I found the house of my dreams, when can I move in?

I found the house of my dreams, when can I move in?

By Nathalia N. Edmonds

You got your mortgage pre-approval letter and know how much you can spend to buy your new home!  If you qualify, you attended the First Time Homeowner seminar.  You hired an agent and you know what type of home you are going to buy.  Now what?

Is there a limit of how many homes you can see?  No.  Should you see 100 houses versus 10 or 3?  You see as how many houses you want to see.  I tell my clients that the house you want to make yours is the house that made your heart fluttered when you entered.  Or like my mother, she heard bells and felt an overwhelming sense of peace.  A great way to take control of which houses to see is when your agent sends you daily automated emails which will alert you when a new home becomes available!  Those emails are up-to-date and with correct information.  Looking at properties in Zillow, Trulia or Redfin do not have accurate information.  In Maryland, agents pay the Metropolitan Regional Information Systems or MRIS to see all the accurate information of properties that are actively available, under contract, sold even those properties that are withdrawn.  Trust is a very important aspect of your relationship with your Agent.  Remember, if you feel your current agent is not a good fit, you may cancel your business relationship and hire someone else!  Make sure to read your agreement first.  In the state of Maryland it is mandatory to place a contract expiration date as well as instructions on how to cancel your contract with the agent and broker.

Now, you found your home but not just your new home, you found YOUR DREAM HOME!  With your approval, your agent will write an offer on your behalf.  A contract will be about 47 pages long.  It could be less or it could be more.  In this contract you will let the seller know how much you are willing to pay for their home.  How much deposit you will pay, where you will deposit that money, how you will pay for the home, if you are doing any inspections, what you want to keep from the house, acknowledge the settlement date, amongst other things.  Other things will be acknowledgement of age of the property and possibility of lead, and all kinds of disclosures depending on county and type of home you are buying, especially if the neighborhood has a Home Owner Association.  In your offer, you will have dates of when you are due to do the inspections, when to apply for your mortgage loan, when you are going to settlement!  With the offer you will need to submit your mortgage pre-approval letter and your earnest money deposit.

What is the earnest money deposit?  The EMD or escrow money, how some agents call it, is a “good faith payment” it shows the seller that you are serious about buying their home, soo serious you are willing to put money down.  This amount it is usually 1% of the sales price or 10% if you are buying the home in cash.  So if you are offering $100,000 to buy their home, you need to prove a check or money order in the amount of $1,000.00.  This EMD will only be deposited ONCE your offer is accepted by the seller.  This money will be applied towards what you need to pay to get your home, meaning, you will now have to pay $99,000 plus closing costs.

Once the seller receives the offer, he or she will evaluate the offer or several offers and make a decision.  Do not be alarmed if your agent calls you back with a new offer from the seller.  Your agent will have your best interest and inform you of what are the best choices.  But remember, you are the only person who will make the decision.  Agents are advisors and messengers.  A good agent will email you the instructions you gave them over the phone for both your records.

Immediately after your offer was accepted by the seller you MUST contact your loan officer and start your application process.  If you already got “pre-approved” why do you need to apply?  Well, the loan officer creates your file and starts getting you formally approved and get the house appraised.  They make sure you didn’t go nuts and buy a boat or got into more debt.  The underwriter also schedules the appraisal to make sure the home is good collateral for the loan.  This process could easily take about 30 to 40 days.  It is important that YOU are as responsible to close early.  If you delay giving your loan officer all the documents he/she asks, you will delay the process.  Once the appraiser returns their findings and the home is good collateral, you will get approved or denied for the loan.  BUT BE AWARE, the underwriter will check your credit the day before or the day of the settlement and approve the loan!  Buy furniture AFTER settlement NOT before!

Simultaneously, your agent will schedule all the inspections.  You should ALWAYS do a structural and mechanical inspection.  This inspection MUST be done by a Licensed Home Inspector.  You can go to https://goo.gl/x0Ic5h and search if that person is licensed!  Inspections could run you about $250 up to $500.  You can also do Lead, Mold, Termite, Radon, Chimney and others.  The buyer will ALWAYS be responsible to pay for the inspections!  And don’t forget to go to the inspections!!

Around that same time, you would have to pick a Title company to help you investigate if the property has any issues with the past ownerships or any debts due to unpaid taxes, water bills or any other liens or debts against the property.

After all these things are done, you should expect to close between 45 days or 60 days and this is only if you are asking for money!  If you are paying your future home in cash, closing will happen in about 45 days.  At settlement, you must make sure you bring the check you need to pay, if any.  If you are a first time homeowner you could get $5,000 towards closing cost and you could have ask the seller for 3% closing cost help, which in some cases, you don’t need to bring anything.  Bring your ID!  Your loan officer will have given the title company their bank information to wire the money to which the title company will pay the seller’s mortgage and give him or her the difference in a check.  The sellers will bring the keys to your future home.  After signing the new title, the receipt or HUD1, you get your keys and the seller gets their check and you go home to your new home!

If you would like to learn more about the process in buying your future home, please contact me or your preferred agent!  

Nathalia N. Cruz-Edmonds is a REALTOR with Berkshire Hathaway HomeService PenFed Realty.  To schedule a meeting call (410) 350-5848, at her office (410) 464-5500 or via email at nathaliaedmonds@gmail.com.  She is also the owner of Clearview Real Estate Management LLC a third party real estate management company in Maryland.

 

Why should you hire a REALTOR?

With shows like BravoTV’s Million Dollar Listings New York, Los Angeles and Miami the perspective of a Real Estate Agent or REALTOR is pretty impressive.  Big houses, expensive clothes, fast cars and tons of money on commissions.  Last month, in the Baltimore Metro area the average sold price for a three bedroom townhome was $172,676.00 and for a 3 bedroom single family home was $244,773.00.  Out of 539 transaction of 3 bedroom single family homes sold, 24 were above $500,000.00!  That is only 4%!  

What does that mean?  REALTORS earn about the same as you do!  The difference is that our profession is about providing a home to our clients, or a business location for your growing business.  Like with anything, it’s about the effort you put into your work that will make the difference in your paycheck.  Like when buying an expensive item, such as the newest television or a car, you will do your research but ultimately you will ask the expert.  The expert that has been to the factory where the car or television that is being made.  For a REALTOR is the same BUT BETTER!  Why is it better?  Because the sale of real estate is regulated by the state and federal government for YOUR protection.

In the state of Maryland a REALTOR or Agent, must be licensed and affiliated with a licensed Broker.  Meaning the Agent cannot work on their own.  An Agent has to be affiliated with a company like Long and Foster, Coldwell Banker, ReMax or Berkshire Hathaway HomeService.  There are other real estate brokerage that are smaller that can and will provide the same services as the big national franchises.  The most important aspect when learning this information is that when you hire an Agent you are the Broker’s client, the Agent is a representative of the Broker to help you during your transaction.

For example, if you choose to hire me as your Agent when either buying or selling your home, I will represent you but you are a client of Berkshire Hathaway HomeServices PenFed Realty.  My Broker’s responsibility is to make sure I follow the law and represent you as best as we can.  Both the Agent and the Broker has to take classes in order to renew their license every two years and the Maryland Real Estate Commission oversee the rules and regulations of all real estate transactions in the state of Maryland.  This has been created in order to protect the public of anything and everything that can cause the client to lose money and to make the real estate profession an honest one.

Are the services of the REALTOR free?  If not, who pays for them?  A REALTOR is paid, a great number of times, by the seller.  Sometimes, the buyer pays the REALTOR.  Please understand that there is no law regulating how much you need to pay your REALTOR but you should NEVER EVER pay your REALTOR in advance.  A honest law abiding REALTOR will get paid when the transaction closes.  Meaning, when you get or give keys to the home at settlement.  Some brokerage firms ask for a “broker’s fee” which is typically between $250 up to $500 per transaction which covers the cost of doing business.  Again, this fee is also paid at settlement.  It doesnot matter if you want to see 100 houses and decide you will move out of state, you will NOT PAY ANYTHING UNTIL THE DATE OF SETTLEMENT!

You might ask yourself that if you can see houses for sale in the newspaper or in the Internet, why do you still need the assistance of a REALTOR?  Did you know the average contract is about 30 pages long?  Did you know that you may not be able to do a home inspection if you forgot to tell the seller you wanted to do one?  If you are buying a home, did you know you can ask the seller for closing cost help?  If you are either selling or buying a home do you believe your house is priced correctly?  Are you paying too much for a house?  Could you get a little bit more money if you sell your home now?

All these questions and more are answered by a licensed REALTOR.  We have access to accurate available listings in the state of Maryland.  The REALTOR we will write an offer for the house you want, as well guide you in explaining the contract.  We will make sure we protect you in making sure you have the right to inspections and inform you of any defects inside your future home.  Coordinate the home inspections as well as negotiate any repairs.  We will also assist you to get the house for the best pricing as dictated by the market.

Think about it this way, you own a pizza shop and a friend calls you and asks you to use your oven to cook their frozen pizza.  You are capable to buy or sell your home on your own but wouldn’t you rather hire an expert?

Nathalia N. Cruz-Edmonds is a REALTOR with Berkshire Hathaway HomeServices PenFed Realty.  To schedule a meeting call direct (410) 350-5848, at her office (410) 464-5500 or via email at nathaliaedmonds@gmail.com.  She is also the owner of Clearview Real Estate Management LLC a third party real estate management company in Maryland.