Home Buying Process - Franklin TN Real Estate
There are various online resources available to search homes for sale. As a Realtor, I have access to detailed information that might not be included on public home search websites. Additionally, I can set up a custom property search for you based on your specific needs. Perhaps you would like a house with a main level master bedroom, a bonus room or you need to be in a certain school zone. I can email you listings that satisfy these specific criteria. This will help you avoid sorting through bunches of listings that don't meet your needs. Also, mapping resources can show you where your target properties are located and save you time and gas money.
I recommend that you get pre-qualified for a mortgage loan early in your search. It's good to know exactly what you can afford before you actually view homes. You might want to talk to a few different local mortgage providers. Some companies have different products and might enable them to offer you a lower rate. I can suggest a few trusted loan officers who I have worked with. Please call me for more information!
Making an Offer
Once you find the right home you will need to make a written offer. Verbal agreements are not binding and might not be taken seriously. The standard Tennessee real estate purchase agreement includes many parts to help protect the buyer. There are several subject to clauses or contingencies. The most common contingencies include financing, appraisal, and inspection.
INSPECTION: I always recommend that you get a home inspection by a certified inspector. No matter how new or old a home is, there are lots of mechanical and structural parts that need to be checked. The inspection looks beyond physical appearances. The inspector will go in the attic, crawl under the house and look at visible electrical plumbing and structural components. In some cases, the inspector will recommend further investigation by a specialist such as a plumber, electrician or structural engineer. I have had a few occasions where a buyer decided not to buy a house because of details that the inspector found. That is why this paragraph is included in the contract- to help protect you! I just want to be sure that you are aware of the condition of the house. There is also an opportunity to ask the owner to make repairs based on the inspection report. The buyer must pay for the home inspection. Cost for a general home inspection usually starts around $250 to $300 for a small home. Costs vary based on the size of the house, the age of the home, the location and the services performed. The buyer or the buyer's agent will schedule the inspection.
APPRAISAL: This clause requires that the appraised value of the home must be greater than or equal to the purchase price. This helps to prevent you from paying too much. It is in the agreement to protect you and the lender. Anytime you get a loan for a house, the lender will require an appraisal. The lender will hire the appraiser but the cost is passed onto the buyer on the closing statement.
FINANCING: This clause will generally allow you to get out of a contract in the event that you cannot get financing for the purchase. It also spells out the time frame in which the buyer must apply for a loan.
SALE OF HOME: If you need to sell your current home before you buy another you will need to have a sale of home contingency in the agreement. Depending on the market, Sellers may be accepting of this clause. If homes are selling quickly, owners might not be willing to accept a sale contingency.
TITLE INSURANCE: Title insurance protects you in case there are any overlooked blemishes on the title to the property. The title company will perform a title search before closing. All mortgages and liens on the property should be paid off at or before closing and you will be assured clear title to the property. Title insurance costs can be the responsibility of the buyer or seller depending on language in the purchase agreement. Typical practices vary by county.
The purchase agreement specifies various terms of the sale including the price, the closing date and possession date, time for inspections and items that will remain in the house. In our area, the oven/stove, dishwasher, and built in appliances are typically included with the property. The washer, dryer and refrigerator are not automatically included. The contract should spell out which appliances stay and which do not. If there's something you specially want to be included, ask for it.
It's not uncommon for real estate negotiations to go back and forth a few times. This is where having representation by an experienced agent can really make things easier for you. I deal with these details weekly and am familiar with typical practices in this area.
Before making an offer, you need to know how much money you have to put down on the purchase. There are two kinds of up front money: closing costs and down payment. The closing costs include the loan processing fees, various taxes and recording fees associated with the purchase. Closing costs are not applied to the purchase price. They are over and above the purchase price of the home. Closing costs are paid at closing and are included on the closing statement. Closing costs are typically estimated at 3% of the price of the home. The purchase contract can require for the home seller to cover all or part of the buyers closing costs. However, keep in mind that this is effectively just allowing you to finance the closing costs and the home still has to appraise for at least the purchase price. Your down payment on the home is applied toward the purchase price. Discussions with your lender will let you know if you can qualify for 100% financing. In some cases, little or no down payment is required. However, it is easier to get financing and you may get a better rate if you have some down payment.
EARNEST MONEY: Earnest money is usually expected by the Seller. Earnest money shows the Seller that you honestly intend to purchase the home. The exact amount of the earnest money expected varies depending on the area and the price of the home. The earnest money you submit with an offer to purchase a property will be credited toward your down payment at closing.
Home Owners Insurance
Before closing on your new home, you will need to set up home owners insurance. This will be required by the lender before the home is officially yours.
Call to arrange to have utilities turned on before you move in. Some utility providers will require a deposit if you have not had service with them before. Other utility companies might run a credit check or require a letter of credit from a previous provider. If you can arrange to have utilities put in your name when the previous owner has them disconnected, you might save a reconnect fee.
A day or so before closing the title company will prepare a closing statement or HUD-1 document. This closing statement has all the charges and credits associated with the sale and purchase of the property. It will show the amount the buyer needs to bring to closing to purchase the property. Funds required at closing must be in the form of a cashier's check or money order. The title company cannot accept funds by personal check. The title company or the Buyer's agent can get this amount before closing.
Search Nashville and Franklin TN area Real Estate www.TiffanyWhite.com. Call Tiffany White at 615-260-5858 for assistance with all your home buying and selling needs!