Whether you’re a first time buyer or have owned many homes, you never stop learning, so don’t be afraid to ask questions. The agents at Frankel Realty Group are real estate experts and will guide you through the process of buying home in Northern Palm Beach County and Jupiter with care, diligence and attention to detail. Below are the top 10 daily questions our buyers ask, but call us at 561-427-2154 with any questions you might have.
Question 1 – What do I do if I need the cash from my home to purchase something new?
The agents at Frankel Realty Group will help you market and sell your home first. Once we get an executed contract on your home, we will make sure the offer on your next home is contingent upon the sale of your current home.
Question 2 – How do I present an offer on a new home?
Once you identify your next home, your Frankel Realty Group agent will access the Property Appraiser’s website and provide you with valuable information on what the Seller paid and what’s owed on the property.
When your agent completes the research, he/she will suggest a target purchase price. We can then come up with a negotiation strategy, make an initial offer and properly negotiate the best price. Your agent will then help you write a FAR/BAR contract and make sure you understand all aspects of the transaction.
Question 3 – What happens if I offer less than the asking price?
The seller can either reject your offer or counter your offer. If the seller rejects your offer you can walk away with no penalty or decide if you would like to present a new offer. If the seller counters your offer we can then start the negotiation process.
Question 4 – What if there is another offer on the house I want?
There could be another buyer who submitted an offer simultaneously and the seller could have two (2) offers to consider. The seller will ultimately choose the offer with the best price and terms.
Question 5 – Will I need a deposit to make an offer? Could I lose my deposit?
Remember, it doesn’t cost you any money to make an offer, but you will be expected to include a refundable earnest money deposit of at least five percent (5%) of the offer price. The deposit is a show of good faith that you are serious about buying the home. Your earnest money will be deposited into an escrow account and will be applied to the purchase price should you and the seller come to terms.
If the buyer and seller cannot come to terms or contingencies have not been met, the earnest money deposit is refundable. The only way you can lose your earnest money is if you decide that they you no longer want to buy the home and have no legal reason for rescinding your offer. For specific legal questions, always consult a Florida real estate attorney.
Question 6 – What will be my expenses when buying a new home?
There will be several expenses you should plan for when buying a new home including, but not limited to an appraisal, credit report, inspections and closing costs.
A more detailed version is listed below:
1. Appraisal – Appraisals usually cost between $300-$600 and will be debited to the buyer on the closing statement.
2. Credit Report – If you are financing your new home, most lenders charge between $30-$75 to pull your credit. This charge will be debited to the buyer and appear on the closing statement.
3. Inspection – When buying a new home you will want to have it inspected for any potential material defects. Inspection costs are based on the square footage of the home, include windstorm, termite and roof inspection. Prices range from $300 up.
4. Taxes – The buyer always owns the day of closing and will be responsible for paying real estate taxes at the end of the year. The seller will credit the buyer at closing for the prorata share of the taxes up to the day of closing.
5. Other Closing Costs – Your lender might require additional fees at closing including discount points, wire fees, transaction fees and document preparation fees. Make sure they provide you with a list of those fees. Your Frankel Realty Group agent will help you identify which fees are reasonable and which are not. Don’t let your lender take advantage of you.
FINANCING YOUR HOME
Before you decide to make an offer on a home, get pre-qualified. Getting pre-qualified with a lender will give you a better idea of what you can comfortably afford, including everything. Getting pre-qualified will also help you understand the amount of cash you will need to close, your monthly payment, insurance, taxes and the costs to close the transaction.
Many buyers ask, what are closing costs? Closing costs are the expenses associated with closing the transaction of a home. For buyers, they are usually between 4% and 7% of the final sales price and could include application fees, appraisal fee, county taxes, credit report, discount points, documentation fee, escrow fees, HOA fees, loan fees, mortgage insurance, origination fees, tax registration and title insurance.
What is a point?
One point is equal to 1% of the new loan amount. Whenever government regulation, state usury laws, and/or competitive practices prohibit the lender from changing a rate of interest that would make a real estate loan competitive with other fields of investments, the lender must seek some method of increasing the yield for the investors. By charging ‘points’, the lender can bring the real estate loan up to those other investments.
What is earnest money?
When you make an offer, you will need to put up an earnest money deposit as a sign of good faith that you are seriously interested in buying a home. That deposit becomes a part of the purchase price and is held in a trust account until there is a full acceptance of the offer. Typically an earnest deposit is 5-10% of the offer.
What is title insurance?
Title insurance protects the named insured against loss of defects, liens, encumbrances, adverse claims, or other matters not shown or disclosed to the new owner that attach before date of policy.