PRIME BUYING TIPS
Define Your Needs
The first step towards buying your new home is to analyze your needs. Be specific-- we can assist in analyzing your needs so that you will be able to get a clear picture of exactly what you want your new home to look like and how it should function for you and your family.
Mortgage Pre-Qualify/ Pre-approval
In NYC, the seller expects a buyer to sign the purchase & sale agreement within 5 days of receipt of contract along with a deposit of 10% down. Most contracts are issued without a “mortgage contingency.” Attempting to qualify and approve for a mortgage can be difficult in 5 days, and it’s important that the buyer be pre-approved for the mortgage amount rather than risk losing a 10% deposit.
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Pre- Qualify |
Loan prequalification is simple, it takes into account very basic information regarding your financial status and gives you an amount for which you may qualify for. This can be done on a verbal level or over the Internet. The pre-qualified amount is based solely on the information you provide. In most markets, pre-qualified buyers usually hold little clout compared to pre-approved buyers due to the fact that the information given during the prequalification process is not thoroughly investigated and therefore may be unreliable. Where a pre-approved buyer is actually approved for a loan of a certain amount, a pre-qualified buyer is only told that they might be approved for a certain amount.
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Pre- Approval |
The lender will take all pertinent information regarding your finances and perform an extensive check on your current financial status. This will give you the exact amount that you will be eligible for (depending on what type of loan you decide to go with). Being pre-approved lets the seller know that you have gone through an extensive financial background check and there should be no unexpected obstacles to buying the home. You can see how being pre-approved would be more attractive to a seller than just being pre-qualified. Pre-approval also allows you the time to correct or improve your credit score.
Neighborhood Information
People don't just buy a house; they buy the neighborhood as well. What type of neighborhood do you want to live in? You will most likely want to consider things like how living in the neighborhood will affect your commute time to and from work, what amenities are offered (full time doorman, washer/dryer in unit or in building, fitness room, rooftop deck, etc.), and, if you have children who are attending school or soon will be, what school district you will be in and how close the schools are. We can help you consolidate the information from your list of needs for your home, the pre-approval process, and your neighborhood. We will incorporate this information into a broad search profile, which will then be narrowed down to specific areas. Our experience will be an invaluable resource during this step.
Search Listings
The most efficient way to find properties is to allow us to keep you up-to-date on available properties that meet your criteria, when we present you with a property that interests you, we will arrange for you to tour the property at your convenience.
Making an Offer
When we have found the home you would like to purchase; it's time to make an offer.
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Taking into account the recent sales of homes in the neighborhood which are similar in size, quality, conveniences, we will consult with you and advise you on how to create an offer in order to negotiate the BEST price. |
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We will ensure that you have everything down in written form... no verbal agreements. After consulting with you to put your offer in a written contract that meets all the legal requirements according to local and national guidelines, we will present the seller with a written document detailing what needs to be done by both parties to execute the transaction. We will also ensure your financial position as the buyer by including any necessary contingencies, which would protect you if a particular requirement was not met. |
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Choose an attorney who specializes in residential Real Estate. Attorneys are utilized to close all real estate transactions. Time is often critical; be sure your attorney is available to move quickly. |
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Be knowledgeable of your closing costs, which can be an additional 3-6% of the sales price. Your attorney will know the exact number. |
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The customary deposit for a condo upon executing a contract of sale is 10% of the purchase price. Be prepared to have those funds liquid, the balance of the down payment will be due upon closing. |
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For Co-op purchases, your total annual housing costs should not exceed 25-30% of your gross reported income, and your total debt should not exceed 35-40% (except in the case of substantial liquid assets). Housing costs include: mortgage interest, co-op maintenance, secondary residences and any other mortgage in which your name appears. |
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Offers are not only accepted based upon price, but upon the financial strength of the potential buyer. Be prepared to have your net worth statement with substantiating documentation (bank statements, brokerage statements & other financial documentation) available. In many cases sellers require you to provide this with your offer. This information will be required for most purchases and financial institutions so having it prepared will also save you time in the future. |
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The contract, though not limited to this list, should include the following: |
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A legal description of the property |
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The offering price |
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The down payment |
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Financing arrangements |
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A list of fees and who will pay them |
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Amount of the deposit |
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Inspection rights and possible repair allowances |
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The method of conveying the title and who will handle the closing |
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A list of appliances and furnishings that will stay with the home |
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The settlement date |
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Any relevant contingencies |
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The legalities of this phase are very important. If you have any questions or concerns, they need to be addressed right away. We will cover every base to ensure that all of your concerns are addressed. |
Negotiate the Offer
Once your offer is made, we might need to enter some negotiation in order to reach an agreement. This can give you a great deal of leverage in the buying process… that is, if you have adequate information and you use it in an appropriate manner. We will have the market knowledge and negotiating expertise necessary to make sure that your offer is accepted at the best price and terms possible for you. Some of the things that you may have to negotiate are:
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The price |
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Financing |
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Closing costs |
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Repairs that need to be done |
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Appliances and fixtures |
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Painting |
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Occupancy time frame |
Finding Vendors
After your offer has been accepted, we will supervise the coordination of all necessary vendors and serve as your advocate when working with each vendor. We will make sure that the vendors have access to the property at the appropriate times to perform their procedures and oversee the execution of those procedures on your behalf.
Homeowner insurance is another very important item that will need to be taken care of at this point. Insurance experts recommend that you obtain insurance equal to the full replacement value of the home. Unless you have insurance coverage on the home, the closing can not proceed. Having these procedures done in a timely and professional manner is a must. Investigate each vendor to make sure that they are reputable and have a clean operational history.
Our experience in this area will be invaluable in making sure that everything is completed on time and in a professional and legal manner.
Pre-Close Preparation
As the closing date draws near, we will contact the escrow company or closing attorney and your lender to make sure that all the necessary documents are being prepared, and that they are complete, accurate, and delivered in a timely manner.
We will also need to confirm that the documents will be delivered to the correct location so they can be reviewed and that they will be ready for the appropriate closing date.
We will help you find out what form of payment you will need to bring to the closing for any unpaid fees. Make sure that your payment is made out to the appropriate party.
Ensuring that each closing document is ready and available will enable you to have a quick, easy closing.
Closing
"Closing" refers to the meeting where ownership of the property is legally transferred to the buyer. It is a formal meeting that is attended by most parties involved in the buying/selling process. Closing procedures are usually held at the title company's office or lawyer's office. Your closing officer coordinates the document signing and the collection and disbursement of funds.
We will be present at your closing to answer any questions, and help to resolve any last minute or unexpected details that may come up. In order for the closing to go smoothly, each party involved should bring the necessary documentation and be prepared to pay any related fees (closing costs). There may be more than one form of acceptable payment for your closing costs, so ask the closing officer which form of payment will be required and to whom it should be made out.
Sellers sometimes pay for a portion or all of the closing costs, depending on local market conditions, terms of the purchase contract, and the seller's cash and timing considerations. Any such concessions should be acknowledged in writing. Most lenders will allow a credit from the seller to the buyer for the non-recurring closing costs. However, they usually won't allow a credit that reduces the amount of the buyer's down payment or any of the buyer's recurring costs, such as expenses for fire insurance premiums, PMI, or property taxes.
Live Your Lifestyle: After Closing
You have taken ownership of the property and you will need to have your local services such as electricity, cable, and phone set up. We can help you coordinate the set-up of these local services. We already know who the local vendors are for such services as water and electricity, as well as others, and can help provide you with a list of contacts.
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