FIRST STEP FOR BUYERS
Step By Step for Buyers
Now that you have decided to purchase home, what are the steps you need to be aware of to make it a hassel free procedure? The information below applies to your basic transaction in Southern Westchester County. Other parts of the county, state or country may vary in their proceedures.
If you are seriously thinking that this may be the year you purchase a first or new home, prepare!
Loan Officer: Before you do anything else sit down with a loan officer and share with him what you would like to accomplish with this purchase. You may want to speak to family and friends for the name of someone or you may ask your real estate agent. Your agent deals with loan officers all the time and can direct you to the names of a few people who will be certain to get your financing completed. Without a good loan officer, you won't be able to purchase the house you want so badly.
A loan officer will be able to advise you on just how best to proceed. In particular, if you are currently a property owner who plans on using the proceeds of your sale to purchase a new home, discuss with the loan officer the options you may have and not be aware of. You may qualifiy and be able to make an offer on a new home, non-contingent on the sale of your current house. This will make your terms and conditions of offer much stronger and may be the difference of getting your dream home or losing it to another purchaser.
Once you have decided how you will finance your purchase, get a pre-approval for purchase. A pre-approval is your key tool in showing a seller that you are a serious buyer and in fact you will not be able to make an offer on a property without one. Don't hold off thinking that it will take you months to find the right home. Should you find the perfect house your first weekend, you may lose out if you find out on Monday that there are multiple offers and that they are going to highest and best. Without your pre-approval you won't be able to present a valid offer and you won't have time to get one. Get it done early. It will eliminate a stressfull situation.
A pre-approval letter is much stronger than a pre-qualification letter. A pre-approval letter will not only check your credit but will also verified all your income and assests in writing. A pre-qualification will check your credit but will still have to verifiy in writing all the information you have given verbally. You want to be in the strongest position possible when making an offer against the competition...a pre-approval is the way to go.
Home Inspection: You may want to ask friends and family who have purchased recently who they used as a home inspector. If you need assistance with finding someone, ask your real estate agent. They should be able to provide you with the name of several good inspectors. You should interview these people over the phone to find out what they actually cover in their inspection and what they will charge. Some inspectors do not do termite inspections and if your new home has oil heat you will need to have the tank tested by a company that handles that specifically. You may also wish to have a radon gas test done, lead paint test, lead water test, or perhaps mold test done. Having your inspector lined up prior to finding that perfect house will help to make the purchasing process run smoothly. In Westchester County we do not take binders on offers to purchase. What that means is that you are not bound nor is the seller to an offer until the actual contract is signed by both parties. The contract must be signed after inspections have been completed. So, once you have an acceptable offer, the house will continue to get shown to other potential buyers until contracts are signed. You want this time frame to be minimal so that you don't lose the house to a higher offer. To do this you want to get inspections done quickly. offer has been accepted by a seller) neither of you are bound to that offer until you have both sides (buyer and seller) sign the contract. If you want the home you picked out, having your inspector and attorney will save time and help you to get to contract quickly.
Attorney: You also want to line up an attorney. Once again you may want to ask friends and family for recommendations if you don't have an attorney. Just realize that if you use a real estate attorney, the process usually runs smoother for obvious reasons and if the attorney is local and use to the local procedures, it also helps to eliminate possible difficulties.
Real Estate Agent: Of course you also need to identify your real estate agent. Make certain that it is someone you communicate well with since you will want the agent to listen carefully to your housing needs. This will help eliminate your time getting wasted. Also, don't use more than one agent in an area. We all have the same access to the same MLS in Westchester County and it is unusual for there to be many homes if any homes that are not on the mulitple listing service in lower Westchester County. By utilizing one agent who communicates well with you, you will eliminate the possibility of getting mutlple listings of the same house from several different agents. You will also eliminate the possiblity of being driven up to a house you have already seen with a different agent...a waste of your time.
Step By Step
Once you have found the perfect home, you need to be familiar with what happens next so that you feel more in control.
How your agent communicates your offer and interest in the home will depend on whether it is a sellers market, a buyers market, a stable market...whether there are other offers on the house, whether the listing agent will negotiate each offer received individually or if there will be a wait period ending in a "Highest and Best" situation.
The real estate market over the last five years has been a strong seller's market whereby there are many more buyers than houses available for sale. This is starting to change but do not be mistaken in thinking we are now in a buyers market. I would classify it more as a STABLE MARKET. Some homes are still going over asking, some at asking but several are now being negotiated, some thing we have not seen in a long time. A seller's market allows a home to appreciate greatly in short periods of time due to the low supply of homes and great supply of buyers.
We are starting to see the appreciation level off but with interest rates still low many buyers are still out there looking and you may still find yourself in a competitive situation depending on the home. Homes are not selling for less than they did last year but rather they are not selling by double digits, higher than last year. Those home overpriced for the market will make corrections and lower their asking but this should not be looked at as being a lower asking price than it would have been last year...therefore a stable market. In the most active part of the market these last few years, homes have sold for asking price or multiples over asking. This can still happen but less frequently. It depends on how the Market reacts to a particular house. In cases where there are multiple offers on a home, often the sellers will wait at least through the first week and weekend so that they can get all interested parties into the house for a showing.
When multiple offers are presented more than likely all offers will be held (no counter given) until such time as the seller decided with their listing agent to go back to all interested parties and ask them to give their very highest offer (price) and the best terms and conditions (listing all contingencies or in recent history, all non-contingencies) they can come to the table with. This makes it particularly difficult for the buyer and their agent but it is in fact the type of market we have seen in the last several years due to the low interest rates we have experienced.
If you are fortunate to find a home that is not in high demande, you will be able to negotiate a price and terms and conditions with the homeowner. In a changing market such as we are experiencing it takes great care to know how to present your offer.
Interest rates are still low (under 7%) and this should still be a good selling market.
Click here to go to INFORMATION FOR BUYERS. It will continue the discussion on the Step by Step Process of Purchasing a house and what you can expect.
