AN OVERVIEW OF THE PURCHASE PROCESS

First of all, I want to thank any of you for the honor of being considered to assist you w/ the purchase of your home/property. I realize this is one of the biggest decisions and purchases you will make in your life. If you are a first time buyer, or it’s been a while since you purchased a property, hopefully the information below will be of value to you.

Unless you intend to pay cash, financing is necessary in order to complete the process. I work w/ loan officers or mortgage brokers who are very good at informing buyers of their options – once some initial information is obtained regarding income and credit status. This is an early step that needs to be taken in pursuing a purchase. A buyer will learn what type of loan they can qualify for and should receive an estimate of what monthly payments will be for a specific loan amount. The loan officers I work with are glad to sit down w/ you and explain things in detail.

Typically, if a person has good credit and income, getting a loan for a purchase is not difficult. One of the best loans for first time home buyers is an FHA loan - usually has a lower interest rate and requires 3% down, so 97% of the purchase price is financed. There are other loan programs that allow for 100% financing. Typically, sellers like to see an earnest $ deposit in the amount of at least $2,000 (but we can always try getting the contract accepted w/ less). I do not ask for a check for the earnest money deposit until after an offer is accepted; then I will need it to open up escrow. At the close of escrow or completion of property transfer, you need to be aware that there are charges associated w/ the transfer of property, called 'settlement' or 'closing costs.' Both buyer and seller typically EACH pay 3%. As a real estate agent, I commonly see offers accepted where the seller AGREES to pay the buyers closing costs (so 6% from the seller and little or possibly nothing from the buyer at closing). In this type of scenario where the seller pays the buyers closing costs, the buyers should take this into consideration when determining an offering price.

With condominiums, keep in mind there are monthly maintenance fees in addition to a mortgage payment. These help with up keeping the exterior, landscaping, pools, etc. - things that are shared by/benefit all unit owners or considered "common elements."

The other fees associated with a purchase a buyer has to be prepared for involves the home inspection. This is not required, but advised to make sure there are no surprises after purchasing regarding plumbing, foundation, roof, electrical, pests, etc. (and if things to be concerned about are discovered, a buyer can back out of the deal within a certain time frame and not lose/will get back their earnest $ deposit). The price is determined by the dwellings square footage; to give you an idea of a home w/ 1,500 or less sq ft, the inspection is typically around $400. I can not hire an inspector for you, but can provide you w/ a list of names and numbers and some questions to ask to assist you in the decision making process.

*A transfer of property typically can take as little as 30 days (this is an average), depending on terms of the contract.
After finding a home and submitting an offer and receiving acceptance, the next thing to be arranged is obtaining a homeowner’s insurance binder, usually within 5 days after acceptance. You can either contact the insurance company who carries your automobile insurance and see if they provide homeowners as well (Progressive does not) and perhaps receive a discount, or you can seek or I can refer you to an insurance broker who will shop different companies and inform you of the best rate they can get you and you can decide from there. Typically, an insurance broker will be looking out for your interests more so than going through the company directly and will inform you of what is necessary and what is not required, thus possibly saving you $.

* A Form 17 or Sellers Real Property Disclosure Statement is usually provided to the buyer within 3 days of acceptance and then the buyer has 3 days to review and accept or reject based on the information disclosed.

*The inspection period needs to be completed or satisfied typically within 10 days of acceptance.

* I will review copies of the Title report.

* LOAN approval is typically the last thing that needs to happen prior to the closing of the transaction and an appraisal of the property needs to occur. Be advised NOT TO MAKE ANY LARGE PURCHASES during the home purchase process as it may result in denial of your loan. Keep all credit card purchases to a minimum.

* Some other issues w/inspections and documentation that may possibly pertain to a specific property could be the following: Septic, Well’s, Investigating Specific Uses for property (Feasibility Study), approval of CC&R’s (Covenants, Conditions, Restrictions), Association Documents (common w/ condo’s).

* At closing, you will either need to go to the escrow company - or there is a chance an escrow officer may come to your home – to review and get your signatures for all the required documentation to complete the process.


For your peace of mind, I want you to know that if there are any reasons you may not approve of or get approval for some of what’s mentioned above, you will not lose your earnest $ deposit, if notification is given during the specified time frames. These are some reasons for having a Realtor. I will facilitate what needs to occur when it needs to and be in communication w/ and provide required documentation to all parties.

Please don’t hesitate to ask questions or bring up any concerns – that’s what I’m here for!