Buyer Information

Buying a home can be overwhelming, and there are many pitfalls and mistakes that buyers often make. Here are a few tips and some valuable advice as well as a detailed 22-page Buyers Guide: 

Know How Much You Can Afford

Before you ever start looking at homes, I highly recommend that you research the different types of home loans and get “Pre-Approved” with at least one lender. It is important to be completely honest with the lender about your financial situation so there are no surprises that would prevent you from being able to fully obtain a loan. Your lender should always provide you with a "Good Faith Estimate" that will show the estimated closing costs and fees you will be charged by the lender, title company, etc when the loan closes. A "Pre-Approval Letter" from your lender is very important part of the process. My goal is to help you find your dream home and in today’s competitive market it is a requirement for me to provide a "Pre-Approval Letter" from your lender when we submit an offer. Not only does it allow me greater negotiation power when you are ready to make an offer, it also confirms the price range of the home you will be approved for and therefore be able to afford. I have several lenders that I can recommend, and I can also give you some important information about the current mortgage rates and loan programs.

Know What You Are Looking For

Before you start your home buying pursuit, it's important that you have a good idea what you are looking for. Often what one family member wants is quite different from the other. It's very important that you sit down to discuss what you want before you start your search, or you're likely to end up with buyer's remorse. Is it important to you to be close to work, schools, shopping, or hospitals? How many bedrooms and bathrooms do you need? Is it more important for you to have a 3 car garage or an extra workshop room? Is potential noise from nearby roads or trains a deal breaker? I suggest making a "Wish List" and make sure each person in the family gets to add their items to the list. Let the sky be the limit. Then, after the list is complete, take some time to sit together and carefully prioritize the items on the list. Often times when searching for a new home, you can end up with a few that you really love and this list can help you see which one best meets what you really want and need.

Timelines Matter

It is also important to understand your timeline for moving. Will you not have your downpayment for a few months? Does your current lease not end for another 6 months? Do you need to sell your home before buying? It is important to understand what life events may prevent you from moving directly into a new home. You may need to request a longer close of escrow or hold off on your search until you are truly ready to move.

Choose the Right REALTOR

Real estate transactions are usually one of the biggest financial investments of most people's lifetime. A typical real estate transaction is usually several hundred thousand dollars. If you had a $500,000 tax issue, would you attempt to deal with it without the help of a certified professional accountant? In most cases the seller (not the buyer) pays the Real Estate Agents commissions which makes it wise to have a professional Realtor on your side who can help you negotiate a better price and terms and help you avoid costly mistakes.

Your Realtor should first and foremost always have your best interest at heart to insure a smooth home purchase. They will help you determine your buying power, understand the market, assist you in finding the right property, completing all the necessary paperwork, negotiating the offer, completing the due diligence (inspections, etc.), and help you follow up with all of the entities involved (title company, lender, seller, inspector, brokers, etc.) to guide you through the closing process so that the transaction closes smoothly.

Become Familiar With The Market

Every transaction is different, and the ultimate value of a home is determined by what the seller is willing to accept and what the buyer is willing to pay. You don't want to pay too much, but if you don't pay what the market demands, someone else will and you may loose out to another buyer. Before you make an offer (or even start looking at homes) it's a good idea to review market trends and recent sales history for the areas that you are interested in. Ask your agent to give you a list of recent sales that match your general search criteria. Pay close attention to the average "price per sq. ft." (including the lot), and the total days on market. Knowing whether you are in a "buyer's market" or a "seller's market" will be important when it comes time to make an offer. 

Location, Location, location

Before you start looking at properties, you should decide what areas (cities, neighborhoods, subdivisions, etc.) that you are most interested in. You may want to consider income levels, crime rates, property appreciation/depreciation rates, foreclosures and school districts. Make sure you are aware of the locations to any amenities or other business you wish to be close by (potential employer, schools, shopping, parks, etc).

Selecting your dream home

If you follow the tips above before you start previewing homes, will be will be confident and better prepared to find your dream home. The best place to start is by engaging with a local Realtor who can help set you up with a home search. They can also help you with any road blocks you hit with figuring out what you are looking for, what you can afford and what your timeline for moving may be. You can set up a personalized search of the MLS which will have all available homes listed with participating MLS members. This search will allow you to track the homes you like. Once you have a short list of homes you'd like to see, meet with your agent to discuss and review these homes. Your agent may have additional information, photos, virtual tours, etc. that help you with your search and save you time. After you have reduced the homes to a reasonable number, your agent can arrange for you to preview the homes you have chosen. Your agent should provide you a one page printout for each home and I suggest you use this to take notes including a like/dislike list for each home. This will help you keep all of the homes straight and to remind you what you did or did not like about each home. Then take the time to give each home a rating from 1-10 with 10 being the perfect home! This will help you narrow down the homes to the 2 or 3 your are the most interested in. You may want to go back and preview those homes again to compare them with each other. Once you have decided on your dream home, it is important to act promptly and decisively. Your agent can help you to make an offer that is right for you and attractive to the seller.

Make An Attractive Offer That Is Right For You

Before you begin the home buying process, resolve to act promptly when you find the right house. I can not tell you how many times I have heard Realtors tell stories about buyers who looked far and wide for the perfect home, finally found it, and then said, "We'd just like to sleep on it" and ended up missing out on their dream home. Remember, if you are unsure you can always make an offer with a contingency that gives you time to “sleep on it”. This way, you can back out if you need to, but you don't loose the perfect home by hesitating. Resolving that you will act swiftly when you find the house that's clearly right for you can be the difference between owning your dream home or being left with stories of the the amazing home that got away.

There are many factors to consider in determining the price and terms of your offer. Your Realtor will help you navigate through all of these decision. Start with what is most important to you, and then consider adjusting the price or terms to make it a "win-win offer" for you and the seller. If you offer a lot less than what the seller is asking, you may want to try to offer a quick close of escrow. Reversely, if you can't move in for 6 months, you may want to ask the seller to sell and lease back or you may want to ask for a long contract, but in return you may want to put down higher offer price, offer to pay higher than market value rent for the lease back or put down a large than normal non-refundable amount of earnest money. The most important thing to consider when making an offer is how likely it is that you will be competing with other buyers and how close your offer is to comparable sales. If you offer more than what other homes are selling for, you may have trouble with your appraisal and getting financing. If you offer less than market value, the seller may get offended and not accept your offer.

Always make sure your agent has your "Pre-Approval Letter" from your lender and “Proof of Funds” to present with your offer. To justify a less than full price offer your agent may ask you for a list of items that you noticed about the home that will need repair or that you did not like so that they can present these to the listing agent in a tactful way. I recommend providing a “letter from the buyer” that you agent can attach with the offer in which you as the buyer can discuss all the wonderful things you liked about this home. These letters can often sway sellers.