Buy

Setting a Budget

Before the house-hunting process can begin, it is important to consult with a local Lender to determine how much house you can afford. Kim can provide you with trusted Lenders to consult with. Expenses to consider include your downpayment, monthly expenses, and PITI (Principal, Interest, Taxes and Insurance). These will all have to be considered before you begin looking at properties. Since a person’s credit score determines their interest rate, knowing your score ahead of time can help you decide if now is a good time to buy or not, or if there are things you need to do to raise your credit score. An individual’s debt-to-income ratio (DTI) must also fall within acceptable limits of the home’s cost. Once you have determined these things with your Lender, and if you feel you have enough room in your budget to afford a new home, then its time to begin the home buying process!

Calculate your Payment

Finding a Home

Once you have been pre-approved for a mortgage and you know how much you can afford, it’s time to start looking! If you haven’t yet hired Kim as your Buyer’s Agent, now is the time to do so. Not just any Realtor® will do! Kim has been a Nashville expert in the real estate business since 1997, and is knowledgeable about the areas where you are looking. She knows local neighborhoods and can guide you in making this most important decision. Let Kim know your needs and wants, taking into consideration the number of bedrooms and baths you desire, amenities, location and price range. Remember, the first home you visit might be beautiful, but you should be knowledgeable about all available homes in the area before making a final decision.

Set up your First Search Here

Be sure not to visit or call on any properties without Kim’s involvement. Rule of thumb is always let your agent make the inquiries and schedule showings. The Seller generally pays the Buyer’s agent’s commission, and in the case of resale and new construction, there are a myriad of things you will not be aware of. The Seller’s agent is NOT working for you: they are representing the Seller. You therefore will need your own representation, and that is where Kim comes in.

Getting Pre-Approved

When looking for a loan, it may help to get more than one loan quote to get the best interest rate and loan terms for your mortgage. Do not be fooled by the promise of a low interest rate, however. Make sure you know in advance what all your loan costs will be, as higher Lender costs may override a low interest rate. Be sure to also check your loan officer’s website for testimonials and information. A good loan officer should offer you online resources and tools. Before you lock in your rate, be sure your Lender stays on top of the adjusting rates in order to ensure you are getting the lowest rate possible. Interest rates will determine how much a mortgage will cost each month and come in fixed or adjustable terms. Mortgage lengths can range from 10 years to 30 years (some lenders will do as many as 40 years). The longer the repayment term, the lower the monthly mortgage payments will be. However, the interest you pay will also be higher over time on a lengthier loan.

Making an Offer

There is an art to making an offer on a home. Typically in a normal market, Sellers place their home’s value a bit higher than their desired price. A Buyer will submit a lower bid in a reasonable range, and the Seller will counter with an offer somewhere in the middle. Appliances might also be negotiable if you are willing to up your offer a bit. Kim will be watching for signs of problems with the home and will make suggestions to you regarding your offer. Listen to Kim closely, as this is her business and she does it every day. The average Buyer only buys a home once every 7 years or so. Kim, as an experienced Realtor®, will be able to help you negotiate a price that sometimes includes concessions or closing costs. Her job is to protect you in the contract.

In a Seller’s market such as Nashville has been experiencing, you also need Kim’s expertise in making strongly-competitive offers that will set you high above all others. Kim’s prior Corporate Contracting experience gives her a decided advantage over the majority of agents who do not have the same level of experience.

(1) FINANCING

You must be able to secure the financing and be approved by Underwriting in order to close on the house. Your Lender will ask for lots of documentation from you, so don’t get frustrated as this is just part of the approval process.

(2) APPRAISAL

The Lender will order an appraisal if you are obtaining a loan. This verifies to them that the house is worth the price you are paying for it, and what they are lending to you. If the home doesn’t appraise equal to or higher than the contract amount, you may end up renegotiating the price with the Seller, coming up with extra funds out of pocket, or simply canceling the contract.

(3) HOME INSPECTION

Getting a home inspection is a vital part of the homebuying process. These inspections ensure that the home’s foundation, structure, HVAC, electrical system, roof, walls, and plumbing, etc. are up to certain standards. Inspections may also test for items such as radon and lead-based paint. It is extremely important to protect yourself by getting a home inspection. You typically have 10-14 days from an accepted offer to get your inspections done. Many Buyers have been saved from disaster by taking the time to spend the extra $400-500+ on a home inspection, only to find out the house has major problems, allowing them to back out of the contract before it is too late.

(This amount is applied to your downpayment and can be more or less, depending on price of property.)
Note: the more Earnest Money, the stronger the offer is considered by the Seller.

Home Insurance

Lenders normally require that you insure your home. Home Insurance Policies cover the costs to fix any damages that might occur down the road. The price of this insurance is dependent on a home’s age, location and value, as well as the insurance company you choose. Kim can provide a list of insurance agents to call. Be sure to get several quotes. Agents will oftentimes be able to take your information over the phone and get back to you with a quote in a relatively-short timeframe. Once you choose a company to insure your new home, the cost of the first year’s policy and several additional months is normally added into your closing costs, with subsequent monthly prorations added into your monthly mortgage payments. These amounts are held in an escrow account to be paid to the insurance company every subsequent year.

Title Insurance

Title Insurance will be required in order to protect you, as the new owner, from other parties laying claim to the property after you close. Unlike other types of insurance, Title Insurance works backwards to protect you against claims of ownership from other people/estates. The Closing Attorney/Title Company will perform a title search on the property during the escrow process, the cost of which may be paid at closing by the Seller or the Buyer, depending on what was negotiated in the contract. Generally on resale properties, the Seller will pay; on new construction, the Buyer usually pays.

Escrow and Closing Costs

Kim will work with the Closing Attorney to schedule your closing (traditionally 30-45 days from contract if working with a Lender; possibly a shorter timeframe if you are paying cash). Before the home is legally deeded to you, the closing must occur. At closing, you will sign all of the mortgage and various other legal documents, and either wire or bring a Cashier’s check to pay your downpayment and closing costs. Once all of the papers are signed (which usually takes about an hour) and your loan funds to the Seller, you will receive the keys to your new home! The only thing left to do is move into your humble abode. This may occur immediately after the closing or at the date set in the initial contract.

Relocation

If you are moving to Nashville and have a relocation package with your company, Kim will coordinate all aspects of your relocation with them. Let your company know Kim is your agent. She has worked with many relocation companies before, and will be happy to provide them with their referral fee upon closing!