Buying & Selling - Market Values - Offer to Purchase - Inspections - Closing

Buying and selling a home are different processes, each requiring specific attention and service. When buying a home, there are certain things that are extremely important; such as having the assistance of a real estate professional who has intimate knowledge of the area, and access to every home available on the market.
Our integrated approach provides the complete range of services you may require while looking for and moving into your new home. At first glance, there are a number of reasons why buying a home can appear to be a challenge, including:

· Complexity: Homebuying involves many steps and the coordination of multiple parties.
· Financial: Buying a home is a large and important investment in your future.
· Emotional: Getting everyone involved to agree on the definition of ‘the perfect home’ can be a real challenge.

A homeownership services firm that meets your needs by providing expert advice, high professional standards, and convenience can help ensure that the process is a successful, enjoyable experience. A homeownership services company can provide tremendous value: Reputation for honesty, integrity and fairness Professional standards and support for agents Broad, consistent market coverage Complete range of homeownership services Online technologies to simplify your home search Commitment to customer satisfaction A real estate professional can provide valuable assistance: Expert guidance through a complex process Insight about homes and communities Vigilance for market dynamics Advice on critical issues* Support through emotional decisions Legwork to help complete the transaction Dual Agency occurs when a real estate firm represents both the Buyer and the Seller in the same transaction. In Dual Agency, the agent will continue to remain loyal to you and will protect your confidential information. However, because the agent also represents the other party in the transaction, in a Dual Agency situation, the law in some states may limit the degree to which your agent can zealously advocate for you in that particular circumstance. Even in Dual Agency, your agent can continue to assist you to the best of his or her ability to fulfill your wishes and desires in the transaction. Because the laws and rules governing Dual Agency vary from state-to-state, we encourage you to ask your real estate agent about Dual Agency, and consult with legal counsel as well, if you feel that is appropriate.

· Mortgage Assistance: It is recommended that you get pre-approved early in the process.
· Insurance Coverage: Home protection is recommended even if you are not financing your home.
· Legal Assistance: Legal assistance during the closing process can prove invaluable.
· Home Inspections: A formal inspection will help put your mind at ease about the condition of the home.

The process of determining the market value of a home is quite complex. Recent sales of comparable houses (in terms of size, features, location and style) The condition of the interior, exterior, major systems, and grounds. Community characteristics, Local market conditions, including the inventory of comparable homes, the motivation of the homeowner to sell, the existence of other competing buyers. Of course, these factors only provide part of the answer. Your own motivations also weigh heavily on any determination of value: how well does the house meet your goals? A homeownership professional specializing in the local market is best qualified to give you an accurate assessment of a home’s current market value, and to help balance market realities with your dreams. Considering all of these factors will allow you to make an offer that is considered seriously by the seller. Successful home searches lead to offers. Offers formalize the homebuying process by committing in writing to purchase a property, subject to certain terms and conditions. An offer will start with home value, which should take into account the competitiveness of the local marketplace and your level of desire for the house. In a soft market where home sales are slow, you may be able to structure an offer with terms very favorable to you. However, if homes are selling briskly, you may need to make your offer more compelling for the seller. In either case, the seller has the right not to accept any offer - even those at or above asking price. Generally, offers must be in writing, signed and dated by all buyers, and include the following:

· Offer Price: how much you are agreeing to pay
· Expiration Date: when the offer expires, if not accepted
· Closing Date: when you can take ownership, including elimination of all contingencies
· Deposit: the amount you will place into an escrow account to secure your offer (typically 5% - 10% of the offer price)
· Contingencies (if any): such as mortgage financing and inspections

This is only an overview; how an actual Offer to Purchase is submitted and progresses through a transaction varies from state-to-state, and often from town-to-town. In many locales, an agent will assist a buyer in completing and submitting a standard form Contract to Purchase, which will be negotiated and, if accepted, will become the complete agreement between the parties for the purchase and sale of the property. This Contract to Purchase is frequently referred to as the Buyer’s Offer until such time as it is accepted by the seller, at which point it is referred to as the Purchase Contract, or Purchase and Sale Agreement. In other areas, it is common practice for a buyer to submit a simplified Offer to Purchase, or Binder, as a preliminary step in the process. This Offer or Binder is negotiated and agreed to by the parties; the parties are expected to enter into a more detailed Contract to Purchase, or Purchase and Sale Agreement, after the initial steps in the process are complete (note: depending upon the practices of the locality, these Offers or Binders may or may not be considered legally binding). It is wise to become familiar with the offer and purchase contract practices in your market area, with legal assistance if appropriate. The seller has the following options when considering offers:

· Accept the offer as proposed
· Counter-offer with a modified offer
· Reject the offer and return the deposit

If the seller counter-offers, negotiations will continue until all terms are agreed upon (or, because the original offer was not accepted as submitted, either party may withdraw from the negotiations, at which time the deposit should be returned). Until the offer is accepted, the buyer may withdraw the offer and a seller may entertain other offers. Once the offer is accepted, the home inspection process begins, after which the parties proceed to execute the purchase contract (typically within 5-10 days), and begin the closing steps. Additional negotiations may ensue if inspections uncover unanticipated issues and costs.
As these inspection findings would constitute a change to the terms as agreed upon, the seller has the right to refuse or accept any change requests. It is common for buyers to make an offer contingent upon one or more home inspections. These inspections are performed for, and paid by, the buyer. The seller must consent to the inspection, but is not required to correct, or provide compensation for, any problems identified. If the seller agrees to an inspection a part of accepting the offer, the seller must allow the inspection within the time specified in the offer. If the inspection findings are acceptable to the buyer, the closing process can begin. If the inspection uncovers problems, the buyer may be able to withdraw the offer, or may propose an alternative to resolve the issues. The seller may agree to all, a portion, or none, of any request made by the Buyer. Property inspections should be conducted by professional inspectors - someone trained in the field that has no outside interests in the property. The buyer should be present when inspections are performed, so that the inspector can describe the process and findings personally. It is a valuable time to learn how the house has aged, as well as the details of any issues. Also, as houses do age, you can learn many helpful tips on how to care for your home in the future.
The Inspector Should:

· Look for any serious structural, mechanical, and/or other major defect in the property
· Examine all systems, including heat, air conditioning, electrical, and plumbing
· Examine the general construction quality and condition of the house
· Spend time checking the exterior of the house, including the roof, foundation, and chimneys
· Check the basement, including wiring, plumbing, heating, and air conditioning
· Check the attic for proper insulation and venting
· Check all interior rooms for proper venting, insulation, and electrical outlets
· Run all appliances and plumbing fixtures to verify working condition
· Check all bathrooms to see if moisture has affected the areas around the tub or shower
· Inspect for other items you may have requested, such as insects, termites, and other pests

Insects and pests are significant contributing factors to structural problems. If the infestation is new, a structural problem may not exist yet, or the home inspection may not detect it. Insect, termite, and pest inspections may, or may not, be included as part of the services offered by your home inspection firm. Buyers should verify that their home inspection service includes this: if not, contract separately for it. Beginning in 1978, federal law mandated the removal of lead as an additive in residential paints, and prohibited the use of lead paint in the construction of homes built after that date. As a result, properties built after 1978 should be free from lead-based paint, although a risk assessment and/or inspection is still recommended. Properties built before 1978 may present exposure to lead from lead-based paint that may place young children at risk of poisoning. The federal law is particularly concerned with protecting children under six years of age and pregnant women. Some states’ laws are even more stringent than the federal law, and directed at lead hazards other than those associated only with lead-based paint. Buyers should familiarize themselves with relevant laws in their states. A risk assessment or inspection for possible lead-based hazards is recommended prior to the purchase of any home.

The closing (or settlement) is an exciting time; all negotiations are resolved, and all contingencies have been met. Often, the days leading up to the closing date are active, as both parties work to put everything in place. An experienced agent can significantly improve your closing experience. Closings usually occur thirty to ninety days after a signed Purchase & Sale Agreement. In the period leading up to closing, the buyers and their homeownership service providers are normally focused on removing contingencies, which would include conducting inspections and processing the mortgage application(s). All parties will be present or represented at the closing for final review and signing of papers. Closings are administered by a Closing Attorney or Settlement Agent. If the seller cannot attend, there are alternative arrangements, which typically involve signing papers in advance, and/or granting Power of Attorney to their representative. The buyers will be asked to sign the mortgage and any other papers that the lender, and/or other interested parties, may require. If the buyer is financing the purchase through a lender, the lender’s attorney will often be present, in order to review documentation and protect the lender’s interests. At conclusion, the lender’s attorney will record the new deed and mortgage, and discharge all previous obligations of the seller. Once the closing papers have been executed and the deed recorded, the buyers take legal ownership of their new home.

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