- The Buying Process
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- Each Step Expands to More Info
- The Buying Process
- Click Each Step Below to Expand
- Learn More By Clicking Below
- Each Step Expands to More Info
Step 1 - Formation of Your Team
Step 1 - Forming Your Team
HIRE A REALTOR TO REPRESENT YOU – This action creates an agency relationship between you and the Realtor, making you an official client. This gives you certain rights, including the ability to be advised by your Realtor, who must put client interests above his own.
APPLY FOR LOAN WITH AT LEAST 1 LENDER – This will “pre-approve” you for a loan with at least 1 lender, who will give you a pre-approval letter. We will attach this letter to any and all offers we make, in order to evidence to sellers your ability to buy, making your offers stronger and more competitive against other buyers.
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Step 2 - The Search
Step 2 - The Search
AUTO MLS SEARCH/WEB PORTAL SETUP/HOME SHOWINGS – Using your criteria from step 1 above, we will set up an automatic search of the MLS for you via a customized web portal. You will get emailed links to this customized web portal each time properties that match all of your criteria hit the market, enabling us to react quickly to new listings you like with a home showing appointment. You can mark each property you see in your custom web portal as a favorite, a maybe, or reject. We’ll then find a time that works for you to view the home(s) in person. Your DFW First Realty agent will schedule the appointments and attend the showings with you.
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Step 3 - Offer and Acceptance
Step 3 - Offer and Acceptance
Once we’ve found the perfect home, we will review the market data of recent sales in the neighborhood to determine and advise you of a fair offering price. We will then assist you in drawing up the offer contract, while explaining the meaning of each paragraph. We will sign and submit the offer to the listing agent and wait to hear back on offer acceptance or counteroffers. Once we have agreed on all terms of offer with seller and all parties have signed the purchase (offer) contract, we have an accepted contract and we are officially “in-contract”. There is typically 25-35 days between the date buyer/seller all sign the contract and when the scheduled “closing date” is. Closing date is the official date you will purchase the property via a set of paperwork at the title company, who will receive the wire-in of the loan amount from your lender on the same day that the final party signs the contract. Before we get to closing day, a number of things need to happen while we are “in-contract”.
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Step 4 - ``In Contract`` Period
Step 4- ``In Contract`` Period
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- PREPARE & DELIVER OPTION MONEY & EARNEST MONEY CHECKS
- OPTION MONEY (OM) – This purchases an “option period” for the “in-contract” process, which gives you the buyers the unrestricted right to walk away from the house for any reason within a certain number of days from effective date of contract (usually 7-10 days but is negotiated into contract). Option Money is typically $100-300. If you don’t use the option and proceed to closing, this amount is treated like a deposit on the Settlement Statement by reducing the amount of your down payment. However, if you use the option and terminate the contract, option money is forfeited. NOTE: if sellers have not given us a “Seller’s Disclosure” document before we make an offer, we will mark a box in the contract that says we have not received the SD yet, which gives us a FREE 7 DAY OPTION PERIOD from the time we receive it. AS YOUR REALTOR AND ADVOCATE, WE WILL ALWAYS TRY TO PURSUE THIS FREE OPTION PERIOD IF POSSIBLE TO AVOID YOU PAYING AN OPTION FEE.
- EARNEST MONEY (EM) – While not technically a requirement of a valid contract, providing Earnest Money to the seller functions like an upfront down payment, which shows the sellers you are serious about purchasing the home and makes your offer more appealing to sellers. Like the option money, it is credited off your down payment amount on closing day. Also important to note, if you exercise your termination option while “in-contract”, the EM is refunded to you. EM is typically about 1% of gross sales price ($2,000 on 200k purchase).
- NOTE: We will get EM & OM checks from you very soon after contract acceptance. We will deliver these checks to the appropriate parties on your behalf (OM goes to Listing Agent, EM goes to Title Company).
- FINALIZE FINANCING – you will have already applied for a loan with at least 1 lender by this point (to obtain pre-approval letter that accompanied our offer(s)). Still, just because you have applied for the loan doesn’t mean you have to take the loan from that lender. It is very wise to shop around and apply with at least 2-3 different lenders to make sure you are getting a good deal on your interest rate and closing costs (itemized on GFE provided by lender). We are happy to help you compare GFE’s from different lenders to determine the cheapest financing. I (Matt) am a numbers junkie and can definitely help you compare financing options. We want to get financing selected within 3 business days from getting “in-contract” to stay on schedule with closing date.
- HOME INSPECTION – We want to get this scheduled asap after getting “in-contract”. For $300-400, a professional home inspector will come out and inspect the construction of the home and the working condition of it’s various components. He will write up a report showing everything that is wrong with the property. We will then take this to seller’s listing agent during OPTION PERIOD and ask that they remedy certain repairs, credit us money back on the sales price or closing costs so you can make the repairs after closing, or a combination of both. IT IS IMPERATIVE THAT WE NEGOTIATE REPAIRS DURING THE OPTION PERIOD, SINCE THIS IS WHEN WE HAVE LEVERAGE ON THE SELLER VIA OUR ABILITY TO TERMINATE THE CONTRACT IF THEY DON’T COMPLY.
- FINANCING CONTINGENCY CLAUSE – This is a deadline set by the 3rd Party Financing Addendum, which accompanies all contracts involving a home loan (90%+ of residential sales). If we cannot get full loan approval by this date, we may be able to terminate the contract and still receive your EM back (if lender cannot approve your financing for certain reasons). As your REALTOR and advocate, we will monitor this date and will stay in touch with lender regarding full loan approval prior to this date, so that we are protecting your Earnest Money.
- PREPARE & DELIVER OPTION MONEY & EARNEST MONEY CHECKS
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Step 5 - Closing!
Step 5 - Closing!
All that is left now is signing the final paperwork at the title company. At least 3 days before closing, the title company or your lender will email us a “Settlement Statement”, which itemizes all of your closing costs, down payment amount per contract, as well as any and all credits you have (prior paid OM & EM, prorated taxes, etc.). The bottom line amount on this settlement statement is the amount you bring to closing in the form of a cashier’s check. All buyers must be present and have their driver’s licenses or some other valid ID to sign the title company paperwork. We always attend our clients closings to help answer any last minute paperwork questions. AFTER BOTH PARTIES HAVE SIGNED THE CLOSING PAPERWORK (in 2 separate closings… sellers have their own closing on same day), you will receive the keys to your new home from title company! CONGRATULATIONS, YOU JUST BOUGHT A HOUSE!
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