Kay Rigley & Shannon Hill Hanson
Kay Rigley & Shannon Hill Hanson
Windermere Real Estate/ FN
Kay: 206.200.5347 krigley@windermere.com | Shannon: 206.419.5332 slhill@windermere.com
How to Buy a Home 

Getting Started
A home is the largest single investment you will ever make. A home is also an expression of personality and a statement of a multitude of personal values. A home must reflect recognition of the tangible realities of income. A home shapes the life lived within it, allowing patterns of daily activity. The selection of a home from a number of possible choices involves a complex number of personal and financial decisions. The various steps of the home buying process should be clearly understood, for each involves you in certain obligations as well as committing others to meet obligations to you. You need to know both your duties and your rights. Organization is the key to finding the home you want while spending the least amount of time and energy. Find out how much house you can afford. Do this before you go house-hunting. I can refer you to a loan officer who can help you determine how much of a down payment you can afford, along with a monthly payment you can handle.

Make a list of everything you want in a home. Is a master suite important? How many bathrooms? What about closet space? Do you need a yard for the kids and pets to play in? How about a fireplace or a bay window? Do you prefer a rambler or multiple-story house? Are schools or access to transportation important? Separate the essentials from the items you could do without and put them on the A list. Prioritize the rest of the items into a second and third list in order of importance.

Keep good notes as we look at homes. After a while, it becomes difficult to remember which features belong to what home. Bring along a digital camera to snap pictures. I can provide you with a form and rating system to help you compare homes.

Doing Your Homework
This homework assignment is instrumental to a wise home purchase. Skipping the needed preparation will increase stress and decrease our opportunities. Become pre-qualified by a lender. This is a free service. Call two lenders on the same day, asking to be qualified and for a good faith estimate based on probable price. This will give you some idea of the price you can afford to pay for a home.

  • Make a list of wants and needs. Divide the list into wants, like to have, and needs, and must have features. Note particular geographic areas.
  • Start the pre-approval process. Pick the lender and make the actual loan application. Your credit report, employment and funds will be verified.
  • Review the The Law of Agency pamphlet and household hazards (asbestos, oil tanks, etc.) that we provide you.
  • Consult with your tax accountant. If you have questions about how your home purchase will impact your tax return, ask your accountant now.

Tour open houses. This is a great way to get started and narrow down geographic areas. Look only in your price range. Save flyers to discuss later with us. Do not let the agent at the open house sell you on a house without us. It's easy to fall in love with a few details like granite countertops or a paint scheme, and overlook something vital like too few bathrooms or a bad school district. Most importantly...relax! We promise you will have fun!

Applying for a Loan
Unless otherwise indicated in your sales agreement, you will be required to make a formal loan application within 5 days from the last date on the sale agreement. If you have already been pre-approved, you are a step ahead of the process. When you apply, the mortgage broker or lender will ask you to bring along the following: W-2 forms from the last two years; your last two bank and investment statements; your last two paycheck stubs; and a $30 deposit for a credit report If you are self-employed or earn commissions, provide tax returns from the last two years..

It is important that you provide all information and full disclosure with your mortgage broker or lender at the beginning so that they can structure your loan to be of the most benefit to you. The faster you provide the mortgage company with requested paperwork, the faster you will get your loan approved.

In today's fast paced market it is imperative that you have a pre-approved loan prior to selecting a home. This allows us, as your agent, to better represent you and give you a more competitive edge, especially in a multiple offer situation. This may make the difference when competing with an equally qualified buyer who has not arranged financing. After you have made loan application, the lender will begin to process the paperwork necessary to document the loan for approval with an underwriter. In the first few days, the lender will order the appraisal, your full credit report, open escrow and order a preliminary title report. (Title and escrow are explained later.) It will take up to three weeks for all of the paperwork to be compiled so that the file can be submitted to an underwriter for approval.

After the loan is approved, the documents are taken to the escrow company where they prepare the actual documents for you to sign. Escrow will call you as soon as they receive the documents to set up an appointment for signing. At the escrow office, you will meet with the closing agent to sign all the documents 2-3 days prior to the actual closing.

Making an Offer
Once you've found the home you want to buy, together we'll complete a purchase and sale agreement. This is the contract in which you and the seller outline the details of your property transfer. The Purchase and Sale agreement usually consists of the following pages:

  • earnest money
  • financing addendum
  • inspection addendum
  • conditions/disclosure addendum
  • contingency addendum
  • addendum outlining special conditions
  • agency disclosure
  • property disclosure form (from seller)

Who Pays What
During the negotiation stage of the transaction, a date for closing is chosen that both parties agree on. Closing is when you and the seller sign all the paperwork and pay your share of the settlement fees, and the documents are recorded. Settlement obligations vary widely due to specific contract language, local laws and customs. Prior to closing, the closing agent (usually an escrow or title company or attorney) will complete a detailed settlement statement for both buyer and seller. As your Windermere agents, we can help you understand which of the following typical settlement fees apply to you. Your earnest money deposit is returned to you upon closing.

The buyer pays: one-half of escrow document preparation fees; recording and notary fees; title search and title insurance (paid by either the seller or the buyer); local transfer taxes, if any; loan fees; appraisal fees; credit report fees

Common Questions

How will I know it's the right home? This is the most common question buyers have, and after eleven years of touring homes with clients, the scientific answer is you'll just know! It's almost like the house embraces you. However, you need to make the sure the emotional choice is also a practical choice, which is why I'm here to help. You can always put in hardwood floors, but you can't turn a split-level into a rambler.

How long will it take? As long as it takes. My goal is to find you the house that fits your dreams, needs and finances. I want you to find a home that you'll be happy living in, and will be a good investment for your financial future. One thing to remember is that there are thousands of homes out there, dozens of which might be the perfect home for you. Don't fall into the trap of thinking, what if something else better comes along? When you find a house that feels like your home and fits your needs, make an offer!

Will the owner accept my offer? Sellers are usually very proud of their homes, and they want someone who appreciates their home as much as they do. Seller's agents are looking for a fair offer with good financing from an agent they trust to work with. The seller and their agent take the best offer, which is not always the highest. Kay has successfully won in multiple offer situations because she helps you make an offer that both the seller and the seller's agent will consider the best offer.

What is the difference between pre-qualified and pre-approved? Prequalification is a determination of your probable ability to obtain a loan. To become pre-qualified, meet with a loan officer or mortgage company. They will help you determine the price you can afford, based on your monthly income and your current debts, as well as the cash you have for a down payment. Pre-approval means that the mortgage lender has already verified and approved your credit and employment. Obtaining pre-approval early in the process will make your offer more attractive to the seller.

What is earnest money? Earnest money is a good faith deposit submitted with your offer to show the sellers that you are serious about purchasing their home. Earnest money is a required part of an offer. Earnest money eventually becomes part of the purchase, and will show as a credit to the buyers on the settlement statement drawn up by the escrow company.  

What is title insurance? Title insurance is protection against loss arising from problems connected to the title to your property. Before you purchased your home, it may have gone through several ownership changes, and the land on which it stands went through many more. There may be a weak link at any point in that chain that could emerge to cause trouble. For example, someone along the way may have forged a signature in transferring title. Or there may be unpaid real estate taxes or other liens. Title insurance covers the insured party for any claims and legal fees that arise out of such problems. The lender usually requires title insurance.

Kay: 206.200.5347 krigley@windermere.com | Shannon: 206.419.5332 slhill@windermere.com
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