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Buying a home
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Can you afford to lose $800 or more when trying to buy a home?

These are true experiences through my eyes as a listing agent.   I put one of my listings under contract twice and both times the buyer had to cancel due to not being able to get financing.  Both buyer’s had their own buyer’s agent.  Both buyer’s agents never worked or recommended the lenders the buyer’s chose.  Both buyer’s agents did not enter into the process of getting the buyer qualified for a loan nor did they speak with their lender when the offer came in.  Both buyers provided pre – approveal letters with their offers.

I always call the buyer’s lender on behalf of my seller to find out how the lender qualified the buyer.  Did the buyer actually provide documentation to the lender or did they just fill out an application and a credit report was ran.  In both cases both lenders verified they had looked over the documents the buyer provided and were confident they could get a loan.

What happened?  The first buyer we had was put in the wrong loan program by the lender.  How did it happen that the lender put the buyer in the wrong loan program?  The lender assumed the buyer had a job in the area instead of looking at the application.  The buyer spent money on inspections and an appraisal only to find out they did not qualify for that loan program.  I tried to talk with the buyer’s agent to put the buyer in the correct loan program through one of my lenders, but the buyer got cold feet after the experience.

Our second buyer who was again pre – qualified found out they could not get financing after they spent money on inspections and an appraisal.  What happened? The loan officer did not know the loan policy when it came to dept the buyer owed and did not calculated the dept to income ratios correctly.  Had the loan officer done this correctly from the get go the buyer would of never qualified for a loan from day one.   I reached out to the buyer’s agent to have one of my credible lenders look at the buyer finances and that is when I found out the problem.

 

In both instances the buyer’s agents sent over the cancelation agreement without consulting with me to see if they could re-negotiate the deal or save the deal using another lender.   After I got the cancelations I tried to save the deal.  The buyer’s agent should of tried to save the deal for their buyer instead of just sending the cancelation over.  The buyers both spent a lot of money.

You here all the time every Realtor is a like and it doesn’t matter who you get to list or buy a home from.   It’s just not true.

I can guarantee you neither one of these buyers had a buyer’s agency agreement along with the services that buyer’s agent would provide them.  Both buyer’s lost a lot of money and on the listing end it wasted a lot of people’s time, cost my seller undue stress and money, cost me my commission twice and the title companies pay check twice.

As a listing agent I am limited on what I can find out from a lender how qualified the buyer is.   The lender is the one who should know loan policy, and what loan program the buyer can fit into based on their credit report and documentation.  If the lender tells me they reviewed the documentation and the buyer is qualified, I have to believe them.   The best defense for the buyer is the buyer’s agent they hire from the get go.

My best advice to buyers or sellers is make sure whoever you pick to buy or sell a home through that the services the real estate agent will provide are in writing and you read what those services are.  When it comes to financing make sure your buyer’s agent works with credible lenders and go with a credible lender your real estate agent recommends and make sure your agent is involved with the lender from day one of you looking at homes.

According to the National Association of Realtors 1 out of 3 closings fails due to the buyer not being able to get financed. 

 

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Broker advises Seller and Buyer to verify all facts

Verify Property Information

Broker advises Seller and Buyer to verify all facts

Professional Advice; Broker Liability: Broker advises Seller and Buyer to verify all facts and representations that are important to them and to consult an appropriate professional for legal advice (for example, interpreting contracts, determining the effect of laws on the Property and transaction, status of title, foreign investor reporting requirements, the effect of property lying partially or totally seaward of the coastal construction control line, etc.) and for tax, property condition, environmental, and other specialized advice. Buyer acknowledges that Broker does not reside in the Property and that all representations (oral, written, or otherwise) by Broker are based on Seller representations or public records. Buyer agrees to rely solely on Seller, professional inspectors, and governmental agencies for verification of the Property condition, square footage, and facts that materially affect Property value.

 

The above paragraph is in all Florida Realtor purchase contracts and really addresses both the seller and the buyer.  It’s in the best interest of the seller to verify what is being published about their home when listed for sale.  The seller does not want their home misrepresented to the public and typing errors can occur when placed in multiple listing service.  

It’s in the best interest of the buyer to hire the appropriate professionals to verify the following on the property:

A survey can provide the properties legal description, boundary lines, easements, zoning, flood zones, utility lines, buildings, fences, ingress & egress, and encroachments. 

A home inspection can provide you the condition of the home, appliances, and mechanics.  However, a home inspection does not look inside HVAC units nor can it tell you if you have water leaks under the slab.There are separate tests for radon gas, mold, and lead paint in addition to a regular home inspection.

Test the water when there is a well on the property.   Have a professional septic company look at the septic system

An appraisal will provide the buyer an opinion of value and the gross living sq. ft. of the home.  

Use a environmental consultant if buying a large property or commercial property as there may be a hazard waste liability on the property

Protect your investment with A Title search and title insurance policy will discover recorded liens on the property, who has the right to sell the property, history of ownership, tax search, unsatisfied judgements against the property, 

Homeowner Associations –  ask questions directly to the homeowner’s association especially when it comes to pets, commercial vehicles and sheds or better yet get a copy of the current homeowner association covenants, conditions, restrictions manual and the bylaws manual. 

The bylaws govern how the HOA operates and contain the information needed to run the HOA as a business.

The CC&R are the rules of the neighborhood.