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Walking the Buyer Through the Process

Buying a home is one of the biggest decisions most people ever make.  Your experience will depend on your preparation, if you want a smooth transaction we suggest you carefully read this page and do your best to be prepared.

Buyers must get their affairs in order first.  It is nice to know you want a home and nice to go looking for a house, but if you get a contract and then find that your financing is not possible for several months while you make some corrections to your credit report, you will not be happy.  Get your credit report and carefully review it, work with a professional in this area to remove bad credit and add good credit, also use a monitoring service so that while you are looking for a home you instantly know if something happens credit-wise.  You can find links to credit repair and monitoring services on our Buyer Resources page.

You should connect with a mortgage lender.  Work with them to get pre-approved, not just pre-qualified.  Sellers will ask if you are already qualified and take your negotiations more seriously.  It sometimes happens that more than one offer comes in at the same time, the better prepared you are to satisfy the mortgage contingency; the more likely your deal gets negotiated first.

Your lender will tell you how much house you can afford based on your down-payment, credit score and selected mortgage details.  Try to stay within that range.  There is no need to frustrate yourself or the seller to negotiate a contract that you cannot perform on, don’t waste everyone’s time.  It is a rough day when you fall in love with the perfect house that you cannot possibly buy.

When you look for houses, get as much information as you can before you contact the seller.  Look at the full listing online, if you must have 4 bedrooms, then avoid going to all the effort to look at the house, only to ask the seller where the 4th bedroom is, when they had not listed it initially, and calling to ask if the bonus room or den with bathroom can be converted into another bedroom.  Since sellers read this too, usually if there is a flexible space they will say so in their description. Sellers generally take buyers more seriously when they ask questions that reflect they have done their homework.

Know the schools in the area, if that is important to you. Research the recent sales in the area.  Know what the land is worth and what the range is for the cost per square foot for houses in that area.  Your lender can probably refer you to an appraiser that they will use for your loan; call him or her and ask these questions so you are as knowledgeable as possible.

“First impressions are lasting” – you never can overcome how the seller relates to you if you start off on the wrong foot.  Agents are shock absorbers, but here you have a direct line of communication between buyer and seller, so strive to be polite, just like you would want to be treated.

Ask questions appropriately.  “This room would be a fantastic fit for all of my furniture.” Is a very different statement from “What on earth were they thinking when they decorated this room?”. Everyone has different styles and tastes, be careful not to create unnecessary negative feelings

When it comes to making an offer, use the right forms; make it real.  Our sellers are encouraged to be prepared with the forms and encouraged to have spoken with a lawyer to be prepared for your offer to come in.  Verbal offers are worth the paper they are written on.  Sellers know that it would be highly unusual to have a contract for a $300,000 house with $100 in earnest money. Please consult our resources so you can determine what is an appropriate amount of earnest money for your transaction.  You can read the sellers information on this site to get the feeling on the other side of the transaction.

If you find what you truly want, do not waste any time in making an offer.  Many people hunt for houses for sale by owner to get a good deal, and they can be quite aggressive, so don’t “sleep on it” and miss out.  Be prepared so that when you find it, all the “sleeping” has been done.

Your offer should be clear, try not to complicate it with unnecessary contingencies, get those issues taken care of as soon as possible.  Any contingencies about the inspections or titles or anything otherwise related to the property will be identified and dealt with timely in the countdown to closing.  If you are selling your existing house and it must close in order for you to complete the purchase of your new house, be clear about the status of that transaction to the seller.  Generally a seller will want to have some confirmation from the other transaction, either a quick call with the closing attorney, Title Company or buyer’s mortgage broker; in fact it can be from any independent corroborating source on the other transaction.

A very important caution to buyers who are planning to use equity in their existing home to buy another home.  Do not list your property in MLS without first consulting a mortgage professional.  Most lenders will not refinance, especially a cash-out refinance if the property has recently been in MLS.

If you receive a counter-offer back from the seller, be clear that you do not have a contract until you accept it, and if you change anything, then they must accept your changes.  You do not have a contract until all parties have signed the contract, initialed and dated any handwritten changes etc.  This is where you should consider having a lawyer that is in the real estate transaction business to review your agreement to be sure you have an enforceable contract.

Your lawyer or the title company will review with you all of the remaining steps to completing the closing.  You will need to have your utilities, insurance, movers etc. and you can find those links on our Buyer's Resources page.