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  Buyers
Watch the 9 Steps to Ownership
Defining What You Want
Start by creating a prioritized list of features you want in your next home and the reasons why. Use it as your search guide, but remember that depending on your funding, you will probably need to make some compromises. In addition, talk to your real estate professional about where you want to live. Location is a huge part of any move. As a professional I am trained to help my clients narrow down their choices by sharing market trends and local information.
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What is the first step to buying a home?
Answer: Make sure you are ready - psychologically and financially. Ask yourself the following questions: Do I have steady income? Is my debt lower than my total income? Do I have enough money to pay for the down payment and closing costs? Am I working hard enough to improve bad credit? A house needs constant care and attention. Also ask yourself if your budget will allow for unexpected repairs and upkeep. Once you can honestly answer "yes" to these questions, you are several steps ahead of the game and that much closer to becoming a homeowner.
Figuring Out What You Can Afford
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I work with several mortgage brokers who I would be more than happy to put you in contact with. It is illegal for Realtors to take a commission from a mortgage broker so the brokers I suggest are based on the level of service they have offered past clients.
It is a good idea to get started with this straight away so that when you come to look at property you are all set to go – you have already sent all the required paperwork in to the mortgage broker and have qualified for a mortgage. This will save you time and energy and allow you to use your time more profitably viewing homes. If this is all sorted out before, then you know how much you can afford to spend on your home and you are in place to buy. It also means if you see something you like, you can move on it straight away.
In Florida the Mortgage Broker is paid a fee by the borrower (you) in addition to a lender commission.
The costs incurred by you, the borrower, are collectively called the closing costs. There are a number of fees and charges that make up the closing costs . These costs are paid at the end forming part of the closing costs, Mortgage Brokers charge a loan origination fee. This fee can range in size from 1 to 10% of the actual loan amount, depending on the complexity of the case (10% is the legal maximum loan origination fee permissible). The most commonly charged fees will be in the region of 2 to 3%. Also, please be aware of Mortgage Brokers who claim there are “no closing costs” these costs are generally hidden elsewhere.
Loan Origination Fee
This covers the administrative expenses in setting-up and processing the loan. The loan origination fee may be a percentage of the mortgage amount.
Points (optional)
An option for the home buyer is to pay points to lower the interest rate at which the loan will be repaid. Each point equals 1 percent of the mortgage amount. For example: on a $150,000 loan, 1 point would equal $1,500.
Appraisal Fee
The fee for having the house appraised may be incorporated into the closing costs or payment may be required by the lender at the time the loan application is submitted.
Credit Report
The lender uses a credit report to determine the creditworthiness of the loan applicant. This fee is often paid when the loan application is submitted.
Interest Payment
Typically the buyer is required to pay interest on the mortgage loan to cover the time between the closing date and when the first mortgage payment period begins. For example: If closing is on May 15. Your first monthly payment begins to accrue interest on June 1 with your first mortgage payment due July 1. At closing an interest payment covering the accrual period between May 15 and May 31 may be required.
Money Thoughts
 Don’t Move Money Around
When a lender reviews your loan package for approval, one of the things they are concerned about is the source of funds for your down payment and closing costs. Most likely, you will be asked to provide statements for the last two or three months on any of your liquid assets. This includes checking accounts, savings accounts, money market funds, certificates of deposit, stock statements, mutual funds, and even your company 401K and retirement accounts.
If you have been moving money between accounts during that time, there may be large deposits and withdrawals in some of them.
The mortgage underwriter (the person who actually approves your loan) will probably require a complete paper trail of all the withdrawals and deposits. You may be required to produce cancelled checks, deposit receipts, and other seemingly inconsequential data, which could get quite tedious.
Perhaps you become exasperated at your lender, but they are only doing their job correctly. To ensure quality control and eliminate potential fraud, it is a requirement on most loans to completely document the source of all funds. Moving your money around, even if you are consolidating your funds to make it "easier," could make it more difficult for the lender to properly document.
So leave your money where it is until you talk to a loan officer.
Oh…don’t change banks, either.
Should You Change Jobs?
For most people, changing employers will not really affect your ability to qualify for a mortgage loan, especially if you are going to be earning more money. For some homebuyers, however, the effects of changing jobs can be disastrous to your loan application...
Income Tax Savings Because of income tax deductions, the government is subsidizing your purchase of a home. All of the interest and property taxes you pay in a given year can be deducted from your gross income to reduce your taxable income.
For example, assume your initial loan balance is $150,000 with an interest rate of eight percent. During the first year you would pay $9969.27 in interest. If your first payment is January 1st, your taxable income would be almost $10,000 less – due to the IRS interest rate deduction.
Property taxes are deductible, too. Whatever property taxes you pay in a given year may also be deducted from your gross income, lowering your tax obligation.
Stable Monthly Housing Costs
When you rent a place to live, you can certainly expect your rent to increase each year – or even more often. If you get a fixed rate mortgage when you buy a home, you have the same monthly payment amount for thirty years. Even if you get an adjustable rate mortgage, your payment will stay within a certain range for the entire life of the mortgage – and interest rates aren’t as volatile now as they were in the late seventies and early eighties.
Imagine how much rent might be ten, fifteen, or even thirty years from now? Which makes more sense?
Forced Savings
Some people are not the best at saving money, and a house is an automatic savings account. You accumulate savings in two ways. Every month, a portion of your payment goes toward the principal. Admittedly, in the early years of the mortgage, this is not much. Over time, however, it accelerates.
Second, your home appreciates. Average appreciation on a home is approximately five percent, though it will vary from year to year, and in some years may even depreciate... Over time, history has shown that owning a home is one of the very best financial investments.
Shopping for Homes
Once you know what community you'd like to live in and have an idea of how much house you can afford, its time to start checking out actual properties. Beginning this search online can help save you time since it can help you target homes that meet your search criteria. My home notifier can even email you when properties come on the market that meet your search criteria.
Next, begin visiting homes in person. Happy to arrange visits and to houses that are in your target area and price range. When comparing homes, make sure to look at all aspects of the property. Is the property tax approximately the same? Are both the houses renovated? Do they both have the same amount of bedrooms and bathrooms? Are both houses located on the same or similar streets? Does either house have any encumbrances? Remember to keep an open mind when you are looking at homes.
Making an Offer
Once you find the home you want, you need to make an offer for the house. Typically this is a very difficult and trying time since both parties have totally different goals. In most cases it is better to have a third party, such as a real estate professional, negotiate the offer. If you have any personal interaction with the homeowner, don't give out any information about your move, your current housing status, financial status or your feelings about their property - positive or negative. This could hurt you in future negotiations.
Your offer is the first step toward negotiating a sales contract with the seller. Since this is just the beginning of negotiations, you should put yourself in the seller’s shoes and imagine his or her reaction to everything you include. Your goal is to get what you want, and imagining the seller’s reactions will help you attain that goal.
The offer is much more complicated than simply coming up with a price and saying, "This is what I’ll pay." Because of the huge dollar amounts involved, especially in today’s litigious society, both you and the seller want to build in protections and contingencies to protect your investment and limit your risk.
 In an offer to purchase real estate, you include not only the price you are willing to pay, but other details of the purchase as well. This includes how you intend to finance the home, your down payment, who pays what closing costs, what inspections are performed, timetables, whether personal property is included in the purchase, terms of cancellation, any repairs you want performed, which professional services will be used, when you get physical possession of the property, and how to settle disputes should they occur.
Inspection and Insurance
After your offer is accepted Iwill need to set up, coordinate and interpret various inspections, including insect, building quality, title, etc. You will also need to arrange for homeowners insurance and finalize the mortgage.
This is a major step in the buying process and there are many potential problems that can be discovered during this period. These include a leaky roof, radon gas, termite damage, a foundation problem, and wall cracks, to name a few. These problems happen all the time. The difference between closing on your dream home and starting the process all over again is what occurs during the negotiations between you and the seller.
I can help make these discussions go more smoothly. In most states you will also have the option of a "walk through" before the closing. This is your last chance to make sure that all of the items that you have agreed upon were completed to your satisfaction.
 Inspections The Home Inspection is an unbiased, professional assessment of the condition of the house. It provides you an expert opinion and professional report on the condition of the physical structure and various systems within a house.
An average cost will be in the region of $300.00 dollars. We also suggest a termite inspection. These costs in the region of $100.00, if you are getting a mortgage your mortgage company will require one.
When the inspection has been done it is then up to you and your agent to discuss any on going issues with your new home. Quite often there is an agreed amount in the contract between the buyer and seller to cover the cost of minor repairs. Your agent will organize any repairs that need to be done and keep you informed of the progression towards closing.
If you are not going to be here for the closing it is essential that you have a re- inspection to make sure all the work agreed under the contract has been undertaken. Allow $200.00 dollars for this.
The Final Closing
Before you arrive at the closing, make sure all the necessary paper work and deposits have been completed. If the mortgage, title work, homeowners insurance and other items necessary under local and state laws are not completed and brought to the closing table, the closing may not happen on time. And, depending on what the contract says, this could result in further action including financial penalties and even the loss of your rights to the home.
Once you close, it's official - you own the house! But there might be a few things you want to do before you lay out the welcome mat. These include arranging for an alarm system, turning on the electricity, subscribing to the local paper, cleaning or replacing the carpet, arranging for lawn services, etc. This could also be a good time to make some needed renovations.
What Do These Terms All Mean?
 MLS - Multiple Listing Service
Multiple Listing System is a real estate listing service that combines the listings for all available properties in an area, except For-Sale-By-Owner (FSBO) properties, in one directory or database.
The MLS allows me to put in certain criteria such as an upper limit for price, how many bedrooms/bathrooms you want, does it have a pool and is it in the area you are looking. I can then updateyou , by e-mail, as new properties become available or if there is a price change on a property that is currently for sale.
In general, MLS access is restricted to licensed real estate agents. Those agents pay a fee to view the listing database. The general public only gains access to a portion of the overall listing database via a portal or other website.
Deposit on a Property When you have found the home that you would like to buy, I will write up the contract (the offer) and send it to the agent who is listing the property, and they in turn will present it to the owner. At this time it is usual to place a good faith binder deposit of $3000 to $5000 dollars. If the seller does not accept your offer on the property then the deposit will be returned to you. The deposit is held in “Escrow” (see note below).
Title Company The Title Company will pull together all the paperwork for the transaction. They will research the title and issue Title insurance (See below). In the State of Florida, we do not generally use lawyers for Real Estate transactions. All the necessary documentation is typically taken care of by the Title Company; they are used to doing thousands of transactions, most of which are standard. If you feel you would like a lawyer to represent you please ask for a list of names?
Title Insurance The Title Company will also be issuing your Title Insurance policy. Title insurance is a type of insurance that helps protect against losses that could occur if you discover after closing that someone else can claim ownership of your property.
Title Search Is a close examination of all public records that involve title (deed) to a piece of real estate. The person conducting the search looks at past deeds, wills, and trusts to make sure the title has passed correctly to each new owner. The examiner tries to verify that all prior mortgages, judgments, and other liens have been paid in full. A title search should uncover potential problems, such as rights others may hold (right of ways, view easements, power line easements, mineral rights), claims by prior undisclosed heirs, and pending legal actions. If you would like a more complete description please ask.
Escrow also known as settlement or closing, is the process in which an escrow company, Title Company, or other third party overseas the transfer of ownership to from the seller to the buyer. The third party agent holds and organizes any funds and documents until all the details of the transaction have been fulfilled. Escrow opens when good faith money (deposit) has been deposited into an escrow account along with the contract for sale and purchase signed by both seller and buyer. Your agent will take care of this for you.
Closing Costs If you are using a mortgage to purchase your home, there will be closing costs -typically you need to budget 3% to 5% of the sales price to cover these. Your mortgage advisor will go through the costs very carefully with you. If you are paying cash then you would be looking at closing costs of about 1.5% of purchase price (this is for State and County Fees).
Taxes the government asses the property you purchase for taxes; this covers services such as trash removal, schools and road works. Your Realtor with tell you the tax on the home you choose. Tax is due in November and when you close you will pay these pro-rated for the part of the year that is left.
H.O.A – Home Owners Associations When you buy a house, a condo or a town-home you may be subject to join an association which will have rules and regulations that govern what you can or can’t do with your home. Associations as a rule are a good thing as it protects your investment making sure that other houses in your sub division can’t be painted purple for instance. There will usually be a cost involved that may be shown as a monthly, quarterly, or yearly fee. These can be quite an expenditure if you community has a lot of amenities that have to be looked after.
 New Developments
Suppose you have selected an agent to work with, but on a free day you decide to visit a new development on your own .You have to be particularly careful when visiting a new home in certain states, such as Florida. Otherwise it can end up unnecessarily costing you thousands of extra dollars. Developers have large advertising budgets to attract you to their show houses. The agent present at the development you visit is working solely for the builder or developer. Whatever they may say, they are not independent and do not, and indeed, legally cannot act exclusively on your behalf.
The builder's agents can be very persuasive in suggesting a whole stack of additional mod cons that you apparently require to maintain the value of the home. They are very often on a higher level of commission for these extras, which can cover hundreds of items; from sinks, tiles, carpets to even grade of paint! This is not always the case and selecting the wrong options, can actually lead to a loss if you sell the house in a short period of time. Other builders offer very competitive homes with many features included as standard, how can you tell which builders properties will have the best resale value in 5 years time? This is where the expertise of a Realtor working for you can help when making decisions.
If you registered when you walked onto a development or have given your personal details you may have lost your exclusive Agent representation. The commission for your agent was included in the selling price of the house. You will not obtain the property at a lower price by buying it directly from the builder, instead the builder benefits. Therefore you forgo your agent's exclusive representation of your interests.
What are some home buying negotiating tips?
One of the most frequently asked questions about buying a home is related to negotiating a fair price. Buyers -- especially first-time home buyers -- want home buying tips, particularly about negotiating.
While some people feel uncomfortable bargaining even at a garage sale or farmer's market, in real estate, negotiating is part of the home buying process and I love to negotiate !!
Here are proven tips for becoming a successful negotiator when it comes to buying a home:
Home Buying Tip #1: Know your seller's motivation. A seller who needs to move quickly because of a job transfer, divorce, or contract on another home is more likely to accept a lower price. In this case, the seller is motivated by closing the sale quickly.
Home Buying Tip #2: The "listing" or "asking" price is what the seller ideally would like to receive. However, it's not necessarily what he or she will settle for.
Home Buying Tip #3: Before you make an offer, know the market value of the home. Your Imagination Agent can help you determine this by checking recent sales and listing prices of comparable homes in the neighborhood where you're looking.
Home Buying Tip #4: Be flexible. Never say, "Take it or leave it." An attitude like this can ruin the potential for making a deal.
Home Buying Tip #5: Each time you increase your offer price, ask for something in return such as repairs, appliances, even lawn furniture or the riding lawn mower.
Home Buying Tip #6: Take a tip from poker players and never show your hand -- or reveal your next step.
Home Buying Tip #7: If you plan to pay cash or have a tentative commitment for a mortgage loan, use your strong financial position as a bargaining tool.
Home Buying Tip #8: Don't let your emotions (or those of your spouse) get in the way of negotiating the best deal. Leave your pride, fear, anger, and emotional attachments at home.
What contingencies should be put in a home buying offer?
Answer: When you look to purchase a home, anticipate potential problems. But protect against them so that if something does go wrong, you can cancel the contract without penalty. This is what contingencies allow you to do. They should be included in any offer you present to buy a home.
Most offers include two standard contingencies: a financing contingency, which makes the sale dependent on your ability to obtain a loan commitment from a lender, and an inspection contingency, which allows you to have a professional inspect the property. Without contingencies, a buyer could forfeit his deposit under certain circumstances if he backs out of a deal.
The purchase contract also should include the seller's responsibilities, such as passing clear title, maintaining the property in its present condition until closing, and making any agreed-upon repairs.
Choosing an Estate Agent /Realtor®
In Florida all Realtors® are licensed by the State of Florida and it is a 3rd degree felony to practice real estate without a license. To obtain a Realtor’s® license it is necessary to attend Real Estate School and pass the schools exam followed by a very rigorous State exam. This license has to be renewed every 2 years – this ensures your Realtor is up to date with current laws and practices.
Once you have joined the board of Realtors® you are able to access the Multiple Listing System (MLS). This is a web-based system that lists nearly ALL properties currently for sale in Florida. All Realtors have access to the same properties. Really you must find a Realtor that you feel that you trust and can work with to sell your home.
Check what experience your Realtor has – have they taken additional exams that will benefit you?
 Why Choose a REALTOR® With a GRI Designation?
Graduate of the Realtors Institute
Only 19 percent of the NAR REALTORS® hold this accreditation. Buying and Selling property is a complex and stressful task. In fact, it's often the biggest single investment you will make in your lifetime. At the same time, real estate transactions have become increasingly complicated. New technology, laws, procedures, and the increasing sophistication of buyers and sellers require real estate practitioners to perform at an ever-increasing level of professionalism.
So it's more important than ever that you work with an agent who has a keen understanding of the real estate business. The GRI program has helped the best and the brightest in the industry achieve that level of understanding. They have completed 90 hours of coursework, covering such topics as residential finance, legal issues, contracts, property appraisal, marketing techniques, professional standards, taxation, investments, property management and brokerage management, and environmental law.
GRI’s are: Nationally recognized as top performers in the real estate industry
Professionally trained · Knowledgeable · Dedicated to bringing you quality
 Why Choose a REALTOR® With an ABR Designation?
Accredited Buyer Representative
The ABR designation reassures extensive classroom training, a formidable written examination, and substantial experience in buyer representation. An agent with the ABR designation is fully committed to the real estate buyer, and has specialized training in understanding buyers' needs and representing them in the negotiation process.
The ABR designation is administered by the Real Estate BUYER'S AGENT Council (REBAC) which is a part of The NATIONAL ASSOCIATION OF REALTORS.
 Why Choose a REALTOR® With an ALHS Designation?
Accredited Luxury Home Specialist
The Luxury Home Council, a national organization is made up of an elite group of real estate professionals, ALHS accreditation “puts people at ease” because they know I understand their needs. Consumers in the luxury home market can choose an ALHS specialist and know they have the education and experience.”
 Why Choose a REALTOR® With an ICREA Designation?
"ICREA is a Consortium of the world's leading real estate associations who believe in the right to own and transfer real property. The Associations set standards for international real estate practice and transactions for the benefit of the industry professionals and the public they serve."
Why Choose a Broker Rather than an Agent
Brokers are more knowledgeable than sales associates, we have more experience, more training and we are more resourceful. I am always on a search for excellence; I look for new ways to do business, never satisfied with the "we've always done it that way" mentality. I Work Hard
I am a highly professional individual offering a wealth of knowledge and experience in the real estate industry. I am decisive and goal oriented, I set realistic priorities. I have years of experience successfully buying and selling homes in the local market, I own and invest myself. People don't talk about it a lot, but finding the right real estate agent can be the difference between a happy, stress-free home buying or selling experience, and an unhappy, stressful experience.
Be your eyes and ears if you do not live in this area to help oversee every detail in the sale of your home. Arrange to meet any of the inspectors that your buyer may require. I will guide you through the closing process; I can help you close the deal. Between the initial sales agreement and closing (or settlement) questions may arise. For example unexpected repairs, a cloud on the title is discovered, the paperwork alone can be very overwhelming for most sellers. I can help you resolve these issues and make sure everything flows smoothly
 Understanding How Realtors Get Paid
In all Real Estate transactions there is a listing Real Estate Company and a selling Real Estate Company. All commission money at closing of a Real Estate transaction is paid to the listing Real Estate Company and disbursed by the Listing Company Broker. The amount or percentage of commission for the sale of the property is set by the listing broker (with the approval of the home owner or seller) and published in the MLS along with the listing. The commission split between the selling broker and listing broker is also determined by the listing broker but generally the listing broker keeps 50% of the commission and pays the selling broker 50% of the commission.
After the commission money is received by the Listing and Selling Brokers, they in turn pay the sales agents involved in the transaction. The amount that the sales agent receives is determined by the employment contract the sales agent has with the Real Estate Company. Real Estate Agents are independent contractors and receive no other financial benefit other than the sales commission
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Mortgage Approval
