SoldOK.com Buyer's FAQ

Disclaimer: This is provided for reference only and is not to be considered legal, financial, or tax advice.

While the real estate market for sellers is challenging at best, it is a time of opportunity for buyers. It’s a great time to buy. Prices are down and sellers are often willing to work with buyers. We have answered a few of your most frequently asked questions below. We welcome you to our website SoldOK.com as you search for your property whether it is a first home, upgrade to a newer, bigger home, or buying an investment property.

Q. Why should I use SoldOK.com as part of my property search?
A. While SoldOK.com does not believe in excluding anyone, including real estate agents, many of our sellers are either For Sale By Owners or banks. If these individuals do not have to pay a 6 or 7 percent commission they have more flexibility in their pricing. You may be able to get your property at a lower price. Save Money!

Q. Why should I bother getting a prequalification letter before making an offer?
A. When making an offer on a property give the seller a copy of this letter. Presenting it gives your offer strength and shows the seller you can indeed buy their property. A savvy seller will likely not sign a purchase contract with you if you do not have a prequalification letter because they will have to pull their property off the market without any assurance you can actually get the loan.

Q. If I want to make an offer who writes the offer to purchase contract?
A. State law does not prohibit you from writing the purchase contract (see our sample offer to purchase contact under the “forms” section). However, you may want an attorney to write it or you may want to sit with the seller and write it together, it is up to you.

Q. What is earnest money and do I have to provide it?
A. An earnest money deposit is a deposit made to a property seller to secure an offer to buy the property. It is similar to a down payment. Usually the buyer's check is made out to and kept at the title company (so choose a title company before you write the “offer to purchase contract”. This money is usually applied toward the purchase price. Often earnest money deposits range from 3 to 5 percent of the purchase price, however, you can agree to none or more earnest money. It is up to the agreement of the buyer and seller. The earnest money is often forfeited if the buyer decides to withdraw the “offer to purchase” for an unjustified reason. Watch out here. Justifiable reasons often include the inability of the buyer to qualify for a loan, however if you have a “prequalification letter” this will not be an issue.

Q. What do I do once we have signed an offer to purchase contact?
A. After you and the seller have completed and signed the “offer to purchase contract”, and if you wish have it reviewed by your attorney (review by an attorney is not required, merely suggested. Click here for some local attorneys in your area.) Then the buyer or seller will need to go to a title company. (Click here for some local title companies in your area.) Bring the following:

The signed “offer to purchase contract”,
A copy of “the property disclosure form”,
A copy of the “lead based paint” form,
Your “pre-qualification letter”, and
Any earnest money deposit.

When you take the forms to the title company you will set up a “closing date.” The closing date is the approximate date that the seller, the buyer, and the bank sign all the ownership papers, ownership will change and the seller gets their proceeds.

Q. Do I have to have the home inspected?
A. Most buyers will want to hire and pay for a home inspector. (This is not required but we recommend it.) This comes after the “offer to purchase contract” has been completed and turned into the title company. Most “offer to purchase contracts” allow the buyers to back out if “material defects” have been found that were not disclosed on the “property disclosure” form provided to the buyer earlier. (Click here for a list of some home inspectors in your area.) Often, after the home inspection the buyer will want some minor repairs made by the seller. We suggest sellers and buyers openly negotiate with each other as to what will and won't be done. Just a tip to buyers and sellers. You have both put a lot of time and effort in your agreement, if the inspection calls out a small issue, don't let your pride be a deal breaker.

Sunday, September 05, 2010