Steps to a Successful Purchase
Create the Offer to Purchase
Before the offer to purchase is created, it is very important that you have been at least pre-qualified or better yet pre-approved by a lender. This is one of the best negotiating tools a buyer can have. It shows the seller that you are financially able to purchase the home.
After you have found the right home, it is time to prepare the offer. In Texas, the offer to purchase is a TREC-Approved Earnest Money Contract. It covers all facets of the purchase process, such as:
- purchase price
- amount and type of earnest money
- contingencies (financing, inspection, etc.)
- personal items you wish the seller to include (washer/dryer, etc.)
- closing date
- time limit after which the offer will expire
- responsibilities of both buyer and seller
Once you make the offer, we present it to the Seller and their Agent. The Seller may accept it, prepare a counter offer, or reject the offer all together. Once the offer is accepted, it is a legally binding contract.
Negotiate with the Seller
Negotiation begins before we get started looking. A strong position is enhanced by getting pre-qualified for a mortgage. Better yet, making the effort to become pre-approved will maximize your ability to strike a deal most favorable to you.
When we find the right home, as your Buyer’s Broker, Andrew will:
- endeavor to discover prices of similar homes sold in the last 6 months
- help you compare it to any other homes you’ve looked at
- evaluate its condition and access the amount of work it needs
- determine how long it’s been on the market and attempt to discover why the Seller is selling, and if the price has been reduced
- help you affect a strategy using time, price, and terms to your advantage.
Andrew will draw from 21 years experience in negotiating real estate transactions always with your best interests in mind.
Whether it’s starting with your best offer, saving room to maneuver, compromising, or making concessions to the seller’s counter, Andrew can represent you with the objectivity to help you make a wise decision.
I strongly recommend an inspection for every transaction.
The home inspection checks the condition of the major systems of the house including the structure’s exterior, windows, foundation, roof, garage, electrical, plumbing, heating/air conditioner, attic and basement or crawlspace. A pest / dry rot inspection is usually available at an additional charge.
If any major problems with the structure or systems of the house are uncovered, you will then have the right to void the sales agreement or to renegotiate the terms of the purchase.
It is recommended that the buyer attend the home inspection. It usually lasts between 2 and 4 hours, depending on the property itself. This will allow you to ask questions about repairs and maintenance of the home and property.
A home inspection usually costs between $200 and $400 and is the best money you will ever spend.
Andrew has the experience with the inspection community to recommend a list of accredited inspectors.
Escrow Process & Closing
What is an Escrow?
Escrow is the deposit of documents and funds with a neutral third party with specific instructions as to how they should be disbursed.
Escrow acts as the clearing house for the exchange and distribution of those documents and funds in connection with transfer or financing of real property.
Andrew or his assistant will attend the escrow settlement with you to verify the transaction closes as agreed.
The escrow officer, an employee of the title insurance company will, acting as a neutral 3rd party, explain the documents and have you sign them. The officer will then assure completion of transaction by delivering to the lender for verification and document recheck and deliver to county for recording your deed.
Why is escrow important to me?
Escrow, or the services of a qualified escrow agent, assures all interested parties that the rules and regulations governing real property transfers will be strictly observed by a neutral third party with an objective interest in completing the transaction.
An escrow agent represents neither the seller nor the buyer. The escrow agent can act only on each party’s behalf according to their written instructions.
What escrow services does the title company provide?
The basic definition of an escrow agent’s responsibility is to accept and hold a deed from the seller in exchange for funds from the buyer. The escrow agent will concurrently, when all mutually agreed terms have been satisfied, release the funds to the seller and deed to the new buyer.
In most sale transactions, this “simple” process requires the escrow agent to perform the following:
- Order a title report on the subject property and obtain all the necessary information to clear all title defects and satisfy existing liens and encumbrances against the property or the principals involved in the sale.
- Work with the buyer’s lender to insure instructions from the seller, buyer and lender are coordinated.
- Prepare many of the documents necessary for the transaction and review all others to make certain they conform to the parties’ demands.
- Figure tax and interest prorates and prepare closing instructions and statements for both buyer and seller.
- Arrange closing appointments for all parties to sign the necessary documents.
- After taking final signatures, the escrow agent has responsibility to complete the transaction by checking all documents for completeness, compliance and accuracy.
- Return copies of all loan documents to the lender for approval to record.
- Record all necessary documents in the county where the property is located. This is when the transaction is closed.
- Disburse all funds out of the escrow account according to the signed, written instructions. (These funds could include the seller’s net proceeds, the Broker’s real estate commission, and other payments required for loan approval or to satisfy other terms of the agreement.)
- Prepare and distribute final closing statements to all interested parties.
How much does an escrow cost and who pays for it?
Fees are a negotiable item subject to agreement between the parties. If the sale transaction involves a federally guaranteed VA loan, the buyer is not allowed to pay any escrow fees and the entire amount will be paid by the seller.