Nolo's Essential Guide to Buying Your First Home (53 page)

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Authors: Ilona Bray,Alayna Schroeder,Marcia Stewart

Tags: #Law, #Business & Economics, #House buying, #Property, #Real Estate

BOOK: Nolo's Essential Guide to Buying Your First Home
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Always Late … But Worth the Wait?
 
One of the most frequent complaints from buyers in new communities is that their homes aren’t built on time. Even reputable builders can get pushed back due to rain or other problems. Here are some terms you can include in your offer to compensate you for delays:
• pro rata rent, based on your current home
• pro rata hotel rental, based on the market price of an acceptable hotel
• pro rata mortgage payment
• credit toward upgrades based on pro rata mortgage costs, or
• reduced price or free upgrades in exchange for allowing late delivery.
 
 
 
TIP
 
Don’t back down.
Realtor® Mark Nash advises, “Buyers need to go head to head with pushy developers. If they don’t, they’re asking to be taken advantage of.”
 
What’s Next?
 
Once you and the seller have signed a contract, it binds you both. Now it’s time to arrange your inspections, pull your financing together, get homeowners’ and title insurance, remove contingencies, and close the deal. We discuss these topics in Chapters 11 through 14.
 
CHAPTER 11
 
 
Toward the Finish Line: Tasks Before Closing
 
 
Meet Your Adviser
 
Sandy Gadow,
a nationally recognized expert on real estate closing and escrow, and author of
The Complete Guide to Your Real Estate Closing
, widely considered the ʺbible of escrow and closing.ʺ Sandy maintains a website,
www.escrowhelp.com
, where she shares real estate articles, tips, and advice.
 
What she does
Sandy travels all over the United States and abroad in order to continue researching and tracking the latest developments in escrow and closing. With over 25 years experience as an escrow officer, Sandy has become a frequent contributor to newspapers and other publications nationwide, including
The Wall Street Journal
online (
www.realestate-journal.com
), and the
Washington Post
. Sheʹs also been a guest on CNNʹs
Open House
and a speaker on national radio. Sandy continues to have direct contact with homebuyers as a licensed sales associate with Sothebyʹs International Realty in Palm Beach, Florida, and a mortgage broker with Palm Beach Mortgage. She is a featured columnist at
realestatejournal.com
.
 
First house
ʺIt was a shack, really, on two acres of land that I discovered during a hike in Californiaʹs Point Reyes National Seashore. I was intrigued by the established trees, including redwood, apple, quince, and cypress; the small vineyard; and the investment potential. With a little research, I found that it was an abandoned estate, left to heirs in the Azores. I tracked down some U.S. relatives and negotiated to buy the property—it all wrapped up within 14 days, with no inspections or disclosures. This was my introduction to the property market, but it went smoothly, and I was so excited that I had no time to be nervous. When we moved in, we found cobwebs everywhere, white lace curtains hanging in shreds, beds still made, dusty dishes and glasses on the table, and jars of preserved fruits from the apple and quince trees—a scene frozen in time. It was a huge fix-up effort but is now worth many times more than what I paid for it.
 
Fantasy house
ʺIt would have to be two houses: one in the countryside, in the South of France preferably, where I would work on the land, relax, and eat very well. The other would be in a city, such as London, where I could work and enjoy all the cultural activities, such as museums, theatres, ballets, and concerts, with the bonus of being able to take short-break trips to neighboring countries.ʺ
 
Likes best about her work
ʺFirst I should say that, after my first house purchase, I got the ʹreal estate bugʹ and decided the best way to learn about investing in real estate was to become an escrow officer. I started working at a local title company shortly thereafter and have been doing that ever since. I wrote my first book,
All About Escrow,
in 1981 because I saw a need to have a training manual for buyers, sellers, realtors, and escrow trainees and officers. And I still enjoy the fact that the real estate field is always changing, is always interesting, and involves meeting and dealing with new people every day.ʺ
 
Top tip for first-time homebuyers
ʺJust go for it—the best way to learn how to buy your first home is to buy your first home. But I also do mean for people to do their homework, ask a lot of questions, and never take ʹnoʹ for an answer.ʺ
 
 
CD-ROM
 
For more tips from Sandy Gadow, check out her audio interview on the CD-ROM at the back of this book.
 
 
H
aving signed a written agreement with the seller, you’re in the home stretch—literally. But before you send out invitations to your housewarming party, let’s focus on the few (but important) steps that remain before the sale closes:

Removing contingencies.
You’ll need to make sure all the conditions you placed on the transaction (like getting financing and approving your inspections) are met.

Getting title insurance.
This is to verify that the seller has good title to the property and to protect you from claims to the contrary.

Deciding how to take title.
Especially if you’re buying with someone else, you’ll need to choose what legal form your shared ownership will take.

Getting ready to move.
Prepare yourself, and anyone going with you, for the big change ahead.
 
Some of your other responsibilities—like arranging inspections and choosing insurance—will require more discussion, provided in future chapters. Then in Chapter 14, we’ll describe what actually happens on closing day.
Wait! I Changed My Mind!
 
There are a few moments in the homebuying process where buyer’s remorse —that sinking feeling that you’ve made a
huge
mistake—is common. If you’re feeling panicked, try:

Calling a homeowner.
Talking to a happy homeowner reminds you that it’s worth it and that your fears are completely unoriginal!

Driving by the house.
Take another look and imagine living there. Bring a loved one who will be excited for you.

Watching a home improvement reality show.
Even if you’re buying a brand-new house, or not changing a thing, it’s fun to see others get creative. Try the DIY Network (
www.diynetwork.com
) or HGTV (
www.hgtv.com
).

Doing something different.
You’ve probably spent too much time talking with businesspeople and reading official papers. Take a break: a long hike, a movie, or a massage.
 
 
Your purchase contract probably gave you at least a few weeks before the closing, unless you’re waiting for a new house to be built. To help out, you and the seller will either hire a closing agent or one or more attorneys. They’ll assist and monitor the process from start to finish.
 
CHECK IT OUT
 
For a detailed chart of who typically handles the closing in your state:
Refer to
The Complete Guide to Your Real Estate Closing
, by Sandy Gadow (McGraw-Hill).

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