary responsibility (meaning legal duty) is to you, the buyer. Before working with an agent, establish if they are a buyer's agent or a seller's agent. After spending a lot of time with a REALTOR®, it's natural to feel like you're a team. But if they are not negotiating for you, then they are not on your team.
4. Learn about the neighborhood.
Often times the house you find may be in a neighborhood that you're not familiar with, which is ok. It just means that you'll have to do a little more research. If you find a house that you like, ask for a list of the neighborhood properties that sold in the last year. How does your home rank? Is it at the top of the price range? If so, it might be hard to resell. Is it average or on the low end? If so, great - as the other home prices go up in value, they will pull your home's value up as well.
Check out the schools - are they sought after? A good school district means your neighborhood will always be valued by families which is a great reassurance to purchase, not to mention the value-add if you have school-age children.
Next, contact the police station and obtain crime statistics? Are they acceptable to you? Sometimes, if they won't give them to you, it could be a cause for alarm.
Talk to the neighbors. The more people you talk to, the better sense you will get of who makes up the neighborhood and how they will effect your time spent in it.
Check out the location of the shopping, police and fire stations, schools, and air traffic overhead. These are all things that might affect your property value or quality of your life.
5. Protect Yourself.
Ask your REALTOR® for a copy of the documents you will be asked to sign if you decide to buy the house. Read them ahead of time so that you'll understand the questions that you will be asked, the things you need to know, and the decisions you will need to make.
6. Have reasonable expectations.
There is a lot of money at stake. No house is perfect. Understanding and remembering these two statements will help diffuse the negotiation stage, the inspection stage and the closing stage.
Emotions are high for both buyers and sellers. - The seller may have loving memories and years of sweat equity in the house. Maybe they are being relocated and don't want to go. Understanding their motivations for selling will help you appreciate their situation and predicament during these emotional times.
There is a lot of money at stake for all the parties involved (and that includes the REALTORS®) - Just remember that market value (the value of a home) is the price that a willing buyer and a willing seller can agree to. If you can not agree on a price, ask yourself: Is there something you missed? Are there comparables that support the price that they want? Are there motivations that might factor into the price they are demanding? In the end, does it matter? What is the house worth to you today and what do you think you can reasonably sell it for based on the amount of time you plan to spend in it? Think about the answers to those questions before you make your move.
 Determine How Much You Can Afford
How much house you can afford is largely dependent on how large a mortgage – basically, a home loan -- you can handle. Start your research by using the simple mortgage calculators I have on my website to see whether you can afford to pay the monthly mortgage on the kinds of houses you have in mind.
You may even apply for a mortgage at a lender before you start looking for a home. This is called getting pre-qualified for a loan; it will tell you exactly how much you can afford and may make the closing process go faster.
But, remember that owning a home involves more than a monthly mortgage. You’ll also have to consider money you’ll need to have at hand when you make an offer, when you close on a home and on a monthly basis after the home is yours.
Payments you may have to make when you submit an offer and at closing include:
- Earnest money, usually 1% to 5% of the cost of the house, which you pay as a deposit on the house when
you submit your offer. It’s your proof that you’re a serious buyer down payment, usually 10% to 20% of
the cost of the house, which you must pay at closing
- Mortgage insurance, paid by borrowers making a down payment of less than 20%
- Closing costs, usually 3% to 4% of the cost of the house, to pay for processing all the paperwork.
Don’t forget the day-to-day expenses you may incur once you own that home. This includes:
- Utilities
- Homeowner or condo association dues
- Property taxes
- City or County taxes
 Shop for a Home
House hunting can be both exciting and frustrating. Most homebuyers see roughly many houses before buying one. To make the search easier and faster, nearly half of all house hunters today begin by browsing for properties on the Internet, using web sites like this one.
Please go to my home page and click on the "Search Properties" link and you will have access to the same data as Realtors in the areas from Burbank to Thousand Oaks in Los Angeles County. For Ventura County Property information click on the other link "Here" on my homepage. This information is up-to-date and accurate. Other sites on the internet do not provide up-to-date data and lag behind my site.
The Internet is a quick way to see whether the houses that are currently available meet the following critical criteria: in the right location, with the right features and at the right price. If you find after your search on my website that few properties meet with your expectations, you may want to readjust your criteria – change the location, features, price – to increase your chances of finding a house that works for you. If you have any difficulties in this initial search, feel free to contact me for assistance. Homes can become available instantly and I'am always the most current resource for literally up to the minute new home listing information.
Once you know what you want, where you want it and what you can afford, it’s time to see the houses for yourself. To help stay focused, bring with you a checklist of things that you’ve decided ahead of time are important qualities of your future home.
This might include:
Is there enough room for you to grow in?
Is the house structurally sound?
Is the house in move-in condition or will it need work?
Is it close enough to everyday needs, such as grocery stores, schools, work?
Will you feel safe here?
Do the appliances that are part of the sale work?
Is the yard right for your needs?
Do you like the floor plan?
Is there enough storage?
Will you be happy in this house in winter, summer, spring, fall?
You may also want to take some exterior and interior photos of each house you visit so that you can keep track of its pros and cons.
Research Different Mortgages
There are a variety of mortgage types available today, each with advantages and disadvantages depending on how long you plan to live in the home, the financial marketplace and your income potential, among other things.
A fixed-rate mortgage is the most common. In a fixed-rate mortgage, your interest rate and payment stay the same for the life of the loan.
An adjustable-rate mortgage usually starts out at lower interest rates and lower monthly payments than fixed-rate mortgages, but your rate and monthly payments may rise and fall based on a financial index.
There are also several government mortgage programs available, including FHA mortgages, which are designed to help people who might not otherwise qualify for a loan.
You may also have a choice in loan terms. There are 30-year loans and 15-year loans.
It’s best to talk to me about your best mortgage option. I may refer you to a Mortgage Broker that can discuss current market financing packages and provide a FREE Loan Qualification.
For more information regarding mortgage loans please go to my page "Mortgages".
 Make an Offer
When you’ve found a house you really want, it’s time to make the offer. How much you offer may depend on a number of factors:
- Is the asking price fair? Here’s where the legwork you put in while shopping for a home pays off. Decide whether this house is priced right or out of line in the current marketplace.
- Is the house in good condition? Is this house in move-in condition or will it need a lot of work? Take any costs of improvement into consideration when deciding your offer price.
- Has it been on the market long? Usually the longer a house has been on the market, the more likely it is the owner would accept a lower offer. Or maybe it’s just overpriced for the market.
- Is it a seller’s or buyer’s market? If the houses you’re interested in are being bought as soon as they’re listed, that means you’ve got a lot of competition from other buyers; offer accordingly. If houses aren’t selling fast, you may have more leverage in negotiating a lower price.
Once you’ve determined how much you’d like to offer, work with your real estate professional to submit the proper information. This includes:
- A complete, legal description of the house
- The amount of earnest money you’re paying
- The down payment and financing details
- A proposed move-in date
- The price you’re offering
- A proposed closing date
- The length of time your offer is valid
- Details of the deal
This can be just the beginning of the negotiation process. The seller has three options: accept your offer, counter your offer or reject your offer.
Let me advise you on the best way to present your offer for a good outcome.
Begin Contingency Period
When your offer has been accepted, the contingency period begins. This is time that allows you to obtain financing, perform inspections and satisfy any other contingencies of your purchase agreement.
Obtaining financing might include loan approval, which will include an appraisal of the property. Also be prepared to make your down payment, which is usually due several days before the close of escrow.
Now is the time to schedule a professional inspection of the property; it is one of the best safeguards you can take before buying. A home inspector should check (and may give you a rough price for repairs on) the electrical system, plumbing and waste disposal, the water heater, insulation and ventilation, water source and quality, pests, foundation, doors, windows, ceilings, walls, floors and roof.
Keep in mind that the inspector isn’t there to tell you whether you’re getting a good deal. He or she is there to give you an educated opinion on whether the house is structurally and mechanically sound and fill you in on any repairs that are needed.
The Home Sale: Securing the DealReady to close the deal? Maybe not. Sometimes unforeseeable issues arise just prior to closing the sale. Hopefully, with negotiation, most of these have a workable solution. Unfortunately, this is not always the case. But don't panic. Another buyer might still be found who is willing to accept the house as is. Imagine that your prospective buyers are a couple with young children. They envision your unused attic as the perfect playroom for the kids but, before closing the deal, they request an inspection to see if it's safe and also if they will be able to install a skylight to provide natural light to the new space. This inspection reveals that under the shingles that are in good condition is a roof that will only last another year or two. The prospective buyers immediately balk, not wanting to incur the time and cost of replacing the roof. Their plans were to move in and only have to spend time and money renovating the attic. The additional cost of the new roof, they say, is just too much. At this point, you sit down with the prospective buyers and calmly discuss the situation and how it can be solved to the benefit of all. First, you agree to get another professional opinion on what really needs to be done. Inspectors are only human, and are not infallible. Once the extent of the damage is agreed upon, you can jointly decide what to do about it. While the buyers hadn't planned on that expense, you show them that instead of a limited roof life that they would get with most existing homes, they'll have a new worry-free roof that won't cost them in repairs for the next decade or so. Since the roof wasn't in as good shape as you had thought, you agree to lower the purchase price to help offset the cost of the new roof. By negotiating calmly and looking at all possibilities, what could have been a "deal breaker" can be turned into a win-win situation for both the buying and selling parties. In other cases, the most workable agreement for both parties might be for the deal to be called off. The seller can always find another buyer and the buyer can always find another home. To protect yourself against last minute "buyer's remorse," make sure the purchase contract anticipates and closes as many loopholes as possible after all known defects have been fully disclosed. |
Buy Homeowner’s Insurance
A paid homeowner’s insurance policy is required at closing. I will help make sure your insurance company and your title officer are working together to put your policy in effect by the close of escrow. But, if you get your insurance agent involved early in your home-buying process, he or she may also help point out ways to help keep your insurance premiums lower.
You've Opened Escrow, Now What?
Congratulations, you are on your way to owning your very own home! Follow these suggestions (and your realtor's advice) so that escrow and settlement with go as smooth as possible.
You will be asked for a down payment on the home you are purchasing. You can choose to put down as much or as little as you want (depending on your mortgage), but remember, the more you put down toward the total price of your home, the less time it will take you to pay off and the less your mortgage payments will be every month.
During this period of purchasing your home, you are going to need an escrow or settlement company to act as an independent third party so that you know when and who to give your money to get the deed to your new home. The escrow or settlement company will hold your deposit and coordinate much of the activity that goes on during the escrow period. This deposit check may also be held by an attorney or in the broker's trust account. Make sure that there are sufficient funds in your account to cover this check.
The deposit check will be cashed. Assuming the sale goes through, this money will be applied to the purchase price of the home. If for any reason the sale is not consummated, you may be entitled to receive all of your deposit back, less standard cancellation fees. In certain instances, the seller may be able to retain this money as liquidated damages.
Prior to executing a purchase contract, it would be wise to speak with your counsel regarding whether or not it is your best interest to have a liquidated damages clause as part of the contract.
1. The period that you are "in escrow" is often 30 days, but may be longer or shorter. During this time, each item specified in the contract must be completed satisfactorily. By the time you have opened escrow, you have come to an agreement with the seller on the closing date and the contingencies. Each contract is different, but most include the following: 1. Inspection contingency: this should be completed as soon as possible after the contract to purchase is signed as unsatisfactory results of the inspection may mean that you will want to cancel the contract.
2. Financing contingency: once the contract is signed, you have a period of time to secure funding. If, for any reason, you are unable to secure funding during the period of time granted to you by the contract (and the seller will not provide a written extension of time), you must decide whether you want to remove the contingency and take your chances on getting a loan. You may choose to cancel the purchase contract.
3. A requirement that the seller must provide marketable title.
With an attorney or title officer, review the title report. The title must be "clear" to ensure that you do not have legal issues regarding your ownership.
Check into local and state ordinances regarding property transfer and make sure that you and/or the seller have complied with them.
Secure homeowner's insurance. This will probably be required before you can close the sale. Due to such requirements as special fire and earthquake insurance, obtaining this insurance may require a lengthy period of time. It would be in your best interest to apply for insurance as soon as possible after the contract is signed.
Contact local utility companies to schedule to have service turned on when you close escrow.
Schedule the final walk-through inspection. At this time, you should make sure that the property is exactly as the contract says it should be. What you thought to be a "permanently attached" chandelier that would come with the property might have been removed by the seller and replaced with a different fixture entirely.
 Complete Settlement or Closing
When the property you’re buying has been inspected and you’ve had your final walk-through of the property to see that all contingency conditions – such as final repairs made by the seller -- have been met, it’s time to face the paperwork. You will be signing loan documents and closing papers, paying the balance of your down payment and closing costs. This is the day you get the keys to your new home.
 Congratulations! You've made it! Once the sale has closed, you're the proud owner of your home.
 As Your Real Estate Agent it is my responsibility to help you succeed in buying your home quickly, painlessly, and for the most competitive (lowest) price.
It would be my pleasure to answer any questions you may have regarding real estate in this area, including: schools, community centers, parks and neighborhoods that make it special!
Please for all your real estate needs!
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