When Buying Real Estate
Select a Realtor®
When the purchase of a residence, investment property or vacant
land is a consideration, the first decision needs to be the selection of
the professional you will work with throughout the process. Choose a
full time licensed agent who is a member of the area Board of Realtors to ensure you get all the attention you need from a professional who works within the parameters of the Realtor® Code of Ethics.
Meet with Your Realtor®
Ask for a meeting where you can get acquainted, review the agency relationship options available to you, discuss your situation and needs in detail and set forth an action plan. The time you spend at this stage will result in an efficient process and ensure you are aware of all of your options.
Consider the Buyer's Agency Relationship
The seller in a real estate transaction is represented by a Seller's Agent and it is that agent's duty to work on behalf of the seller. As a buyer, you can choose the type of representation you have from your agent and those options must be disclosed to you by means of a disclosure document which you are asked to sign. If you want to ensure that your agent is working on your behalf and that your interests are being represented, designate your agent as a Buyer's Agent. You also benefit by having one agent become familiar with your needs as you preview property options and provide feedback, making the search process faster and more efficient and you will know that person is working for you.
Arrange Financing If Needed
Knowing what your personal budget will allow for a mortgage payment can be different from what mortgage program parameters will allow. It's important to know the maximum amount of monthly payment you are comfortable with and that you can be approved for that amount. Plan to meet with a lender right away. Your Realtor® may suggest several lenders if needed. Be prepared to review your income, debts, available cash and employment history, among other things. There are many programs available and a thorough review of your situation, including a review of a credit report and credit score allows a lender to recommend programs that meet your needs. Your Realtor® and your lender can recommend the best way to structure an offer once you find the property. You also benefit by being able to show the seller you are a qualified buyer, making your offer more likely to be accepted. Remember, a great offer from an unqualified buyer and a transaction that cannot close is not a good outcome for either the buyer or the seller. Knowing your financing options from the beginning is the best way to avoid this problem.
The Search, The Offer and the Negotiation
Your agent will help you think about and determine the most important criteria in selecting a property and arrange to preview the ones that match your priorities. Your feedback is most helpful to your agent in refining the search and focusing on your priorities, which can change as you see and evaluate available properties. When you find the property and decide to make an offer, your agent will take you through the process of defining the terms regarding the price, time frames, conditions, etc. The offer may be reviewed by an attorney and changed prior to being signed by you and presented to the seller. If your offer is accepted as is, all parties proceed within the terms of the agreement and prepare for the closing. If a counter offer is received, your agent will assist based on your decision to accept the new terms, counter the counter offer or cease further negotiations.
Preparing for the Closing
It is important to adhere to all the time frames within your sales agreement regarding inspections, commitment letters, etc. When all conditions have been satisfied and the financing (if needed) is in place, you will be asked about scheduling a time for the closing. It is important that you review the documents prior to the closing and have them reviewed by an attorney who specializes in the type of real estate being purchased. Following the closing, be sure to keep all documents together and in a safe place where they can be easily retrieved. You will need them at a later date should you decide to refinance, obtain a second mortgage, split the property or sell.
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