Q1. What does it cost to use a Buyer's agent?
It's Free! The Buyer's agent is generally compensated by the Seller's Brokerage Company. Therefore, it's in your best interest to have a Buyer's agent represent you throughout your transaction.
Q2. What is Earnest Money Deposit (EMD)?
Earnest money is a cash deposit buyers make when they sign a contract to buy a house. It makes the contract binding and signifies the intention of the buyer to complete the purchase. At closing, the earnest money becomes part of the down payment. If the buyer defaults without a good reason, as spelled out in the contract, the earnest money becomes payment for damages suffered by sellers and their agents
Q3. What is Contingency?
A contingency is a condition on the sale put into the contract by either the buyer or seller to protect against specific eventualities. Examples of common contingencies are: a requirement that the buyer obtains financing or sells their current home; the seller has a home inspection done; or the seller must repair certain items before settlement. Contingencies can be removed by an addendum to the contract, or they can expire if a time limit is specified in the contract.
1. Loan Contingency (also called Financing Contingency)
Under this contingency, the buyer has a specified time period (e.g. 10 days) to obtain a loan that will cover the mortgage. If the buyer can’t get a lender to commit to a loan, the buyer has the right to walk away from the sale with the security deposit.
2. Appraisal Contingency
With this contingency, a third party hired by the lender evaluates the fair-market value of the home within a specified time period (e.g. 10 days). In the instance the appraised value is less than the sale price, the appraisal contingency lets you back out of the deal.For example, let’s say you have a loan that covers 80% and you need to put 20% down for a home selling for $1,000,000. If the house is appraised at $950,000, the lender is only going to cover 80 percent of that appraised value, or $760,000. And instead of a $200,000 down payment, you would be expected to put down $240,000 to cover the difference.
3. Property Contingency
A property contingency gives the buyer the right to conduct any investigation or to have the home professionally inspected within a specified time period (e.g. 7 days). If something is wrong, the buyer can back out of the sale and take the deposit back.
Q4. How long will it take to purchase my home?
The timeframe usually varies when searching for your new home and securing an accepted contract. Factors that may affect this are available inventory, market conditions, and your specific needs. Upon receiving an accepted contract, the process usually takes 20 to 45 days to close.
Q5. What is a Realtor®?
A Realtor® is an individual licensed to list and sell real estate, one who is also a member of a local Board of Realtors®, the State Association of Realtors® and the National Association of Realtors®. As a member of these three professional trade associations, a Realtor® is bound by a strict Code of Ethics, the canons of professional behavior that guide daily activities in the real estate business.
A Realtor® pledges fidelity to clients, but also pledges to treat fairly all parties to a real estate transaction. A Realtor® is knowledgeable about various aspects of the real estate profession and maintains current information regarding market conditions. Realtors® have an affirmative obligation to serve property owners and prospective buyers to the best of their ability.
A Realtor® is the recognized professional in real estate. The distinctive Realtor® "R" is your guarantee that you are dealing with the elite of the profession, a member of an association of Realtors®, a professional who deserves your trust: a Realtor®.