Loan Pre-Approved, Cash Buyer, or 1031 Tax Exchange
Most people need to take out a loan when buying a home. A licensed lender can help evaluate your financial standing and provide a pre-approval. They will review your income and credit history to determine your buying power and establish a price range. Having a pre-approval letter in-hand can also increase the attractiveness of your offer. If you are paying cash, proof of funds is generally required with an offer. With a 1031 Tax Exchange, there are timelines that need to be adhered to along with proof of funds from your facilitator.
The Home Search
Finding the right home can be time consuming, but it’s important to consider everything before you decide. Depending on your lifestyle, how you plan to use the property whether as a primary, second home, or investment property, style, amenities, and location are key factors for consideration. Together we will look at everything using the Funnel Process to make sure you do not miss anything and begin a process of elimination verses selection until you find your top one to three choices. We’ll schedule showing tours for you to preview the properties in person or via real time video. Once you have identified a property of choice, I will research it and provide you a market analysis of similar properties that have sold prior to you making an offer.
To start your search you can create a property search file, save your favorites, and specify your search criteria to automatically receive new listings as they first come on market so you do not miss any opportunities.
Making An Offer
When you’re ready to move forward with a purchase, I will advise you on constructing the strongest offer possible. Then I will draw up the necessary paperwork on your behalf. There is a lot to consider when making an offer. We’ll discuss the purchase price, the closing date, sale contingencies and any special stipulations for your purchase. Once an offer is submitted, the seller may accept, reject, or counter the offer. If the seller returns with a counter, as your negotiator I will work collaboratively for an acceptable agreement, or the offer is rejected by either party. Once an agreement is achieved, you are under contract and escrow opens.
The Transaction (Going Under Contract or In Escrow)
Once an agreement is reached, escrow will open, requiring you to make your initial agreed upon deposit into escrow. Next a series of tasks agreed in the Purchase Contract need to be performed by either you or the seller in a timely manner or “default of contract” could occur with negative consequences and possible cancelation. As your Realtor I will monitor these transaction dates, order necessary documents, inspections, and other items of request in the contract while keeping you informed throughout. You will also need to work closely with your lender if obtaining a loan to purchase the property.
Inspecting the physical condition of your next home is a vital part of the home-buying process. A licensed home inspector will conduct a comprehensive evaluation of the entire property and report any problems with the condition of the home’s structure or systems. I will help coordinate additional inspectors to investigate potential issues such as pest infestations, mold, pool, air-conditioner units, and roofs if needed. Depending on the purchase agreement, we may enter additional rounds of negotiation to resolve any problems discovered during the inspection such as repairs or treatments.
If your purchase is with a loan, your lender will arrange a professional appraisal of the home. An appraisal is an unbiased estimate of the true (or fair market) value of a home and is conducted by an independent third party. The appraiser will confirm the appraisal value of the property for all parties involved. If the home appraises at less than the expected value, you may have the option to renegotiate the purchase agreement or terminate the contract.
The Final Walkthrough
Prior to closing, we will conduct a final walkthrough of the home to ensure that all negotiated repairs have been completed, and that the home is in the same (or better) condition as when the original offer was made. This is the final opportunity to call out any problems identified with the home before closing. Depending on the purchase agreement, you may sign a formal contract addendum confirming that the walkthrough is complete, and the condition of the home is acceptable.
If your purchase is with a loan your mortgage lender will provide final confirmation about 10 days prior to the closing date that you are approved to close and will provide a final closing disclosure that summarizes the loan terms, monthly payments, taxes, and other costs associated with the closing. Escrow will send you all your loan documents and closing documents required to complete the sale 5-7 days prior to your closing date. Signing is usually done with a notary and not at Title and Escrow. In the State of Hawaii, all transactions are recorded by the Bureau of Conveyances and all monies and closing documents by all parties must be at the Bureau 72 hours prior to the closing date. Once the Bureau of Conveyances records the transaction on your closing date, you will receive your keys and ready to move in. Time to celebrate!