Going Shopping
Shopping for a Mortgage Loan
It is important to shop around when looking for a morgage loan. differnt lenders will offer different terms, have different requirements, and offer varying levels of service.
Pre-Qualify of Pre-Approval for a Mortgage
To help determine the amount you may be eligible to borrow for a mortgage loan, consider getting pre-qualified with a mortgage lender. This free service usually takes two days and involves providing income, asset and debt information to a lender who may issue a letter to the home shopper. This letter must be presented by the realtor when an offer is made on home.
Taking this process a step further, a potential home buyer may get pre-approved for a morgage. This means getting a guaranteed loan for a certain amount that generally lasts for 60-90 days from the date issued. A pre-approved loan may involve a nonrefundable fee.
When shopping for a lender, dont be afraid to ask basic questions, with the most basic being the official name of the lender. Find out the true identity of the lender. Are they a licensed lender, financial institution or simply a servicing company? Is the company licensed by the state of New Jersey?
Choosing a Real Estate Professional
All of the details involved in buying a home can be confusing. finding the right real esate professional for you is a great first step toward making the experience much easier.
In New Jersey, there are four brokerage business relationships: seller's agent, buyer's agent, disclosed dual agent and transaction agent. 'Each of these relationships imposes certain legal duties and responsibilities on the licensee, as well as the seller or buyer represented.
All four of these types of agents must be licensed by the New Jersey Real Estate Commission (REC). Agent's are required to demonstrate, to the Real Estate Commission's satisfaction, that they are honest, trustworthy and of good character and integrity in order to obtain a license.
Some agents, such as myself hold the distinguished Accredited Buyer's Representative designation, or ABR. Click here to find out the benefits of working with an ABR.
All REC Licensees must:
1. Deal honestly with all parties.
2. Disclose any known physical condition of properties sold or leased that affects the property in a material way.
3. Faithfully administer escrow funds.
4. Submit all written offers according to the rules and regulations.
5. Disclose in the contract any personal interest the agent has in the transaction.
6. Prior to discussing any rela estate matters, disclose to all parties the agent's business relationship- seller's agent, buyer's agent, dual agent or transaction broker.
7. Provide the Consumer Information Statement prescribed by the REC.
Exclusive Buyer/Agency Contracts
The Exclusive Buyer/Agentcy contract is an optional agreement that some brokerage firms choose to present to their clients. Once signed, this contract is binding for both the agent and the buyer. The intent of these agreements is to make sure the buyer and his or her agent understand that the agent is working on behalf of the buyer, and the buyer will use the services of that particular brokerage firm (agency) exclusively for a designated period of time. If you are presented with this type of agreement, make sure your agent explains the content in detail and you fully understand and agree to what you are signing.
Finding Your Dream Home
Everyone's idea of a "dream home" may be different, so it is important to formulate a list of the features and benefits you would like in a home. Consider factors such as pricing, location, size, amenities and design. Your real estate professional will be able to provide guidance and help.
I prefer to meet individually with each of my clients to review their needs and discuss many other issues. This is called the buyer's counseling session. Also in the buyer's counseling session I will review all of the steps in this section of the website on the home buying process. I feel this is an important step in helping my clients in the most efficient manner.
Consider these factors as you narrow your search:
1. Quality and availability of schools and libraries;
2. Proximity to work, major highways and mass transportation;
3. Immediacy of shopping, religious centers, hospitals and recreation facilities/parks;
4. Property tax rates, income tax rates and other community expenses as compared with similiar homes in other neighborhoods (ie, association fees, snow and trash removal, common ground maintentance)
5. Utility expenses, trash collection and sewage disposal
6. Availability of public services such as police and fire protection;
7. Local zoning ordinances adn condition of other properties in the neighborhood.
Next, consider your priorities. If you cant find a home within your price range with ALL of the features you want, then decide which features are most important to you. Would you prefer a large kitchen or an extra bathroom? Would you trade a bigger yard for a shorter commute? Write out this list and share it with your real estate professional. This will help your agent limit the search to only these homes truly of interest to you.
If you look at more that a few homes, they can quickly become a blur. To help keep track, I give all of my buyers a "Buyers Binder" to help you organize the homes in sections of "Like it", "Gotta Have It" and "Rejects". It also is helpful to write notes on the back of each MLS sheet as to what you liked and did not like about the home.
Pay Attention to the Details
Once you have begun to narrow down specific properties, go beyond the surface appearance and look carefully at each house. Be sure to examine the physical details and construction. Particular details about a home may be available in a residential property disclosure form, if the seller completed one. This form is a questionnaire that gives you an overview of the physical history and condition of the property according the the seller's knowledge. Ask me for a copy when we find a home you are interested in. I will get it from the seller's agent for you.
Source: NJ Department of Banking and Insurance
