Buying a property in Marin.

The guide below is useful whether you’re looking for your first home or as is often the case, it’s been a while since you’ve been active in the market.

• Pre-Qualification:The first step is to meet with a mortgage broker and find out how much you can afford to pay for a home.
• Pre-Approval:This is an important distinction. Pre-qualification tells you what you can afford. Pre-approval let’s a seller know what you can afford. When applying for Pre-Approval, the buyer actually applies for a mortgage and receives a commitment in writing from a lender. Without pre-approval, any offers you make are not considered to be strong offers, and are likely to be viewed skeptically.

• Define your search:Prioritize your requirements. Make a list starting with essential attributes (size & location etc.) ending with luxuries. As you search, you will become discover more about what your budget can accommodate.

• Representation by a Professional:Listing agents have a duty to represent the seller – to get the best price and terms for the seller. A buyer’s agent is one who is working for you, the buyer, not the seller.  Buyer’s agents get paid at close of escrow form the proceeds of the seller, so there is no out of pocket expense for their service.

• Focus & Organization: While there are many online tools to assist you in your search, your agent may have access to information about properties before they come on the market. Communicating your evolving list of wants and needs to your agent will ensure they are up to date and able to alert you as soon as a property of interest comes to their attention.

• Viewing: When visiting a property of interest, take notes & photos (if permitted). Also remember it is common to have cameras and recording devices in homes these days. It is recommended to keep any negative comments to yourself until after the viewing.

• Offer: Once you have decided you want to make an offer on a particular property, you will work with your agent to determine an offer that works for you and that you think will work for the seller. At this point excitement can creep in, and possible disappointment – you may be outbid on a property that is in demand, and even a full price offer can be rejected. Be prepared for a counter offer, which like the seller, you can accept, reject or counter. This process can be lengthy, so it is important to remain focused. During this process, you can continue to search for alternatives, but it is highly discouraged to make other offers. Usually offers must be responded to within 1-3 days.

• Contract and Escrow: Once an offer has been “ratified” - all parties and agents have signed an agreed contract - the Escrow process begins, whereby an Escrow officer begins to assemble all documents and funds with a view to closing Escrow on an agreed upon date. Most likely your contract will include contingencies – usually loan and inspection contingencies….

• Loan & Appraisal Contingencies: Unless you are purchasing with all cash, you will have loan and appraisal contingencies in your contract. These are removed when your loan officer has confirmed that your loan will be funded by the lender. While problems can occur, provided you are pre-approved, and the property does not appraise below your offer there are limited circumstances where this process falters. Your loan officer will provide guidelines to help avoid potential problems.

• Inspection Contingencies: Most likely you will include inspection contingencies in your offer. These give you a period of time to organize and review inspections carried out by professionals. Your agent will assist in this process. Most properties come with disclosures that include seller’s inspections. If your inspections reveal problems with the property that were unknown when you made your offer, you may request the issues are addressed, or a credit for you to fix the issues (this request may be refused).

• Removal of Contingencies: While your contingencies are in place, a seller may continue to show the property, and even accept back up offers. Once you remove contingencies, the property is pending, and the escrow officers prepares to close. In the final days before close you should plan to do a final walk through with your agent to ensure that the property appears to have been maintained as expected. Throughout the entire process, you will have plenty of documents to sign – final preparation to close will include more paperwork.

• Close & recording: Usually you will sign the final paperwork at a title company, subsequent to which the transaction is recorded – you are now the owner. Congratulations!

While this overview doesn’t detail all the possible complications and details, I hope it is apparent that purchasing a property in California is a highly complex process, and for most people these are the largest transactions they will ever make.  Having a professional guide to assist you throughout this journey significantly reduces the stress and anxiety you might otherwise experience. I look forward to accompanying you on this journey.