Step 1: Review Financing Options
Financing your new home purchase begins with a consultation with a qualified loan agent. If you wish, we can recommend one who has the requisite experience, competence and integrity. There are a wide array of loan options, and choosing the one that works best for you will depend on a number of factors: your financial wherewithal and future plans, the monthly housing expense you are comfortable with, cash available for the down payment and closing costs, how long you plan to own your new home, etc. You may wish to consult your accountant regarding financial and tax implications.
Note: For statistical term definitions, for such terms as “median price” and “average dollar per square foot” see the link on our Market Dynamics page.
First Suggestion: Find a Good Agent to Help You
Even if you’re just beginning, tentatively, to begin the home search process, the sooner you find a competent, dedicated, knowledgeable agent to work with, the sooner they can provide you with valuable help, guidance and information to make the process easier and more understandable, facilitate any financing arrangements you might need to make, introduce you to options you may not be aware of, and to help you understand current market values, conditions and trends. A good agent will not only save you time and effort, but may also save you thousands or tens of thousands of dollars when you move forward with your purchase. In the vast majority of home sales in the Bay Area, the seller pays the buyer’s agent commissions, so you might as well take advantage of a good agent’s services as soon as possible. Buying real estate is a big, complicated financial transaction and having the help and counsel of an experienced professional right from the beginning is very, very useful and it is not unusual for an agent to start working with a buyer six to twelve months before they actually make the purchase, adjusting the scale and pace of their help as appropriate to where you are in the process.
Buying a home is typically the largest, most complicated, and often most emotional financial transaction of one’s life. There is a lot at stake, not just money but also issues such as security, happiness and everything else wrapped up in the concept of “home.” One of the main reasons why it can be so stressful is that one’s agent never explains how the process actually works step by step, what the decision points will be and the options one has at each step. When one understands the process and has a sense of control over how it will proceed, much of the stress is alleviated.
Buyers are responsible for performing adequate due diligence during the escrow period, which basically means making sure you are getting what you think you are paying for. Along with the careful review of disclosures, documents and reports provided by the Seller and Agents involved, inspecting the property is the most important part of such due diligence.
In one of the largest, most complicated financial transactions of your life,
what exactly does a good real estate agent do when you’re buying a home?
A Dedicated Buyer’s Agent has a fiduciary responsibility to represent the home buyer’s best interests in all aspects of the purchase process: the home search and property valuation counseling; purchase offer strategy and negotiation; the due diligence phase of disclosure, investigation and inspection; any renegotiation of price and terms; and all other aspects of the transaction.
How buyers and sellers in San Francisco split the closing costs pertinent to the sale of real estate is ultimately decided in the purchase contract itself, but this list details how they are typically split in San Francisco County.
Fidelity National Title has put together a good overview of common ways to hold property title in the state of California and the meaning and ramifications of each way. This is simply an overview provided as an introduction to this important issue: you should discuss your specific circumstances and plans with your accountant and attorney before coming to a conclusion.
Typically, the purchase of a new home is one of the largest financial transactions and investments of one’s life. Whatever home you purchase should work for you now—fulfilling your basic housing requirements at an affordable monthly cost.
Title insurance is a contract of indemnity which guarantees that the title to the property is as reported. If it’s not as reported,you are reimbursed for actual loss or damage under the conditions specified in the policy. The title policy covers you for your loss up to the amount of the policy.
Who pays for the various closing costs is negotiable between the Buyer and Seller, though the below sets forth the customary division in San Francisco County. These items might not apply in other counties. Some counties split their title and escrow fees between Buyer and Seller in varying manners.
1. Not having your agent do a full comparative market analysis of the property: a clear-headed assessment of what fair market value is.
The sale of real property involves transferring large sums of money and signing important documents by you, the Seller and your lender. Escrow is the process in which an impartial third party acts as a stakeholder and facilitator for both you and the Seller. Typically this entity is the Title Company. It carries out both parties’ instructions and handles the paperwork, distribution of funds, title insurance, and the transfer and recordation of the title deed.
Buyers Are Responsible for Inspecting the Property
The Purchase Agreement typically contains provisions allowing you to perform any inspections you desire. Inspections do not guarantee the condition of the home; instead their purpose is to educate you regarding the home’s current condition and how to maintain it in the future.
Once you have an idea of what you’re seeking, it’s time to start viewing available properties. These are the best places to get started:
While this flowchart depicts a typical process, the fast-paced and competitive San Francisco real estate market results in variations of this flowchart. Paragon Agents are able to quickly respond to market shifts.