Phil Sharp Online

Buyers Tool-Box

Get Started, Get Organized

If you just started your home buying search or are in the process of buying a home, you know the importance of information and being organized. Our tool-box is to help consolidate helpful and relevant information for buying a home and organizers to aid you in the process. If you don't see what you need, contact Phil at This e-mail address is being protected from spam bots, you need JavaScript enabled to view it   for additional information or with any questions that you might have.

Phil and his team are happy to assist with your home buying and relocation needs.

The documents below are in pdf format. If you need the Adobe Reader, click here to download for free. You can right click on the link and select "Open in New Tab" to view/download in a new window. The information is also presented further down the page if you prefer to not open the document.

Realtor & Home Buying Information

About Starting Your Search

About Phil

Finding the Right Realtor: Your Realtor Should Have Baggage - Article

Professional Service Provided by Phil Sharp Homes

The Home Buying Process: Start to Finish

House Hunting Trip: What to Expect

Why Use a Realtor When Buying a Home? Get the Facts

10 Home Buying Tips

Offers & Inspectors

The Basics of Making An Offer - Including Foreclosures & Short Sales

About your offer...what's next?

Why Home Inspectors Are Important

10 Questions to Ask a Home Inspector

Worksheets

Wants & Needs Worksheet

Home Search Property Tracker: Use this worksheet to rate home you viewed.

Detailed Home Search Worksheet: Use this detailed worksheet for each home you view.

Document Information

Realtor & Home Buying Info

Start Your Search

You have started your home search; either looking for a new home, or looking for market information in order to make a decision about selling.  Even if you just started yesterday, you know that there is an overwhelming amount of information out there, and a million gimmicks to get your attention.  If I may make one recommendation, it would be to find a website with the resources you need, in a format you like, and stick with it.  There are thousands of real estate websites, all offering essentially the same thing; your best bet is to find one that works well (really, all link to the MLS and contain the same listings) and avoid losing yourself in the maze that is real estate on the web.

In the paragraph above I make the assumption that you will search for a home on the internet.  You will find that my levels of service, and my business, are state of the art.  I am convinced that the internet will (if it has not already) become the hub for the real estate business in the 21st century.  In light of this, my business is built around using the web as the primary tool in marketing the homes that I sell; and in providing the services that you, my customers, need to find the perfect home, understand the market place, and get the best deal possible.

I offer my services to Home buyers and Sellers in the Olympia, Lacey, and Yelm areas.  Although I have not really specialized in any one area, I work a great deal with Soldiers and Airmen serving at Fort Lewis and McChord AFB, others relocating to the area, and investors.  Having retired from the Army myself, and having been an investor in Thurston County real estate for over 10 years, I am uniquely qualified to serve both groups.

If you hire me to represent you know that I only make a living if you are happy with the service received.  My record shows that I am skilled at what I do, that I am a skilled negotiator, and that I have many satisfied clients.  Providing buyer representation to you means more than driving around looking at houses; I do that, but in the changing real estate industry, as is true with life in general now-a-days, what you need is a subject matter expert able to deal with the technology, bureaucracy, and pitfalls of a modern business transaction.  Most buyers don’t need or want me to drive them around looking at dozens of homes, many identify the home they want or at least a short list…..my work really begins after you find your new home, and need me to close the deal.

Buyers Services Available Here:

• MLS search in just about any format you can imagine; detailed information, Street map and neighborhood searches, and even search on satellite photos.
• Email listing alerts; 24/7 emails alert you to new listings that match your needs as soon as they are entered into the MLS, you will see new listings before the majority of realtors.
• Comprehensive buyer educational information to include: 
o The Offer/Negotiations
o Inspections
o Financing
o Title and Escrow, how it works and what it costs
o Closing
o Owner builder information (I have built 5 homes, 4 in Yelm and one in Olympia in 2007)
 
• Unlimited MLS access at PhilSharpOnline.com (Ask for your login and  
            password if you have not received one)
• Solicitation of unlisted sellers in your desired area
• Email alerts of new listings that fit your needs
• Internet Buyer advertising, reverse prospecting

Satisfied clients have made me successful, and the repeat business and referrals that I receive from them (and you) are truly appreciated.  I am a real estate professional, and as such I am available to answer your questions and provide any information that I can, even if you are not my client.  I sincerely hope, of course, that you will find that I can and will live up to your expectations and that if you do need an agent in the future you will think of me.

Thank you for your time.

Phil Sharp

About Phil

Phil Sharp of Abbey Real Estate     

Phil Sharp is a top performing Real Estate Agent and investor in the Olympia and Fort Lewis Washington area.  As an agent with Abbey Real Estate Inc., Phil is on track to meet our goals for 2009 by mid June, having completed sales in excess of 5 million dollars during the winter and spring of 2009.  Phil and his wife Gayle also put their “money where their mouth is” as co-owner’s of Sharp and Sharp Holdings LLC, a family real estate investment company.  Phil’s role in the company is of course that of realtor, with abundant knowledge of real estate ownership issues, negotiation and finance in his back pocket.

“In 2004, after 24 years in the United States Army, I retired as the Ft. Lewis Garrison First Sergeant, responsible for the health, welfare and supervision of approximately 500 soldiers and civilians engaged in the day to day operation of the installation; to include Public Works, Schools, Housing, Airfield Operations, Installation Engineering and Training Ranges.  During my first years at Fort Lewis I was assigned as a First Sergeant in the 1st Brigade, 25th Infantry Division.  I was then assigned to a position on the Corps Staff, and upon being offered the job of First Sergeant at USAG, decided that it would be fun, and that working at the garrison level would be good experience prior to my retirement”.

Phil’s Real Estate business, Phil Sharp Homes of Abbey Real Estate is state of the art.  Relying heavily on the use of technology and the internet, Phil is able to meet his clients and customers needs efficiently and effectively and without wasting time, especially yours; as a realtor catering primarily to families that are making major relocations, sometimes from overseas, Phil has both the personal experience as a soldier, and the professional experience as a realtor, to be especially qualified at serving the needs of all of his clients.   Having served our country for almost a quarter century with integrity and commitment, Phil is the perfect choice for top notch service.

“I really enjoy having the opportunity to continue to work closely with military people.  The best part of this job is that a large percentage of my business is with Soldiers and Airmen, we can relate to each other and I have special insight into military life and lifestyle.  I have also made enough Change of Station moves to know how uncomfortable it is to be a transient; you want to get settled ASAP with minimal hassles.”

Phil initially started in real estate as an investor, and as a real estate agent working with other investors.  He built his reputation with investors thru his own success as a property owner, and by hosting real estate investing conferences and luncheons in Olympia.  Phil has published numerous articles and editorials on real estate ownership and investing in the Olympian Newspaper, and has been featured on KING5 (NBC Seattle), as an up and coming realtor in a unique market.

“I have been excited about real estate in Olympia for a long time.  I first visited here while with the Army in 1989, and I saw the potential in the real estate market then.  Olympia is situated directly in the path of growth in western Washington.  With Puget Sound to the west, mountains to the east, and Interstate 5 running thru town, Olympia is destined to continue its phenomenal growth based on geographic location, a steadily growing economy, and the fact that Olympia is the seat of the state government.  Add to this the outlook for a major continued presence to the north by the military and I see the makings of a fantastic real estate market for the long term.”

Phil’s reputation and track record in the local real estate industry, and his experience working with people throughout the local and military communities, set him apart from his peers in the real estate industry, and make him a unique choice for recognition as Featured Agent.

Phil Sharp Homes - Finding the Right Realtor

Your Realtor Should Have Baggage

Finding the right realtor is not just about calling the agent with the best looking website or advertising; it is about finding someone whose personality is compatible with yours, and someone who will help you buy, or market and sell your home in a manner that suits you.  Then you get to the nuts and bolts; when you hire a realtor, you are not just entering into a contract with him or her, you are engaging the services of that agents’ entire network.  If your agent gives a funny look when you ask about affiliations, you should look elsewhere.

An accomplished realtor should have a network of associates who can assist in all aspects of your transaction.  Starting with the Title company used by your agent to produce a title report (necessary to insure that there are not surprises at closing) to a contractor to repair items identified by the buyers inspector, your agent should have these people in a back pocket ready to resolve the inevitable issues that arise in the course of buying or selling a home.

You should expect, as a matter of routine, for your agent to bring up his or her network at your first meeting.  I have made it a practice to discuss the following with all clients, buying or selling:

• Title costs and procedures
• Inspections/inspectors
• Reputable lenders (things to consider when finding the right lender)
• Contractors (plumbing, electric, landscape, paint, minor to major repair, etc.)

Your Realtor should also have the following “on tap” if needed:

• Land use planner/engineer (especially if you are looking to build)
• Septic designers and well drillers
• Architect or draftsman (many folks plan to add additions etc. after purchase, do you know if the people that issue the permits will?)
• Wetland/environmental experts (for all of the reasons mentioned above)
• Many others!!!

It never ceases to amaze me when I hear about people entering into contracts with no idea of the potential outcomes.  Just because you buy a vacant lot doesn’t mean that the local jurisdiction will allow you to build on it.  Nor does what the neighbor did have any bearing on your property.  The rules are changing so fast that what was OK six months ago might be impossible today.  If your network of experts is out of touch, it could hurt.

As realtors, we represent ourselves as experts in the field of real estate.  The term “real estate” is very broad, it includes not only our homes, but the roads that serve them, the water, the sewer, community impacts, and everything else we take for granted until it affects our purchase or sale.  No one person will have all of the answers; but you should insist that your expert know what questions need to be asked, and of whom. 

Professional Services Provided by Phil Sharp Homes

Personal Professional Services Provided to Home Buyers

To save your time, minimize your stress, provide maximum security and help assure you get the best home for your money; I will perform the following services for you, the home buyer:

1. Provide a complete explanation of the home buying process.

2. Provide thorough knowledge of the current and emerging real estate market conditions.

3. Assist you in selecting the best home for you, for your money.

4. Write your purchase agreement to correctly and clearly express your intentions and represent your interests.

5. Submit your purchase agreement in a manner that will present you in the most favorable position.

6. Review all offers in detail and provide negotiation representation of your interests.

7. Provide assistance in obtaining the best possible financing of your next home.

8. Coordinate the closing of your purchase with other REALTORS®, lenders, inspectors, appraisers, attorneys, escrow officers, and title insurance companies.

9. Provide on-going personal communication to keep you informed on the step by-step progress of the purchase of your home.

10. Provide post-sale follow-up to assure your total satisfaction.
It may matter more who personally represents your interests when buying a home than which home you may attempt to purchase. If you try to buy the right home through the wrong agent, you may not get the home you want to you may have an unsatisfactory home buying experience.  You can’t get these personal services from me unless I am the agent you select to represent your interest in the purchase of your home.

The Home Buying Process: Start to Finish

Should you use a Realtor?

I don’t know why a buyer would not use a realtor.  Buyer’s agents are real estate professionals who work exclusively for the buyer.  The buyer’s agent is there to protect your interests, and insure that you get the best home possible, at the best price.  The greatest thing about this relationship is that it costs you nothing.  Sellers pay real estate commissions, buyers do not.   A home buyer using an experienced realtor is receiving free market knowledge, expertise in executing a real estate transaction, and exposure to the widest possible number of homes on the market.  Sellers pay the cost because they want buyers to be qualified by an agent; and because they want the buyer to have experienced representation that will result in a sale.

When you retain a realtor to represent you, that realtor is legally obligated to serve your best interests.  Beyond legal obligations, realtors must work in the community, and rely on satisfied clients to promote their business.   Real Estate agents with dissatisfied customers don’t typically do well or last long in this business.

Finding the right Realtor; what to look for:

Read Phil’s Olympian article    Your Realtor Should Have Baggage

About Financing:

It is imperative that you get pre-qualified for a home loan.   Most sellers will not consider an offer if you can’t back up your ability to close the deal.

Qualifying for a home loan is not much different than obtaining financing for a new car.   I would be happy to refer you to the local mortgage lender that I use, or you may wish to use a lender that you have banked or borrowed with before.

If you are relocating to the area and want to use a local lender who will be around at closing time, pre-qualification can be accomplished via email and the web.  For help getting this part of the process started, please contact me.

About what mortgage lenders do:
Most mortgage lenders are actually brokers; some also have “in house” underwriting, meaning that they are making the loan themselves.  A lender who can fund a loan in house can be a lifesaver should the third party lender fail to come thru (a very rare occurrence).

Your lender will perform the following functions:
• Collect your financial information to include a copy of your credit report
• Verify your debts and income
• Approve you for a home loan based on your current financial situation
• Provide you with a Good Faith Estimate for your loan.  If you are looking at different types of loans ie: VA vs. Non-Va, you should get a GFE for both.  The GFE will also list all closing costs associated with your purchase.
• Once you have a home under contract, the lender will order an appraisal, process your loan, and provide loan documents to the title company for the closing.
Be prepared for a possible last minute request for a bank statement, or to pull your credit again before closing….the lending industry has gotten more cautious recently.

Starting the home loan process:

Initially, your lender will ask you to provide some specific information, and for authorization to check your credit.  The lender will ascertain that you meet “conforming” loan standards, standards that apply to the entire industry.   A borrower who meets conforming standards will qualify for a loan from most mortgage underwriters, or lenders; your loan officer will then find the best deal for your specific needs.

There are numerous loan programs and guarantees.  The VA, FHA and HUD offer loan guarantees, these guarantees offer the lender protection and reduce their risk, which in turn makes them more inclined to lend to you. 

Your lender can better explain which, if any, program may benefit you.  Make sure that you get comparisons, as different loan packages have differing costs.

If you are applying for a VA guaranteed loan, you will need your VA certificate of eligibility.  If you are on active duty, you can get this from your PAC or PSB, if you are prior service the local VA, or the Retirement Services Officer (RSO) at a nearby installation can help.

What does pre-qualification mean:

The pre-qualification letter will mean that your offer will be seriously considered by the seller.

To the lender, pre-qualification means that you are qualified for a home loan based on your financial situation at the time that you applied, with the assumption that you have been truthful with the lender.  If you go out a  buy a new car, or run up a credit card, you may not qualify for as much, and if you were already close to the limit with debt, you may not qualify at all.

Finding the right home:

When searching for a home, it is critical that you establish some upfront criteria, but don’t go overboard.  Your criteria should include the obvious such as bedrooms and bathrooms, but don’t put a home out of the running because you would like a double oven or skylights.  You may miss your dream home, and double ovens are fairly cheap.

I have a checklist that I can provide you, or you can come up with your own.  Using a checklist or some other tool to keep track of the homes that you look at is a must.   Your checklist should have a way to track positives and negatives, kind of like a ledger sheet.  Having a system that will enable you to quickly compare many homes against each other is the best way to disqualify all but the best, and shorten the list to only the homes that you really like. 

Your agent is going to show you the best deals on the market, and you will probably see all of the really good deals in your price range within the first day or two of looking.  From there you have to decide weather to make an offer, or to wait for new listings to come on the market…..the supply of homes that fit your wants and abilities are limited.

If you are having difficulty finding the right home, your agent should explore with you weather or not there is a need to increase the price or change requirements (do you really need the 3rd bath or spare bedroom?).  Some agents may be uncomfortable doing this, since the customer is always right; but reality may dictate an adjustment in expectations, and your realtor needs to be straight with you.

Making the right offer:

The philosophy, science, and sometimes guesswork of making an offer that will result in the best possible terms for you is dependent on the situation, the following is a list of things to consider when making an offer.

• Although there are many homes on the market, the ones that are appealing to you are also appealing to your competition.  The appeal may be in the home itself, the price, the location, or any number of other things.
• Even in a buyers market, the seller with a desirable property or good price is enjoying a sellers market.
• An offer that is too low will always bring a counter offer, often times for more than what the seller would have accepted.
• Remember that a used home is a used home.  Don’t expect the seller to make it new.
• If you are looking at a property, it is probably priced pretty well.  You would have disqualified it without going for a look if it wasn’t.

In writing your offer, do everything possible to understand the seller’s motivation.  Understanding how motivated they are, and why, can go a long way to making the right offer.  Some sellers have short time frames, while some have mortgages that they can’t afford.  Any insight you can get into these things can be like money in your pocket.

Consider the sellers emotional state.  If the home has obviously received a lot of “customization”, your compliments of the sellers efforts may be all that is needed to take the sting out of a lower than expected offer.

Try not to be critical of the sellers or their home.  Be careful of how you verbalize your requests.  When asking for repairs or compensation for repairs, use language that won’t antagonize the seller. 

The goal in writing your offer is to have it accepted as written, or with few changes, especially in price.   Do all that you can to make the seller feel good….they are more likely to give you what you want.

Earnest Money:

Earnest money is a deposit (not a down payment) on the home.  There is no set amount for the earnest money deposit, I generally feel that 1% of the purchase price is very reasonable, less is acceptable. 

Your earnest money deposit is a show of your good faith and commitment to the contract.  Obviously, the larger the deposit, the stronger your message is to the seller that you are serious.

Negotiations:

Negotiations should be minimal if your agent is in tune with the market, and if you put careful consideration into your initial offer.  Try to put yourself in the sellers shoes, try to read the situation (with your agents help), and consider what is worth asking for and what is not.  Always ask for what is important to you, don’t be frivolous. 

One more thing about offer price:  If the seller owes more on the home (mortgage, taxes and commissions) than what you are offering, will they be able to accept your offer?  Because of market conditions of the past couple of years, many homes are priced at the break-even point.  Short Sales are an exception, are priced below what is owed on the home, and may be priced below what they will actually sell for.  For more about short sales, read “Offers on Short Sales and Pre-Foreclosures”

Once your offer is accepted:

Once your offer is accepted, your agent should take the ball.  He or she will provide a copy of the contract to the title company and your lender for processing.  Inspection(s) should be scheduled immediately, and your earnest money will be deposited to either your realtors trust account or, preferably in my opinion, the title company trust account.

The Inspection:

I really encourage my clients to have a home inspection performed by an experienced, licensed home inspector.  There are several inspectors that I like to use; all have had experience building and remodeling homes, have been successful contractors, and are bonded and insured.

A home inspection is like added insurance.  For the $350-400 spent, you receive piece of mind and no surprises after moving in.   Home inspectors are typically paid at the time of the inspection….you don’t want him or her to “fluff” the inspection, hoping to make sure that you close and that he gets paid.

The inspection must be conducted within 10 days of acceptance of the offer unless otherwise specified in the contract.  Additionally, if conditions are discovered during the inspection that require further evaluation, 5 days is provided for additional inspections in the contract.  If additional time is needed it can be negotiated with the seller.

The results of the inspection will be reviewed by you and I as a team.   At this point we have three options.
1. Withdrawal the offer based on dissatisfaction with the results of the inspection.
2. Request that the seller make repairs or offer a cash credit for repairs and corrections.
3. Accept the condition of the property and proceed to closing.
*  Unsatisfactory inspection results may also provide the basis for re-negotiating other parts of the contract, such as the price.

The appraisal:

Your lender, as part of processing your loan, will order an appraisal of the property.  The lender must order the appraisal, and with certain types of loans the appraisal may be ordered by a third party to insure impartiality. 

The fee for the appraisal will be collected at the closing.  This fee is part of what is considered your closing costs.

Home owners insurance

Once you have a contract to purchase your home, you will need to contact your insurance agent for your homeowners insurance.  Usually, having your insurance agent contact the lender is sufficient.  Your agent will provide an insurance binder for the property that will be required by the lender prior to closing.

Your lender should include a monthly amount for homeowners insurance in the good faith estimate, several months of insurance premium is often included as part of your closing costs.

The title company and escrow officer:

The title company and escrow officer (usually an employee of the title company), perform the following functions:
• Hold funds, such as earnest money, in a trust account until closing.
• Research the Title; this is verification that there are no liens against the property, that no other person or party has an interest in the property, and that you will be able to take full ownership and rights to the property
• Issue title insurance; should a claim on the property arise in the future you have insurance to protect you from loss.  This is always a requirement by the lender.
• The escrow officer is also known as a Limited Practice Officer (LPO), licensed to practice specific legal functions in the state of Washington.  The LPO will gather the title documents, the loan documents, and the funds to close.  Once all is in order, he or she will distribute funds to the necessary parties, transfer the deed for the property to you, and record the transaction with the county recorder.

What defines “Closing”:

The Paper Trail
• Loan documents received from the lender by the title company
• LPO prepares the deed for signature, as well as the loan documents and seller related documents.
• Buyer and seller sign documents, usually at separate times.
• LPO sends the document packet to the lender for review (usually less than one business day).
• Lender approves the documents, and releases funds, authorizing the LPO to close the transaction.
• The LPO has the necessary documents recorded in the public record, and transfers the deed or title.
Congratulations, the home is yours!

When can you move in?

Many people feel that the home is theirs as soon as they have signed the closing documents.  As you can see in the previous paragraph, there is a bit more to it. 

The answer is “Once the Deed is recorded with the county recorder and the tax assessor is paid”

Taking ownership; utilities other obligations:

Upon closing it is your obligation as the new homeowner to have all utilities transferred to your name.  You will also need to provide change of address information to the post office, and I recommend a note in the mailbox informing the mailman of your arrival.

I also encourage you to become an active member of the community.  If you do so as soon and you move in, it will happen………if you wait, it won’t.  Learn about the homeowner’s assn., attend a meeting, and be pro-active both in protecting your rights, and in voting for rules that protect your neighborhood and its value.

House Hunting Trip: What to Expect

What to expect on your house hunting trip:

When house hunting, weather traveling across the country, or across the world, I like to make sure that you and I are on the same sheet of music, and that there are no un-met expectations.  I have prepared this document for your information and also to provide talking points for us during our initial meeting.

Arrival:  Upon your arrival it is imperative that we meet to discuss house hunting, listings, and any concerns or special needs that you may have.  I also like to set the stage for our relationship in a way that insures that I will live up to your expectations.  Taking this time up-front will pay dividends as we start house hunting.  During our initial meeting I will address several topics:

• Real estate market conditions
• Seller sentiment
• Your needs, wants, and trade-offs…the realities of house hunting
• Timeline for the purchase process
• Inspections
• Closing, closing date, and seller expectations

*Negotiating a real estate transaction is a combination of psychology, anticipation of seller expectations, and a little bit of guess work or “gut feeling”.

I typically schedule house hunting from 9:00-5:00, but of course make exceptions based on your timeline and needs.  I have found that 8 hours of looking, during which time we will view 12-24 homes, is about all that one can absorb in a day.  At the end of our day, I will normally return to the office to prepare for the following days activities, based on what I have learned about you and what appeals to you.  I encourage you to get out on your own during this time and look around…..and get on the website and search, now that you have a better feel for the area.  Something new may come on the market, possibly outside of the criteria that I am using, that will appeal to you.

At the end of the first day, you can expect to have viewed many if not all of the homes that fit your needs and criteria….and of course we are going to look at the best deals first.  By best I mean best based on price per square foot etc.  At the end of the day, we will talk about what we have seen so far, and try to refine our search based on your feelings for what we have looked at so far.  By mid-day on the second day, if we are not finding a home that appeals to you, we will need to look at the following options:

• Look in different areas
• Look in different price range
• Modify criteria; square footage, lot size, age etc.

My experience has been, based on the size of the local market, that by the end of day two we will have looked at all of the homes on the market that fit your criteria.   80-90% percent of the folks that I house hunt with will be ready to make an offer on a home at this point, if not sooner.   If we get to the end of day 2 without success, then it is reasonable to assume that we have been looking at the wrong thing (I have not interpreted your needs properly), or we have set our expectations too high and will need to re-assess.  Again, what we control are our ability to change price range, area, or square footage and amenities.

Why Use a Realtor When Buying a Home

Why Use a REALTOR® When Buying a Home?
A real estate agent can help you understand everything you need to know about the home buying process.
Not all real estate licensees are the same; only those who are members of the NATIONAL ASSOCIATION OF REALTORS® are properly called REALTORS®. They proudly display the REALTOR " ®" trademark on their business cards and other marketing and sales literature.
REALTORS® are committed to treat all parties to a transaction honestly. REALTORS® subscribe to a strict Code of Ethics and are expected to maintain a higher level of knowledge of the process of buying and selling real estate. An independent survey reported that 84% of home buyers would use the same REALTOR® again.
Real estate transactions involve one of the biggest financial investments of most people’s lifetime. Transactions today usually exceed $250,000. If you had a $250,000 income tax problem, would you attempt to deal with it without the help of a certified professional accountant? If you had a $250,000 legal question, would you deal with it without the help of an attorney? Considering the small upside cost and the large downside risk, it would be wise to work with a professional REALTOR® when you are buying a home.
If you're still not convinced of the value of a REALTOR®, here are more reasons to use one:
1. Your REALTOR® can help you determine your buying power - that is, your financial reserves plus your borrowing capacity. If you give a REALTOR® some basic information about your available savings, income and current debt, he or she can refer you to lenders best qualified to help you. Most lenders - banks and mortgage companies - offer limited choices.
2. Your REALTOR® has many resources to assist you in your home search. Sometimes the property you are seeking is available but not actively advertised in the market, and it will take some investigation by your agent to find all available properties.
3. Your REALTOR® can assist you in the selection process by providing objective information about each property. Agents who are REALTORS® have access to a variety of informational resources. REALTORS® can provide local community information on utilities, zoning, schools, etc. There are two things you'll want to know: First, will the property provide the environment I want for a home or investment? Second, will the property have resale value when I am ready to sell?
4. Your REALTOR® can help you with negotiations and inspections. There are many negotiating factors, including but not limited to price, financing, terms, date of possession and often the inclusion or exclusion of repairs and furnishings or appliances. The purchase agreement should allow time for you to complete appropriate inspections and investigations of the property before you are bound to complete the purchase. Your agent can advise you as to which investigations and inspections are recommended or required.
5. Your REALTOR® provides due diligence during the property evaluation. Depending on the area and property, this could include inspections for termites, dry rot, asbestos, faulty structure, roof condition, septic tank and well tests, just to name a few. Your REALTOR® can assist you in finding qualified responsible professionals to do most of these investigations and provide you with written reports.
You will also want to see a preliminary report on the property title. Title indicates ownership of property and can be mired in confusing status of past owners or rights of access. The title to most properties will have some limitations; for example, easements (access rights) for utilities. Your REALTOR®, title search company or attorney can help you resolve issues that might cause problems at a later date.
6. Your REALTOR® can help you understand different financing options and identify qualified lenders.
7. Your REALTOR® can guide you through the closing process and make sure everything flows together smoothly.

10 Home Buying Tips

Home Buying Tips: Prevent Costly Mistakes
You’ve changed your mind, but it’s too late now that you’ve bought your home. A little work upfront can save you from making costly mistakes. Each home buying experience is different, but here are a few things to get you thinking on the right track. Your agent can help you with details specific to your situation.
Tip #1:
Get professional advice before signing any contract. Can you finance the home, is the property a good deal, does the contract fulfill your needs; these questions are best answered with the help of the professionals to ensure your happy with your purchase.
Tip#2
Get pre-qualified for a mortgage loan before you start looking to buy a home. Your lender will need you to answer questions like: Do you have a reliable source of income? What’s your credit history? Do have money for a down payment? There are several other questions and information that your lender will need to help you with pre-qualification, check out our Mortgage Dept. section for more specific information on this step.
Tip #3
Make a wish list before you start your home search. Prioritize your criteria for your ideal home, and be prepared to compromise. Look for homes that closely meet your criteria, but don’t have so much detail that you are eliminating every house on the market. Many times, less priority items on your list can be changed easily and inexpensively to make your home more suitable after you move in.
Tip #4
Search the MLS, get an idea of the area’s that are of interest to you. Get an idea of what properties are worth in the areas that interest you, checking recent sales statistics will help you find the values of homes in your area of interest.
Tip #5
Consider visiting open houses and ask a lot of questions. There’s more to a home than what is on the inside, compare houses, look at the neighborhoods, how is the access to community facilities (shopping, transportation, schools, etc.) and check-out potential neighbors, check for things outside of the home that will affect the value of the property as well as the inside.
Tip #6
Check to make sure the home is structurally sound; is anything unusual or seem out-of-place? Check the actual land or lot that it sits on for any potential problem areas, are boundaries and fences where they should be, are there any repairs that are apparent to you, is the roof sound, is the foundation sinking, is the home energy efficient? If there are unusual features to the house, consider those if you sell in the future, would those features appeal to potential buyers in the future?
Tip #6
Again, consult a professional on the structural conditions of the home and property. If you were not seeing any major problems and have got to the point of consideration for making an offer, a home appraiser can find any problems that you can’t see before committing to buy. Read more about the importance of a home inspector in this same section. Most people don’t have the money to take a lot of risk; the inspector will reduce the risk or prevent you from getting over your head with repairs in the future.
Tip #7
When looking for a home, consider the opportunities that will allow you to increase the value of the property, for example, adding storage, redecorating, landscaping, subdividing, adding rooms. Some upgrading can be fun and range in cost, but make sure the updates and opportunities for increased value are in your means to accomplish.
Tip #8
Be organized, take pictures and keep checklists or information about houses that interested you for future consideration. Gather as much home buying information as you can and don’t hesitate to take a second look at an attractive property. Remember, if it’s attractive to you it is likely to be attractive to many other buyers and you don’t want to miss out.
Tip #9
Insurance and Taxes: Don’t forget to check the property tax liability of interested homes; this will be a factor in your mortgage payment. Homeowners insurance is required at closing, so make arrangements ahead of time so that you’re prepared to close on-time. Your agent and lender can remind or help you with this type of information, but that is why it’s important to involve them early in your home buying process.
Tip #10
Get involved in the process! Understand the roles and duties in the home buying process, including your own. Your lender and agent are there to help you with your best interest in mind. When it comes time to make an offer, you and your agent will have a good idea of the details of the property you’re interested in and ensuring all parties, including the seller’s agents and people, are on track with your purchase.

Offers & Inspections

The Basics of Making an Offer - Includes Foreclosures & Short Sales

Offers on Foreclosure and Short Sale Properties

Offers made on Foreclosure (REO or “bank owned”) and Short Sale properties are essentially the same as traditional offers described below. 

The exception is with Short Sales.  In a short sale situation the seller is typically attempting to sell the property for less than what is owed.  In this case the seller may accept an offer, at which time the property is considered to be “under contract”, and off of the market.  The contract however is not ratified or “complete”.  The lender must still approve of the sale, and typically takes 30 days +/- to do so.  Once lender approval is obtained the transaction will proceed as described below. 
The Basics of Making an Offer
A written proposal is the foundation of a real estate transaction. Oral promises are not legally enforceable when it comes to the sale of real estate. Therefore, you need to enter into a written contract, which starts with your written proposal. This proposal not only specifies price, but also all the terms and conditions of the purchase. For example, if the seller offered to help with $2,000 toward your closing costs, make sure that's included in your written offer and in the final completed contract, or you won't have grounds for collecting it later.
REALTORS® have standard purchase agreements and will help you put together a written, legally binding offer that reflects the price as well as terms and conditions that are right for you.  Your REALTOR® will guide you through the offer, counteroffer, negotiating and closing processes. In many states certain disclosure laws must be complied with by the seller, and the REALTOR® will ensure that this takes place.
If you are not working with a real estate agent, keep in mind that you must draw up a purchase offer or contract that conforms to state and local laws and that incorporates all of the key items. State laws vary, and certain provisions may be required in your area.
After the offer is drawn up and signed, it is usually presented to the seller by your real estate agent, by the seller's real estate agent, if that's a different agent, or often by the two together. In a few areas, sales contracts are drawn up by the parties' lawyers.
What is in an Offer?
The purchase offer you submit, if accepted as it stands, will become a binding sales contract (known in some areas as a purchase agreement, earnest money agreement or deposit receipt). So it's important that the purchase offer contains all the items that will serve as a "blueprint for the final sale." The purchase offer includes items such as:
• address and the legal description of the property
• sale price
• terms: for example, all cash or subject to you obtaining a mortgage for a given amount
• seller's promise to provide clear title (ownership)
• target date for closing (the actual sale)
• amount of earnest money deposit accompanying the offer, whether it's a check, cash or promissory note, and how it's to be returned to you if the offer is rejected - or kept as damages if you later back out for no good reason
• method by which real estate taxes, rents, fuel, water bills and utilities payments are to be adjusted (prorated) between buyer and seller
• provisions about who will pay for title insurance, survey, termite inspections, etc.
• type of deed to be given
• other requirements specific to your state, which might include a chance for an attorney to review the contract, disclosure of specific environmental hazards or other state-specific clauses
• a provision that the buyer may make a last-minute walkthrough inspection of the property just before the closing
• a time limit (preferably short) after which the offer will expire
• contingencies, which are an extremely important matter and that are discussed in detail below
Contingencies - “Subject to” Clauses
If your offer says "this offer is contingent upon (or subject to) a certain event," you're saying that you will only go through with the purchase if that event occurs. Here are two common contingencies contained in a purchase offer:
• The buyer obtaining specific financing from a lending institution: If the loan can't be found, the buyer won't be bound by the contract.
• A satisfactory report by a home inspector: for example, "within 10 days after acceptance of the offer." The seller must wait 10 days to see if the inspector submits a report that satisfies the buyer. If not, the contract would become void. Again, make sure that all the details are explicitly stated in the written contract.
Negotiating Tips
You're in a strong bargaining position, that is, you look particularly welcome to a seller, if:
• you're an all-cash buyer
• you're already have a pre-approved mortgage and you don't have a present house that has to be sold before you can afford to buy
• you’re able to close and take possession at a time that is especially convenient for the seller
In these circumstances, you may be able to negotiate some discount from the listed price.
On the other hand, in a "hot" seller's market, if the perfect house comes on the market, you may want to offer the list price (or more) to beat out other early offers.
It's very helpful to find out why the house is being sold and whether the seller is under pressure. Keep the following considerations in mind:
• every month a vacant house remains unsold represents considerable extra expense for the seller
• if the sellers are divorcing, they may want to sell quickly
• estate sales often yield a bargain in return for a prompt deal
Earnest Money
This is a deposit that you give when making an offer on a house. A seller is understandably suspicious of a written offer that is not accompanied by a cash deposit to show "good faith." A real estate agent or an attorney usually holds the deposit, the amount of which varies from community to community. This will become part of your down payment.
Buyers: the Seller's Response to Your Offer
You will have a binding contract if the seller, upon receiving your written offer, signs an acceptance just as it stands, unconditionally. The offer becomes a firm contract as soon as you are notified of acceptance. If the offer is rejected, that's that - the sellers could not later change their minds and hold you to it.
If the seller likes everything except the sale price, or the proposed closing date, or the basement pool table you want left with the property, you may receive a written counteroffer including the changes the seller prefers. You are then free to accept it, reject it or even make your own counteroffer. For example, "We accept the counteroffer with the higher price, except that we still insist on having the pool table."
Each time either party makes any change in the terms, the other side is free to accept, reject or counter again. The document becomes a binding contract only when one party finally signs an unconditional acceptance of the other side's proposal.
Buyers: Withdrawing an Offer
Can you take back an offer? In most cases the answer is yes, right up until the moment it is accepted, or even in some cases, if you haven't yet been notified of acceptance. If you do want to revoke your offer, be sure to do so only after consulting a lawyer who is experienced in real estate matters. You don't want to lose your earnest money deposit or find yourself being sued for damages the seller may have suffered by relying on your actions.
Sellers: Calculating Your Net Proceeds
When an offer comes in, you can accept it exactly as it stands, refuse it (seldom a useful response) or make a counteroffer to the buyers with the changes you want. In evaluating a purchase offer, you should estimate the amount of cash you'll walk away with when the transaction is complete. For example, when you're presented with two offers at the same time, you may discover you're better off accepting the one with the lower sale price if the other asks you to pay points to the buyer's lending institution.
Once you have a specific proposal before you, calculating net proceeds becomes simple. From the proposed purchase price you can subtract the following costs:
• payoff amount on present mortgage
• any other liens (equity loan, judgments)
• broker's commission
• legal costs of selling (attorney, escrow agent)
• transfer taxes
• unpaid property taxes and water and other utility bills
• if required by the contract: cost of survey, termite inspection, buyer's closing costs, repairs, etc.
Your present mortgage lender may maintain an escrow account into which you deposit money to be used for property tax bills and homeowner's insurance. In that case, remember that you will receive a refund of money left in that account, which will add to your proceeds.
Sellers: Counteroffers
When you receive a purchase offer from a would-be buyer, remember that unless you accept it exactly as it stands, unconditionally, the buyer is free to walk away. Any change you make in a counteroffer puts you at risk of losing that chance to sell.
Who pays for what items is often determined by local custom. You can, however, negotiate with the buyer any agreement you want about who pays for the following costs:
• termite inspection
• survey
• buyer's closing costs
• points paid to the buyer's lender
• buyer's broker fees
• repairs required by the lender
• home protection policy
You may feel some of these costs are none of your business, but many buyers - particularly first-timer buyers - are short of cash. Helping them may be the best way to get your home sold.

About Your Offer...What's Next?

Once you have written an offer on your new home and it has been accepted, you can expect the following actions to take place.

•       The offer will be provided to your lender so that they may begin processing the transaction.  The lender will take the following steps:
o Verify that nothing has changed regarding your financial situation, and place the loan with an underwriter.  The underwriter’s job is to insure that all is on the up and up, and that there are no surprises.

o Order an appraisal; depending upon the type of loan, the lender may do this him or her self, or in the case of a VA loan, a VA appraiser must do the appraisal.  This is done to insure that the lender does not influence the appraisal amount.

o This is the time to consider locking your interest rate, if you believe that rates may go up.

•       Inspection:  I will coordinate the inspection.  We typically have 10 days to complete the inspection; with an additional 5 days should further inspections be needed.
•       Home Warranty:  I will place a warranty on the home in time for it to become effective upon the closing date.
•       The Title Company:  Your contract, along with your earnest money deposit, will be provided to the title company that will close the transaction.  The title company will prepare a “title report” addressing the condition of the property title, liens, and any other issues that may impact your ownership of the property.  The title company does not verify physical features such as fences and property lines.

The earnest money will be held in the title company trust account, and will be applied to the purchase price.

•       Underwriting and Closing:  Once all verifications are done, and the appraisal is   approved, the underwriter will prepare loan documents and forward them to the title company/escrow offer.  The escrow officer then prepares a closing package, which includes the loan documents, deed to the property, tax documents etc.

           
Once all the documents are in order (usually within 24 hours of receipt), the buyer and seller will sign the documents that are applicable to each of them.  The documents are sent back to the lender for final review, the money is transferred to escrow/the seller, and the title to the property is recorded at the county in your name.  After the signing, you will not actually own the property for 4-24 hours.

Why Home Inspections are Important

Home Inspections Avert Future Headaches
Suppose you bought a house and later discovered, to your dismay, that the stucco exterior concealed a nasty case of dry rot. Or suppose that when you fired up the furnace in the winter, you discovered a cracked heat exchanger leaking gas into your home. The best way to avoid unpleasant surprises like these is to arrange for a home inspection before you buy.
Home Inspections Help You Avoid Unpleasant Surprises
A good home inspection is an objective, top-to-bottom examination of a home and everything that comes with it. The standard inspection report includes a review of the home's heating and air-conditioning systems; plumbing and wiring; roof, attic, walls, ceilings, floors, windows, doors, foundation and basement.
Getting a professional inspection is crucial for older homes because age often takes its toll on the roof and other hard-to-reach areas. Problems can also be the result of neglect or hazardous repair work, such as a past owner's failed attempt to install lights and an outlet in a linen closet.
A home inspection is also a wise investment when buying a new home. In fact, new homes frequently have defects, whether caused by an oversight during construction or simply human error.
Getting an Inspector
Real estate agents can usually recommend an experienced home inspector. Make sure to get an unbiased inspector. You can find one through word-of-mouth referrals, or look in the Yellow Pages or online under "Building Inspection" or "Home Inspection."
Home inspections cost about a few hundred dollars, depending on the size of the house and location. Inspection fees tend to be higher in urban areas than in rural areas. You may find the cost of inspection high, but it is money well spent. Think of it as an investment in your investment – your future home.
Some builders may try to dissuade you from getting a home inspection on a home they've built. They may not necessarily be trying to hide anything because most builders guarantee their work and will fix any problems in your new home before you move in. Some builders, in fact, will offer to do their own inspections. But it’s best to have an objective professional appraisal - insist on a third-party inspector.

An Inspection Will Educate You about Your House
Education is another good reason for getting an inspection. Most buyers want to learn as much as they can about their purchase so they can protect their investment. An examination by an impartial home inspector helps in this learning process.
Ask if you can follow the home inspector on his or her rounds. Most inspectors are glad to share their knowledge, and you'll be able to ask plenty of questions.
Inspection Timing and Results
Homebuyers usually arrange for an inspection after signing a contract or purchase agreement with the seller. The results may be available immediately or within a few days. The home inspector will review his or her findings with you and alert you to any costly or potentially hazardous conditions. In some cases, you may be advised not to buy the home unless such problems are remedied.
You could include a clause in your purchase agreement that makes your purchase contingent upon satisfactory inspection results. If major problems are found, you can back out of the deal. If costly repairs are warranted, the seller may be willing to adjust the home's price or the contract's terms. But when only minor repairs are needed, the buyer and seller can usually work out an agreement that won't affect the sale price.

10 Questions to Ask Home Inspectors

Before you make your final buying or selling decision, you should have the home inspected by a professional. An inspection can alert you to potential problems with a property and allow you to make an informed decision. Ask these questions to prospective home inspectors:

1. Will your inspection meet recognized standards? Ask whether the inspection and the inspection report will meet all state requirements and comply with a well-recognized standard of practice and code of ethics, such as the one adopted by the American Society of Home Inspectors or the National Association of Home Inspectors. Customers can view each group’s standards of practice and code of ethics online at www.ashi.org or www.nahi.org. ASHI’s Web site also provides a database of state regulations.

2. Do you belong to a professional home inspector association? There are many state and national associations for home inspectors, including the two groups mentioned in No. 1. Unfortunately, some groups confer questionable credentials or certifications in return for nothing more than a fee. Insist on members of reputable, nonprofit trade organizations; request to see a membership ID.

3. How experienced are you? Ask how long inspectors have been in the profession and how many inspections they’ve completed. They should provide customer referrals on request. New inspectors also may be highly qualified, but they should describe their training and let you know whether they plan to work with a more experienced partner.

4. How do you keep your expertise up to date? Inspectors’ commitment to continuing education is a good measure of their professionalism and service. Advanced knowledge is especially important in cases in which a home is older or includes unique elements requiring additional or updated training.

5. Do you focus on residential inspection? Make sure the inspector has training and experience in the unique discipline of home inspection, which is very different from inspecting commercial buildings or a construction site. If your customers are buying a unique property, such as a historic home, they may want to ask whether the inspector has experience with that type of property in particular.

6. Will you offer to do repairs or improvements? Some state laws and trade associations allow the inspector to provide repair work on problems uncovered during the inspection. However, other states and associations forbid it as a conflict of interest. Contact your local ASHI chapter to learn about the rules in your state.

7. How long will the inspection take? On average, an inspector working alone inspects a typical single-family house in two to three hours; anything significantly less may not be thorough. If your customers are purchasing an especially large property, they may want to ask whether additional inspectors will be brought in.

8. What’s the cost? Costs can vary dramatically, depending on your region, the size and age of the house, and the scope of services. The national average for single-family homes is about $320, but customers with large homes can expect to pay more. Customers should be wary of deals that seem too good to be true.

9. What type of inspection report do you provide? Ask to see samples to determine whether you will understand the inspector's reporting style. Also, most inspectors provide their full report within 24 hours of the inspection.

10. Will I be able to attend the inspection? The answer should be yes. A home inspection is a valuable educational opportunity for the buyer. An inspector's refusal to let the buyer attend should raise a red flag.