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Guide to Buying
How to Find Your Perfect Home
Whether you’re a first time buyer or new to the Central Florida area, I’m here to help you every step of the way. No matter what sort of property you’re looking for, I’ll provide expert, caring and candid advice throughout what will be one of the most important transactions of your life. That’s my professional commitment to you.
First-Time Home Buyers in Central Florida
If you are a first-time home buyer, use the guide below for helpful hints and tips and learn how to avoid common mistakes when buying your first home in Central FL area.
Pre-Qualification: Meet with a mortgage broker and find out how much you can afford to pay for a home.
Pre-Approval: While knowing how much you can afford is the first step, sellers will be much more receptive to potential buyers who have been pre-approved. You'll also avoid being disappointed when going after homes that are out of your price range. With Pre-Approval, the buyer actually applies for a mortgage and receives a commitment in writing from a lender. This way, assuming the home you're interested in is at or under the amount you are pre-qualified for, the seller knows immediately that you are a serious buyer for that property. Costs for pre-approval are generally nominal and lenders will usually permit you to pay them when you close your loan.
List of Needs & Wants: Make 2 lists. The first should include items you must have (i.e., the number of bedrooms you need for the size of your family, a one-story house if accessibility is a factor, etc.). The second list is your wishes - things you would like to have (pool, den, etc.) but that are not absolutely necessary. Realistically for first-time buyers, you probably will not get everything on your wish list, but it will keep you on track for what you are looking for.
Representation by a Professional: It's always a good idea as a buyer to have a Realtor representing your interests. Your Realtor will help locate properties, set up showings, make sure asking prices are fair, negotiate on your behalf, help with inspections and ultimate bring the purchase to a successful closing. In our area sellers are charged a commission which is shared between their agent and the buyer's agent. This means having a Realtor is typically FREE as a buyer so it only makes sense to have one on your side.
Focus & Organization: In a convenient location, keep handy the items that will assist you in maximizing your home search efforts. Such items may include:
One or more detailed maps with your areas of interest highlighted.
A list or file of the properties that your agent has shown to you.
Paper and pen for taking notes as you search.
A camera to snap pictures of homes you have toured to help you remember your favories and features you really liked.
Visualize the house empty & with your decor: Are the rooms laid out to fit your needs? Is there enough light?
Be Objective: Instead of thinking with your heart when you find a home, think with your head. Does this home really meet your needs? There are many houses on the market, so don't make a hurried decision that you may regret later.
Be Thorough: A few extra dollars well spent now may save you big expenses in the long run. Don't forget such essentials as:
Include inspection & mortgage contingencies in your written offer.
Have the property inspected by a professional inspector.
Request a second walk-through to take place within 24 hours of closing.
You want to check to see that no changes have been made that were not agreed on (i.e., a nice chandelier that you assumed came with the sale having been replaced by a cheap ceiling light).
All the above may seem rather overwhelming. That is why having a professional represent you and keep track of all the details for you is highly recommended. Please contact us directly to discuss any of these matters in further detail.
Home Financing Resource
Get A Mortgage Pre-Approval
Looking to get approved for a mortgage in Central Florida? The very first step in the home buying process is to talk with a bank or lender about your mortgage financing options. They can help to determine if your credit is good enough to purchase, how much house you can afford, what your payments will look like and what type of loan programs and incentives you qualify for. Once the lender gets you pre-approved, you will receive a written pre-approval letter which shows sellers that you are a serious and capable buyer. This is extremely helpful when negotiating the purchase a home since pre-approved buyers typically beat out others who aren't pre-approved yet.
What Happens Next?
Made Your Escrow Deposit
Congratulations, you are on your way to owning your very own home! Follow these suggestions (and your Realtors's advice) so that escrow and settlement with go as smooth as possible.
So you've found a home, submitted an offer and the seller has accepted. One of the very first things you will be doing after going under contract is to make your escrow deposit. This amount of this escrow deposit should of been established in the details of your offer and typically ranges between 1% of the home's sales price and can go as high as you the buyer are comfortable with. The higher the amount the more serious you look in the eyes of the seller. Just keep in mind that if you back out or default on the contract for a reason outside of one of the contract contingencies, this escrow deposit can be lost to the seller. Your agent should explain these details to you prior to submiitting an offer.
During this period after going under contract, you are going to need an escrow or settlement company to act as an independent third party so that you know when and who to give your money to get the deed to your new home. In our area the seller will usually select the title/closing company and in return the seller will be paying for a owner's insurance title policy on your behalf. This policy averages about $5.75 per $1k of the sales price. Again, typically paid by the seller. This escrow or settlement company will hold your deposit and coordinate much of the activity that goes on during the escrow period. This deposit whether it be a cashier's check or a wire, will held by the settlement agent. Make sure that there are sufficient funds in your account to cover this check.
The deposit check will ultimately be cashed and assuming the sale goes through, this money will be applied towards the purchase price of your new home.
1. The period that you are "in escrow" is often 30 days, but may be longer or shorter. During this time, each item specified in the contract must be completed satisfactorily. By the time you have opened escrow, you have come to an agreement with the seller on the closing date and the contingencies. Each contract is different, but most include the following: 1. Inspection contingency: this should be completed as soon as possible after the contract to purchase is signed as unsatisfactory results of the inspection may mean that you will want to cancel the contract.
2. Financing contingency:Â Once the contract is signed, you have a period of time to secure funding. If, for any reason, you are unable to secure funding during the period of time granted to you by the contract (and the seller will not provide a written extension of time), you must decide whether you want to remove the contingency and take your chances on getting a loan. You may choose to cancel the purchase contract.
3. A requirement that the seller must provide marketable title. With an attorney or title officer, review the title report. The title must be "clear" to ensure that you do not have legal issues regarding your ownership. Check into local and state ordinances regarding property transfer and make sure that you and/or the seller have complied with them.
4. Secure homeowner's insurance. This will be required before you can close the sale. Depending upon the home's age some insurance companies may require a 4 Point Insurance Inspection so obtaining this insurance may require a couple weeks to bind. It would be in your best interest to apply for insurance as soon as possible after the contract is signed.
5. Contact local utility companies to schedule to have service turned on when you close escrow.
6. Schedule the final walk-through inspection. At this time, you should make sure that the property is exactly as the contract says it should be. What you thought to be a "permanently attached" chandelier that would come with the property might have been removed by the seller and replaced with a different fixture entirely.
You've made it! Once the sale has closed, you're the proud owner of a new home. Congratulations!
Making an Offer On A Home
Things To Know
Before the offer to purchase is created, it is very important that you have been at least pre-qualified or better yet pre-approved by a lender.
This is one of the best negotiating tools a buyer can have. It shows the seller that you are financially able to purchase the home. After you have found the right home, it is time to prepare the offer.
When you are buying a home, there are many problems that the seller is obligated to disclose. For example, in most states, it is illegal to withhold information about major physical defects on the property, but these disclosures don't always paint the entire picture of the home. Here are six questions you may want to ask that can offer additional insight about the prospective home before you make a final decision.
1) Why is the seller selling the house? This question may help you evaluate the "real value" of the property. Is there something about the house the seller does not like? If so, you may be able to adjust the purchase offer accordingly.
2) How much did the seller pay for the home? This question can, in some instances, help the buyer negotiate a better deal-maybe even get the seller to carry part of the loan. However, it is important to remember that the purchase price is influenced by several factors, like the current market value and any improvements the seller may have made to the home. The original purchase price might not have anything to do with the current value of the house.
3) What does the seller like most and least about the property? By asking the seller what he or she likes most and least about the property, you might get some interesting information. In a few cases, what a seller likes the most about a home might actually be something the buyer is looking to avoid. For example, if the seller describes his house as being in a "happening community," the buyer might consider this a negative factor because the area may be too noisy or busy for his or her taste.
4) Has the seller had any problems with the home in the past? It is also a good idea to ask the seller if he or she has had any problems with the home while living there. Has the seller had problems with a leakage from the upstairs bedroom in the past? If so, even if the leak has been corrected, the floor and walls around the bathroom might have been damaged. You should also check that these items were repaired properly.
5) Are there any nuisances or problem neighbors? Use this answer to find out about any noisy neighbors, barking dogs, heavy airplane traffic or even planned changes to the community, such as a planned street widening. This may give you insight on why the seller is really moving.
6) How are the public schools in the area? Because the value of a community is usually greatly influenced by the public schools in the area, finding out the buyer's perception can give you some insight about the quality of the area's schools.
Knowing all you can about a prospective home, not only helps you decide if it's the home of your dreams, but what offer to make as well. Your real estate professional can help you get your key questions answered and give you advice on how to evaluate your findings.