STEP 1: FINDING THE RIGHT AGENT
There are certain characteristics you should be looking for in your prospective agent.
He or she should be a model of honesty – which means your agent should not be afraid to tell you the hard truths. Also, and this may seem obvious, but the right agent should also fully understand the home buying process – you can not afford to have a representative who might lose track of something important along the way. To be a successful realtor, one must be very detail-oriented, and be on top of every date and task – in real estate transactions, timelines are vital. If the agent is not precise in their methodology, then the whole process will be disorganized and stressful. The right agent has a heightened sense of awareness, and is ready for any contingency that might arise.
Moreover, a good agent should have a comprehensive understanding of the market. Agents should know what has sold and for what, what is on the market and for what, and what is currently under agreement, and for what. In this way, the agent’s knowledge will help guide you to a more responsible home purchase. He or she will be able to tell you if you are over-paying for a property, or if you are bidding too low on what they know is your dream house. Whether it’s your money or your dreams, the right agent does not want you to carelessly lose either.
And lastly, but of most importance, your agent should be a good, kind-hearted person. Some might disagree with me on this point, but I will tell you why they think that, and why they are wrong. Critics of this particular agent requirement will say that what you want is an agent who is a shark – a tough, mean go-getter -- because if an agent is too nice, then they will get eaten alive in negotiations. And in the end that won’t be good for the buyer. To which I would say, many kind people are quite charming. People who are charming win others over with their likeable nature. And in the end, isn’t winning people over the main objective of the art of negotiation. What’s more, successful agents always try their best to keep their former clients in their lives as a means of driving future business through referrals and such. So if you are going to be stuck having to repeatedly deal with this person, then believe me, you are going to thank me that your agent is so kind.
STEP 2: PRE-APPROVAL
At this point in the process you are going to want to get the name of a good mortgage broker or financial institution. They will run your credit and let you know what you can afford to spend on a home.
STEP 3: SHOP FOR A HOME
Now that you know what you can spend, it is time to figure out what exactly it is you are looking for. A good agent will do his or her best to balance your budget and your home wants in such a way where it does not feel like you are having to compromise too much to get everything you want.
Your agent should also provide you with many different ways to see homes. He or she should bring you to open houses, schedule showings, e-mail you new listings daily, as well as provide you with access to listings through a personalized app and/or website.
STEP 4: THE OFFER
Once you find the house that fits your budget and specifications, it is time to make an offer. This is where having the right agent is so important.The right agent will be able to tell you what the house is worth based on current market conditions. For example if a home has had an active listing for a couple of months during a red hot market, and it has yet to have a price reduction, then your agent should advise you that you would probably be safe to make an offer under list price. (This example is by no means a hard and fast rule, just a likelihood – the right agent will assess each particular situation and then help you act accordingly.)
Your agent should explain to you exactly how making an offer works. More than just the total amount spent – you will need to know the difference between your deposit and your down payment -- how you break up these two amounts, and when each of them is paid out. You should also know about escrow and what happens with your “earnest money” until the closing.
STEP 5: OFFER ACCEPTED
If your offer is not accepted you go back to step 3, but if it is accepted, take a moment to celebrate, and then move on to step 6.
STEP 6: INSPECTION(S)
Assuming that it is set as a contingency in the offer – which it always should be -- it is now up to you as the buyer to have the home inspected. You have about 7 days to schedule the inspection(s). You may just hire one home inspector and feel satisfied with the state of the property; however, you may want to hire some other companies to perform inspections as well. These may include tests for lead paint, pests, mold, etc. Your agent should have some recommendations for you.
STEP 7: PURCHASE & SALE AGREEMENT
This is where a contract is drawn up and the down payment (as agreed upon in the offer) is put down.
However, before you hand over any more money or sign anything, I highly recommend that you have an attorney, who specializes in real estate law, read over the language in the agreement to make sure that you are protected.
STEP 8: THE MORTGAGE
Unless you are fortunate enough to purchase a home with cash, then at this point in the home buying process you will need to apply for a mortgage. This is why step 2 was so important. It got the proverbial ball rolling, so that at this point there should be no surprises.
The mortgage application is submitted, and the bank appraises the house to make sure it is worth what you agreed to spend. They do this to insure that their investment is a good one. This is another good reason why having the right agent matters so much. It was your agent who advised you in determining the home's worth.
STEP 9: HOMEOWNER'S INSURANCE
After the loan approval and mortgage, it is time to purchase home owner’s insurance. The first year is usually paid up front. You must get an insurance binder to provide the closing attorney with, as a proof of purchase.
STEP 10: TITLE SEARCH/ FINALIZING PAPERWORK
This is when agents on both sides of the transaction gather all the paperwork together for the closing attorney.
Also at this point in the process, a title search is done to insure that there are no "clouds" on the title, and that it can be transferred to a new owner without issue.
STEP 11: FINAL WALK-THRU
The final walk-thru is your last chance to look the property over and make sure that there are no hidden surprises or defects. According to Massachusetts law, the home should be in broom-clean condition, which means that every thing has been moved out and the floors have been swept up. (This, however, does not mean that the home has to be spot-less. Washing the floors is not the seller’s responsibility.)
STEP 12: CLOSING DAY
The day that everyone has been waiting for. This is when everything is finalized by the closing attorney and the deed is transferred to the buyer.
The Keys are handed over and the new owner moves in!
CONGRATULATIONS! YOU ARE A HOME-OWNER!
Comments