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TIPS TO CONSIDER BEFORE BUYING A
HOME: Get Pre-Approved, not just Pre-Qualified. In order to ensure that you are in the strongest negotiating position possible, get a written loan approval letter from your lender. Pre-qualification letters are worthless and only mean you spent a few minutes on the phone with a lender who asked you a few questions and then issued a pre-qualification letter. This pre-qualification letter is the equivalent of a CONDITIONAL loan approval, but sellers and their agents want an UNCONDITIONAL loan approval. The problem with pre-qualification letters is that none of the information has been verified and undisclosed problems usually surface which affect the loan amount (sometimes dramatically).Undisclosed problems may include recorded judgments, child support payments, inaccuracies on the credit report, and funds for the down payment that are borrowed or have not been in the bank account long enough. Pre-Approval letters mean that the potential borrower is approved for the loan based on a careful check and full verification of the information provided to the lender. Therefore, the only way to make a strong offer is to get pre-approved. Don't Use Any Credit. After you have been pre-approved for a loan, don't use any current credit or apply for new credit. New purchases and loans should be postponed until after your home closes. Otherwise, you may alter your credit score and ratios in a manner that significantly affects your ability to qualify for your loan. Keep in mind lenders typically check your credit report a few days before close of escrow to make sure you haven't taken on any additional debt and liabilities. Lenders even look at how many credit checks you have had and more than two may raise a red flag. If Possible, Sell Your Current Home Before You Buy a New Home. If you need to sell your current home to afford a new home, try to do it first because contingency offers don't always work out. One of the worst scenarios in residential real estate is watching a buyer find and secure their dream home and then have it slip away because they couldn't sell their current home. In addition, buying before selling might put you in a desperate situation and end up costing you thousands of dollars. Most likely, any seller who accepts a contingency offer will want full price and, since you need to sell your home in a hurry, you will probably accept far less than you normally would just to be able to keep your purchase alive and on schedule. WHY YOU SHOULD HIRE A ME AS YOUR AGENT TO REPRESENT YOU? Both buyers and sellers should be represented in a real estate transaction. However, years ago, traditional real estate assumed that all brokers involved in real estate transactions were agents of the seller of the property and, therefore, acted in the best interests of the seller. In recent years, buyers have been given the option of hiring their own representation, a Buyer's Agent. A Buyer's Agent will help the buyer find the appropriate property, determine its correct value, assist with applicable financing terms and advise the buyer during negotiations. The difference between a listing agent (who only represents the seller) and a Buyer's Agent (who only represents the buyer) is that the buyer is merely a "customer" to the listing agent. As a customer, the buyer is without representation because the listing agent handling the transaction is employed by the seller and is obligated to get the highest price and best terms for their client. Although the listing agent must, at all times, be honest and disclose all material facts about the property to the buyer, the listing agent is always working in the seller's best interests. A buyer becomes a client when a Buyer's Agent is hired as an advocate. WHAT MAKES ME AN EXCELLENT BUYERS AGENT? As in any other profession, the quality of real estate agents varies dramatically. To find a great Buyer's Agent to represent you, insist on the following traits and qualifications: Excellent Reputation and References Direct Affiliation With a Well-Established and Prominent Brokerage Firm Experienced in All Facets of Real Estate Extensive Knowledge About the Area Access to the Latest Technology and Equipment Full-Time Agent (you deserve full attention, don't hire a "part-timer") and Employed by a Full-Service Firm A Recipient of Additional Credentials Indicating Higher Levels of Education and Professional Skills Questions for a prospective Buyer's Agent should include: How many buyers have you assisted in the last 12 months? A good Buyer's Agent will be able to provide you with the addresses and selling prices of their most recent transactions. They should also share written testimonials and/or quality surveys from previous clients. The same question should also be asked with regard to the Employing Brokerage Firm. Who are some past clients I can call as references for you? If you are considering the Buyer's Agent, call the references. Can you provide guidance for financing my purchase? A good Buyer's Agent will be able to assist you in obtaining information about current mortgage rates, mortgage loan programs, insurance requirements and any recent changes in tax laws. Why choose a Realtor? After receiving a real estate license, most agents go on to join their local board or association of REALTORS® and the NATIONAL ASSOCIATION OF REALTORS®, the world's largest professional trade association. They can then call themselves REALTORS®. The term "REALTOR®" is a registered collective membership mark that identifies a real estate professional who is a member of the NATIONAL ASSOCIATION OF REALTORS® and subscribes to its strict Code of Ethics (which in many cases goes beyond state law). In most areas, it is the REALTOR® who shares information on the homes they are marketing, through a Multiple Listing Service (MLS). Working with a REALTOR® who belongs to an MLS will give you access to the greatest number of homes. How do you stay current on new listings and those that return to the market (the closing fell through)? A good Buyer's Agent (AND Brokerage Firm) will belong to at least one MLS and will be familiar enough with the area to know about new for-sale-by-owner listings. In addition, many homes are sold even before the sign is installed in the yard because a good Buyer's Agent has access to "real time" information in MLS. Is real estate a full-time job for you? A good Buyer's Agent works "more than full-time" for clients in order to exceed their expectations. If your agent is also working as a cashier or attending school, will they (and YOU) miss your dream home when it enters the market? Do you utilize the latest technology and tools in your business? A good Buyer's Agent invests in the latest technological advances in a continuing effort to provide exceptional service to clients. In fact, up-to-date technology and tools enable a good Buyer's Agent to work "more than full-time" for clients. How will you communicate with me regarding the status of my search and subsequent transaction? A good Buyer's Agent (AND Brokerage Firm) will utilize transactional software that allows a client to check on the status of their search and subsequent purchase, at the client's convenience, 24 hours a day/7 days a week. (CENTURY 21® Shaw Realty uses Transactional Software for ALL transactions) Once you have decided on a Buyer's Agent, commit your agreement to writing, and then play fair by not signing up additional agents to assist you. INVEST IN A VACATION PROPERTY: According to a study conducted by the National Association of REALTORS®, there were a record 2.82 million vacation home purchases last year, up 16% from the year before. The study showed that it's not just the wealthy purchasing vacation homes; the typical buyer earns $71,000 and buys a home worth slightly less than $200,000. Perhaps more than any other property type, vacation homes offer the potential for considerable price appreciation over the long term. Benefits of vacation property ownership include tax deductions, capital gains exclusions and a retirement option. In addition, owning a vacation home, especially if it is within driving distance, will save you on vacation travel and accommodations. Think about how much you spend on airfare, hotels, rental cars, meals, etc. Not only can you redirect those funds into a leveraged investment, you have guaranteed availability for last-minute getaways. In determining where to buy, look for developers and large developments emerging in an area. Developers perform more due diligence than any single buyer could ever dream of doing, and they invest thousands of dollars into researching the market, tourism, growth and inventory. If a developer has made the decision to proceed, you should feel comfortable doing the same. It is also a good idea to look for major employers in the area so, if you decide to turn your vacation home into a rental property, you have access to a pool of prospective tenants. |
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Definition of MLS Definition of Real Estate Definition of Century 21 Definition of REALTOR®
