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Realities of Buying a Home in 2022

Hey, guys. Rachel Beasley here with That Fit Team. I am sitting in one of our offices here in the Suffolk, Virginia office and wanted to just discuss a little bit about what to expect and even why you should have a buyer consultation with your agent. So a lot of times agents will want to meet with a buyer and have a consultation with you, whether you’ve bought a home or not.

The Reality of Purchasing a Home in 2022

Hey, guys. Rachel Beasley here with That Fit Team. I am sitting in one of our offices here in the Suffolk, Virginia office and wanted to just discuss a little bit about what to expect and even why you should have a buyer consultation with your agent. So a lot of times agents will want to meet with a buyer and have a consultation with you, whether you’ve bought a home or not.

ever bought a home before your first time home buyer, I highly recommend this process. It’s probably about an hour, an hour and a half of your time, but it is well spent. You’re there to do a few things. One, you’re meeting with your possible agent, so you’re going to get to know how they speak to you, how they can relate to you.

Finding the Right Realtor

Are they listening to your needs? Do you feel like you’re being heard and understood and going to be well taken care of? Another thing there, you want to make sure that you’re a good fit. So does their schedule work with your schedule? Have you talked about scheduling? Have you talked about those communication items? Another very important reason why you should have a buyer consultation is to know what to expect throughout the process. Buying a home is going to be one of the most important and biggest and most expensive decisions you’ve made in your lifetime. You might only do it like three or four times in a lifetime if you’re military, might do it a lot more. During this consultation, you really should be able to ask questions to your agent, but also listen to them and see what their processes are, how they help you find the right home. Are they sending you emails of the homes that are available on the market? How are you going to figure out which homes you want to see in person? And then also your next step after that in that consultation really is to find out what it looks like to set that appointment up to go see a home. What a lot of people don’t know is a buyer is going to text or call their agent, say, Hey, I really love this house, I want to see it. So the agent on the other side, the person representing you, has to reach out to that listing agent. Everyone’s kind of on hold until that listing agent reaches back and let everyone know if the house is available and when they can show So you have to coordinate those times that are good for you, your buyer’s agent and the seller.

So there’s a lot of coordination that goes into. So let’s say you want to see eight houses. Well, that’s eight houses. And that’s 24 people that you have to coordinate schedules. So there’s a lot involved there. Instead of just getting it right, getting that scheduled and go showing you the home, there’s a little bit that goes behind the scenes.

So these conversations are really good to have with your agent. So you know what to expect, what kind of timing and communication that you can expect from your agent. And also not just what to expect, but what you deserve during this consultation. Another thing you’re going to want to discuss is now what we find the house that we want to make an offer on what is this process look like, what are the forms and documents that you’re going to be signing. Really good to go over those documents ahead of time so that you’re not like scrambling for time trying to get an offer in very quickly so you don’t miss out on the property. And also you want to make sure you understand exactly what you’re signing. So take the time and talk to your agent about the actual contract purchase agreement, what disclosures are involved, what other documents may be involved during that process so that when your agent writes that offer and sends it to you, you can speed that process up a little bit because really you’re only going through the terms of what you want to do with that house instead of the nitty gritty 14 page document.

Let’s Talk Money

One thing I like to discuss with my buyers is that documentation that you’re going to be signing, also going through Virginia’s regulated forms that are actually required by the state of Virginia. This is a disclosure that goes through basically everything that’s happened in the last hundred, 120 years in real estate and what could or could not happen. And it’s really a good piece of information during this time when you’re talking about the purchase agreement and what to expect when you find the house that you want to offer on. Now it’s time to talk money. So of course you’ve already spoken to a lender. You know what your qualified for and what kind of loan you’re going to go for in the lending process.

But on top of that, whether your VA loan, conventional loan, FHA loan, whichever type of loan you choose to do, there’s a little money involved before you ever close on the home. So let’s talk about money involved when it’s time to write that offer. One, with your offer, you’re going to be presenting what’s called an earnest money deposit. In some states, it’s called escrow here in Virginia, in this area, we call it an earnest money deposit. What this is, is a dollar amount that you are showing that you’re going to write a check for or wire the funds to to an escrow agent. That could be your real estate agent broker or it could be the attorney’s office that’s handling your closing, or it could be the seller’s attorney’s office or the seller’s broker.

So there’s a lot of people that that could be written out to. And that’s something to talk to your agent about. But this deposit is basically your skin in the game. It’s showing your commitment level to actually following through going through the lending process and purchasing this home. You’re showing the seller, I’m committed to this, and here’s a certain percentage of the sales price or here’s $2,000. Basically, as an agent, we kind of have rule a rule of thumb. If it’s new construction, most of the time the builder is going to require a percentage of the sales price. If you’re purchasing a home that’s maybe 300,000 or less, you could probably do a thousand or 1500 dollar deposit. If it’s over that 500 or close to a million, you’re going to want to show a little more skin in the game than you know, 1500 dollars.

So talk to your agent about what you can afford now, because that money does get deposited in an escrow account. It’s held there until closing. So let’s talk about what those inspections are going to be and what they’re going to cost you. One, you’re going to want to have a home inspection done on your home. Typically this is going to be a part of your feasibility or due diligence period.

Inspections, Inspections, Inspections

Here in Virginia, we call it the home inspection contingency period. So that is a contingency that you’re going to write in that offer to give you five to ten days it could be longer than that. But of course, that’s all about negotiating the terms with your offer. So whatever you and the seller decide on for that home inspection contingency period, you are going to be able to hire a home inspector to actually go and inspect the home from top to bottom. Now, this home inspector does cost you money. This is someone that you’re hiring that’s working for you. So you want them to be working in your best interest. A good home inspector will take a couple of hours at a house, or if there’s a team of people there, it might take a little shorter than that. Once they’ve inspected the entire home, they’re going to look at the roof, they’re going to look at all the system.

They’re going to see how well they’re working, how old they are. It’s something towards the near end of its life or are things pretty good? And the house is in good shape and you found a good one. It happens. The inspector is going to crawl underneath the home, see what’s going on underneath that crawl space. To make sure that you know, your house that you’re going to be purchasing is sound and free from moisture issues. So you’re going to want to go through that inspection report with your real estate agent believe me, we’ve read hundreds and hundreds of inspection reports. We know what to look for, what you’re looking for, the safety issues or structural issues, things that could cause problems down the road or maybe issues that just haven’t been maintained well over time while the owners owned that home, sometimes they don’t know about it, so don’t hold it against them.

Once you have the inspection report back and you’ve discussed it with your agent. Now, right now in a crazy seller’s market, I’ll be honest, not a lot of people are asking for repairs and actually in fact, a lot of buyers are completely waiving their right to ask the seller for repairs from that home inspection. They’re getting the home inspection for that peace of mind and the information. So they know what they’re walking into when they actually sign the dotted line and close on the home. So I’m not saying it’s not a bad thing to be able to ask for repairs. What I’m saying is it’s a nice thing to be able to have if you’re able to ask for some repairs from the seller. And it has to be mutual, the seller has to agree to those repairs.

So sometimes I’ve seen agents write a laundry list of repairs. The seller will agree to it all because they’re just excited to sell their home. Or sometimes you go through each one nitty gritty and decide which one’s really important to you, which one would be OK for you to do later down the road. These are all things that you need to discuss with your agent and maybe even with the home inspector to figure out what is in your best interest, but actually how can we all come together and work together towards a common goal, which is helping you get the home that you fell in love with? Once you’ve written everything up and it’s been presented to the seller, then it’s up to him. He actually has a few days to figure out what he can and cannot do or what he can afford or get a contractor to do. So there’s a little bit of a negotiation period there. If you are in fact asking for repairs from the seller.

Once we get past this home inspection contingency and we remove the contingency of the home inspection, the next thing that’s going to be ordered is going to be the appraisal, and that is done with your lender.

So the lender is going to order the appraisal and an appraisal will be assigned to your home, to your loan and they’re going to go out to the home and they’re going to basically do a second inspection. They’re going to look at the house, they’re going to see how sound it is. They’re going to make sure if you’re a VA buyer, they might have a little more stringent regulations that they require. If it’s a VA appraiser, some other appraisers don’t have to use those guidelines if it’s a different loan type. So make sure you know what your loan type is.

Appraisals and More

The appraiser is going to make sure the house is there. It’s structurally sound, and it’s actually a good lender product for the lender. The appraiser is also going to look at different homes in the surrounding areas that are similar to the one that you’re purchasing and see what they sold for. He’s looking for a comparable market analysis of the home so that he can appraise a market value of the home.

In today’s market, some appraisers will go a mile away from a home to find the right properties that are comparable to yours. Sometimes they’ll go look at the three months past sale. Sometimes they’ll go six months past sale. Just depends on what’s out there, the home location and what they can find. So once that appraisal is done, they have a couple of days. It typically takes ten to 14 days for the actual appraisal report to come in to the lender. And then everybody knows what that house is appraised for. If all goes well, then the house will praise for the amount of your contract, maybe sometimes higher, with no repairs requested. Sometimes it comes back with some repairs requested. And those are things like other structural issues that maybe a VA appraiser might be acquiring.

So again, go over that in detail with your agent and your lender and make sure you know all of that information more in detail. Once we know what the appraisal is, the next step after that, you’re going to want to make sure that you get your insurance policy in place. And that declaration page over to your lender. Once we’re getting closer to closing, there’s a lot that goes on between you and your lender.

You’re going to want to make sure you get them the documentation that they ask for. But close to closing will be scheduling that walk through. We will be scheduling your closing time with the attorney. The attorney will be reaching out to you and getting some personal information from you to make sure that everything being recorded correctly on your deed when you close on the home. If the seller was taking care of any repairs from your home inspection, then you’re going to be asking for a receipt that the work was done. You can even have your inspector go back and re inspect the home just from what those repairs are supposed to be to make sure they were done properly. Then you and your real estate agent are going to schedule a final walkthrough of the home to make sure everything is in its place.

The house is how it should be. You know, things could happen. What if a storm comes through and there’s a broken window the day before closing? There’s things that we can do to make sure that you are protected and you can still close on the home and not have that broken window that you know you’re going to have to take care of. We want the home to be in the right condition. When you purchased the home, that’s a little bit a very, very fast, quick one on one. On what it’s like to buy a home. Very brief buyer consultation and when I do this with my buyers, it takes about an hour to an hour and a half. But it’s time well spent because you get to talk through all these things in detail, ask questions.

Found the Right Realtor?

So hope to work with you soon. We’ll see you later if you have any questions or if you want to actually schedule buyer consultation, reach out below and we’ll be happy to set that up. We’ll see you next time.

Another thing that’s really important to do is I love to pull up the multiple listing service right in front of my buyers. So I will do a home search with my buyers, in live time, right there during our buyer consultation so we can go through and see how many houses are available within your criteria. Do we need to make any tweaks? Maybe there’s only six homes available. Well, that’s when we could talk about maybe some making some tweaks to that home search criteria. Or maybe there’s a ton and we need to dial it in a little bit. It’s a great opportunity for you and your agent, hopefully me to get to know what you like. Let’s look at some pictures and see what styles of homes you love, what neighborhoods you want to be looking in these are all things that you should be discussing in your buyer consultation and why it’s so important you want to be in tune with your agent and also in tune with what the market is so you can be prepared for what to expect when it’s time to write that offer and then what to expect after you get an offer ratified and accepted through closing. So that’s it, guys. Sounds like a simple thing, but there’s a lot involved and there’s tons of conversations along the way. But Jonathan and I and that fit team, we want to be here for you for all your buying needs and answer any questions that you have.

So hope to work with you soon. We’ll see you later if you have any questions or if you want to actually schedule buyer consultation, reach out below and we’ll be happy to set that up. We’ll see you next time.

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