Buying A Home – The Process, Step-by-Step
The Initial Agreement and Deposit.
Buying a home the first steps. An effective agreement is a legal arrangement between a potential purchaser and the property’s seller.
Some important tips to keep in mind to streamline the process:
- Keep written records of everything. For the sake of clarity, it will be extremely useful to transcribe all verbal agreements. Counter-offers and addendums need to be in written agreements and signed by both parties. We will assist you in drafting all the paperwork for your purchase. While making sure you have copies of everything.
- Stick to the schedule. Now that you have chosen your offer, you will both be given a timeline. That marks every stage in the process of closing the real estate contract. Meeting the requirements on time ensures a smoother flow of negotiations. So that neither party will in breach of the agreement. During the process, we keep you updated and prepared for the next step.
The Closing Agent.
The selected closing agent will either be an attorney or a title company. The closing agent holds the deposit in escrow while it researches the complete recorded history of the property. The research will determine if the title of the property is free and clear of liens. While also discovering if any new liens are pending. Before the closing date comes new liens on the title must be recorded. Some properties are subject to restrictions which limit various activities such as building or parking restrictions. The property may also have recorded easements and encroachments. That can restrict your rights to use your property.
How to Hold Title.
You may wish to consult an attorney or tax advisor on the best way to hold title. Different methods of holding title have different legal, estate and tax implications. Especially when selling or upon death of the title holder.
Buying A Home – Inspections.
Once the seller accepts your offer it’s time to hire a licensed property inspector. The properties inspection must as agreed upon in the contract to purchase. You may elect to have different inspectors inspect the property. If you wish to obtain professional opinions from inspectors who specialize in a specific area (eg. roof, HVAC, structure). If you are purchasing a commercial property. You need to have an environmental audit done on the site for the lending institution. We can recommend several different inspectors.
Depending on the outcome of these inspections, one of two things may happen:
1. The inspection passes and you move toward the closing.
2. The buyer, after reviewing the property and the papers, requests a renegotiation of the terms of contract (usually the price).
Buying A Home – Appraisal and Lending.
It’s important you stay in close communication with your lender. In case you need additional documents to approve your loan application and fund your loan they will let you know. If the agreement is conditional upon financing. Then a licensed appraiser needs to determine the value of the property for the lender. Appraisers are specialists in determining the value of properties. Appraisals are based on a combination of things. Such as, square footage measurements, building costs, and recent sales of comparable properties. In addition to, operating income, etc. All these factors help in determining the appraised value of a property. When you’re within two weeks of closing, it’s a good idea to double check with your lender. To be sure the loan will go through smoothly and on time.
If your purchase is conditional upon approval by an association then get the rules and regulation from the seller. Also ask for other important documents you may need from the seller. You need these as soon as you have an effective agreement to purchase. Turn in all application and processing fees on time to the appropriate person. Fill out the information completely. Write legibly so there is no delay in processing the application. If the association asks to meet with you for the approval process, then make that appointment as soon as possible. Most associations require a certificate of approval before move-in. Your agent will ask you for the original copy of your approval letter at closing. So it can then be recorded with the deed at the county public records.
Are you going to be taking out a loan? If so, you will be required by the lender to buy insurance. The amount will depend on the lending institution. As well as the amount of the loan on the property. Do you want to save hundreds of dollars a year on homeowners insurance? You could, by shopping around for insurance. You can also save money with these tips.
- Consider a higher deductible. By increasing your deductible by just a few hundred dollars can make a big difference in your premium.
- Ask your insurance agent about discounts. You may be able get a lower premium if your home has safety features. Such as dead-bolt locks, smoke detectors, and alarm system. Also storm shutters or fire-retardant roofing materials. People over 55 years of age or long-term customers may also be offered more discounts.
- Insure your house NOT the thats land under it. After a disaster passes the land is still there . If you do not subtract the value of the land when deciding how much homeowners insurance you need, you will pay more than you should.
Its our business to know the right people. We will be happy to recommend experienced knowledgeable insurance agents for every property type.