Buying a home should be one of the most exciting times of your life. It doesn’t have to be stressful or overwhelming if you are prepared. Whether it’s your first home, or one of many, it’s different every time. I treat all buyers with respect and help them get organized. I communicate details. I listen to what they want and offer my best advice and strategy. I help analyze value (what the home is worth) and cost (monthly payments and hidden expenses such as maintenance, repairs, HOA fees, landscaping and pool management). I explain potential risks and consequences. I help manage expectations.
The best gift you can give yourself is to get ready. Understand the process before you begin looking. Too often, buyers look and fall in love with homes then scramble to get financing, their home sold, the paperwork required by the lender, and more, in order. Mistakes along the way, and decisions made under duress, can increase risk of not only losing the opportunity to buy the home but also unnecessary expenditures. It’s a much more emotional and stressful journey if you don’t plan.
I have an Ohio real estate license as well as Florida real estate broker license. Below are the most common unknown buyer delays or defeats. Contact me any time for more details.
- Not having a preapproval if you plan to finance your purchase. Preapprovals are not a guarantee of funding. You are showing integrity to the seller, speeding up the underwriting, and, confirming what you can afford. Just because you pay $2,000 a month in rent does not mean you will qualify for a home loan equivalent to that payment. Your lender may approve you for $2,000 a month but your cost of living is more fluid at $1,650 a month. Most sellers prefer a buyer use a Florida lender. Many out of state lenders who are licensed to underwrite in Florida do not know the local real estate laws and contracts which can cause complications. You will be required to provide the following to your lender:
- Last 2 years tax returns all schedules and pages and W-2s
- Two most recent pay stubs
- Two most recent checking account statements all pages
- Two most recent savings account statements all pages
- Color copy of your drivers license
- Copy of social security card
- Copy of purchase contract
- Copy of deposited earnest money deposit
- Proof of funds from a financial institution if you are a cash buyer. I have not met a seller yet who has accepted a cash offer without proof of funds. The closing agent will require it as well. This can be a bank statement, mutual funds statement, retirement statement, money market account statement, or similar.
- You may see advertisements for interest rates that are lower than you are quoted. There are many variables to interest rates: Your credit score. If your mortgage is 15 year or 20 or 30 fixed, or variable. If you buy points. And more. Rates fluctuate daily and throughout the day. You can lock a rate. The standard is 30 days. It’s wise to get under contract before locking a rate. While most real estate transactions can close in 30 days or less, your lender may charge you to extend your rate if it doesn’t close in time. It’s best to contact your trusted lender for a more detailed explanation. This is not my area of expertise yet I know enough to help you ask the right questions.
- If you are applying for a mortgage, do not pay off credit cards. Do not open new credit. Do not buy anything same as cash. Do not touch your finances until you are closed on your home. Doing any of the above could effect your credit score enough to cause funding to be declined. If you have a large, non payroll deposit in any of your accounts, your lender will be required to substantiate its legitimacy. If you receive a gift from a family member or friend, they will need to sign a document confirming it is a gift and not a loan. If you receive a bonus, transfer funds from investments, or win the lottery, you will need to provide proof.
- There are two types of purchase contracts in Florida. One is called the Standard FAR/BAR. The other is called the AS IS. While there are several differences, one or the other may be more suitable for you. You deserve to have them explained to you so you can discern. Read here for the 5 big differences between them. I will help guide you as to which is best for your situation and why. Some bank owned properties will only work with the AS IS offer. Some luxury sellers will only work with the Standard offer.
- If you are married, the state of Florida requires you to take title in both names. If you are going through a divorce, consult with your divorce attorney if you should buy a home before or after the divorce.
- If you are taking title in the name of a Trust or LLC, you will need to provide an entire copy of your official paperwork to your closing agent. Your contract and disclosures will have to be signed in a particular manner if a Trust or LLC.
- If your purchase agreement falls through and the contract cancels, you may or may not get your deposit back depending on the language in and timeline of the contract. You will not get your inspection fees, appraisal fee, survey fee, title search fees back if the services were already performed. Be sure you, your REALTOR® and your closing agent are watching the contract timelines to try to mitigate you losing your deposit. Know your options.