2. MORTGAGE APPROVAL: Due to Federal reforms in the banking industry, it is imperative you consult with your banker or mortgage broker prior to previewing property. Getting pre-qualified benefits you, the buyer, in so many ways. First, you know exactly what you can afford thereby making your search more efficient. Second, getting pre-qualified avoids costly delays that may arise during the loan process and directly related to Federal guidelines. Lastly, the seller will take your offer more seriously if you have been pre-qualified. Your Realtor at Berry Realty Group may refer you to a preferred lender for an opinion as to your purchasing power qualifications. We encourage you to speak to at least two lenders to compare rates and terms. Remember, a mortgage broker shops among a variety of lenders and an institutional bank may be more limited in what can be offered so we recommend you include at least one mortgage broker and one lender.
3. PREVIEW HOMES: After your appointment with a Realtor at Berry Realty Group, you will agree to a mutually convenient time to preview homes you are interested in buying. We recommend you keep the showing list limited to a range of three to five homes in one day. Our experience has shown buyers will get confused as to the various home features once they exceed more than five properties in one day.
4. THE OFFER: When you have targeted a home in a robust market, we recommend you move quickly to present and negotiate an offer. Any due diligence as to the integrity of the home is customarily done once you are in contract. Realtors at Berry Realty Group negotiate at minimum a two week contingency to perform due diligence. There are a number of contingencies negotiated, including a property inspection that allows you to cancel the contract and receive a full refund of your deposit if there are any issues about the home, even minor issues. If you wait to present an offer, we often see another buyer coming to the table thereby creating competition, or perhaps you lose the home to a more aggressive buyer. Remember, it is always best to cancel the contract during the contingency period if you are not happy with the property rather than lose the home of your dreams by doing all your due diligence before going into contract.
5. NEGOTIATIONS: Your Realtor at Berry Realty Group is a seasoned expert negotiator of whom will be your advocate in acquiring the best price and terms available. Such terms will be when you take possession, payment of escrow/title fees, inspection contingency as well as disclosure contingencies. More often than not, the seller will counter your offer on price or terms or a combination thereof.
6. CONTRACT: Once there is an agreement and the seller and buyer have signed the contract, an escrow is opened with an escrow company. An escrow company is a third party who receives funds directly from you. The escrow companies are insured and bonded so your money is safe. In addition to receiving funding, the escrow company is an intermediary who coordinates all related documents in preparation for recording the sale of your home. Delivery of funds may be by way of a wire transfer to the escrow trust account or a check made payable to the escrow company and also deposited into their trust account. Your Realtor will provide escrow with all the necessary contractual documents as well as coordinate with escrow a successful recording of the deed to your new home.
7. APPRAISAL: A lender will always order an appraisal when applying for a loan to finance the purchase of any home. In a cash deal, some buyers will order an appraisal with the assistance of the Realtor at Berry Realty Group. Typically, when a loan is necessary to purchase the home, this is written in the contract as a contingency for a loan approval as well as being contingent on the home appraising at or more than the purchase price. Federal regulations place strict guidelines on appraisers so homes are not over valued. The appraisal also instills confidence in the buyer so as not to over pay for the home. In a “hot” real estate market, sometimes the home will not appraise at the higher market value because valuations are appreciating so rapidly. In these unusual circumstances, the buyer may be required to pay the difference of the appraisal and the purchase price. In the alternative, the buyer may cancel the contract if there is an appraisal contingency.
8. HOME INSPECTIONS: We at Berry Realty Group strongly advise our buyers to retain a professional property inspector to evaluate the condition of the home and generate a detailed report as to their findings. Your Realtor at Berry Realty Group will arrange for a professional property inspection as well as termite inspection. If any issues arise from either of these inspections, your Realtor will negotiate a remedy. If the inspection and/or remedy is not satisfactory, then the buyer many cancel the contract within the time allotted in the contingency.
9. TITLE INSURANCE: Typically, your Realtor at Berry Realty Group will negotiate for the seller to pay the buyer’s Title Insurance, but not the lender policy. There is a Standard title insurance policy and an ALTA policy. The ALTA policy offers a broader coverage for any title defects. Your Realtor at Berry Realty Group, or the title company can explain the differences in title policies.
10. HOME WARRANTY: Your Realtor at Berry Realty Group will explain what a home warranty typically offers and the approximate cost. Depending on the coverage, a one year policy will cover appliances, air conditioning, heating systems, limited plumbing and limited electrical. Most policies are renewable after one year. Policies can vary in coverage and cost so it is important to see what is covered for the fee. Your Realtor will use their best efforts to have the seller pay for the home warranty.
11. CLOSING COSTS: Prior to closing escrow and taking possession of your new home, you will have time to review escrow closing documents as well as lender documents. Your Realtor at Berry Realty Group will be there every step of the way to assist in answering any questions and to be sure escrow and the lender are proceeding in a timely and informative manner.
12. FINAL INSPECTION: Several days before the closing, you will accompany your Realtor at Berry Realty Group for a final inspection of the home. The purpose of the final inspection is to confirm any repairs that may have been made as well as verify there have been no significant damages to the home since it was professionally inspected.
13. POSSESSION: Several days before you close and take possession of your new home, escrow and the lender will have you sign all related documents of which will facilitate the recording of your deed and thereby taking possession of your new home. We recommend you contact all the relevant utility companies several weeks before closing in order to transfer services into your name when you take possession. If a utility is turned off, it may result in unnecessary reconnection fees. Your Realtor at Berry Realty Group will answer any questions and assist you with a smooth transition into your new home.
14. OWNERSHIP: This is an exciting time for all new home buyers! We at Berry Realty Group enjoy great satisfaction when we see our clients happy with their new home purchase. In fact, the best compliment we can get from all of our happy clients are the referral of friends and family because this tells us that we did a great job!
DISCLOSURE: The following information is offered as a general explanation of the buying process. Every real estate transaction is different and the terms negotiated in each contract is different. Therefore, it is important that you not rely solely on statements set forth herein, but carefully read and understand all contracts and supporting documents to see what is applicable to your transaction.