Real Estate Process for Buyers
We know that the real estate process can be overwhelming, and there’s a lot of things along the way that can be forgotten. With that being said, it’s much easier when you constantly have something to refer to so that nothing is missed. So we’ve written out a “Buyer Cheat Sheet” for you! Check it out:
|STEP 1: Find your REALTOR
The majority of REALTORs will be working for free on the buyer’s end. It is very important to have one represent you to facilitate the transaction and work for your best interests.
- Negotiation power and experience
- Contract creation and coordination
- Risk management strategies
- Exclusive real estate market data
If you think you are saving money by having the listing agent work for you and the home seller, keep in mind that the listing agent is under contract to work in the best interests of the seller. It is nearly impossible for the listing agent to work in both of your best interests, when the buyer wants the lowest price possible and the seller wants the highest price possible. It is best for you to use a buyer’s agent.
|STEP 2: Get Pre-Approved/Budget
Talk to your lender to make sure you can afford the purchase of your home. Nothing hurts more than having an accepted offer but realizing the bank won’t be able to help you finance the amount of money you need. Getting a pre-approval letter will also help in the negotiation process by letting the listing agent you are serious and ready.
Items to give your lender:
- Photo ID
- Employer letter
- Current and recent pay stubs
- Copy of Bank account statement showing income
·Record of previous employment if you’ve been at your current job for less than 2 years
- Gift letter (optional)
- Proof you have funds for closing costs
Items may vary depending on your situation and the lender you work with.
|STEP 3: Write Your Offer (CPS)
Get your REALTOR to write this for you. There are many details that needs to be covered to protect you and make sure you come out in a good position for the next few steps.
Things to consider:
- True market value of the home
- Negotiation strategy
- Possession, adjustment, completion dates
- Terms and subjects (inspection, financing, title, strata documents, property disclosure statement)
- Subject removal process and length
Contract of Purchase and Sale (CPS):
Contract that obligates a buyer to buy and a seller to sell a product or service. Contains variable details depending on the agreement of the parties of the transaction.
|STEP 4: Negotiation Process
Your REALTOR should help you with this and try their best to present the offer in person. Try and find out the motives of the homeowner, so that you can find out what is most important to them. Sometimes convenience or who they are giving the home to can outweigh the final sale price. This information can really help in multiple offer scenarios.
Things to consider:
- What is your ceiling price? (the maximum amount you are willing and able to pay)
- What are you willing to compromise on in order to get what you need?
- Are you competing with other offers? How many?
- What are the advantages of the competing offers? What are you disadvantages of the competing offers?
- What have other homes in the area that are similar sold for recently?
- Make sure you still have money left over for closing costs.
|Step 5: Accepted Offer/Subject Removal
This process is typically set for 5-10 days. You may have to coordinate and schedule appointments with a number of parties to ensure a smooth process. This may be the busiest part of a home purchase. Depending on your situation, you may be skipping the subject removal process if you have written a subject free offer.
·Make sure to have your deposit ready to go. This will be due within 24 hours of subject removal. If you have a subject free offer, you typically have to hand it in within 24 hours of acceptance or right away with the offer.
|Step 6: Get ready for possession
Once you have removed subjects and handed in the deposit, you now have a “firm deal.” Find your notary or lawyer to iron out the final details and prepare the conveyancing process. Many costs will arise upon completion date, make sure that your realtor or notary/lawyer has reviewed these with you in advance, such as a Property Transfer Tax unless you are approved for a first-time homebuyer program. You should be on your way to the possession, adjustment and completion date. Congrats – you own a home!