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Dec. 17, 2007
Categorized in: House Hunting
So you are ready to make an offer on a Carlsbad home (or elsewhere).
Are you new at this? Or do you already know the drill?
Heere are some thoughts on what to expect (keep in mind the process may vary a little bit in different states - but this is how we do it in California).
First, decide on an offer price, perhaps the most important thing you need to do...read more on making an offer here.
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Start your CARLSBAD HOMES SEARCH here (and other San Diego communities)
Download FREE BUYER AND SELLER REPORTS here
Visit CARLSBAD COMMUNITY REPORTS for profiles on communities, subdivisions and neighborhoods (including other areas)
Are you a first time home buyer. Check out First Time Buyer Central.
Nov. 21, 2007
Categorized in: House Hunting
 Another commonly asked question about short sales (and it's a relevant question for any buyer trying to purchase a home) is the following:
I OWN ANOTHER HOME I NEED TO SELL - CAN I MAKE AN OFFER ON A SHORT SALE?
The short answer (sorry about the pun) is YES. Certainly you can make an offer any time you want.
But the more important question is whether this is a prudent thing to do.
Many sellers in this slower market with lots of inventory will accept an offer contingent on the buyer selling their current home. Not all, but some. Certainly more than in a seller's market. And there will likely be a 48-hour or 72-hour first right of refusal clause in case another buyer comes along with an offer, and you will have that time frame to remove your contingency or withdraw your offer.
A short sale is different, since you are dealing with the bank. The bank wants the best offer, and the cleanest one, i.e., with a minimum of contingencies., so they can sell the property, minimize their financial loss, and get the property off their books Thus, if you are trying to acquire a short sale and really want o be effective in doing so, chances are a contingency offer will NOT be viewed as a competitive one. Remember, the banks know what is going on in the market, too. My feeling is that it is a waste of time.
But if the short sale is languishing on the market and there are no offer, you might give it a try. Just don't be surprised if the bank does not accept it, and they might not even respond. Talk with your agent, and really think seriously about what you are trying to accomplish.
Previous Questions and Answers on Short Sales:
Who Pays the Taxes and Penalties?
Who Pays the HOA Fees?
Who Pays the Commissions?
HAPPY THANKSGIVING!!
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Start your CARLSBAD HOMES SEARCH here (and other San Diego communities)
Download FREE BUYER AND SELLER REPORTS here
Visit CARLSBAD COMMUNITY REPORTS for profiles on communities, subdivisions and neighborhoods (incouding other areas)
May. 31, 2007
You've received your first offer on your home (woo hoo!!) and now you need to respond to the buyers. What are you going to do?
I won't tell you what to do since each situation is unique, as is each offer, so you need to ponder the points in the offer that are most important to you. What is acceptable? What is not? Is there a way to find a common ground on which to agree?
Here in California there is a form (Counter Offer No. ___, or C.A.R. Form CO) used to communicate a counter offer. There may be one in your state, too, or it might be done verbally, as it often was in MA. If there is no form or requirement to put it in writing, putting YOUR response to the buyer in writing is smart, even if you make a copy of the offer, make the changes and use that.
Here is what you can do:
1. You can accept the offer as it is (in a sellers market you might get a full price or better offer; in today's market this is unlikely). But the offer MIGHT be good enough for you to accept ALL the terms and condition.
2. You can accept some of the terms and conditions, but not all, and so you make a counter offer with the terms YOU are proposing (say a different price). I generally advocate making a counter, even if the offer is so low it is laughable. Who knows what the buyer's might do?
3. You may reject the offer. Some people just don't respond, as the offer expires after a certain time (either set by the buyer or by default - in CA it is 3 days). Personally, I think this is just plain rude - the buyers made their offer in writing, even though it might be ridiculous, and they deserve a response. I recommend you put your rejection in writing - the bottom of Page 8 of the CA form allows you to do this.
The process of responding is pretty easy. Just make sure you are clear as to what terms and conditions have changed. But you will find, as first time sellers, that making the decision of HOW to respond is not so easy. Just another reminder - DON'T TAKE IT PERSONALLY.
Your agent will provide the counter offer in writing to the buyers' agent. The buyers can then respond to YOUR COUNTER, with the same choices that you had. The process continues until there is a meeting of the minds and everyone agrees on final offer terms and signs the contract. [I have seen some negotiations over in a few hours, or less. Others can take days or even a couple of weeks.]
Congratulations!
FIRST TIME HOME SELLER SERIES:
Article 7 First Time Home Sellers – It’s Offer Time
Article 6 First Time Home Sellers – Make Yourself Scarce
Article 5 First Time Home Sellers - Showings
Article 4 First Time Home Sellers – The Fun Begins
Article 3 First Time Home Sellers – Don’t Forget These Questions
Article 2 First Time Home Sellers – The Agent Interview
Article 1 First Time Home Sellers – Getting Started
May. 30, 2007
 Great news! Your REALTOR called to tell you that an offer has come in and needs to be presented to you.
Some Listing agents will do this in person, others may simply call you, email you the highlights (price, closing date, down payment, etc.) or fax you a copy of the offer. However it happens (and don't be afraid to let YOUR agent know how you would prefer the discussion to occur), you should be pleased to have your first offer, especially if the property has been out there a while or you have timing issues with a relocation.
What next? Well, the agent will review the offer with you and you must make a response (this might be done verbally but oftentimes the response is written).
Let me caution you on a few things (I will assume you are in the market most folks are...a buyer's market):
1. Be prepared that the offer will NOT be full price and may be a lot lower than you would like or would be able to accept.
2. Be pleased to have an offer and prepare to discuss the terms and conditions that have been outlined (price, closing date, financing, any concessions, dates)
3. Keep your emotions in check. It is NOT the time to get angry, depressed, or insulted. The buyers have made you a proposal and you get to decide how to respond. You need to be objective and focus on the ISSUES not the EMOTIONS (remember how YOU felt as a buyer submitting YOUR offer, and how you hoped to get a response?)
4. Consider the issues that are most important. Is it price? The date of closing? Are there things you can accept if other concessions are made?
5. I would NOT reject the offer, even if it is low. Make a counter, even at or close to full price. You never know what the buyers might do. And don't be discourteous like some sellers and not respond at all (remember being a buyer yourself?)
6. Some sellers decide to wait and see if they get a better offer. Well....could happen, but so many times the first offer IS the best. And the longer the property sits on the market the more likely any other offers will be lower.
You probably have time to consider the terms and decide how you want to respond (check the date of the offer expiration so you don't miss this). The buyers will likely appreciate a response fairly quickly. Dawdling over it does not do anyone any good. It's YOUR decision but discuss this with your agent. Keep in mind that you and the buyers want to meet on happy grounds...there is no winner or loser.
Next step? The response.
FIRST TIME SELLER SERIES
Jan. 10, 2007
Categorized in: House Hunting
I thought it might be useful to provide a summary of the home buying process here in California (some of the general activities will be similar in other states, but check with your agent on the specifics). I've talked about most of these issues at one time or another so this is really an overview/summary.
PRE-APPROVAL
- Done BEFORE you start looking so you know your budget
- NOT just pre-qualification - this really has no value to you
- Lender will review income, assets, debt and credit scores to determine how much you can borrow
- Review types of programs, rates, etc.
HOME SEARCH
- Identifying WHAT you want and need
- Searching in your price range on the Internet, attending Open Houses, driving around neighborhoods
- Select your REALTOR
- Tours with your REALTOR (house hunting trips if you are out of state)
- THE DECISION
MAKING AN OFFER
- Offer to Purchase in CA is 10 pages and includes a Buyer Advisory - verbal offer is meaningless
- Accompanied by a deposit ( talk with your agent about amount) - often up to 3%; goes to Escrow once agreement is reached
- Offer present to listing agent; sellers review and respond
- Any counter offers must be in writing; finals signed copies of agreement and counters provided to all parties
CONTINGENCY PERIOD
- Deadline date agreed on by buyer and seller
- Receive, review, approve and sign all disclosures; check on insurability; approve Preliminary Title Report
- Conduct home inspection (and any other desired inspections), request any repairs, if applicable, and resolve with seller
- Apply for loan; appraisal done by licensed appraiser; loan commitment issued
- All contingencies must be removed by due date unless extension agreed on in writing
PREPARING FOR CLOSING
- Make plans to move (obtain estimates); pack
- Set up utilities in new home; arrange to stop utilities in current home
- Provide any final documents to Escrow Company
- Arrange wiring of any funds to escrow
- Set-up and complete final walk-through before closing
- meet with escrow to sign all documents (or if remote, meet with their representative)
- Once everything received and approved by escrow. transfer of property is complete and docs will be recorded
- CONGRATULATIONS ON YOUR NEW HOME - BUY A BOTTLE OF CHAMPAGNE AND CELEBRATE!
Dec. 24, 2006
.gif) Part 4 of this series on "What Does a REALTOR do in a Sale" focuses on activities once an offer is obtained. If you missed any of the earlier posts, you can read them here (Part 1, Part 2, and Part 3).
The Offer and Contract
- Receive and review all offers submitted by buyers or buyer's agents; make sure all information is submitted, including pre-approval letter and copy of deposit check
- Present all offers to seller as soon as possible, preferably face-to-face; provide written copy to seller for review (some buyer agents may request permission to present the offers themselves to the listing agent and sellers).
- Counsel seller on offers and answer all questions. Discuss merits and weaknesses of each offer
- Review buyer's qualifications and discuss offer with buyer's agent
- Negotiate offers on seller's behalf
- With sellers, prepare and convey any counteroffers, acceptance or amendments to buyer's agent(s)
- Ensure necessary paperwork flow between sellers and buyers regarding offer, counteroffers, etc.
- Once offer has been accepted and signed by seller, deliver signed offer to buyer's agent and provide copy to office file
- Record and promptly deposit buyer's earnest money in escrow account (process varies by state)
- If property will continue to be shown determine "Under-Contract Showing Restrictions" (depending on seller’s request)
- Cancel planned public and broker open houses if applicable
- Advise seller in handling any additional offers to purchase that may be submitted between contract and closing
- Change status in MLS to reflect being under contract
Since the process of making and finalizing offers may vary quite a bit from state to state, there may be many other activities that your REALTOR will engage in during this phase. If there are any questions, please feel free to let me know.
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