The Buying Process
   

Plan ahead -- From the moment you think about buying a home, start planning. Home buying is a time-consuming and demanding process, and it behooves you to utilize your management skills early on. During this planning phase, consider your life over the next several years. Do you plan to start or grow a family? Will an in-law eventually move in with you? Will you be working from home? The number and layout of the rooms you require will depend on your answers. We are here to assist you.

Here is how the process works...

STEP 1:  THE DECISION TO BUY Start by requesting a copy of your credit report. Carefully examine it for errors, and clean it up before you talk to a lender. Are you currently renting? Check your lease for an early release clause. If you'll be subject to penalties, try to time your closing with the expiration of the lease. If you qualify for financing based on a dual income, will you be able to survive on one salary in order to fulfill a long-range plan, such as one parent staying home to raise a child? Once you've answered these questions, establish a plan. Then direct the process with reference to the plan. Don't let the process dictate to you. Understand the home buying process. Home buyers need to ask questions. Lots of questions. Based on our expertise we can explain the entire home buying process - from viewing homes to negotiating, to financing, to escrow and closing - in detail. STEP 2:  MORTGAGE PRE-APPROVAL It's smart to ask your lender to pre-approve, rather than pre-qualify, you for a mortgage. Pre-qualification only tells how much you can afford. Pre-approval goes a step further. Your lender will thoroughly evaluate your application - including verifying employment information and financial disposition - then clear you for a loan of a determined amount. Having your loan pre-approved gives you a sizable advantage:  Your new status as a cash buyer makes you more attractive to the seller. Once you learn how much of a home you can afford, stay within your budget. Just because you've been approved for a certain amount, doesn't mean you'll feel comfortable with monthly payments at the high end of the range. Ask yourself if you can live with these payments. Do they fit your established budget? If not, rethink your spending limit. Your new home should give you great pleasure, not hold you hostage. Once you relay your price range to us, we will arrange for you to view properties within that range only. By restricting yourself, you'll avoid disappointment later on. STEP 3:  PREVIEW HOMES FOR SALE During the home search think with your head, not your heart. Curb appeal can be a powerful force. It's the buyer's kryptonite. By disengaging the mental faculties, it leaves you the home buyer emotionally vulnerable. To counter its effect, you must be objective. Brutally objective! Look at many homes, including an assortment of types of homes. When you view a property, list the positives and the negatives. Make certain your furniture will comfortably fit into the space. Recruit a friend or family member to view the home and provide you with objective feedback. STEP 4:  UNDERSTAND THE FINANCING Here's where it helps to be a quick study. Home buyers have to contend with an assortment of mortgage types and the associated jargon. As your real estate agent, we can be a great resource. Get every detail in writing, in particular, the lock-in rate, points and fees. And request a copy for your file. You should also request an estimate of your closing costs. Inquire about prepayment penalties and avoid them whenever possible. You can save a good deal of money. Before you get to the table, read all the documents related to the purchase of the property. As your Buyers Agent we interpret them for you and provide you with feedback. You are signing a binding, legal document. Make certain you understand the conditions of the loan. STEP 5:  PLAN THE APPROACH Negotiating the purchase agreement is part of every transaction. Preparation lets you negotiate the best price and terms obtainable. We at Vermace Realty have the experience to help you develop negotiating strategies and techniques to plan the approach to be taken. STEP 6:  MAKE THE OFFER You have previewed quite a few homes. Now, you have found one that meets your needs and you are ready to make an offer that your Vermace Realty Agent will present to the owner's representative. You will be expected to submit a check, usually $1,000 as earnest money at this time. The owner, in turn, may accept, reject, or make a counter-offer. Because counter-offers are common (any change in an offer can be considered a counter-offer) it is important for buyers to remain in close contact with your Vermace Realty Agent during the negotiation process so that any and all proposed changes can be reviewed quickly. STEP 7:  HOME INSPECTION AND REPAIR RESOLUTION As a buyer in Iowa, you are responsible for hiring and paying for a home inspector. The home inspection should be ordered shortly after the purchase agreement has been signed by both buyers and sellers. A number of inspections are common in Iowa residential realty transactions. They include inspection for termites, wood-boring insects, a radon inspection, mechanical and structural inspection. During these examinations, an inspector comes to the property to determine if there are material physical defects and whether expensive repairs and replacements are likely to be required in the next few years. Such inspections for a single-family home often require two or three hours, and buyers should attend. This is an opportunity to examine the property's mechanics and structure, ask questions and learn far more about the property than is possible with an informal walk-through. Any home inspection issues should be addressed immediately after inspection results are received. STEP 8:  APPRAISAL As a part of the loan approval process your lender will require that the property be appraised to ensure that the value of the property is adequate to justify the loan. Although the buyer and seller have already agreed on a price, the appraiser's evaluation must support that price. If the appraisal is not adequate, the contract must be renegotiated. STEP 9:  LOAN APPROVAL When the appraisal has been satisfactorily completed and the lender has verified the buyer's income, credit, etc., the loan can then be approved. Both listing and selling agents will work to ensure that all necessary steps are taken to get to the point. STEP 10:  CLOSING ATTORNEY When the loan is approved an attorney specializing in real estate must be selected to prepare for and conduct the closing. The buyer's lender usually makes the selection. Among other things, the attorney will check title to the property, prepare necessary paperwork and handle the receipt and distribution of all monies in the transaction. The attorney will represent the lender in the transaction, not the buyer or seller. The attorney must be approved  by the lender. Buyers and/or sellers may hire attorneys to represent them. While this is rarely done, it might be advisable in special circumstances. STEP 11:  HOMEOWNER'S INSURANCE Prior to closing, your lender will require you to arrange for a home owner's insurance policy covering the property.  STEP 12:  UTILITIES TRANSFER Prior to closing both buyers and sellers must arrange to have the utilities transferred from one to the other. To accomplish this a date (usually the possession/closing date) will be agreed upon for the transfer. The seller notifies the utility companies to cancel their service on that day. The buyers make application with the various utilities and ask that their service be established on that same day. It is important that these dates coincide to avoid a lapse in service. STEP 13:  THE WALK-THROUGH Coordinated through your Vermace Realty Buyer's Agent, the walk-through inspection is performed the day of closing. The walk-through of the home you're about to close on lets you re-confirm the condition of the home before the closing takes place. STEP 14:  THE CLOSING After the loan is approved the closing attorney will prepare the necessary documents to finalize the sale. A time will be scheduled for the buyers, sellers and their respective agents to meet to "close" the transaction. At this meeting all of the paperwork will be reviewed and signed, title to the property will be transferred from the sellers to the buyers, the buyers receive the keys and the sellers receive payment for the home.

Please remember to use us, your Buyers Agent as a resource. We can clarify any issues for you, will educate and guide your through the home buying process, and will protect your interests every step of the way. Best of all you don't have to pay us a commission!

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