Liz Nason, Sales Associate, Premier Sotheby's Realty  50 Central Avenue, Sarasota, FL 34236   cell (941) 350-2243

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WELCOME TO BASIC HOME BUYING 101

 

Explore the BASICS of buying property here in Sarasota, Florida. 

 

  1. KNOW WHAT YOU WANT TO SPEND:  Most people will need to borrow money to buy a house so go to the "Horse's Mouth" immediately and speak to a mortgage Broker or Banker to see what you realistically and comfortably afford.  There is NO point in looking for a $1,500,000 house if you can only afford $750,000.  Lenders will look at your credit history, your debts, your income and what you have in cash.  Debt-to-Income Ratio is taken very seriously by the lender: Your overall debt should not be more than 40% of your income, and your housing debt should not be more than 32%.  When you DO find out what you can afford, get a letter from the lender to submit when making an offer.

  2. LOOK FOR YOUR HOME: Write down your non-negotiables and your "would-be-nice-ifs."  It's a good guide but I've learned that sometimes Buyers may end up finding a home that is a far cry from what they started out looking for.  Get to know several areas of the town you want to live in, guide your Realtor by telling him or her what you like and what you don't.  The process of looking for a home takes some time and fine tuning!  It does occasionally happen, but don't expect to find a home the first time out and don't lose faith that you'll find "the One."  It'll happen and you'll know it within seconds you walk in the door.  I promise.

  3. MAKE AN OFFER: You've found a place you can see your self in finally so you need to make an offer.  The inventory is small and there are other Buyers looking for the same type of home.  GET THAT HOUSE OFF THE OPEN MARKET...NOW!  I call it "getting the ball away from the other kids on the playground" so that you won't lose your chance at it.  Your Realtor will immediately go back to his or her office and will put together a spread sheet to see what comparable homes have sold for.  From that information you will come up with a price to offer and terms, such as how much of a good faith deposit you are offering, the inspection period and when you're closing.  Typically, the offer goes back and forth at least twice to hammer out the details.

  4. INSPECT, INPECT, INSPECT: You will have a number of days to have access to the home with your inspectors (general contractors, plumbers, dock and seawall experts, etc.)  Most Buyers only have the home inspection with a Home Inspector which will cover the house in a general sense.  Personally, I like to get the inspector in there asap so that if there are issues that pop up at the inspection you have time to call in that electrician if the inspector mentioned that the electrical box in the garage has something wrong with it.  This is also your time to get estimates for any work that needs to be done to fix any of the issues that arise in inspections.  Sometimes a Seller will be obligated to pay up to an agreed amount on waranteed items (roof, a/c, etc.) if they aren't working properly but even in an As Is With Right to Inspect offer, the Buyer often asks for a credit or to have the item (s) fixes.  During this time you can also start applying for insurance (home, flood, wind/hurricane. In today's market, with very expensive insurance in Florida many people use the Insurance Addendum with the original offer which puts a limit to the insurance the new owner must pay.)

  5. MOVING FORWARD WITH THE SALE: You have decided to move forward to closing on the house after the inspections, you have already met with your mortgage person, filled out their application and they have ordered the appraisal.  While all this is going on, your insurance person is shopping policies, the title agent (closing agent/lawyer) is 'running a title search' to make sure that the homes has marketable title and is 'free of defects'; if there are any issues (building lien, open permits, etc.) the Seller has a chance to clear them up before closing.  The Realtors, the lender and the Closing agent's office are in constant contact to make sure that if there is anything that needs to be done by the Buyer or Seller, it's done. 

  6. APPROACHING THE CLOSING DATE: Within the week before closing, the Title Agent is working with both the lender and the Realtors to make sure everyone is ready to close.  By this time, the insurance policy should be ready to bind by the insurance broker.  Within 48-72 hours before a closing, a HUD Statement or Settlement Statement is generated; a sheet of checks, balances and proration's of all the monies coming and going for the deal.  It is sent out to the Realtors for confirmation and any corrections are made and confirmed.   By this point, all repairs have been done, if required, and the Buyer has set up their utilities to start on the date of closing.

  7. THE WALK THROUGH: The day before the closing both parties or their representatives literally walk through the home, confirming repairs were made if agreed upon and receipts for work done are given to the Buyers.  Sometimes the Buyer will pay for their inspector to come back to review any repairs that were required to be done by the Seller.  The walk through is sometimes quite a shock for the Buyer, to see the home 'naked' without any of the furnishings and all the walls bare.  Our contracts require the house to be left by the Seller in "Swept Out" condition but most owners end up professionally cleaning the homes.

  8. CLOSING: This is the day that the Buyer and Seller have been waiting for.  At this point, there should be no surprises and it's just a matter of the Closing Agent or their Paralegal to sit with the parties and coordinate the signing of a LOT of paperwork.  Once both parties have signed, each party will get their appropriate packet of papers; The Buyer will receive copies of what they signed as well as the keys, clickers and originals of the boundary survey.  They will get copies of the Title Policy from the Title Company in the mail some weeks later. The Seller will get a copy of what they signed and confirmation that their monies have been wired to their bank account.

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November 1, 2019

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