Home in Pasadena
BUYER’S GUIDE
Purchasing a home is one of life’s biggest financial decisions. If this is your first time or you have purchased before, it is a decision that must be made with care and consideration.
Key Terms
PRE-APPROVAL
This is your first step prior to beginning your home search. The pre-approval from a lender will help narrow your search and is what will be needed to accompany all offers. Lenders have a measured checklist they will consider that includes proof of funds, verification of employment, any assets along with your credit history.
CONTINGENCIES
Contingencies are timeframes within your contract that ,when purchasing property, allow you time to obtain financing, verify the property value via an appraisal, investigate the property and (if needed) exit the contract without penalty. Once you’ve completed your due diligence and have met the requirements of each contingency, you will be asked to remove all contingencies by signature that certifies you agree to proceed with the purchase. Once this form is signed the contract is considered ‘binding’. *
ESCROW
Once your offer is accepted the contract moves into the escrow stage. Escrow is a neutral third party that will oversee the transaction through closing. An escrow company is used to protect the interest of all parties and ensures that no property or funds are exchanged until the conditions of the purchase contract have been met.
CLOSING COSTS
In addition to the property’s sales price there are costs associated with the transaction that have to be paid. These costs can include loan origination fees, taxes, title fees, escrow fees, recording fees and additional settlement fees. I will provide you with an estimated closing sheet for your review.
Five Stages of the Home Buying Process
PHASE ONE
DETERMINE THE GOAL
* What is your motivation to buy?
* What is your time frame?
* What are your features you can live without?
* What neighborhood characteristics do you prefer?
CREATE YOUR BLUE FILE
This is a file that will house all of your important financial documents. The information will be needed to secure financing for your property. Your blue file should contain the following documents:
*Statements from your financial institution(s)
*Bank accounts
*Recent pay stubs
*Investments
*Auto loans
*Credit cards
*Two years of tax returns
*Retirement accounts, mutual funds, bonds, stocks, 401k statements & life insurance
FINANCIAL STANDING
Understanding your finances and buying power is the first step. A lender can help you do a proper analysis to show what you can afford, issue a pre-approval and determine how much of a purchase price you are comfortable with. I am happy to assist you with a recommended lender or other reputable loan officer.
REVIEW THE CURRENT MARKET
Understanding the current market includes researching the neighborhoods you are interested in, reviewing active, pending and sold properties in those areas and looking into the seasonal changes.
PHASE TWO
HOME SHOPPING
* Create a collection of potential homes and define communication expectations
* Review new and off market properties
* Make appointments for private viewings and attend open houses
YOU FOUND THE HOME YOU WANT, WHAT’S NEXT?
* Discuss objectives and how to proceed
* Review the purchase contract
* Discuss offer strategies
* Offer presentation and buyer strengths
* Negotiate to optimize price and terms
* Acceptance of offer/counter offers
PHASE THREE
ESCROW PROCESS
Great news! Your offer has been accepted. Within three business days of an acceptance of offer, you are expected to deliver the earnest money deposit (EMD) to the escrow company per the terms of the purchase agreement. The EMD is typically 3% of the total purchase price. Once the contract has been reviewed, the escrow officer will draw up the escrow instructions that need to be signed, completed and notarized if necessary. My service to you during this phase includes but is not limited to - keeping you abreast of the transaction progress, monitor the process for the timely completion of all contingencies, attend all inspections within your due diligence timeframe, stay in regular contact with your lender for any changes or updates, provide explanations of documents and making sure they are prepared correctly and review all reports and disclosures with you.
PHASE FOUR
INSPECTIONS & DISCLOSURES
* Once escrow is opened, we will review the physical investigations and determine which inspections to schedule based on your contingency timeframe
* Review sells disclosures and reports and answer your questions and concerns
* Review and approve preliminary title report
* Upon inspections discoveries, we approve property condition OR negotiate repair/request a seller credit for repair work to be completed after the close of escrow
PHASE FIVE
INSPECTIONS & DISCLOSURES CLOSING
* Review closing documents provided by the escrow company
* Meet with escrow for signature of loan documents
* Final walk-through to verify property condition
* Schedule the transfer of utilities to your new home
* Inform you once title records and you’ve closed escrow
* Coordinate delivery of keys to your new home and celebrate….You’re a Homeowner!
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