FAQ for Buyers
Many people are interested in becoming home owners, but aren’t sure if they can qualify for a mortgage. The BEST way to find out is to speak to a lender. I have local lenders I work with and they are able to answer this question. Usually, people are able to buy right away…and often the cost of a mortgage is LESS than the rent they have been paying. Sometimes a small amount of credit repair is necessary to qualify, other times a lender can help you create a plan so you will be able to purchase in the near future. Please check out the financial tab for more information now.
This is another question best answered by the lender. There are often loan programs available to help with down payments, closing costs, and sometimes both. Aside from the down payment and closing costs, there are also some times in the purchase process that money will be needed.
Earnest Money: Once you have been pre-approved for a loan and you have found your dream home, made an offer and had if accepted…you will need to deposit earnest money. There is no set amount for this, but many sellers and listing agents would like to see earnest funds close to around 1% of the purchase price. So if you are buying a $200,000 home $2000 of earnest money is often expected. Earnest money will be held by the title company, a neutral 3rd party in the transaction. This money can be used towards down payment or closing costs at the close of escrow.
Inspections: Once an offer is accepted you will have 10 days to do inspections. Prices for this range on the size and age of the home, and whether the property has a pool and spa. Usually these range from $350-$500. Often buyers will also do a termite inspection, (usually $50-$75) and if additional inspections are needed then there may be additional costs involved in those.
Appraisal: Appraisals are usually paid up front, and done about 10 days after contract acceptance. Appraisals usually cost $400-$500…but the lender will be able to give you more specifics about this.
Those three costs will be needed before the purchase of the house, but the lender will be able to give you more specifics of how much you will need to cover closing costs and down payment. Don’t forget to budget for moving day too!
The seller of the house the buyer buys pays the buyer’s agent, so it costs a buyer nothing to use an agent!
This isn’t a question that has only one answer. There are so many factors that go into pricing a property, and knowing the value of a property. This is something you should really look to your agent for guidance about. The agent will look at days on the market, comparable sales in the neighborhood and surrounding area, the current market specs (average days on the market) , and the plusses and minuses that the particular property has to offer. For instance the size of the lot, the location within the neighborhood, the updates and upgrades that property has, or doesn’t have. It is important to trust the guidance that your agent offers you…we want you to get the property for the best price you can, but we especially don’t want you to lose your dream home by coming in with a less than strong offer.
Every seller, just like every buyer is different. Some WILL only care about price. Most sellers will look at other factors, such as the close of escrow date, the financing…both the loan and who the buyer is using, and if they buyer is asking for other concessions…such as the washer, dryer, refrigerator….or a home warranty with all of the bells and whistles. Usually sellers are worried about their bottom dollar, so if they leave their appliances, pay for a home warranty, and cover the buyer’s closing costs…that all affects their bottom dollar. Some sellers will want a quick close, others will need time to relocate…this is why it is best for the buyer’s agent to speak with the listing agent so you, as the buyer, can make an offer that will appeal to the seller, especially if you don’t mind waiting to close on the home, or can cover your own closing costs.
You are on your way to making the house yours, but there is still a lot of work to do. First of all, you must get the lender absolutely everything they need so your loan can progress appropriately. Then you must do inspections on the home…and decide if any deficit that the seller will not repair is acceptable for you to deal with after you purchase the home. Then the home also must appraise for at least the purchase price. If it appraises for more, you win! But less, then the difference between the contract price and the appraised price must be figured out. You as the buyer can make up the difference with cash, the seller can reduce the price of the home, or something in between can be negotiated. Once you have your loan approved, the repairs negotiated, a solid appraisal….you are most likely home free! Wait…Most likely??? Yes, well, real estate is always exciting and always different…so remember it is never over until it records with the county and you are given the keys on closing day!
FAQ for Sellers
Selling your home may feel like a very expensive endeavor. There is not a set amount that it costs to sell your home, but there are costs associated with the process that must be accounted for. When you hire an agent to represent you in the sale of your home all of the costs associated with the sale will be discussed. The listing agent will charge a commission for their work, and that commission will be shared with the buyer’s agent. This amount can vary depending on several factors. There are also title fees, HOA fees for disclosure and transfer, and escrow fees…plus any of the buyer’s fees that are negotiated for the seller to cover. It is important to be very clear about all of the fees up front, and throughout the negotiation process…so if you ever aren’t certain please ask for a worksheet of estimated costs from your agent.
There are advantages to selling your home at any time of the year. Traditionally the MOST homes are sold in the early summer…closing before the next school year starts in early August. This means listing your home February-May will be when MOST homes sell. This doesn’t mean though that other times of the year are not good times to sell. Over the holidays for instance…many people do not want buyers walking through their home. If a seller is willing to put up with buyers over the holidays, or if the home is vacant, it will have less competition than the spring months…and buyers will be more serious….less looky loos.
I would love to answer this with an unequivocal YES…but sometimes things happen. Knocking on wood as I write this, but this has never happened with any of the listings I have had over the past 15 years…no one has ever reported anything stolen. But to be safe I suggest not leaving certain things out in the open. Prescription medication, cash, jewelry, and guns should not be seen….even if the buyers open closets, medicine cabinets, or drawers. Licensed agents will usually only take pre-approved serious buyers out to look at homes, so this shouldn’t be a top concern for you.
As soon as you start to think about it. Seriously. Have your agent over to chat. Talk about the market, talk about the costs to selling, talk about the future and what you want it to hold. Often small things can be done to your property to help you increase your sale price, and DECREASE your time on the market. Things like sprucing up your landscaping, making repairs, or even a coat of paint or new counter tops. Talk about everything with your agent so you have all of the information to make educated choices…and the TIME to do any updating or upgrading you might choose to do.
Yeah, you do. Disclose, disclose, disclose. There are a few protected things you don’t have to disclose, such as death on the premises, a person with AIDS or HIV living there, or if a crime occurred on the property…but outside of those things…just tell the buyers. Before you list the property your agent will give you a form to fill out that asks a gajillion questions. Answer them all, truthfully. Back up your answers with receipts and warranties, and any other paperwork you have. If a buyer loves your home many of them will overlook pretty much anything, especially if you handled it appropriately. For instance, if you had a flood…but you dried the property out and made repairs…tell them about it. Chances are they will find out anyway when they see your insurance history and see what claims have been made on the property. Then you look shady…and that will cause worse feelings than if you had been open and upfront right from the beginning.
For the most part, pretty darn clean. Remember you are selling something here, something that is most likely the biggest thing the buyers have ever bought. So you have to sell them the experience of what their life will be like if they make this home their own. So it needs to feel good, smell good, and be completely distraction free. You don’t want them seeing your dirty dishes and wondering what you had for breakfast…or tripping over your kid’s toys. Yes, it isn’t easy to live in a home and have it on the market, which is why I suggest talking with your agent about your challenges and working out solutions to make the process easier, right from the beginning. Sometimes an agent will have brilliant tips to make things easier…remember this IS what they do for a living.
The easiest way I can think of to say this is…NO! NO NO NO! No matter how tempting it might be to stay to demonstrate the cool LED lighting in the pool, or the remote control for the fountain…let the buyers look around with their agent alone in your home. If they have questions about the fountain, or the pool…they will likely ask…and maybe you can give instructions to your agent to tell their agent. Even if the buyers LOVE your home, you being there will make them uncomfortable. They might not spend the time looking at things like they want to, because they will naturally want to hurry out of your home so you can get on with your day. Let them take the time to explore your home, experience how wonderful it is to live there, and chat with each other and their agent without filtering their words for your ears.
Well, let’s put it this way. I hope so. I prefer to request feedback via email and not with the check box questionnaire that can be sent out automatically. I like the email because it gives the agent an opportunity to give better feedback, feedback that might actually be useful. Sometimes I miss things about a client’s house…and the feedback will help a seller know if something is distracting, or unpleasant. For instance once we heard poopy diapers in the trash were a little stinky. I hadn’t experienced that ever, but the feedback was good stuff for the sellers to remember! But LOTS of agents don’t respond to requests for feedback, and that is annoying. But just know that it isn’t you, or your property…it is common and doesn’t mean anything other than agents are busy.