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Home searching and buying should be fun for your spouse, and even your children. If you have a Top Professional Real Estate Sales Representative like John W David  you will have a stress free and memorable experience.

Each of you, your spouse, and children make a list of your dream home. 
Take a sheet of paper and divide it into three columns. 
At the top of column one, write: NEEDS. These are absolute necessities for you.

At the top of column two, write: WANTS. These are some extras that would be nice if they can be worked into the family budget. 
At the top of column three, write: DESIRES. These are what you would like if money were no object. 

Take your time with these little exercise. Certainly, as you grow forward, you will add to it. 

You should always be looking at:

• Now and into the future.

• The neighborhood and the amenities you need now and into the future.

• The size of the home you need, want, or desire. 

• Make a list then check it off against what you find in your search.

• Is there public transportation for your family now or into the future?

• Where are the community centers and how do they stack up to your kids' needs now and into the future?

• Is the community in growth or in decline? This can impact dramatically on the future value of your home when you may need the money the most. 

• Learn about the local schools. In fact, what I often do is drop in with my client to visit the principal. 

Now... beside each item that you write down, try to guestimate what more that item will cost. You don't have to be all that accurate. But, it will help you get an idea and help keep things in some perspective. But, again, don't worry about accuracy. We can tighten it all up afterwards. 

What is most important is that you have some stars to shoot for and everybody can get a better appreciation what is and what can be possible. Okay? So, start there. And, keep it simple and fun. 

Okay. Let's begin in the beginning. And, let's have fun with this. Deal? Before you even think of buying a home, find out how much you can afford. 

Mortgage Pre-approval first
There are several sources of mortgage capital. They are all good. But, I suggest that you start where you have an already established a good record and relationship. Then, you can begin. 

NOTE: There are two kinds of pre-approval. 
- Over the phone with a lending source with little more than what you make and a general list of your personal obligations to arrive at a percentage. This is common. And, it can be problematic if there is more discovery during an offer. It's common. It is called "pre-qualified" And, I don't recommend it.

- Sitting down with a real, serious, mortgage professional and getting everything down on paper to arrive at a true, most acceptable loan or mortgage amount. This is pre-approval. 

That should help you. Moving forward...

Whether the market is hot or not, prospective buyers should determine, in advance, what you are eligible for in terms of mortgage capacity and hence what you can afford. 

Several good things will happen: 

1. You will have more confidence both in knowing that you can afford certain homes
   
   
2.  You will be able to negotiate a better package considering that it is one less impediment that your offer has to face than that of someone else competing for the same property. 
   
   
3.  Someone who is pre-approved for a certain amount has greater credibility in an offer than someone else who has to make his / her offer conditional "subject to approved financing".
   
   
4.  Real estate professionals will take you more seriously simply because you have taken yourself to the appropriate level in the home buying process. I hope that makes sense. 
   (Most really good real estate professionals will work with only those buyers who are pre-approved simply because the last thing we want is to have a good deal fall through because the prospective buyer was not pre-approved and was not even qualified to buy at that level).  

** NOTE: Being pre-approved means that you are approved for a certain amount. However, pre-approval does not mean that the property is pre-approved although over 98% of properties listed professionally do support the price and price range being shown to a buyer who has been pre-approved for that amount.
The property remains subject to approval by the lender for the pre-approved amount. 

Mortgage Resources.
Today there are three equally good places you should consider when applying for a mortgage. And, again, begin with the people with whom you have already established a good name.

1. The banks are still the primary place where new home owners go for their mortgage. However, you should consider that these institutions are retailers of their own mortgage products with little or no flexibility expect within tight structures.
   
   
2. Mortgage brokers are gaining market share. 
   Mortgage brokers are a tightly regulated financial institution whose products include professional private lenders and even many of the big banks offering wholesale products to the mortgage brokers under subsidiary names. 
   Very often, the mortgage you sought through your bank is available at a lower rate and even more flexible terms under a different name of the same bank but through a mortgage broker. 
   
   
3. Online mortgage brokers is a growing industry. I personally think it's just a bit too early yet to go that route. I am not certain about the amount of regulatory controls in place to protect consumers.

NOTE: My own mortgage is through a really good mortgage broker.   
Note 2: Always check the fine print as to terms and conditions in any mortgage contract. That is often the primary reason for some rate variations. As just one example: a low rate with inflexible lock-ins can have very expensive consequences if you want to or have to pay off early. 

See mortgage providers and, important, questions to ask your mortgage provider here.

When I am dealing with a pre-approved client, I know they are serious. In fact, I am growing more and more to dealing with only pre-approved buyers. And, they are further benefiting by being immediately qualified for my VIP Club.  

Since until the sale is actually converted at the legal completion or closing date of the sale, everything a sales person does for the client is pure, mostly out-of-pocket cost to the sales person. Real estate reps are not reimbursed for their time or expenses. 

In return, that sales person will usually go above and beyond the call of duty for that client. 
So, if it were your money, you too, would try to improve the likelihood that all this cost will convert to an offsetting income. I hope that makes sense. 

Remember to discuss with your lender closing costs that are to be paid upfront at signing. Discuss with your lender where these funds are going to come from. Closing costs are covered below.  

As a rule of thumb, even a home that is in move-in condition (as my listings are), you will want to personalize it. That will entail added costs. Two considerations>

1.  When I list a home, rest assured that if it is not in move in condition or as I have described it, I will not list the home. 
   
   
2. Normally, expect to spend anywhere from 20% to 40% of what you paid for a home in personalized touches and some upgrades. 

However, again, people buying my listings and agents showing my listings know that for the buyer, if money is a bit tight, there is no immediate need to rush into spending money that is in short supply.

You might wish to look at "sellers-tips" and why not only are my listings the perfect buy for buyers and sellers, they are also one of the many reasons why my listings sell so quickly and to everybody's satisfaction. 

Select your real estate sales professional.

• It is critical that you read "Working with a Realtor" in which the duties of the sales rep and your part of the selling / buying process are clearly spelled out. This aspect is not only important for you, it is also the law. 

The "Working with a Realtor" is not a contract and binds you to nothing. However, from the perspective of the real estate professional, it is the law that s/he have you read it. And, I encourage you to help him / her in fulfilling their legal requirement simply by signing it. Your signature only confirms that they have fulfilled their legal duty. Fear not. You are not on the hook for anything. Okay?

• Most often sales professionals are chosen from recommendations of friends and family based on their previous experiences. Needless to say, I get a lot of referrals. 
  
  
• The ideal sales pro knows the local area well and has resources and contacts to help you in your search. Overall, you want to choose an sales rep who makes you feel comfortable and can provide all the knowledge and services you need. I will see to it that you integrate quickly, smoothly, and comfortably into our community.

I'll discuss this with you. And, you'll see that's it's both fun and exciting.

Before viewing homes with your real estate professional, make a list of what you need, want, or desire in your new home. And, share each with your real estate professional

- How many bedrooms?
- How many bathrooms and why?
- Family room?
- Separate dinning room? 
- Garage and how big and why? 
- Back yard? How big and why?
- Community safety... especially if you have children of any age.

In the normal "subject to building inspection", you need to ask for and things that I watch for in addition to the report itself are: 
Foundation: Not only does it leak, but has it ever leaked, when, and what was done to correct the problem. What proofs do they have that the problem has been solved permanently. 
Roof: How old, has it been reshingled or replaced, has it ever leaked? The same questions about the windows and doors. 

ALL homes should be subject to a building inspection. Remember: This home, this structure is left outdoors 24/7 every day and night of its existence. And, nature does its best to knock it down. 

And, if you can swing it, be with the building inspector when s/he is performing their work. This way you can get immediate and personal insight into the good, the bad, and even some of the ugly right on the spot. 

In my own listings, I encourage my sellers to get a building inspection done before we get an offer. This way, anything that would delay or harm a decent sale can be caught and repaired properly and to the inspector's requirements. 

NOTE: A clean building inspection of any or all components of your new home is not a warrantee. A building inspection by a qualified, certified building inspector is, at best, a professional opinion based on his / her training. 

However, a home can easily cover up a deficiency that even the best home inspectors may not notice and, therefore, legitimately miss. Many times, even the home owners, themselves, may have lived with it and not noticed it since day-one. 

By all means, have a home inspection done. All I'm suggesting is that you view the building inspection or a clean building inspection as a very good first step but not as a guarantee. 

Ask questions... lots of them. 
Consistent with the content of the "Working with a Realtor" every good real estate sales professional wants to make sure you get the best of the services s/he can legally, morally, and ethically provide. You certainly know I will. 

On the back of each feature sheet of each home that you see, write down your impressions as well as your likes and dislikes.
What you will find is that you begin to create a matrix from which making a good decision is better assured. 

What I find oftentimes is that there is a level of euphoria that may not match up very well between that particular home and the obvious family needs. That's why it is best to continue to see the other homes I have found to make sure that the other very good options can help prospective first time buyers (especially) stay on track. 

It's Okay to say you just plain don't like the property. 
It's not about making a quick sale. It's about making a referral for life. If during our home tour(s), you just don't like the place, I encourage you to say it to me or your rep. 
You are not going to offend me. In fact, it will help me better to help you. Makes sense? 

Making an Offer. 
Even when we are making an offer on a property I have on the market, I, as will any really good real estate professional, will sit down with you and we will do a complete market comparable on all the homes as similar as possible that have sold recently, are still on the market, or which have expired. 

There are a huge number of different pricing essentials that fall out of these reports which will help you in structuring the terms of your offer and your price. 

Good faith deposit with the offer. Five percent is fairly standard. If you have to, bring it up with your mortgage lender so that the deposit, all closing costs, and the mortgage (and all its terms, benefits, privileges, and limitations) are all on the financing table so that there are no unpleasant surprises. 

Closing costs. Typically. 
There are many mathematical variations that can influence the final closing costs. I have covered a few items, like lawyers and their fees, in the resources section. But, in a very general way, here is what you should expect: 

- Adjustments for property taxes and fuel
- Legal expenses and disbursements
- Mortgage expenses including interest on assumed mortgages.
- Home owners insurances
- Title search and / or Title insurance (check with your lawyer)
- Cost of survey. Usually I ask for one from my own sellers.

 It's just common sense.

- Sales taxes in applicable
- Land transfer tax.
- Personal expenses like moving costs and a bit of discretionary money. 
- Sometimes a municipal sales tax may apply. 

Amongst your real estate professional, your mortgage lender, your lawyer, and your insurer, you can come up with a reasonably accurate idea of your closing costs on a particular property. 

Now, these are questions I ask my home sellers as well so as to make sure the home is a great value in the marketplace for any prospective client. Again, view my page on: "sellers-tips". 

For mortgage providers, lawyers, inspectors, home owners insurance, title insurance, home security systems, carpenters, and any other services you may need, there is a growing list in the resources section of this site. It's a new site. So, more and more and more people are being added on once they've been approved.

Come back often to johnwdavid.com. Your perfect growing source for everything related to the best in real estate. 

Ready to proceed? Let's have some fun. Call me. 

Home | Buyers-Why John W David | Buyers Tips | Prequalified | Condominiums | Land Transfer Tax

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