Serena Russell ~ Bay Area Real Estate Specialist

The contract of purchase, also known casually as ‘the offer’ is really a legal document for the purchase and sale of real property.  It becoming binding when both parties agree to the terms in the document.  The e quality of your offer is almost as important as the price you offer to buy that home.   Poorly written offers reflect badly on everybody and lessen your chances as a buyer to get your offer accepted.

Here are 10 basic tips to guide you.

1. Use the Correct Forms

2. Determine Price

Barring extreme buyers’ markets or sizzling sellers’ markets, you will probably want to offer a bit less than you expect to pay. You can ask for guidance, but don’t expect your real estate agent to name a price for you. Picking buyer’s prices is not an agent’s job.

3. Make an Initial Deposit

In most states, to have a binding offer, you need to make a good faith deposit. It could be cash, personal check, cashier’s check or other modes such as personal property, real property, mortgages or unsecured promissory notes.

Spell out who will hold the deposit — almost anybody but the seller!

If your state has “liquidated damages,” the seller could be entitled to retain your deposit if you default under the contract.

4. Disclose your Down Payment

Your down payment could be cash, promissory notes, stocks, real estate or other assets. Generally, it is readily available cash. Some states require verification of your down payment within a certain time period.

5. Name Financing Terms

Please remember that your deposit, when added to your down payment and financing should equal the total consideration paid. Disclose the type of financing you hope to obtain: conventional, FHA, VA, contracts of sale, assumption or other.

6.         Include maximum points, especially if you are asking the seller to pay them.

7.   Include Contingencies

California Association of Realtors (CAR) purchase contracts in California give the buyer by default 17 days to do inspections. Other states are similar.

Many contracts carry provisions for such contingencies as:

·            Appraisal

·           Loan Funding

·            Physical Inspections.

·            Depending on your state law, if you do not remove your contingencies in writing, they may still be in effect, all the way to closing!

8.  Under when possession happens

Is it  on closing? A day after closing?

9.   Understand  Who Pays the Fees

10.. Request Special Reports

WHAT DOES YOUR REALTOR DO FOR YOU?

·    Rather than focusing on a REALTOR®’s compensation, consumers instead should focus on identifying and selecting a REALTOR® who best meets their needs and unique situation.  The guidance and value a REALTOR® brings to the transaction cannot be determined by his or her commission rate alone.  In this instance, the saying “you get what you pay for,” may ring true.   Consumers should interview several REALTORS® to identify the best fit for them and their situation.
·    It’s critical to point out that although there are more than half a million licensed agents, not every real estate agent is a REALTOR® who voluntarily agrees to subscribe to a strict Code of Ethics.
·     As members of their local, state, and national associations of REALTORS®, REALTORS® constantly receive updates on the latest housing legislation impacting them and their clients.
·     Additionally, REALTORS® have access to the latest technologies for the real estate industry, including critical housing data, pricing trends, time on market, and historical sales activity in the neighborhood.  These tools and resources enable REALTORS® to provide the highest level of service possible, including helping sellers determine the best price for their home in today’s market.
·    A REALTOR® also can assist with the critical negotiations included in every real estate transaction, and help both buyers and sellers finalize the many details that comprise a purchase agreement.
·     For sellers, a REALTOR®’s role may include negotiating a sale price and other terms in this tough market. A REALTOR® also can help sellers determine what, if any, repairs may be the owner’s responsibility, and can help negotiate deadlines for their completion.

Historically, the longer you lived in your home, the better it would be for equity building and tax advantages.  The world is changing and so are the cyclical nature of the economy.  Pay close attention to the economy as a whole. Are jobs increasing or decreasing in your target area?  Is the unemployment rate getting lower or higher?  Are home prices increasing or decreasing over a 3 to 6 month period?  Make the situation work for you. 

Short sales and foreclosures are still available in most parts of the country, so once those go away, then th maket will start to return to the pre-recession state we were more famililar with.  Until then.  Generally, buyesr will benefit from lower interest rates and declining home prices now than ever before.

Some sellers might also benefit if they have owned the home for many years and have some equity in their home. This would make it possible for a seller to sell and make a decent profit. 

Also take a look at what investors are doing?  If investors are out there buying up low priced proeerties, for cash, then it means it must be a good time to buy.  Buy low and sell high is always a good goal to have.  Investors generally pay a higher interest rate than owner occupied property owners, so they must make their money go farther.

For more advise contace your well informed real estate specialist today.

My faithful insurance office State Farm, sent me the following useful tips which I want to share with you.

How To Prepare for a Power Outage

Severe weather can strike at any time of year, possibly leaving your home without electricity for an extended time. By preparing for outages smartly, you can help minimize the disruption to your life and keep your home and family safe.

Generators

You probably know that gasoline-powered portable generators can be real lifesavers during prolonged power outages, allowing you to run a few essential appliances. But generators can do more harm than good if used improperly. The carbon monoxide fumes they give off can sicken or kill in minutes.  Never use generators indoors or in an attached garage.

Candles and Flashlights

Candles are a reliable low-tech light source, but they can be a fire hazard if not used carefully.

Never leave lit candles near children, pets, curtains or bedding. Always place lit candles on secure surfaces and never leave them unattended.

Flashlights are a safer bet, so keep a few dedicated emergency flashlights in a designated spot, along with a supply of fresh batteries. Read the rest of this entry »

Many buyers, especially first-timers, hope to purchase a foreclosed property at a bargain price.  While purchasing a foreclosed home can be a wise choice for some buyers, it is important that buyers understand the differences in buying at different stages of foreclosure and be prepared to take on the challenges typically associated with each.

There are three basic stages of foreclosure in California: Pre-foreclosure, trustee’s sale, and repossession, often called an REO or real estate owned by the bank.

Read the rest of this entry »

Are you in the market for a vacation home or second home?  Would you like a place to get away to.  The beach or the mountains?  If you’ve been thinking about this, then now is the time to achieve your dream of owning your second home.   According to the National Association of Realtors® Vacation-home sales recovered in 2009 while investment sales fell sharply,

“The typical vacation-home buyer is making a lifestyle choice, with nine out of 10 saying they intend to use the property for vacations or as a family retreat.  “Investment buyers primarily seek rental income, with six in 10 planning to rent to others, although one in five wants a family member, friend or relative to use the home.”says cheif economist Lawrence Yun of NAR.

Only one in four vacation-home buyers plan to rent their properties to others, while one in five investment buyers plan to use their homes for vacations or as a family retreat. However, 26% of vacation-home buyers and 8% of investment buyers intend to use the property as a primary residence in the future.

The median transaction price of a vacation home was $169,000 in 2009, compared with $150,000 in 2008.  “The higher vacation home price may reflect increased sales in higher-priced markets, particularly in areas of Florida and California where prices became highly attractive for buyers over the past year,” Yun said.

Half of vacation homes purchased last year were in the South, 21% in the West, 17% in the Midwest and 12% in the Northeast. Seven out of 10 were detached single-family homes.

Source: National Association of Realtors®

Share your thoughts and comments on this.

Serena Russell
Realtor®
REALTY WORLD, VIKING & FINANCIAL
Fremont, CA
DRE License #01824057

These are some of the questions received from buyers competing against all cash offers.
What is an all cash offer and who benefits from it?  
 Is it better than conventional offer and does it matter if you have a lender or not?
How does and all cash offer help the buyer’s position?

The answers to these questions depend on  market conditions at the time of your offer. 

For example, if investors are rampan in the market , then you can expect to face competition with cash offers.

Your offer should be one that the seller cannot refuse.  What does this mean?  How do you make your offer creative?  Some all cash offers are too low for the seller so they might get rejected.  The seller might have a set price in mind under which they are not willing to go.  Some buyers think that making an all cash offer makes their postion stronger.  This is not always the case. 

Price and terms matter.  What does this mean?  Make sure you are working with an experienced real estate agent, who can advice you on up to the minute changes in the marketplace.  Your  professional agent works in your best interests and can  negotiate with your lender, the sellers agent and other parties to your advantage.