Buyer information
Introduction
By buying a property, for primary or investment, you get to build equity.
The difference between buying and renting, besides building equity, is that you get to have fixed monthly payments, have long term stability, get property tax deduction and have the pride of being a home owner.
Buyer considerations
● Budgeting: Nowadays there are websites where you can input your personal finances and it will calculate for you how much you can afford. If you are obtaining a loan, your loan officer will be able to provide this and a financial advisor can also assist.
● Mortgage pre-approval: If you are obtaining a loan to purchase your home it is very Important to get pre-approved because you will need to know in what price range you may search for properties and also if there are any conditions you will need to work on to continue on your purchase journey. If you need a referral for a few Great Loan Officers please call me.
● House Hunting: What to look for in a home, neighborhood considerations, schools if you have children visit https://www.greatschools.org. Home amenities you are interested in and attending open houses is always a good idea besides private showings.
Financing Options
● Mortgage Types: A Loan Officer will be able to give you the better options specific to your finances.
● Down Payments: A Loan Officer will be able to guide you through the down payment options and assistance, if applicable.
● Mortgage Calculator: A Loan Officer will generate a Loan Estimate that will give you an idea of what your mortgage payment will be as well as lender closing costs.
● Closing Costs: There are two closing costs, Lender’s closing costs and Title closing costs. Each company will give you their estimates; however, on the final settlement statement these will be combined into one.
The Buying Process
● Making an Offer.
● Escrow Deposit: Once an offer is accepted by a seller you will be required to put money in an escrow account with a title company or an attorney’s office.
- What is an Escrow Deposit? An escrow deposit is a payment made by a buyer to a seller as a sign of good faith when a contract is signed. It shows the buyer is serious about the purchase of the property.
- Typically the escrow deposit is 1%-3% of the asking price.
- The escrow funds will be applied towards your final settlement.
● Inspection Period: A specified time frame in which the buyer can inspect the property and make the final decision to move forward with the home purchase.
● Home Inspections: Inspect the property as soon as you can, time is of the essence. In fact start calling inspectors beforehand to ask for quotes and for availability.
● Negotiations: Depending on the inspection report and even the appraisal report have to negotiate, repairs, and contingencies.
● Homeowners Insurance: Your homeowners insurance quote can be obtained after the inspection report is issued, as they will need a copy of it. Do get it as soon as possible, this is another time is of the essence because some properties may not be insured or there might be contingencies from the insurance company in order to insure the house.
● Property Appraisals: The appraisal is ordered by your lender to know how much the house is worth because they are financing and they want to ensure that it is up to par.
Legal & Financial considerations
● Property Title Insurance: Please see the Title Processing tab for more information.
● Cash to close: Cash to close amount will be issued once the title company or attorney’s office has satisfied all title commitment requirements. If there is a lender it will be issued once the lender has given out their fees and have balanced with the closing agent.
● Closing Date: The title agent or attorney’s office will schedule the seller to pre-sign their documents and the buyers will sign their documents on the day of closing.
- If there is a lender the buyer (s) will be required to sign their documents with a notary, typically the closing agent has a notary in their office. If the buyer (s) not able to attend closing the closing agent will schedule a mobile notary to arrive at their location to notarize documents with them.
- If the purchase is cash the buyer (s) can electronically sign as there are no documents that need notarization.
● Funding: In order for a file to fund and disburse the following items will be needed:
- All monies are received via wire transfer
- If there is a lender, once the loan package has been signed and the lender approves the documents for funding
- Notice of a successful walk through
- All parties have signed all documents
● Possession: Typically the buyers take possession of the property on the day of closing after funding. The real estate agents will coordinate the exchange of keys.
Moving In
CONGRATULATIONS!
Whether you plan to move in or this is a second home/investment property below are some tips for you.
Utilities and Safety
- Ensure utilities (electricity, water, gas) are set up and ready.
- Water company
- Electric company
- Internet company
- Gas and trash if applicable
- Check that all utilities are functioning properly.
- Test smoke detectors and carbon monoxide detectors.
- Familiarize yourself with the circuit breaker and water shut-off valves.
Prepare New Home
- Change locks.
- Check security systems, if applicable.
- Check for any needed repairs or maintenance issues.
- Arrange for pest control if needed.
Address and documents
- Change address with USPS and notify important contacts (banks, employers, etc.).
- Change your address on your Driver's license, vehicle registration and financial institutions.
- Ensure closing documents or any other important documents are accounted for an in a safe place.