Looking To Buy or Sell?

To make sure you’re looking for homes that meet your needs and wants, it’s important to make two lists: one for items you must have and one for items you would like to have. Realistically, as a first-time buyer, you probably won’t get everything on your wish list, but it will keep you on track for what you’re looking for.

It’s worth considering hiring your own real estate agent, one who is working for you, the buyer, not the seller. A professional agent can help keep track of all the details during the home-buying process and represent your best interests.

When evaluating the location of a potential property, it’s important to consider factors such as school district, crime rate, proximity to positive (shopping, parks, freeway access) and negative (abandoned properties, garbage dump, source of noise) features of the area. To make an objective decision, try to look at the property as if you were the seller and consider whether a prospective buyer would find it attractive.

To ensure you’re being thorough during the home-buying process, it’s important to include inspection and mortgage contingencies in your written offer. You should also have the property inspected by a professional inspector and request a second walk-through to take place within 24 hours of closing to check for any changes that were not agreed on.

Before starting negotiations with a seller when buying a home, it’s important to research the housing market in the target area. Focus on the particular property and seller and look for answers to questions such as why the homeowner is selling, how long the home has been on the market, and whether there are any defects in the home or problems with the surrounding neighborhood. As the potential buyer, you want the advantage, so do not give the seller personal information such as your income or the maximum you are able to pay for a down payment or the home.

To establish a timeline for negotiations with a seller and use it to your advantage in the home-buying process, find out if the seller needs to have the sale closed sooner rather than later. If the seller is feeling pressured to sell, use that to your advantage in negotiating. Even if you, the buyer, are the one with the deadline for purchasing a home, don’t let yourself be rushed into making concessions or a purchase you may regret later.

There are several types of mortgages available for buyers, including fixed-rate mortgages, adjustable rate mortgages (ARMs), and government-insured mortgages.

• Fixed-rate mortgages have the advantage of a stable interest rate for the life of the loan but may have higher initial payments and slower equity build-up.
• ARMs have the advantage of a lower initial interest rate and larger loan qualification but may have higher future payments and require careful consideration of the financial index and caps.
• Convertible ARMs combine the initial advantage of an ARM with a fixed rate after a predetermined number of years.
• Government-insured mortgages, such as VA loans for veterans and FHA loans for lower-income Americans, have specific qualifications and limits on the amount you can borrow.

After opening escrow, you will need to provide a down payment and work with an escrow or settlement company to coordinate the purchase process. During this time, you will need to complete a variety of tasks including scheduling inspections, securing financing, reviewing the title report, checking local ordinances, obtaining homeowner’s insurance, and scheduling a final walk-through inspection. The period of being “in escrow” is typically 30 days, during which each item specified in the contract must be completed satisfactorily. Once the sale has closed, you will become the proud owner of your new home.

Homeowners may skip the permit process because it can be time-consuming, inconvenient, and may result in an increase in property taxes. However, failing to obtain a required permit can lead to future problems and may end up being more expensive and problematic than obtaining the permit before work begins.

Prospective buyers can research whether all work on a property has been done according to code and with proper permits by going directly to Building & Safety in the municipality where the property is located or by hiring a “permit puller” to research the permits for them.

Don’t panic and get at least two opinions before making any decisions. Inspectors are only human and can sometimes be wrong. If you receive conflicting reports or are unsure about a problem, it’s a good idea to get a second opinion from a different expert.

A CMA, or Comparative Market Analysis, is a report prepared by a real estate agent that provides data comparing your property to similar properties in the marketplace to determine its worth. The agent inspects your property and obtains data on comparable properties to make an accurate assessment of its condition and worth. A CMA is not an appraisal and must be performed by a licensed appraiser.

If issues arise prior to closing the sale, negotiate calmly and look at all possibilities to find a win-win situation for both parties. In some cases, the most workable agreement might be for the deal to be called off. 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.