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Matching Quality Properties with Quality Buyers
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A Different Agent
396 Washington St #181
Wellesley, MA 02481

Phone: 781-591-9902
Email: Ray@RayWatts.com

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Ray Watts

                                 BUYING PROCESS


    1.    Initial phase 

            The initial phase usually starts with a feeling of being discontent with the present home and a willingness to spend some time researching the possible remedies. This discontent must be sufficiently acute in order for any of the next phases to be entered, otherwise it is simply a curiosity and is limited to web searches or occasional Sunday open house outings. 

    2.    Getting serious

        The Initial phase is ended in frustration. Buyers are spending time and not finding the answers to their housing requirements and questions. The search for help may start with family or friends but  inevitably finds its way to financial officers and Realtors.  

    3.    Pro-active search process 

        We now have all the four requirements to start a realistic home search. Financing in place; List of "must haves"; Primary and secondary towns; and a time specific to move. Let's get started.

 At this point I always recommend that if you haven't done so, see all of the listings in your price range, regardless of description. This accomplishes two functions. First, you will either find your new home or eliminated what is now available. Second, it will let you know if the requirements you have are realistic. If you don't find a home and your requirements are realistic, then we wait for the right home to come on the market. 

        4.    Getting your offer accepted

            All phases of the process are important, but this phase is the most delicate. At this point you have found a home you would like to own, but you and the owner have not come to terms.  This is not a fun time for buyers. You must get your offer accepted, thus eliminating other buyers.

      5. Signing the Purchase and Sale Agreement.  

        The purchase and sale agreement is usually four identical documents all signed in the original. (I like to use blue ink because you can tell  if it is original or a copy.) The offer has determined the date the P&S  will be signed but the time will depend on the buyers and sellers schedule. Usually the buyers will meet me separately from the sellers and I go over the process. The actual documents will have been approved by both buyers' and sellers' attorneys but this may be the buyers first time to see the completed agreement. 

    At the time the buyers sign the P&S, I will have made five copies. Four are signed and the fifth the buyer takes with them unsigned as a record. This is also the time the buyer delivers the additional or P&S deposit check.

    Finally I take the four signed P&S agreements and the deposit check to the listing broker. He or she takes the agreements to the sellers who signs them all, keeps two copies, and returns two completely signed copies to the buyer. Usually the two copies are mailed to buyer and buyers' attorney and a faxed copy is sent to the buyers' lender.

     6.  Between signing the P&S and closing.

        There is a period of several weeks that follows the purchase and sale agreement that both buyer and seller should be looking for moving companies. This will take time and to find the right company at the right price but if you haven't done it yet, now is the time. 

If you are a seller and moving to a new purchase, you will need to be completely out of your current property before you can receive any funds to close on your new home. Occasionally sellers will be allowed to remain in their house after ownership passes to the buyers, but this is rare. Most attorneys discourage buyers from closing until the seller is complete out of the property.

If you are a buyer you need to keep in contact with your mortgage company and insure that any paperwork they need from you they get quickly.

     7.   Closing day

        On the day of closing, or perhaps the day before, the buyers will have a final walk through the property. This is not an inspection but used to insure that all  the sellers personal property has been remove and that the home is in substantially the condition as expected.        

 Paying for your new home


Down payment is how much of your savings or present home equity you will be using as part of the purchase price. At least part, and maybe all, of the down payment will be required when you sign a purchase and sale agreement approximately ten days after your offer is accepted. If you can't write a check for this amount because your money is in term deposits or stocks, then you need to find ways to make these funds liquid. If most or all of your down payment is in the equity of your house, then you need to get an equity line of credit. (Note: Most banks don't like to give you a line of credit for this purpose so be sure you have this reserve in place before you find your new home.)

Closing costs are monies spent on legal, work, appraisals, credit checks, points, etc. Additionally the lender will probably require to come up with three month advance taxes and the first years insurance premium. Although you won't know exactly how much these costs will be you can get a very good estimate. The minimum you should plan is $2,000. and then add any points, escrowed taxes, and insurance premium.

Moving expenses are extremely variable depending on how much you have to move, but don't forget to include some estimate for this expense even if you are doing the move yourself.

Monthly Payments are composed of four ingredients.  Principal and interest on the loan; homeowners insurance; and real estate property taxes. 

The annual property taxes are divided by twelve. If you don't know what the taxes are use one per cent of the estimated sale price as a start and then recalculate when you have an actual figure. 
The insurance varies depending on the cost of the purchase price of the property but generally range from $500 to $1000 per year. I use $65 per month as a start and then have the buyers check with their insurance agent for an accurate number.The principal and interest can be calculated by going to a
mortgage calculator <
Note1: How much can you afford?

There is no substitute for a real, live financial officer's review and advice. There is no cost for this help and it is at the heart of getting serious about  purchasing real estate. I have several excellent loan people I can tell you about. They will ask you a few questions over the phone and are able to get you pre-approved for a mortgage before you actually find your new home. Call me at 781-591-9902 for names and phone numbers of some great loan people.

Note2: What about mortgage rates and programs?

As in note 1, I recommend talking to a real person. . <

Note3: The whole picture.

The monthly payment is the item most people look at very closely. Yet not closely enough. It is true that your payment is an amount you have to come up with each month. But, your real estate taxes and mortgage interest payments are deductible on federal taxes. Effectively this lowers your payment substantially. Additionally, as real estate inflates in value you are benefiting from an automatic savings that may also be tax free. So look VERY closely at all aspects of this monthly payment. Compare all benefits to your current situation. 

Copyright 2008-2023 Raymond K Watts.

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