Who pays my buyer agent’s commission?
The seller pays the commission of BOTH the buyer’s agent and the seller’s agent per the listing agreement. Since you DO NOT have to pay for the commission, search for an experienced, highly rated real estate agent to represent and negotiate your home purchase. Your agent should know about the current real estate market and the areas you are searching for a home.
TIP: Ask for recommendations from friends, family, and co-workers. What are your top recommendations for buying a home in the Bay Area?
What are your top recommendations for buying a home in the Bay Area?
- Work with a real estate agent you like, respect, and trust. Interview each agent carefully and be clear about your expectations. It is important to have an experienced real estate agent with strong negotiation and communication skills to represent you on your purchase.
- Talk to your financial advisor and a mortgage lender before you start searching for a home. Be completely sure your financing is secure, well in advance, and get a pre-approved for a mortgage loan, if needed.
- When you start looking at homes, DO NOT allow anyone to rush or pressure you to make an offer. Purchasing a home is a HUGE financial transaction.
- Make a checklist of your must-haves in a home. DO NOT compromise—only search for homes that inspire you. When you find the home that matches your needs and criteria, you will feel ready to make an offer
What are the main things to consider when touring a home?
- Does it meet your needs and criteria of a home? Having a checklist of must-haves is helpful when looking at potential homes.
- Walk through the entire home and imagine yourself living there.
- What would it be like preparing a meal in the kitchen? Is there enough counter and cabinet space?
- Is there an office, bonus room, or a guest room?
- What direction will the sun rise and set?
- How much privacy will you have
- Does the backyard fulfill your criteria? Large lawn area, outdoor kitchen, gazebo, room for sports court, pool, or garden?
- Look around the neighborhood.
- Are the other homes well maintained?
- Is the home on a busy street or cul-de-sac?
- Feel comfortable and mesh with your family’s desired lifestyle?
- Establish a positive rapport with the listing agent.
- Ask questions about the home and neighborhood including schools?
- Leave negotiations and difficult discussions to your agent.
How should I conduct my search if I have not decided on a neighborhood? Can I search in more than one area?
Location is very important when buying a home. Many buyers we represent will search several neighborhoods simultaneously. This is a very common practice and we highly encourage our clients to find an area that fits their criteria. Our experienced real estate brokerage has a vast amount of knowledge of local areas.
Does that mean I am guaranteed for the loan?
Unfortunately, no. There are actually three tiers in the process of getting a loan:
- Pre-qualification: When you prequalify for a home loan, you are getting an ESTIMATE of what you might be able to borrow, based on information you provide about your finances, as well as a credit check.
- Pre-Approval: The lender requires you to provide proof of your financial history and stability. The lender will verify your income, employment, assets and debts, and will check your credit report. You are still NOT guaranteed a loan and are subject to many conditions.
- Fully Underwritten: The buyer has been FULLY APPROVED by the mortgage lender for a certain loan amount. The benefits of having a fully underwritten approval is the leverage it gives the buyer in a highly competitive real estate market.
Should my real estate agent and mortgage lender communicate?
Communication between your loan officer and your real estate agent is crucial. Your lender will be able to inform us of your loan terms so that we will meet your home needs and financial criteria as we search for your new home. With our years of experience working with hundreds of lenders and mortgage companies, we know the communication is beneficial to our buyers when we all align in pursuit of your goals.
How reliable are sites like Zillow or Redfin in predicting a home’s value?
Zillow and Redfin have been a popular starting point when determining a home’s value. These sites use algorithms or data submitted by property owners to determine property value so they can have inaccurate information. To receive the most accurate home valuation, it is recommended that you work with an experienced real estate agent. The agent will come to your home to see the upgrades added to your home to determine a home’s true worth.
Many disclosure packages are 300 pages or more. How can I possibly know what parts are important?
The amount of pages in the disclosure package can be overwhelming. Your real estate agent will send you the disclosures and reports to review. As your agent, we will be reviewing them as well. We will inform you of any important issues that might be a concern with the home. We highly recommend reviewing the following:
- Home Inspection Report
- Termite Inspection Report
- Roof Inspection Report
- Other inspection reports, if applicable (pool, foundation, fireplace)
- Real Estate Transfer Disclosure Statement
- Seller Property Questionnaire
- Agent’s Visual Inspection Disclosure
These reports and disclosures contain the most current and meaningful information about the property.
What do we need to write an offer?
- Your fully underwritten loan status letter, as well as proof of funds.
- Discuss with your real estate agent an offer price based on the agent’s assessment of the property’s true value.
- Review all of the property disclosures and inspections carefully. If you have any questions about the property, please ask your real estate agent for clarification.
- Tour the property thoroughly with your real estate agent to ensure the home meets all of your criteria and needs.
Who pays for the appraisal and loan fees?
The appraisal and loan fees are paid by the buyer. Rates can vary, so please consult your mortgage provider for specific figures pertaining to your loan. The appraisal fee covers the cost of having a professional appraiser look at a home and estimate its market value.
Can I use a lender that is not local? Are there any benefits for using a local mortgage provider?
Yes, you can use a lender that is out of the area. However, having a local mortgage provider can be advantageous. They have a better understanding of property values and the local economy. When you work with a local lender, you are working with a licensed loan officer and team of professionals who are experts in the area you are buying into. To be the most competitive and to increase your likelihood of winning your dream home, you need a local professional.
What expenses will I encounter as a buyer?
- Non-recurring closing costs (NRCCs): one-time expenses
- rate lock fee
- loan fees
- Recurring closing costs (RCCs): ongoing monthly expenses
- loan principal
- property tax
Is the purchase price the most important factor of an offer? Are there other ways to be competitive when writing an offer?
The purchase price the buyers offer is very important to the seller in their decision to accept your offer. They will also look for other criteria to help them make their decision.
- Purchase price
- Number of days to Close escrow
- Are there any contingencies?
- Status of Loan Approval
- Rentback offered
An experienced real estate professional will communicate with the listing agent to identify the needed elements to meet the seller’s criteria and to help the buyer make a competitive offer.