1. Why Use an @properties Agent
For most buyers, a real estate professional is an indispensable partner in the home-buying process. While buyers today are more educated about real estate than ever before, all the research in the world can’t match an experienced agent’s “in-the-trenches” understanding of what’s happening in the market today. Without the pavement-pounding and advance scouting an agent does on your behalf, you might wind up overpaying for a home or losing out on the home of your dreams.
Also, unlike a parent, spouse, partner or best friend, an agent can give you a completely objective and professional opinion of the properties you are considering. If nothing else, keep in mind that a buyers’ agent is typically compensated by the seller. You have nothing to lose and everything to gain by tapping the expertise of an agent.
2. Getting Pre-Approved
Once you've selected your agent, the next step is to get a financing pre-approval. In today’s home-buying environment, a mortgage pre-approval is not only essential; it is also incredibly easy to obtain – whether online, over the phone or in-person.
A mortgage pre-approval lets you know exactly what you can afford to buy. It also demonstrates to a seller that you are a willing and able buyer. And it gives you a head start in getting an actual loan commitment.
Use an online mortgage calculator to get a sense of your buying power and monthly mortgage payments. As a general rule, most experts say that your housing expenses should not exceed 28 percent of your gross monthly income, but a variety of factors – from your credit score to other debt – can open this ratio up to a pretty wide range.
Remember that there are other costs involved in buying a home, such as moving, decorating and remodeling expenses. You should also consult with your accountant or financial advisor to talk about how real estate affects your financial goals. Knowing where you will come out of the transaction will give you a lot more confidence going in.
3. Selecting a Home
Once you know approximately how much you can afford, it's time to make a house wish list. Almost every home purchase involves some degree of compromise, which is why it is important to prioritize your wants and needs before you begin your search. There are many variables to think about depending on your lifestyle, budget and future plans, but some universal considerations include:
LOCATION - Chicago offers many great neighborhoods, each with its own character. Consider the factors that are important to you, such as schools; transportation; and neighborhood amenities like restaurants, shops and parks.
TYPE OF HOME - A great diversity of housing exists within the city: single-family homes, condos, lofts, town homes, two-flats, new-construction, high-rises, vintage homes, re-sales and fixer-uppers. You probably have a preference for a certain style of construction. Weigh the pros and cons to narrow your focus.
FEATURES & AMENITIES - Garage parking, hardwood floors, a fireplace, outdoor space, a doorman. In the end, these are the kinds of details that drive the decision to purchase one home versus another. In creating this list, some things to consider are resale value, your daily routine, and the cost of making changes or additions down the road.
4. Finding Your Home
Once you have obtained a mortgage pre-approval and selected a real estate agent, you are ready to begin your home search.
REVIEW LISTINGS - Using the guidelines you set forth, your agent will present you with available listings. In addition to price and property attributes, pay close attention to data like property taxes, market time and monthly assessments for condos and town homes.
VIEW PROPERTIES - Your @properties agent will schedule showings and accompany you on each appointment. When you walk through a home, some things to consider are: how the space functions for your lifestyle; what’s included in the total square footage (balcony, basement or garage); and, in new construction, which features are standard and which are upgrades.
OPEN HOUSES - Remember, if you are attending Open Houses without your agent, be sure to mention that you are being represented by an @properties agent. This will save you from being inundated with calls from other agents trying to represent you. Ask your @properties agent to supply you with some of his or her business cards to make the Open House sign-in process even easier.
COMPARE PROPERTIES - Discuss each home you see with your agent, and provide candid feedback. Your expectations and the marketplace will begin to converge, and your agent will be able to adjust certain parameters such as location and features in order to present you with alternatives. When you find a home and are ready to make an offer, your agent will perform a Comparative Market Analysis or CMA. This report compares the subject property with other properties that are currently listed and recently sold to help you formulate your offer.
5. Making An Offer
Chances are, when you find a home you absolutely love, someone else may love it too. So it’s important to act quickly and make an educated offer based on a rational approach to pricing and negotiating that you and your agent have discussed. To start the process rolling, your agent will draw up a contract that includes your offering price and other terms and contingencies. Buyers often focus on price, but there are other important terms to a real estate contract. You can include any terms you like, but the more you add, the more likely the seller is to object. Here are the most common elements of a real estate contract:
PRICE - The market will determine the final price, but your agent will help you formulate an offer based on comparable listings and sales, and current market conditions.
MORTGAGE CONTINGENCY - A mortgage contingency stipulates that you will buy the home subject to obtaining a mortgage. If you cannot obtain a mortgage, and the seller will not agree to finance the sale, then the contract will be void. The terms of the mortgage must be stated in the contract, and you will also need to establish a timeframe for securing financing.
HOME INSPECTION CONTINGENCY - A thorough inspection of the property by a licensed home inspector protects you against structural or material problems that are not detectable in a casual walk-through. Home inspections are just as important in new construction as they are in resale. Obviously, buyers can’t inspect a home that isn’t built yet, but they can request an inspection prior to closing. In new construction, an inspector will make sure that all mechanical systems are working properly. They may also spot repairs that need to be added to the builder’s punch list (a list of items that need to be completed). The buyer, not the seller, is responsible for hiring and paying the inspector.
ATTORNEY APPROVAL - Attorney approval is generally a one-week period, in which your attorney can review the contract and suggest alterations. In most transactions, the seller is also represented by an attorney. Alterations will usually focus on the language of the contract in an attempt to protect you from any undue obligations. Your attorney will also add language to address points that were agreed to as part of the negotiation but that aren’t a part of a standard contract. Even if you are using a standard-form real estate contract, an attorney’s review is always highly recommended. It is also recommended that you use an attorney that specializes in real estate transactions. Something that is obvious to a real estate attorney might be overlooked by an attorney that isn’t familiar with real estate transactions or real estate contracts. Upon attorney review, if the contract is not acceptable to either party, both have the option to cancel. If the contract is acceptable, then the transaction moves forward.
EARNEST MONEY - Earnest money is a deposit, given by the buyer to the seller, which secures the contract until the closing. An initial deposit, usually in the form of a check, must be given to the seller or seller’s agent along with the contract, and the balance of the earnest money is usually due upon attorney approval. Earnest money is typically held in an escrow account until the closing, when it may be applied to the down payment and/or closing costs. If the sale does not go through due to contingencies covered within the contract, then the earnest money may be returned to the buyer. However, if a buyer is in breach of contract, then a seller may be entitled to keep all or a portion of the earnest money.
CLOSING DATE - One of the most important terms of a real estate contract is the closing date – the date when ownership changes hands. This is usually, but not always, the date that the seller must vacate and the buyer may occupy the property. Flexibility on the closing date can give a buyer a big advantage over other potential buyers. Occasionally, it can also allow you to negotiate a lower price or other, more favorable terms.
6. Negotiating Counter-offers
In many transactions, there is a fair amount of negotiation – offers and counteroffers – before both parties are satisfied. This is one aspect of a real estate transaction in which an agent is invaluable. Not only can an agent draw upon his or her experience and market knowledge to offer sound advice during a negotiation, but he or she can also serve as a buffer between the buyer and the seller/seller’s agent. Negotiating for a home can be a highly charged and emotional process. But the most emotional buyer will look like one cool customer behind the right agent, and in the end, you usually wind up with what’s important to you.
7. Contract to Close
In a real estate transaction, there are dozens of loose ends to tie up between signing the contract and closing the sale. I am known for my attention to detail during this important phase in which I coordinate and oversee the following steps:
• Deliver earnest money with the seller or seller’s agent.
• Recommend and schedule a home inspector and accompany the buyer on the inspection. It is always highly recommended that the buyer attend the inspection along with his or her @properties agent in order to make sure that any issues that come up are properly relayed to the buyer’s attorney
• Recommend real estate attorneys
• Obtain important documents, such as property disclosure forms and condominium documents (budget, declaration, rules & regulations, condo association minutes), and deliver them to the buyer and buyer’s attorney
• Recommend mortgage brokers and help expedite the loan-application process
• Monitor all contingencies to ensure that they have been met
• Recommend service providers for moving, home-improvement and repairs
• Schedule a final walk-through. Again, both buyer and buyer’s agent should be present
• Coordinate and attend your closing
As your agent, I will work closely with you, your lender, your attorney, and the seller’s agent to make sure everything is in place for a smooth and efficient closing.
Typically, a day or two prior to the closing, your lender will forward all loan documentation to the title company and let you know the amount required to close. You will be responsible for bringing the balance of your down payment and closing costs (such as lender fees, title company fees, and state and city transfer taxes) to the closing in the form of a cashier’s check or bank wire. At the closing, your attorney will guide you through the many documents you need to sign, including the bill of sale, the deed and the affidavit of title.
My goal is to provide you with the information you need to feel confident at your closing. If you have questions about your closing, contact me at any time. In addition, if you have an existing home to sell, I will customize a comprehensive marketing program to help you achieve the highest possible sales price in the shortest amount of time.
WHY CHOOSE @PROPERTIES? WE ARE A LOCAL LEADER
Since the company was founded in 2000, we've become the #1 real estate company in the city of Chicago, the 3rd largest real estate company in northern Illinois, and one of the 40 largest brokerage firms in America.
@properties has steadily increased our market shart every year we have been in business. And more market share means more exposure for your home - exposure through online marketing, signage, broker-to-broker marketing, advertising, e-mail promotions, direct mail and buzz marketing. More exposure means more page views, more phone calls and more showing requests, and that ultimately means shorter market times and higher overall selling prices. The proof is in the numbers. @properties not only works to build market share; we put market share to work for you.
A MARKET WITHIN A MARKET
@properties not only markets your home through universal channels such as the internet, print advertising and the Multipple Listing Service and signage. We also market internally to our highly collaborative sales force of more than 1,000 agents - each with a broad sphere of influence that forms a rich source of prospects, buyers and referrals. This "market within a market" results in the most efficient transaction environment in Chicago real estate. In fact, more than a third of @properties-brokered transactions occur between an @properties buyer and an @properties represented seller, an unusually high ratio of intra-office sales and a testament to the power of the @properties network.
• Chicago area Multiple Listing Service (MLS)