Buying real estate can be one of the most challenging decisions that we make in a lifetime.
The following information can help you prepare yourself to make good decisions during your home buying experience.
WHATEVER YOUR REASONS FOR BUYING, finding the right home, in the perfect neighborhood, and at a cost that is within your budget, is no small task. That’s why many buyers enlist the help of RED MOON REALTY.
We are licensed professionals with specialized skills. There are many benefits you receive from working with an experienced REALTOR®
As your REALTOR®:
I know the local market and can quickly narrow down a few areas where you are likely to find your home at the price point that you are comfortable with.
I can save you time by doing a lot of the legwork. By knowing your needs, I can eliminate homes that do not meet your criteria.
I will make appointments, preview homes with you and help you determine the pros and cons of each home.
I have access to our northwest multiple listing database (NWMLS) that provides access to thousands of homes for sale.
I can provide information and make appointments to see almost any property listed for sale and also For Sale by Owners (FSBO). A home does not have to be listed by a Red Moon Realty in order to get detailed information or an appointment to view.
Once you find the home you want to buy, I will guide you through the negotiation, legalities and details of purchasing a home.
Beginning the Home Buying Process
Organization is the key to finding the home you want while spending the least amount of time and energy.
Contact a lender to find out how much house you can afford. This should be done prior to searching for a new home. I can refer you to a loan officer who can help you determine how much you can qualify, down payment requirements, programs available, monthly payments that work within your household budget.
Make a list of everything you want in a home. Is a master suite important? How many bathrooms? What about closet space? Do you need a yard for the kids and pets to play in? How about a fireplace or a bay window? Do you prefer a rambler or multiple-story house? Are schools or access to transportation important?
Separate the essentials from the items you could do without and put them on the “A” list. Prioritize the rest of the items into a second and third list in order of importance. We’ll then go over the list so that I’m very clear on what you want and need in your home.
Keep good notes as we look at homes. After a while, it becomes difficult to remember which features belong to what home. Some buyers make audio recordings or take pictures as they go along.
When selecting a home, look beyond cosmetics. Make sure the home is in good physical condition and that you understand the cost of repairs. For more information on how to assess the home’s condition, refer to the Home Inspection information on our website.
Look at additional homes, even if you love the first one you see. Many times, it takes looking at several homes before you find the one that is really right for you.
As your REALTOR®, I’ll check with you regularly, even if you haven’t found a house that suits your needs. Keeping in contact with you allows us to establish a good rapport, and helps me to learn how to help you effectively. I’ll continue to be on the lookout for homes that suit your needs, set up an auto search that will email you new listings that fit your criteria, and keep you updated with new market trends.
How much can I afford?
Before you start looking at homes, it’s a good idea to find a target price range that you can afford. A mortgage lender will want to make sure you can qualify for the down payment, plus a monthly mortgage payment made up of principal, interest, taxes and insurance (PITI).
Interest rates and your personal finances will influence the amount of house you can afford. For a quick estimate of a monthly mortgage payment for which you may qualify, or to see what a how much of a home you might be able to afford, use our mortgage calculator. But remember, it’s always good to talk to a lender before you start shopping for a home. We have a network of lenders to refer you to, that would cater to your specific financial needs.
Purchase and Sale Agreement
Once you’ve found the home you want to buy, together we’ll complete a purchase and sale agreement. This is the contract in which outlines the details of your offer and required documents to transfer ownership of property once the sale is completed. The purchase and sale agreement usually consists of the following pages:
- Earnest money receipt.
- Financing addendum.
- Inspection addendum.
- Conditions/disclosure addendum.
- Contingency addendum-when appropriate.
- Addendum outlining special conditions.
- Short-Sale or Bank Owned/Foreclosure addendum-when appropriate.
- Lead-based paint notification-when appropriate.
- Property disclosure form completed by the property seller.
- Agency disclosure.
The Purchase and Sale Process Step-By-Step Chart
Closing Costs, Points, and Title Insurance
What Are Closing Costs?
Closing costs are charges paid to various entities during the real estate transaction. They can include escrow fees, document preparation fees, cost of an inspection and lender fees.
What Is A Point?
A point is equal to one percent of the loan principal. Some lenders charge points, in addition to interest and fees, at closing.
What Is Title Insurance?
Title insurance protects against loss from any defects in the legal title, liens against the property or other adverse claims. The lender usually requires title insurance.
When you’re ready to complete a purchase and sale agreement on a home, your offer will generally be contingent on a professional inspection of the entire property, including improvements. The home inspector looks beyond the cosmetics to make sure that the home’s general systems operate properly. The inspector will also look for large repairs that are needed and report on the condition of the home.
The standard home inspector’s report will review the conditions of the home’s heating and cooling system, interior plumbing and electrical systems; the roof, attic and visible insulation; walls, ceilings, floors, windows and doors; foundation, basement and visible structure. The inspector will also look for cracks in cement walls, water stains that indicate leakage and any indication of wood rot.
A home inspection also points out the positive aspects of a home, as well as the maintenance that will be necessary to keep it in good shape.
As your REALTOR®, I’m familiar with home inspection services and can provide you with a list of names from which to choose. Another good source for finding a home inspector is to ask a friend, or perhaps a business acquaintance, whom has had a home inspection done before and can recommend a home inspector they were satisfied with.
Remember, no home is perfect. If problems are found, I will help you negotiate through the process.
Settlement Costs – Who Pays What
During the negotiation stage of the transaction, a mutually agreed-upon date for closing is determined. “Closing” is when you and the seller sign all the paperwork and pay your share of the settlement fees, and the documents are recorded. Settlement obligations vary widely due to specific contract language, local laws and customs. Prior to closing, the closing agent (usually an escrow or title company or attorney) will complete a detailed settlement statement for both buyer and seller.
The Buyer Will Receive
- Earnest money deposit
The Buyer Pays
- One-half of escrow or legal fees paid to the attorney or escrow company for preparing the closing
- Document preparation fees
- Recording and notary fees
- Title search and title insurance
- Local transfer taxes, if any
- Repairs or inspections the buyer has agreed to pay for
- Loan fees
- Appraisal fees
- Credit Report fees