Westchester County, NY has it’s own unique way of buying and selling real estate, unlike most other parts of the country. As I network with realtors all over the globe I realize that it might be really helpful to learn how we do things here in a very special way (not always the easiest or the best way!) In my 23 years in the business the steps have basically stayed the same. Our buyers and sellers are each represented by lawyers for one thing, and our closings take approx. 60 days from start to finish.
We have a fourteen part series on buying a home, this would be step 1 out of 14. Stay tuned over the next two weeks for the rest of the steps. By the end, you will see how our system works and see if you agree it could use a little room for improvement :-) !!
Talk To A Mortgage Lender And Get “Pre-approved” – You and your Realtor should know exactly what you can afford, what you should spend, and help you put your financial picture in perspective! PLUS WITH A PRE-APPROVAL IN HAND YOUR OFFER WILL CARRY MORE STRENGTH TO THE NEGOTIATION TABLE, particularly if being weighed against other offers. Most agents want a pre-approval, rather than a pre-qualification – it shows you have taken the time to do your homework! The difference is that the bank will verify your income and assets and check your credit which of course carries more weight than a pre-qual letter which is based on a simple telephone call where the numbers are not verified (ie anyone could say they make big dollars and get a big loan.) It is not necessary for you to apply for a mortgage when obtaining a preapproval; you can always shop around after you find a house and make a decision then. Most lenders will do a pre-approval for free because they are hoping to get your business once you find a property. I like to recommend mortgage people I have a personal relationship with who work locally and I see and talk to regularly. They will do a great job because they want to earn more of my business. Bank of America and Wells Fargo are two I feel very comfortable with. BUT please do not just go online or call an 800 number. You need to ask me for the names of the best people to call. I promise they will give you great rates and great service. Only go with the best people I highly recommend!
The ABR® Designation: For Real Estate Buyer Agents
The Accredited Buyer’s Representative (ABR®) designation is designed for real estate buyer agents who focus on working directly with buyer-clients and have achieved special status by taking the courses required to be the best buyer broker for their clients. See step 2 that follows:
Choose A Buyer’s Agent or Broker – Finding your home is a very serious and very emotional experience and probably the biggest single expediture you will ever make. With the help of a professional who will guide you, educate you and work for your best interests, you have the best chance of finding your dream home. It is very important to treat the buying process as a business, and choose the best person for that job. A person who first explains to you your choices as a buyer and then proceeds to work with intense focus to find the best home possible. Carolyn Schoemer has had additional special training as a “Certified Buyer Representative” and this is something you should look for. Remember an agent has to tell you by law in NYS if they are working for the buyer or seller or as a dual agent. I offer all my buyers a one hour free consultation to go through the whole process and fill out a questionnaire as to your likes/dislike so we can save time and find the best properties. Remember when you go to an open house the agent is often representing the seller.
Choose An Attorney – Your attorney’s job is to protect you legally. Your attorney will review the contract and go over it with you and recommend changes to protect your best interests. He or she make sure that the home you choose is being delivered with all the necessary legal documentation and then work with the seller’s attorney, the bank or mortgage company, and the title company to bring forth a successful closing. When choosing an attorney, please don’t even think of going with the lowest price. A few dollars saved will not be worth it in the long run. You MUST choose an attorney whose primary practice is real estate and knows Westchester County. Imagine trying to reach an attorney when a crises arises and they are in court! Your attorney should have an email address! (believe it or not, some are in the dark ages.) I have several excellent attorneys I recommend. The reason you should seriously consider the attorney your broker recommends? They return phone calls and emails and get the job done! Remember this is the most important person holding your hand at the closing table, so this is a very important step. Please ask me for my list of lawyers who specialize in Westchester county real estate.
Choose An Inspector – In this area, it is normal to do an inspection on homes and townhouses within 72 hours of the “accepted offer”. The inspector’s job is to tell you the condition of the home you’ve chosen and what repairs to expect in the future. Make sure the house inspector has the “ASHI” designation, which stands for “American Society of Home Inspectors.” The house inspector will ask you if you are interested in testing for radon, lead paint, termites etc. Most banks require only a termite inspection certificate and we recommend that the termite inspection be done by a regular termite company, not a general home inspector. If the house must be treated for termites, it is generally the seller’s responsibility to handle this prior to closing. Make sure the inspector will email you the final report in a day or two. Remember, every house is going to have issues; there is no such thing as a perfect house, even if brand new construction. You should get estimates for the work that needs to be done, for example, if the house will need a new boiler in the near future. It wouldn’t hurt to get a price for a new boiler or whatever it is.
Start Looking For Homes – This can be fun but in a seller’s market, it can also be stressful. You may not be able to find exactly what you wanted; often however, you will realize that some compromise may be needed. Take heart! With the help of a good Realtor, you will see the best homes currently available and as you become better educated, you will see good value in the right home. It’s not easy, but it is well worth the effort!
You’ve Found A Home – It is time to start negotiations. As your realtor, I can prepare a market analysis of the home you have chosen to show its current value. Once you have given me an offer I will present it to the seller’s agent in writing with all the terms (price, down payment, amount at contract, closing date, inclusions, inspections, etc.), and your written preapproval.
Negotiating On A Home – When we start with a strong and complete offer, the negotiations hopefully will go quickly and smoothly. If this is not the case, we will continue to negotiate until we have an “accepted offer” or we realize that we cannot purchase this home for the price and terms that you want. In this market, it is common to have more than one buyer bidding on the same property, and the seller may not give a counter offer. The listing agent may just ask for your “highest and best” offer and that may not even be the asking price. In that situation, it will be up to you how much you are willing to pay for that property. ALSO-JUST A WORD OF CAUTION… please realize that if the seller accepts your offer, the seller may get other offers on the property and is by law allowed to accept another offer. Therefore, it is urgent that we proceed with the inspections, contract and mortgage as quickly as possible!
You Have An “Accepted Offer” – As buyer’s agents, we have negotiated with the seller’s agent and you have an “accepted offer”. We will now write a memo of sale with all the terms set forth and notify your attorney. Usually the contract is not subject to inspections and therefore all inspections should be done within 72 hours of the “accepted offer”. This is very important since the property IS STILL AVAILABLE to be shown to other buyers. Should the inspections show problems that were not known or obvious, we may try to renegotiate (your attorney may also be a part of this). Once all issues are resolved, we now go to contract. It is customary in this area to give a 10 % downpayment check payable to the seller’s attorney escrow account. If you do NOT have 10% liquid to write a check please let me know so we can discuss other options.
Signing The Contracts – The seller’s attorney prepares the contracts; your attorney will review them and with the agreement of the seller’s attorney make any necessary changes. You and your attorney will also go over the contract in depth to be sure that you understand all the terms. The contract is usually subject to obtaining to mortgage but may include any other unique terms to this deal. After the contracts are signed, they are delivered with the check to the seller’s attorney who will then ask the seller to sign. The seller’s attorney will then send a couple copies back to your attorney; you should keep one copy and send the contract to your bank immediately.
Applying For A Loan – You may apply with the lender who pre-approved you or another lender. Once your application is complete and the signed contract received by the bank, the appraiser will contact me to see the home and prepare an appraisal of value. When this is complete and the bank underwriter has approved your loan, they will send you a commitment letter stated all the terms of the loan. Fax a copy of the commitment letter to your attorney. Your attorney will order a title search and possibly a survey. In the case of a condominium they will apply for the waiver of the Right of First Refusal. With a coop, you will need to send in your coop board application complete with the contract and your bank commitment and other requested documentation. Once approved, your attorney will need verification that you have been approved by the coop board. On a coop, the attorney will also have to do a UCC search which takes a few days. CONGRATULATIONS, YOU’RE READY TO CLOSE! THE QUESTION IS THE SELLER ALSO READY TO CLOSE?
Important Phone Calls To Make Before Closing – Don’t forget to call the local utility company for gas and electric, and the oil company if the home is heated by oil. You should of course also notify the telephone company and cable, if desired. We can give you the appropriate telephone numbers if you need them.
The Final Walk Through Of Your Home – You have your loan and the closing is set. Before the closing we will walk through your soon to be new home and make sure that everything is as it should be according to the terms of the contract. On the walk through, it is customary to check for leaks, test all appliances and plumbing and check that all items that are supposed to be included are left in the home. The home is usually supposed to be “broom clean” which does not mean scrubbed. All debris should be removed except storm windows etc. which belong to the house.
Attending The Closing – The big day is finally here! Bring your checkbook and photo ID and any certified funds requested by your attorney. Usually present at the closing will be the seller, the bank, the title company, both attorneys and both realtors. This is the place where you give the sellers the remainder of your down payment, your loan proceeds and any adjustments back and forth (for example, taxes already paid by seller, oil in the oil tank etc.) The closing usually takes approx. 1-1/2 to 2-1/2 hours. CONGRATULATIONS! YOU NOW OWN A HOME!
After The Closing – Call us with your new telephone number and let us know how things are going, or we will call you. You will receive a satisfaction survey and we would very much appreciate your taking a few minutes to fill it out and returning it to our company’s corporate headquarters. They take these surveys very seriously and want to make sure we have given our clients excellent service. Of course, if you have any questions or problems please do not hesitate to contact us. Please also keep us in mind if any of your friends or family need to buy or sell a home in this area, or other areas. We have a great network of agents across the country that can be utilized. We look forward to keeping in touch with you over the next several years. If you would be willing to give me a quote about your experience which I can post on my web site for future buyers and sellers, it would be most appreciated. Like any business, many of my clients are referred by former clients.