FAQ Addressed by Albuquerque Realtor Linda DeVlieg
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I want to buy a home – how do I start?
When you are ready to buy a home, contact a real estate professional. The best Realtors will have you meet them at their office or set up a telephone conference first, and conduct a consultation with you about the process.
The first thing you want to have done is be PREQUALIFIED TO BUY
Why do I have to be prequalified first, all I want to do is just start looking around?
Starting to look around at homes is a more sophisticated process than most people would believe. If the homes are occupied, the owners need notification that someone is coming to see their home, which usually takes a lot of preparation and scheduling on their part. Even if the homes are vacant, the Realtor has to set up the appointments to see the homes and plan a route. It takes quite a lot of time and effort for the Realtor, the buyers and the sellers.
If you find the perfect home, and you haven’t started the process to be pre-approved, you won’t have time to do it before you write the offer. Sellers will not entertain an offer on their home until they know that you can pay for it. Someone else will buy the home you have just picked out.
I won’t have any trouble getting a loan, I know there is no problem with my credit… can’t I just wait?
No, unfortunately it’s much more than just a good credit score to get a loan. The mortgage process takes into consideration so many variables now that it is unpredictable to know what will count for and against you until you consult with a mortgage professional and find out what your options are. I have had many clients think that they will have no problems at all, only to find out that they cannot yet qualify for their purchase.
I don’t have a lot of time during the day to be prequalified, I can’t meet with anyone to do it. What now?
No problem! Most lenders now have secure application sites where you can fill out the basic information and do the rest on the phone with a mortgage consultant. Make sure you are working with a well known mortgage professional with a good track record. You can do a lot of the initial work from the comfort of your home or office at any hour.
Will I need to pay for anything until I close on the house?
Yes, be prepared to pay for inspections and maybe even the appraisal at the time of the inspection or service. While some of these items sometimes are negotiated to have the seller pay, a lot of sellers are requesting that the buyer pay for the inspections that they want to have performed on the property.
What is a lease purchase?
A lease/purchase is a two-portion contract. You agree to buy the house after a period of time where you live in the property, agree on a purchase price and deposits, with a secondary contract that addresses the terms of the ‘lease’ period.
Is a lease purchase a good way to buy?
It depends on what your goals are. To find a seller who offers their home for sale as a lease/purchase narrows your choices. Also, you might lose your deposit if you don’t close on the property according to the terms of the purchase agreement.
When do I get the keys to my new house?
In the Albuquerque area, the tradition is that the buyers and sellers sign their closing documents (separately, not at the same appointment), and the title company sends the documents to be recorded, and when the mortgage company “funds” the closing (releases the money) then the buyers get possession of their home. If a buyer takes possession before recording and funding, there is a risk – the risk is that the mortgage company can and sometimes does require last minute items to be completely cleared up, and if those items don’t get cleared up, the buyer could have possession of a home they do not own. There are liability issues with this scenario.
What do I have to bring to closing?
Certified funds – no personal checks. Cashier’s check or wire transfer of funds directly to the title company’s account. Give yourself plenty of time to arrange for these funds before your closing appointment. Note – if the funds are coming from money market accounts or some other non-liquid account, be sure you have set up plenty of time to get those funds in place.
How are you paid for your services?
As a seller, you pay my brokerage a percentage of the sale at closing. This, along with customary closing costs for a seller to pay, i.e. title company fees, closing fees, search fees, are taken out of your proceeds at closing. My brokerage then pays me a percentage of what they have collected. If no sale occurs, I am not paid anything.
As a buyer, the seller is agreeing to pay my brokerage a percentage an amount offered in the MLS to successfully bring you to closing. If there is no closing, I don’t get paid anything.
So, does your brokerage pay you a salary to help people even if a closing doesn’t occur, like gas money or for meeting me to see houses?
Not at all. In fact, I pay to my brokerage fees regardless of whether or not I have any closings. I am an independent contractor and I am not paid any expense monies or salary for my day to day real estate activities.
Why don’t all sellers have open houses? There are some homes that I see for sale that I want to see on an open house.
Some sellers appreciate that they only want qualified buyers looking at their homes under the supervision of a licensed real estate broker. An open house is just that, open to the public regardless of whether someone is really in the market to buy a house or is qualified to buy a house. Primarily open houses are done for the benefit of the broker holding the home ‘open’, to get new clients who are in need of real estate services.