I have decided to buy my home. What is the next step?
First and foremost, be certain that the people you select to represent you are professionals who will excel in their service to you. Select a Realtor. Notice that I say Realtor as opposed to real estate agent. Realtors have a Code of Ethics and are held to a higher standard than a real estate agent. When dealing with a lender, you should work with a local reputable lender. A local lender will have much more invested in keeping their reputation within the community.
Lenders will ask buyers some elementary questions and run a credit report. With this basic information, you will learn what loan amount they can qualify for. This is also all that is needed for a prequalification letter.
Is now a good time to buy?
When considering purchasing a Sacramento home, the motive for your purchase should be considered. If you are purchasing a home in which to live and enjoy for several years to come, then you should be fine to purchase anytime. Your primary purpose is home ownership, not investment.
If you are considering selling your present home and purchasing another home, then simply remember you are selling in the same market in which you are buying – still a great time to buy.
If you are purchasing strictly to remodel and sell, you should exercise caution. In any type of market, strongly consider the location and condition of the property. You cannot change location. You do not want all of your investment capital going into such items as pest work, electrical or plumbing – items from which you will probably not get a return on your investment. In a “buyers market”, your profit margin will shrink, sometimes substantially. Be sure your improvements are prudent.
Buyers often ask “What if I like the first house I see? Shouldn’t I wait to see all of the properties on the market over several weeks?
Family and friends will have the best of intentions telling you not to purchase the first home you see. Let’s look at this from another angle. If you are working with a Realtor that knows the area in which you want to purchase, then he or she will know the properties that best fill your needs. The best properties are going to be the first ones that your Realtor shows you. It is very probable that you will find the house of your dreams in the first or second trip. Why wait?
You have found the house they want – now what?
You will sit down with their Realtor and write an offer. You will talk about a reasonable offering price. You will also decide when you want to record and take possession of your property. Average escrows take 30-60 days. You will also decide such things as how much money you want to put down for a deposit and down payment. Who will pay for such items as a pest report and pest work, the Natural Hazard Disclosure Report, escrow and title fees, city and/or county transfer taxes and a home warranty. Your Realtor should know what is traditional in your county for many of these charges.
Your Realtor has brought the seller’s Realtor an offer. Now what?
Sellers will talk with their Realtor regarding the offering price. Is it acceptable? Is there some necessary negotiating? What fees are you asking the sellers to pay? Are they reasonable? Again, the seller’s Realtor should know what is traditional in the seller’s county. If the offer is well written, the offer will be accepted as written; if not, it will be countered or rejected.
We have an accepted offer! Now what?
Congratulations! You have successfully negotiated an acceptable offer for all parties! There will, in all likelihood be several inspections including but not limited to a home inspection and pest inspection. Other possible inspections could be a pool inspection, chimney inspection, lead-based paint inspection and mold inspection. If you wish, your Realtor, home inspector and pest inspector can guide you as to necessary inspections and negotiations resulting from those inspections.
You should immediately contact their lender with the good news – there will be a lot of work to do for you and the lender in order to secure a loan in a timely manner. Do not, under any circumstances, make any major purchases – cars, large appliances, etc. This will put a stop to the loan very quickly.
You should also contact your insurance agent. Any loan will require a hazard insurance policy be in place prior to close of escrow. The earlier this process is begun, the less expensive the policy can be. This is because the insurance agent will have time to shop your loan for all of the available discounts and policies available.
Start thinking about moving. Do you wish to recruit the aid of family and friends, or do you want to hire a moving company? Remember, your recording date is an approximation! Know that you might move earlier or later than the date on the contract. Be sure to make flexible plans.
We are recording in approximately 10 days. What should we be doing?
Contact the appropriate utilities (post office, pool and garden service, electric and gas companies, telephone, cable or satellite services and any technology services). Give them the approximate move date and line up as much as you can ahead of time. You should be certain that any cash you need to bring to escrow is available. If there are young children or pets, find a place for them to stay during the day of the move. It will be easier on them and you.
YOU MADE IT!