Karen Tammen, Realtor, GRI Office: (941) 639.8500 
 Toll Free: (800) 445.6560
Fax: (941) 639.3366

Buying a Home

With the growth of the internet, buying a home is easier than ever. In fact, homes can now be purchased over the internet!  Links to our Multiple Listing Service can narrow your search and  Virtual Tours can show the home and neighborhood. Purchase offers and contracts can be completed through email and sale closings completed by express mail. But, with the advance of technology, it is even more important than ever to have a Realtor that you can trust.  Even with all of the technology, nothing really is the same as being here to select the home of your choice, but with the help of a trusted realtor, you can buy the home of your dreams whether you come to this area or not.

Buying a home can be one of your most significant investments in life. Not only are you choosing your dwelling place, and the place in which you will bring up your family, you are most likely investing a large portion of your assets into this venture. The more prepared you are at the outset, the less overwhelming and chaotic the buying process will be. The goal of this page is to provide you with detailed information to assist you in making an intelligent and informed decision. Remember, if you have any questions about the process, Im only a phone call or email away! 

Starting The Home Search Process
The realtor may work with you as a Buyer's Agent or as a Sub-agent of the Seller; be sure to discuss these agency relationships with your agent(s) at your first substantive meeting as you will be required by law to sign an Agency Disclosure Agreement at that time.

  Know how much you can spend. Determine how much you want to pay for a new home.
If financing will be required, it is recommended that you obtain mortgage pre-approval from a qualified lender prior to beginning your home search. Often attached with a written offer, a pre-approval letter will give your offer merit in the eyes of a seller, and may allow you to be more flexible if a quick closing is in both parties' best interest.

Choosing legal counsel You should also select an attorney at this time.
It is recommended that you choose an attorney who is experienced in representing purchasers of real estate. If you don't have an attorney already for this purpose, your agent(s) can usually give you names of several highly regarded real estate attorneys that you can interview.

  Now that you have found the home you want, how do you structure and offer to purchase?
Once you have found a home you wish to purchase, your agent will submit an offer on your behalf. Offers and counter-offers may be submitted verbally or in writing. The initial offer is usually submitted in writing (especially in a multiple-offer situation) as an "Offer to Purchase" prepared by your agent.

Terms of your offer usually include:

  1. purchase price,
  2. personal property to be included,
  3. projected closing date,
  4. conditions and contingencies (inspections, financing, etc.)

Subsequent counter-offers are often presented verbally. When you have reached an agreement with the seller on all terms you now have an Acceptable Offer (A.O.).

What happens after you have an Acceptable Offer? Once an A.O. is reached, a written Memorandum of Agreement is usually drafted by the seller's agent, stating the terms of the agreement; copies are distributed to the seller, the seller's attorney, the buyer, the buyer's attorney, and both real estate agents. No earnest money deposit is exchanged at this time. The typical time frame from agreement to closing is approximately 60 days. Of course, many factors can affect this time frame, including specific needs of the buyer and/or seller.

From an Acceptable Offer to Contract
After reaching an A.O., you (the buyer) are given a limited time period during which to conduct an engineer's inspection and other desired and/or required inspections (assuming that an inspection contingency is part of the agreed-upon offer). This period is usually 10 days or less. During this period, the seller has only a verbal, non-binding agreement to sell the property to the buyer; the seller, in the meantime, is free to listen to, negotiate, and/or accept other offers. It is, therefore, imperative that you (the buyer) conduct all inspections in good faith and in a timely fashion. A binding contract will generally not be written until after inspections have been completed.

  Home Inspections do you need them?
An engineer's inspection is very strongly recommended for every home purchase. The purpose of an inspection is to identify the condition of the home and allow the buyer to make informed decisions. Even with newly constructed homes and with condominiums, it is possible that something could have been overlooked or poorly designed. An engineer's inspection will typically take 2-4 hours. If at all possible, you should plan to be there with the engineer during the inspection. This is an opportunity for you to learn a lot about your new home, ask questions of the engineer, and receive suggestions. Subsequent to the inspection, the engineer will provide you with a detailed written report covering his/her findings. Most mortgage lenders require a termite inspection and stipulate that it's to be done by a licensed termite inspector. Your engineer may or may not be licensed to do termite inspections; if not, you will need to hire a termite inspector. Other optional inspections you may wish to perform include a fuel oil tank test (for oil tanks buried in the ground), a radon test, a septic dye test (if applicable), a water portability test and water recovery test (for private wells), asbestos testing, and lead paint tests.
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  From Contract to Closing
Once inspections are completed and deemed satisfactory, the seller's attorney will draft a contract of sale and deliver it, along with the seller's title insurance policy and copy of any existing survey, to your (the purchaser's) attorney. You should review and discuss the contract with your attorney. If any changes are requested, the seller must agree to these changes.

Signed contracts are then returned to the seller's attorney with a 10% contract deposit, also called a "down payment" (this down payment amount can be negotiable but is typically 10%). The contract deposit check is made payable to the seller's attorney who holds it in an escrow account until the closing. Once the contract is signed by the seller, your attorney will receive two fully executed copies of the contract, one of which will be given to you for submission with your mortgage loan application.

Your completed mortgage loan application with all supporting documentation should be submitted to your chosen lender promptly upon receipt of the fully signed contracts. Your attorney will also provide you with an estimate of closing costs at this time.

Prior to closing, your attorney will arrange for a title search of the property. The title company will issue a title report certifying clear title, and a title insurance policy to protect the lender (required) and the buyer (optional) in the event a title problem arises in the future. The title company will also perform a property tax search and a violations search (required by the lender), and a survey inspection. If the existing survey is unacceptable, or if no survey exists, it is typically the buyer's responsibility to pay for a new survey.

  From contracts to the closing table
Once all conditions of the contract have been satisfied, the closing date is scheduled. This involves getting together all parties including the seller, the seller's attorney, the buyer, the buyer's attorney, the lender's attorney, the title company representative, and usually one or both real estate agents. Once the closing is scheduled;

  1. calls should be made to confirm with your movers,
  2. to contact utility companies to transfer service accounts,
  3. to arrange for a homeowners insurance policy (proof of an insurance policy and paid receipt for one year's premium paid in advance must be brought to the closing),
  4. and to transfer any funds (closing costs) necessary for closing.

Your attorney will advise you in advance as to the amount(s) of any certified checks required at closing. You will also be required to bring a supply of blank personal checks for assorted closing costs, as well as two forms of identification, one of which must be a photo I.D. Closing can take just a few minutes if you're paying cash, or much longer depending upon the number of real estate papers to be explained and signed.  

  Inspecting the property for the final walk-thru
A final "walk-through" of the property is performed just prior to closing, usually within a few hours or not sooner than the previous day. This is scheduled with your real estate agent, or the seller's agent.

The purpose of the walk-through is threefold:

  1. to confirm that no damage has been done to the home since the time of the engineering inspection;
  2. to confirm that the major systems and appliances are in working order; and
  3. to confirm that the home is "vacant and broom clean", as stipulated in every sales contract.

Questions
For additional information or clarification of any information provided herein, please consult one of the professionals identified in the disclaimer.

* Disclaimer Please keep in mind that this is not intended to be a comprehensive discussion of the home purchase process. It is intended to give the reader a general overview of the process, and to allow a prospective purchaser to plan ahead. Information contained herein should not take the place of the expert advice of professional advisors such as an attorney, a real estate agent, an engineer, a mortgage counselor, an accountant, and an insurance agent, all of whom you may have to consult with and rely upon in connection with your home purchase.

HOW TO SPOT A GOOD BUY

 

Beauty is in the eye of the beholder, particularly when it comes to buying a home. Features that attract one home-buyer may repel another.

However, the one feature of interest to every home-buyer is price. Getting the most home for your money is paramount. The real problem is figuring out whether that fixer-upper on one street is a better buy than the home in next-to-new condition two blocks away. That’s why knowing what to look for before you buy can save you time, energy and money down the line.

The first step is figuring out what kind of house you need. A good buy is only a good buy if it meets your current and future living requirements. Before shopping for a home, decide how much space you and your family require. How many bedrooms, bathrooms? Is a family room necessary? Do you need a layout that will accommodate a lot of entertaining? Do you prefer a spacious or compact work space in the kitchen? If you have small children, can the house easily be childproofed?

Evaluate the front and back yards. Is there enough space to accommodate your children? Do you want a park-like or garden setting? Do you enjoy yard work and gardening, or do you want a low-maintenance yard? Take into consideration the cost of extensive landscaping and upkeep.

Next, determine how much work is required to make the house you are considering livable. Make an honest assessment of your fix-it abilities. How much work are you willing to do or pay someone else to do? Do you have basic decorating, carpentry and plumbing skills? If you plan to learn as you go, make sure you have accurately determined what you are getting into. Ask an experienced friend, family member or your real estate agent for their opinion, and be sure to consider how much remodeling inconvenience the rest of the family can handle.

Unless you are ready and able to tackle a major remodel, look for a house or condominium that needs only cosmetic improvements. These include painting, wallpapering and replacing items like flooring, window treatments, bathroom and kitchen fixtures, light fixtures, cabinet and interior door hardware and appliances. Remember that even these simple changes can be costly if you have to make many of them.

Beware of improvements that seem easy enough at first glance buy may turn into major headaches and require a lot of money once you’ve moved in. Remodeled kitchens and bathrooms, changes to the floor plan, room additions and redesigned landscaping are examples of seemingly minor changes that can easily eat away the money you thought you saved by selecting a so-called “bargain priced” home. Of course, you may be perfectly willing to spend whatever money is needed to customize the house to match your tastes and needs.

Make sure major systems in the house are in good working condition. The furnace, air-conditioning and plumbing should be up to date, since repairs can be costly. Your agent can arrange to have a professional inspector determine whether the electrical wiring and any room additions are to code. Local utilities often offer free or low-cost inspections to tell you if the house is energy-efficient.

Look for a house with universally popular selling points. If you’re impressed, the next buyer down the line is bound to be, too. For example, a roomy, modern east-to-clean kitchen is the best selling point a home can have. A house with only one bathroom is less desirable than a house with two or more. Many buyers expect at least three bedrooms, with a master bedroom that offers a feeling of privacy. Lots of storage space and closets, especially walk-in closets, will be a real selling point. Family rooms or “great rooms” also are desirable. On closer examination, a house that looks like a bargain may lack some of these key features.

Don’t forget the old adage: location, location, location. Unless you’re looking for a fixer-upper, the house should be in a condition that is comparable to other homes in the neighborhood. Avoid buying the biggest or fanciest home on the block. Consider the amount of traffic or noise. Homes located in a quiet area away from a busy street will command a higher price. Make sure the schools in your district have a reputation for quality education and safety. Nearby supermarkets, gas stations, restaurants and theaters also will make a location more desirable.

Good community facilities also add appeal; pools, athletic fields, community centers, libraries and hospitals all add to a neighborhood’s value and desirability. Transportation needs also should be considered. Is local public transit available? How long are typical commutes to places of current and potential employment? Are there several alternate route? How close is a major airport? All of these can affect a home’s pricing.

Consider the cost of living in a home. It’s important to consider not only purchase price but the monthly cost of living in a home. Estimate your utility and maintenance costs. For example, will the house need to be painted on a regular basis and will you need to spend money maintaining a swimming pool? Ask your agent about the property tax rate and whether increases are anticipated. Will you have to pay special assessments for a homeowner’s association? Consider the point in the life cycle of major household systems, such as the furnace, air conditioning, roof and kitchen appliances.

You can find a bargain! Your first step should be to seek out a knowledgeable real estate agent with experience in the market areas where you wish to purchase a home. Your agent can help you locate those properties that truly are “bargains” and help find the home that most closely matches your desires and needs.