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Buying Video Series
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Home Buying Video Series
Sturm Properties Home Buying Video Series
Check out this Home Buying Video Series. This home buying video series will be a helpful, plain language resource videos for buying a home.
Financing Your Bonney Lake WA Home
This video goes over Home Buying Basics – Financing Your Home. Providing your lender with your financial information so you can obtain financing for your home.
When buying a home you really only have 2 options: 1. is to pay cash for the house or 2, you need to find financing for your home and that’s where our strategy session comes into place. So the very first part of that process is getting pre-approved. The pre-approval process typically takes about 24 hours depending on how long it takes you to gather your documents but what we do is we look at 3 main criteria during that phase. 1: Your credit, so we’re going to pull your credit we’re going to review your credit history and your credit score. 2: We are going to look at your income documentation we’re going to determine how much money you truly earn we’re going to evaluate how your paid and determine your qualifying income and we’re also going to look at your employment history.
Third we’re going to look at your assets how much money you have budgeted for a down payment and how much money you have leftover because the banks don’t like to see that you’re putting all your money towards your down payment and your closing costs so once you’re done with the pre-approval process you will then go and find a home and get your offer accepted and then come back into underwriting that’s why we do things a little bit different.
We have put together a pretty unique strategy in this market where we can have our clients fully underwritten upfront this allows you to negotiate more firmly and 2nd it gives you the upper hand with a Financing Contingency because we do that upfront and that gives you have more peace of mind. The good news is that you’ll be done with one of the toughest things will ever do in life and that’s getting underwritten for a home. Financing your home is one of the first steps.
Setting a Budget
How important is setting a budget? We help you determine not just how much you can afford to spend on a home, but more importantly how much you should spend. It all starts with setting a budget.
If you are like me, setting a budget can be painful, but trust me, it’s really important. I know from experience that it’s best to set a budget upfront before even looking at any homes. You may be pre-approved for $400,000 but only comfortable paying the monthly payments on the $350,000 mortgage. That’s fantastic. With a budget in place, you now have some parameters that will make looking at houses much more enjoyable and less stressful.
Let’s consider a Lease Option. It’s an option you’ll find with Sturm Property Group you will not find at most agencies is our Lease Option. that gives you the Option to Buy. To bridge the gap between renting and owning we have partnered with a company that will buy a qualified home for our clients then lease it back to them until they are ready to buy. In that first year, we will put you on a financial road map to strengthen your financial situation so you can either buy that home or any other home.
This program is great if you are new to the area and not sure where you want to buy, don’t have enough for a down payment or have challenges with your credit. But you need all the benefits of living in a home now. A lease option gives you that ability.
Once you meet with us to determine if this might be a good option for your situation, we will have you go online and apply on their secure website. All you need is a 550 credit score, be able to pass a normal background check and enough saved up to put a deposit down equal to 2 months’ rent. This deposit is fully refundable and is a good way to set aside a portion of your down payment when you do decide to buy that home or any other we find for you.
Finding a home
Once you’re approved we will refer back to our strategy session and select homes that best fit your needs and carefully review all homes before setting up showings so we do not waste your time looking at homes that will not work for you or the program.
At the end of the tour, we will decide which home to move forward with by having you complete a renovation checklist that addresses those issues and allows you to select your move-in date. Whatever date works best for you.
Securing the home
This is another way that we essentially turn you into a cash buyer. Once you approve the rental amount for the home through the company we will submit a cash offer to the seller with no contingencies other than a normal inspection. Once we come to terms you then submit your deposit. Then when we are past inspection there is not much that will get in the way of your move-in date.
When you move in date arrived you will see our smiling faces there to ensure everything is in line with the homes and then we will continue to be a resource for you throughout the term.
There is also a professional property management company that handles your rent payments and address any issues that come up with an online portal set up for you to easily communicate.
Private Bonney Lake WA Home Tours
Time to look at homes! Private home tours with an experienced local agent is best.
Touring homes is the fun part. We can select homes based on your criteria or you can send us the address or the M LS numbers and will get you a private home tour. Either call, text or email us, whatever works best for you. We want to be there for you as your agent we can get you into homes outside of open houses so you don’t have to limit yourself to only looking at properties at open houses. We do recommend you limit it to about 3 to 5 properties per day or else it’s really easy to get a mixed up. For our clients who are not local, we can Skype, Facetime or even shoot a video and send it via email or dropbox. A little tip is not to overlook homes with horrible listing photos. We’ve all seen them but it could be an opportunity for you as they could be a hidden gem that others will be overlooking.
Making an Offer
So now its time for making an offer. If you want the home, don’t hold back! Making an offer that is strong is key.
So making an offer on a home is really not as stressful as you might think and the reason why at least in our case. With the Sturm Property Group, we are really based on education. So in such a competitive market, we know what it’s going to take to get your offer accepted. We work as a team to figure out what the best terms need to be and work collaboratively with the other agent. We make the signing process easy using electronic signatures so we will write up the offer for you we will email it over for you to electronically sign you can do it right from your phone, iPad or your computer. Whatever is easiest for you. It’s really that simple. We pride ourselves on having a positive working relationship with the listing agent to ensure your offer is considered in the strongest light.
Let’s look at multiple offer situations. When a few buyers are making offers on the same house.
Pretty self-explanatory. It means there are multiple offers on the same home. Now in that situation that means that supply and demand are probably out of whack or the house that you’re making an offer on is a really good deal in that situation you’re trying to make your offer the strongest possible. So that means that you’re going to probably be removing as many contingencies from your offer as you can. We will be going over what those contingencies will be.
The escalation clause is a super easy to understand and similar to eBay. For a quick example let’s just say you’re making an offer on a house that’s priced at $500,000 you’re willing to pay up to $525,000 you’re just going to beat the next highest offer by say 5000 so if the next highest offer is $510,000 you’re only paying $5000 more than that so you’re only paying $515,000 for that home even though you said to the seller I’m willing to pay $525,000. Escalation clauses are great in that regard because you only pay a little bit more than the next highest offer. And just for your peace of mind, they have to show us what that competing offer is. Another big tip is don’t hold back when you’re making an offer, especially in a multiple offer situation bring as strong as an offer as you possibly can.
So what is Earnest Money? Earnest money is money that is provided with your offer that is held in a secure separate account until closing day.
Congratulations your offers accepted time to celebrate. Now it gets serious. You now are required to put your money where your mouth is. The next step to provide your earnest money to escrow within 2 business days of an offer. It’s generally between 2 and 3% of the purchase price. Keep in mind you’re not just giving this money away it does go toward the down payment and it’s going to come off your closing costs. We can ensure your earnest money is delivered safely and held in escrow so the seller can not touch it until closing.
Let’s talk about your home inspection in this Home Buying Basics video. With a home inspection this is your chance to ensure there are no hidden defects in the home.
A home inspection is when you hire an inspector and try to find all the underlying issues of the house. In a normal market, you generally have between 5 and 10 days after an offer is accepted to perform a home inspection. You generally have some negotiation power in terms of steps forward at that point. In a seller’s market, you’re going to want to do a pre-instruction. With a pre-inspection, you can decide to move forward or not and then you may be able to waive the home inspection contingency with your offer. They are usually half the cost of a full inspection but it’s worth the money because you never want to buy a property without getting it inspected first.
This video goes over what a home appraisal involves. Is the home worth what you are paying? This is how everyone finds out with a home appraisal.
One of the most important parts of an initial strategic planning meeting with a new client is discussing the home appraisal process what is an appraisal to get more information on the process. So what is an appraisal? It’s a neutral 3rd party’s opinion of value. It’s not a computer it’s a human being and that person has no ties to the real estate professional or mortgage company. It is there to protect you from and the lender to make sure that you’re not you are not overpaying for a home and the lender is not over-lending on the home.
The other thing to realize is that the home appraisal normally happens within the first 7 to 10 days after mutual acceptance so it happens rather quickly. In a competitive market, you need to be concerned with the home appraisal potentially coming in low. It usually doesn’t happen but you need to at least be aware of the fact that you’ve already waived your financing and your home appraisal contingency. If the home appraisal comes back under the purchase price you may have to renegotiate the price with the seller, back out and lose your earnest money or pay the difference. Rare but something to be aware of these days.
Time to get your keys and celebrate! It’s Closing Day!
The closing day is clearly the day that you get your keys. That’s a big deal unless it’s a competitive situation in your letting the seller rent back stay in the home for a while we will go over in person but most of the time you get your keys on the closing day. Now in a competitive situation in a competitive offer situation, we’re going to try and shorten this closing day as much as possible so if you’re fully underwritten for your loan already you can shorten that up from somewhere to 14 to maybe 21 days if you’re not fully underwritten or if it’s not a competitive situation this date is usually about 30 days after you get your offer accepted.
Now don’t get your closing day confused with your signing appointment. You’re signing appointment generally happens 1 to work days before closing. Usually will find out that it’s officially closed somewhere between 4:00 and 6:00 PM on your closing date and that’s when you get your keys!