Home Buying Process and How It Works

Home Buying Process and How It Works – Whether you’re a first time buyer or it’s been 20 years, you may want to know the steps to buying a home.

Home Buying Process

1. Meet with a real estate professional: Discuss the type of home you’re looking for, including style, price, and location.
The Buyer’s Advantage: As the home buyer, your agent’s commission is paid by the seller of the home in almost all circumstances. This means your representation costs you nothing!

2. Get Pre-Approved: You will need pay stubs, W2s, 2 years of tax returns and bank statements. Knowing what you can afford is critical to a successful home shopping experience. Your real estate agent will know a few good lenders to refer you to.

3. Search for Homes: The fun part! Your agent will schedule showings and help you find the perfect home.  When you have a clear idea of what you want, it will be easier.  You’ll help by sharing which listings interest you.
Advanced Search: Not all real estate websites are the same. Your real estate professional has tools and systems to ensure you see every available home that meets your criteria.

4. Make an Offer: Your agent will prepare your offer based on the price and terms you choose.

5. Negotiation and Contract: It may take a few tries to get it just right, but hang in there. You’re on your way!
The Contract: In most cases the contract provides you with a timeline to obtain financing as well as time to inspect the physical condition of the home. Your real estate professional will inform you of all your rights and responsibilities related to the contract.

6. Under Contract or In Escrow: You and the seller have agreed to the price and terms. The home is effectively held for you until closing.

7 Final Details: Perform due diligence, order the appraisal, conduct an inspection, and review terms with the lender.

8. Preparing for Closing: You will be finalizing your loan, reviewing documents, and discussing the findings from the inspection. Your agent will manage this entire process for you.

9. Closing: This is the transfer of funds and ownership. A title company or an attorney typically acts as an independent third party to facilitate the closing. Closings can be done remotely or locally.

Please let us know if you have any questions about the home buying process or selling a home on Anna Maria Island, Cortez, NW Bradenton or Longboat Key, Florida.

Jen and Mark Bowman, Keller Williams on the Water 941-840-0117.
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Why do I need Title Insurance?

Why do I need Title Insurance? When you are going down the list of things that must be paid for at closing, you may hear your Real Estate Agent or loan officer talk about title insurance.  Most people have heard of this expense, but have no idea what it’s for.  Title insurance can be the difference between you losing everything you put into purchasing your home or coming out unscathed if something is amiss.  Let’s take a closer look at Title Insurance.

Title Insurance

What is Title Insurance?

Title insurance is protection against an error in preparing the deed, fraud, undisclosed heirs, or a lien against the property that the new buyer is not aware of.  It also ensures that the person selling the home is actually the owner and has the right to sell.  A title company is responsible for researching the title of the property to ensure there are no issues.  Most of the time when problems are found through title searches, they are cleared up prior to closing.  Title Insurance is a one-time fee paid at closing and it’s based on the loan amount or purchase price of the property.

Owner’s Title Insurance

As the owner of the property, if a problem arises with the title; the insurance can help in a few ways:

1.  They will pay for the owner to be defended in court if someone challenges the title of the property.

2.  They will pay you money to cover your equity and other expenses if you lose the case.

3.  The title insurance can just pay for the issues that come up after closing.


Lender’s Title Insurance

The lender’s policy, also known as a “loan policy” covers any issues with the property prior to the owner’s policy being put into place.  With this coverage, the personal interest of the owner is not included.  The lender uses this policy to safeguard itself from any issues with the property title.   One of the most interesting aspects of this type of insurance is that it is normally paid for by the borrower.

Better Safe than Sorry

When we buy a home we never like to think of the things that can go wrong.  Finding out after you purchase your home that you don’t really own the property can be devastating.  By purchasing an Owner’s title insurance policy, you are ensuring that you and your family are protected against any defect in the title that may rear its ugly head in the future.  Remember, although you may be responsible for purchasing the Lender’s title insurance; it doesn’t protect your stake in the home.  I’ve seen instances after closing, the city contacted the new homeowner and said there were unpaid taxes from the previous owner.  The Owner’s title insurance covered that.  I’ve also seen an instance where my client bought a foreclosure in a neighborhood with an HOA.  About 6 months after closing, the HOA came forward and said there were past HOA dues owed.  The Owner’s Title Insurance protected my client.

Although, you know the title search has been completed; nothing is 100% guaranteed.  This is when the title insurance becomes a valuable asset.

For more information about Title Insurance or real estate in Bradenton, Anna Maria Island or Longboat Key, Florida contact local real estate agents,  Jen and Mark Bowman, Keller Williams on the Water  at 941-840-0117.

Will that home pass a VA appraisal? – Passing a VA Appraisal

VA Appraisal – How to pass a VA Appraisal –

Will that home pass a VA appraisal? This was a call I received from a buyer’s agent regarding a listing I had.  If a home buyer is using a VA loan to get a mortgage then there is a slightly different appraisal that is required by the VA (Veterans Administration) .

Here’s a basic checklist of what the VA appraiser will be looking for:
• Electrical and plumbing systems must be in good condition and have some usable life remaining.
• Adequate heating: The home’s heating system must be safe and adequate and able to maintain a temperature of at least 50 degrees to prevent pipes from freezing, which is not typically a problem here in Florida.
• Adequate roofing: The roof must be in good condition and without any major defects.
• Dry basements/crawl spaces: Basement leaks must be corrected for VA approval.  There aren’t many basements here in Florida, but we do have crawl spaces.
• Free of hazards and defective conditions:  Faulty support beams, exposed wires or stairs without proper railings can also be considered hazardous by a VA appraiser.

Exposed wires will not pass a VA appraisal.
Exposed wires will not pass a VA appraisal.

• No wood-destroying insects: If you live in an area that is prone to termites, the VA may require a termite inspection. Properties with termite infestations must be treated and re-inspected to get VA approval.
• No lead-based paint: Properties built before 1978 must be inspected for lead-based paint. Surfaces with cracked or chipped lead-based paint must be scraped and repainted or covered with drywall or totally removed.

Peeling lead based paint will not pass a VA appraisal.
Peeling lead based paint will not pass a VA appraisal.

A VA appraisal does not replace a home inspection.

I highly recommend that home buyers get a home inspection even on an “As-Is” contract.   A thorough home inspection will give the home buyers additional knowledge of the home and possibly a “to do” list of upcoming projects.

If you are thinking of buying a home give us a call.  We can eliminate homes that we can see won’t pass a VA appraisal and save you time and money in the process.  We partner with great mortgage lenders that can help you with a VA loan or any other home loan.

If you are thinking of selling a home take care of these issues that can be deal killer for a VA appraisal and give us a call.  We can guide you and the home buyers through the process ensuring that we all get to closing.

Disclaimer – We are not VA appraisers.  This is just working knowledge from our real estate business here on Anna Maria Island, Florida.  If you would like a referral to a knowledgeable real estate agent in your area, please contact us.  We know the best Realtors around.

Jen and Mark Bowman, Keller Williams on the Water at 941-840-0117.

Check for Open Permits when Buying a Home

Check for Open Permits when Buying a Home – Checking for open permits on a home is part of the due diligence that many people tend to overlook.  When buying a Sarasota or Manatee County Florida  home, check to make sure that outstanding permits are closed.

Checking for closed out permits is not part of the title search.  Here’s what happened – In 2001 a roof permit was opened on a property.   In 2003, our seller unknowingly bought the house with an open permit. 10 years later, our seller has to pay to re-open the permit and get a roof inspected by the county so it can be sold to the new buyer. The responsibility falls to the current owner.  The responsibility does not revert back to the previous owner.

Barrel Tile Roof

When buying a Sarasota home go to  the Sarasota County Planning and Development website then enter the address of the property you are buying and check for open permits.

When buying a home in Manatee County go to the Manatee County Building Department’s website.  Enter the property address and look for open permits.

Checking for open building permits is just one of the many things that should be done before buying a home.   If you’re thinking of buying or selling a home in Manatee or Sarasota counties, contact Jen and Mark Bowman, Keller Williams on the Water 941-840-0117.   We’re bringing knowledge and expertise to the market.

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