Step Two: Working Efficiently with Your Buyer’s Agent
The first advice is to keep an open line of communication with your agent. From the interview process you’ve made it clear that you are looking for an agent who will take your calls and be prompt about returning messages. This is a two-way street. On the flip-side, it is just as crucial for a real estate agent to know what his buyer is thinking. So always tell your agent what’s on your mind (good and bad) and make it a point to communicate more than is necessary rather than less.
Prequalification is one of the most important and time saving steps in the entire home-buying process. This can help you identify your price range and be prepared to put in an offer as soon as you find a home you want. Getting prequalified is simple. You contact a lender (usually a bank or mortgage company) and they will access your financial information to determine how much house you can afford and what the risk factor is to loan money to you. Based on that data, the lender decides what mortgage amount they would give you.
This is important to know prior to searching for homes so you don’t waste your time looking at places that are outside your means. Also, when you do discover your Dream Home, the seller will want to know that you are a serious buyer with the capital to purchase their property. Prequalification tells the seller that you’ve already conferred with a financial institution and are all set to move forward.
Finding a Loan Officer
Prequalifying is free and your agent can supply you with referrals to loan officers that they have worked with in the past (if you do not already have a loan officer lined up). Remember, your agent does this for a living and he or she can direct you to the best professionals they’ve encountered in the field. Just like a good buyer’s agent it is very important to find a loan officer that is prompt, accurate, understands the time sensitive nature of real estate, and can deliver on that requirement. Your agent recognizes the importance of a loan officer that meets these criteria and should be able to provide you with a list of reliable options to choose from.
It’s time to get you on the streamlined path to finding your Dream Home. According to industry studies, a vast majority of home buyers use the Internet to search for homes, contact agents, and conduct other tasks related to the home-buying process. No doubt you have visited one or more real estate websites that provide access to home listings. Many, if not all, of the reputable sites draw their information from a centralized, agent-only database called the Multiple Listing Service or MLS.
These sites are great for starters, but once you have begun working with a real estate professional, refer to your agent for the most up-to-date, comprehensive information on homes for sale. Why? Most real estate websites have “cached” data. That means they draw all of their information from the MLS and then save it on a computer, which allows the company providing access to re-format it and re-present it to users—often in a more visually stimulating way than the true MLS listings. One problem with cached websites is that they are not updated often enough to keep the status of properties accurate. Real estate is a very time sensitive affair and as such it is paramount that you work with information updated in real time. The only way to do this is to have direct access to the MLS. As a licensed Realtor your agent has access to this system and, more importantly, can provide you with access to the system.
By now your agent will have asked you a series of questions related to your needs and wants. These will include, but are not limited to: Price range, the area you wish to find a home, number of bedrooms and bathrooms, and more specific things like property type, parking requirements, architectural preferences, finishes and features, building amenities, etc.
Armed with your answers, your agent can set up one or more automated MLS searches that email you every available listing that meets your needs. You’ll also receive notification of any new listings that pop into the system and match your specifications. You decide how often you want to receive the notifications—but generally, the more frequently the better. If a property that was previously above your price range experiences a price drop and is now in your range, you will be notified of it the next time your search runs. By the same token, if a property you were considering goes under contract it will be immediately removed from your search results. That’s why daily updates can be beneficial.
In addition to automatically getting search results sent to your inbox, you have the ability to log into a customized website that allows you to view all available listings in real time. This will help you avoid falling in love with a listing that has been sold for a week or a year, as can happen with cached sites. When you log into this system you have the capability to view a listing sheet very similar to what your agent sees.
Each MLS is a little different so this scenario refers to one used here in the Chicago market. When you log on to view the listings that your agent has sent, you will not only be presented with the information about the listings, but also given the option to mark them as “interested,” “maybe” or “not interested.” There is also a “notes” section for each property. These are VERY important to your agent’s ability to zero in on your needs. The more you indicate your interest level and provide notes about what you like or dislike about a property the better your agent will understand your vision of a true Dream Home.
Viewing Possible Dream Homes
This is one of the most fun steps for buyers and agents alike. It’s recommended to view no more than five or six listings in a single outing. At this point your search results should be narrowed down to the top ten or fifteen, so you will be able to see them all in a few trips out. Oftentimes it can be difficult to keep the different homes straight when you’re looking at a bunch of places in one day. But have no fear, here are some pointers that have brought success to many past buyers:
1. Your agent should provide you with a listing sheet for each property you look at. Organize these listing sheets in the order that you view the homes.
2. Take lots of notes. Do not depend on photos because if you are viewing occupied homes the current residents may not be comfortable with you taking pictures of their belongings.
3. Establish a clear winner for each day out. In other words, when you find a home that you really like, make that home your Top Choice of the Day. From then on, you only have to keep two properties in mind, your Top Choice of the Day and the one you are currently viewing. If the one you are viewing is not as good as your Top Choice then forget about it and move on to the next one. If you like the one you are viewing more than your Top Choice, make it your new Top Choice and forget about the other one. It is okay to have a Top Choice and a runner-up for the day, but try to decide which one or two homes out of each tour is the best. Do this each time you go out until you have viewed all of the potential candidates.
4. They say that you know when you see the home you’re going to buy, but there’s no harm in reviewing your Top Choices and revisiting properties if need be. First impressions are extremely important, but a second look is just as critical when making such a huge purchase. Go back and make sure you feel the same way after seeing all of your favorites. It will either reinforce your decision or reveal that you should keep searching. If you find it truly is the home of your dreams, the next step is to make an offer.
Next Time… Step 3: Making An Offer