The process of buying a home begins with the establishment of a trusting relationship between Buyer and Agent. Before any real estate transaction can be commenced, you will be provided with The State of New Jersey Statement on Real Estate Relationships. It is so important to know your relationship to an agent, that the State of New Jersey made it a law. Please take a moment and read the statements in this section on the Buyer’s Agreement, it will play a major role in the progression of closing the real estate transaction. In some cases, Agents’ duty changes when there is a dual agency agreement option. Dual agency occurs when a buyer client is shown a seller client’s home listed by the same real estate company that the buyer client is working with. The dual agency may also occur if two salespeople from the same firm obtain offers to purchase the same property, even if that property is listed by a firm other than The Van Dyk Group.
The Agency Agreement
There are many different ways of searching for real estate that is being offered for sale. Most of you have already searched this website and/or the online real estate sites and have properties in mind. Some questions to ask yourself include basic information like how many bedrooms and baths will meet your needs, what location is most desirable, and what price point is within your comfort level of home buying on Long Beach Island. As a member of the Ocean County Board of Realtors, I am a member of The Jersey Shore Multiple Listing Service, I have access to all the listed properties you are seeing online. If you see a home for sale sign in a front yard, I will be able to locate the property within the MLS and schedule our appointments. Scheduling appointments to show you homes has become easy with the incorporating of central reservation programs like Showingtime. Working together, you pick the home and I’ll schedule the appointments.
Once you decide you would like to purchase a home, we will need to decide to use an “Offer to Purchase” or complete an “Agreement to Purchase Contract”. You must make a determination as to what price you are willing to pay for a property. The Offer to Purchase is a one-page document that basically outlines the terms of the sales. It defines the parties, states the offer price with payment terms, and any other contingencies related to the purchase. Some buyers like the simple format of the Offer to Purchase and know that if the offer is accepted the next step is to enter into the Agreement to Purchase Contract. Other buyers are comfortable with entering into a formal Agreement to Purchase Contract because it provides the seller with detailed provisions and contingencies to the sale. The Agreement to Purchase Contract
Before searching for a home, it is important to establish the qualifications for the financial ability to make a purchase. Local lending institutions will be able to provide a pre-qualification letter that will be used to verify funds will be available. Sellers want to know you have the financial stability to purchase their property before scheduling a showing. If you plan to pay cash to purchase your home, verification of funds will be required in the form of a letter from your banking institution, and/or in some cases, your attorney can draw an affidavit maintaining the privacy of your financial portfolio.
Once the method of payment is determined it is time to provide the documentation necessary to close the loan. The mortgage process is not very complicated. Buyers meet with a mortgage representative or a loan officer to commence the application process. Each lender has different requirements to close a loan. Depending on the type of loan you apply for will determine the documents you will be responsible to submit for the mortgage underwriter to review and make their determination of creditworthiness. Generally be prepared to submit credit report (if not previously completed) two years of tax returns, appraisal report, current paycheck stubs, deposit monies to be held in escrow, home inspection reports, pest inspection, flood certificates, and surveys. Underwriters may require other documentation as deemed necessary to be in compliance with mortgages.
The Mortgage Contingency
Financing The Purchase
Home Inspection
Once an offer to purchase has been accepted, the purchase agreement will specify the terms of the home inspection. The use of a qualified home inspector is very much an expense that is well worth the money. As with most real estate professionals, there are many to choose from. The inspector should be a certified expert with knowledge of local building codes. The inspection is generally attended by the buyer and the buyer’s agent. Both the structural and mechanical systems of the house will be inspected in detail. The inspector will provide some information at the time of the inspection but will prepare a detailed report stating all the facts. In accordance with the terms of your agreement, you will have options available for remedy.
Mortgage companies require buyers to purchase a homeowner’s insurance policy. Generally, this policy should cover the home for damages resulting from natural events and personal liability. Loss of rental income is a feature of your homeowner insurance that should be researched when comparing different policy coverages, along with coverage for liability for tenants. It is very important to ask your insurance agent if the standard liability covers tenants and if you need to add it. Another item to seek clarification on its replacement value in the event of destruction compared to the actual cash value.
Traditionally, flood insurance is underwritten through the government’s National Flood Program. In recent years, some companies are now offering flood insurance through private underwriters. This provides many homeowners with options to shop out the flood insurance.
Title Insurance
Legal Services are always recommended to secure the interests of sellers and/or buyers are represented. Your lawyer will review the contract for completeness, make changes to the purchase agreement to confirm your interests are protected, prepare any legal closing documents that are required to transfer title, and in some cases complete the actual closing. Choosing an attorney will depend on individual preferences. Some clients have long-standing relationships with their legal professionals and some clients choose to utilize the services of a local law firm to represent their interests. The State of New Jersey requires every real estate contract include a three-day attorney review period.
Survey
Flood Elevation
