Information for Home Buyers - Page 2
Viewing Houses
If you have young children I recommend you find a baby sitter instead of taking them along. You are
making the decision on the house, not them. You need to be able to give these houses your
complete attention to see if they meet your needs. It may sound like a good idea to let the kids see
the houses too but most likely they will become bored or tired after a couple and be more of a
hindrance than a help. This is a major purchase and you do not want to pass up a great home
because the kids are fussy.
The seller has to fill out a Residential Real Property Disclosure Report that lists any known defects
to the property such as the basement flooding, leaky roof, termites, and other problems. Check the
report to make sure there are no problems that would cause you to reject this house or offer too
much money.
The Offer Process
When you find the house that you want as your next home it is time to make an offer.
As a buyer here are a few things to remember:
The offer is written on a Residential Sales Contract. This contract contains:
Your REALTOR® will help you complete the Residential Sales Contract and then deliver it to the
seller's agent. Your REALTOR® may even be allowed to be present when the seller's agent reviews
the offer with the seller. Don't get discouraged if the first offer is rejected or the seller makes a
counteroffer. Normally there is an offer and a string of counteroffers to work out any details.
You may want to hire a real estate attorney at the point you are ready to make an offer. Your
REALTOR® can help you fill out the Residential Sales Contract but cannot interpret the legal terms
used in it for you. A REALTOR® is not licensed to practice law and can only help you fill in the blanks
on the form. You will need an attorney for the title search, clear any liens or other problems with the
title, evaluate all legal documents such as the deed, and explain the different ways you can take title
to the house. Since you will be hiring an attorney anyway you might as well get one involved now in
you have any legal questions.
Eventually you may make an offer the seller likes and accepts. There is still a lot of work to be done.
The first thing you need to do is schedule the home inspections and tests as soon as possible. Next
schedule an appointment with your lender and get all paperwork gathered. You will take a copy of the
Residential Sales Contract signed by both you and the seller, a copy of the house listing sheet and
taxes, and anything else the lender may also ask you to provide.
Assuming the home inspection comes back without any major problems and all other contingencies
are met then you can proceed with the purchase of your new home. You still will need to do one final
inspection of the house before the closing. This is called the final walk-through and is usually
scheduled a day or two before closing but can take place anytime before closing. The purpose of the
walk-through is make sure any requested repairs have been made, all fixtures are still in the house,
and any personal property such as a refrigerator that was to stay with the house is still there. Most
houses will be fine but sometimes a seller may try to take some drapes or replace a refrigerator with
a cheaper model. If the seller has already moved out and shut off the power you may find frozen
pipes or other damage. If you don't catch it before closing you may be in for a long battle that you
could end up losing. I recommend doing the final walk-through the day before the closing and if you
have any concerns go back in an hour before closing.
If you have young children I recommend you find a baby sitter instead of taking them along. You are
making the decision on the house, not them. You need to be able to give these houses your
complete attention to see if they meet your needs. It may sound like a good idea to let the kids see
the houses too but most likely they will become bored or tired after a couple and be more of a
hindrance than a help. This is a major purchase and you do not want to pass up a great home
because the kids are fussy.
The seller has to fill out a Residential Real Property Disclosure Report that lists any known defects
to the property such as the basement flooding, leaky roof, termites, and other problems. Check the
report to make sure there are no problems that would cause you to reject this house or offer too
much money.
The Offer Process
When you find the house that you want as your next home it is time to make an offer.
As a buyer here are a few things to remember:
- Your REALTOR® works for you. Let him/her help you write up the offer and present it to the
seller. You make the decision and your REALTOR® communicates it to the seller's agent.
You should not be speaking directly with sellers or their agents. This is your Realtor's job. - Make a reasonable offer. Your REALTOR® can run comparisons of similar homes that have
sold recently or are on the market. You want to make a competitive offer to minimize
counteroffers and also let the seller know you are serious about his house. The seller can
decline any offer and making them mad by offering a price much lower than the listing price
is not a good way to start negotiations. The seller does not have to accept the highest offer or
make you a counteroffer so if they think you are trouble you may be out of luck. - Include everything you want in your first offer. If you plan to have a home inspection, require
repairs, or want an appliance left with the house make sure it is in your first offer. Once the
offer is accepted you probably won't be able to get anything added. The seller should list any
fixtures they plan to take with them like a chandelier or stained glass window but if it is
something you definitely want and is not listed then include it in your offer to avoid problems. - You will probably view the house with just your REALTOR® present unless it is an open
house. If others are present keep your personal opinions to yourself until you can discuss
them in private. You don't want to get in a bidding war with another buyer.
The offer is written on a Residential Sales Contract. This contract contains:
- the street address, the legal description, and the tax identification number of the property,
- the date and time that your offer must be accepted or withdrawn,
- the amount you are offering for the property and the amount of the earnest money. The
earnest money is given to show your commitment to buying the house and is applied toward
the purchase price. It is deposited in the escrow account at the Listing Agent's company once
the offer has been accepted. Make sure you have the funds in your checking account to back
up this check! - an optional Financing Amendment that gives a date by when you will apply for a mortgage
loan. The Amendment can contain financing contingencies that say you must get a loan for a
certain amount of money at an interest rate of not more than a certain percent for at least a
minimum number of years, otherwise, the deal is off. This contingency basically says "I will
buy your house if and when I am approved for a mortgage loan that I like". - the date on or before that you want to close,
- the date you want to take possession and be able to move in,
- any items you want included in the sale of the house such as a washer and dryer. Your
lender may want an estimated value of these items so they are excluded from the amount of
the mortgage loan so pick wisely. If there is something that you definitely want to make sure
stays with the house then list it here. - whether you plan to have a professional perform a house inspection and make this offer
contingent on not finding any major problems. Normally you will want to schedule a
professional home inspector to check the house for any problems. This is optional but if the
inspection reveals any major defects in the structure, roof, plumbing, or the heating, cooling,
or electrical systems then you can ask for those things to be fixed, you could ask the seller to
reduce the price of the house by the cost to do the repairs after you buy it, or you could back
out of the deal. You pay for the home inspection and it can run $250-500 depending on the
size of the house. Additional tests such as testing for radon or termites cost extra. This
inspection is worth the money if serious problems are found. Also you can accompany the
home inspector and learn more about the house. - it acknowledges that you have seen the seller's disclosure form of any known problems and
if the house was built before 1978 that you have seen the lead paint disclosure form. - the name of the seller,
- and your name(s), current address, and signature(s).
Your REALTOR® will help you complete the Residential Sales Contract and then deliver it to the
seller's agent. Your REALTOR® may even be allowed to be present when the seller's agent reviews
the offer with the seller. Don't get discouraged if the first offer is rejected or the seller makes a
counteroffer. Normally there is an offer and a string of counteroffers to work out any details.
You may want to hire a real estate attorney at the point you are ready to make an offer. Your
REALTOR® can help you fill out the Residential Sales Contract but cannot interpret the legal terms
used in it for you. A REALTOR® is not licensed to practice law and can only help you fill in the blanks
on the form. You will need an attorney for the title search, clear any liens or other problems with the
title, evaluate all legal documents such as the deed, and explain the different ways you can take title
to the house. Since you will be hiring an attorney anyway you might as well get one involved now in
you have any legal questions.
Eventually you may make an offer the seller likes and accepts. There is still a lot of work to be done.
The first thing you need to do is schedule the home inspections and tests as soon as possible. Next
schedule an appointment with your lender and get all paperwork gathered. You will take a copy of the
Residential Sales Contract signed by both you and the seller, a copy of the house listing sheet and
taxes, and anything else the lender may also ask you to provide.
Assuming the home inspection comes back without any major problems and all other contingencies
are met then you can proceed with the purchase of your new home. You still will need to do one final
inspection of the house before the closing. This is called the final walk-through and is usually
scheduled a day or two before closing but can take place anytime before closing. The purpose of the
walk-through is make sure any requested repairs have been made, all fixtures are still in the house,
and any personal property such as a refrigerator that was to stay with the house is still there. Most
houses will be fine but sometimes a seller may try to take some drapes or replace a refrigerator with
a cheaper model. If the seller has already moved out and shut off the power you may find frozen
pipes or other damage. If you don't catch it before closing you may be in for a long battle that you
could end up losing. I recommend doing the final walk-through the day before the closing and if you
have any concerns go back in an hour before closing.
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BUYERS GUIDE
Sponsored by Dave McMillin, Jim Maloof/Realtor®, East Peoria, IL
Copyright© 2007-2008 Greater Peoria Homes
Copyright© 2007-2008 Greater Peoria Homes
Peoria Area Real Estate Buyers Guide: