Finding the perfect home usually takes time. Whether it is your first time buying, or an investment property; buying a home is a huge purchase, as well as a huge financial investment--therefore, there are many things to consider. When considering the next place to call your home, there are many factors that one must take into account including;
1. Budget & Criteria
2. Property Taxes & Location
3. School District
4. Size & Style (Ranch, Colonial, etc.)
5. Financing (Mortgage) & Closing Costs
6. Representation (Agent & Attorney)
7. Property Condition &Â Much More!
Great! You've made the decision to take the plunge and buy a home. The first step in the Home buying process usually begins with choosing a Licensed Real Estate Professional to represent and guide you throughout the transaction (usually someone who is familiar with the area you are looking to buy in, or an overall Expert).
The next step, is to get Pre-Approved for a Mortgage Loan. A Mortgage Pre-Approval, makes you appear as a Cash Buyer in the eyes of a Potential Seller. This gives you negotiating power, and also allows you to know the maximimum amount that you can spend on your home. It is also advised that a Buyer have enough money on hand to pay for closing costs (estimated at 6% of the purchase price--varies from state to state) as well as a 6 month cash reserve.
Now it is time to go house hunting! Your Real Estate Professional, will now seek out properties that he or she finds fit for you based on the criteria you gave them, as well as your budget. Once the home is found, it is time to make an offer. Because you are represented by an Agent--(someone who has your best interest at heart), you and your Agent will be able to negotiate the fairest and best sale possible for you. For example, a great negotiation and outcome, will appear to look something like this.
List Price:Â $295,000
Counter Offer:Â $285,000
Offer & Final Sales Price:Â $285,000 with $5,000 in Seller Concessions (Towards Buyers Closing Costs)
Total Savings to Buyer:Â $15,000
***There are always exceptions in Real Estate. Ask for what you want! You might be surpised!***
After the nerve racking negotiating has taken place, and the offer is accepted by the seller, it is time for the home inspection. Do not fear aÂ "bad home inspection report."
"A bad home inspection report, as I tell my clients, just means, that it is time for more negotiating."
Though a bad report, can put a sale in jeopardy, any issues or concerns that arise out of the report, can be put aside with remedying of the problem, by more negotiating. Take the above example for instance. If the Purchase Price was $285,000 with $5,000 towards buyers closing costs (which would net the Seller $280k), and the home inspection report revealed a boiler that needs immediate replacement at an estimated cost of $8,700. I would advise my clients to leave their offer of $285k with $5k towards closing costs paid by sellerÂ as it was,Â Â andÂ ask the seller to replace the boiler.Â Both parties are usually willing to work together if it isÂ not a major property defect. Think about it. Would you want to start the home searching process all over again? Or, in the eyes of the seller, would you want to have to find a buyer all over again?
After the Home Inspection comes the Appraisal. An Appraisal is an estimate of a property's and it's improvements value, through a use of differentiated methods, to arrive at one figure. Does the property live up to the offer? If the property does not appraise for the pruchase price, a Lender will not issue the loan to the Purchaser or the Purchaser will have to make up the difference between the Sales Price and the Appraisal Price. Therefore, this leads to more negotiating, which in the end could save the buyer money!
For Example; " if an offer of a property is accepted by the Seller and Buyer of a Property for $285,000 but the Appraisal reveals that the property is worth around $275,000, the Loan will not be approved, and the Seller may have to drop the Price, or the Buyer will have to bring the difference to the Closing Table."Â
Finally, you have a mortgage commitment letter from the lending institution in hand, found the house, got it inspected and appraised. Now it is time for closing, and to take possession of your new home. At the closing table, you will have to sign many documents including a promisory note, closing statement and more. If you do not understand anything that you are signing, ask for it to be explained. It is wise to have your Attorney and Real Estate Agent there with you--not only for support, but to answer any questions that you may have, and that are within their area of expertise.Â Be sure to bring your check book, and be prepared to recieve the keys to your new home!
I hope you found this information helpful. If you or someone you know is looking for their home in the New York/Long Island & Queens area, please feel free contact me.Â
Your Trusted Real Estate Professional For Life!! I stand behind getting you results!
De Vonte Williamson
Licensed Real Estate Salesperson, NY
Coldwell Banker Residential
36 Route 25A
East Setauket, New York 11733
Direct: (631)384-3695 (available 24/7--Emergency)Â
(C) 2012 De Vonte` Williamson. All Rights Reserved.