Your Questions Answered: Timelines? Cancellations?

Buyer's Questions Answered:
What would the time line be for a purchase, possibly with a downpayment that is a gift, and what is involved with moving forward and canceling if we discover something less than favorable?

The process is to get pre-approved, interview agents, and then hire the one you like best (good service, ethical, etc). From there, you go out and find the best one for you and make an offer. Takes a few days to get a response. It costs you nothing to use our services – our commission is paid by the seller. You really have to hire someone though because without that you won’t get a strong commitment of service like we offer. Hiring them means a simple one page agreement to use them as your agent for the homes that they introduce for you.

Once you find the one that’s right for you, you start an escrow and begin to review all the background and documentation on a home. In escrow you can back out if you find out something really bad about a place or discover through an inspection that something’s really not for you (whatever that may be). You only make an offer if you’re really excited about a place and can envision living and enjoying it. You get your deposit back (1% of the purchase price) if you have to back out. You may have already spent some money “trying” to buy the house however (for example the costs of the inspection and appraisal are non-refundable). You want to find out during escrow if your neighbor is an aspiring rockstar drummer!

Bank owned properties are a bit slow to process the purchase contract (compared to a normal or what we like to call “natural” seller) but you’re usually going to get a great bargain, so you have to bear that in mind. They will tell you if you “won” the negotiations but then it can take about 10 days to get the contract from them so your loan officer can begin to process your loan application. Your timeline starts when the seller signs the contract. Your agent should manage the timeline properly keeping you aware of rights, duties and obligations the entire time. Where you have options, your agent should explain them thoroughly. In cases where there aren’t choices to be made, your agent should still keep you informed of how the transaction is proceeding. We buy and sell homes every day so you don’t need to know every excruciating detail if you don’t want or care to know. The more you do want to know, however, you need to have an agent that can advise you properly and insure that you feel comfortable and confident about your purchase.

Don’t give notice on your apartment until well into the escrow. You may have a bit of “overlap” of paying for both, but you need that to make sure everything goes right and that you’re not homeless. You can use any extra time to make sure the new place is ready for move-in and that the old is properly cleaned out and ready to get your deposit back. Also remember that when you own a property you “live first and then pay” versus in a rental situation you “pay rent first and then you live” – meaning you actually pay your mortgage in arrears. As such, you “skip” a payment when switching from renting to owning!

Hope this was helpful and feel free to email info@sdhousehunting.com if you have any questions of your own!

Jeremy Katz, Broker
San Diego House Hunting &
San Diego Commercial REO
http://www.SDHouseHunting.com
Member, NRBA (National REO Brokers Association)
619-497-1834 Office