ictory home Team Guide To Buying a home
A BUYER S AGENT WHY YOU SHOULD HAVE ONE YOUR INTERESTS ARE PROFESSIONALLY REPRESENTED Enlisting the services of a professional Buyer s Agent is similar to using an accountant to help you with your taxes, a doctor to help you with your health care, or a mechanic to help you with your car. If you had the time to devote to learning everything about accounting, medicine, and automotive mechanics, you could perform the services yourself... but who has time for that? This is why you allow professionals to help you in their specific areas of expertise. YOU GET A PERSONAL SPECIALIST WHO KNOWS YOUR NEEDS Just as your accountant, doctor, and mechanic understand your specific needs, your Buyer s Agent will understand your real estate needs and concerns. This type of relationship is built through open communication at all times. Your Buyer s Agent will save you time by providing you all the details about the home before you see it. In addition, your Buyer s Agent will listen to your feedback and concerns about each home. YOU WILL GET A GREAT HOME FASTER AND WITH LESS EFFORT It is much easier to find a home that meets your needs, negotiate a contract, and close the transaction with an experienced Buyer s Agent by your side. You won t need to spend endless evenings and weekends running around looking for homes or trying to search computer networks by yourself. When you tour homes with your professional Buyer s Agent, you will already know that the homes meet your criteria and are within your price range. YOU WILL GET THIS AT NO COST TO YOU Entering into a Buyer s Agency Relationship has countless advantages. You are simply agreeing to hire a personal representative who, by law, must represent your best interests to the best of their ability. All of this personal service is available at absolutely NO COST TO YOU! The Seller s Broker is responsible for paying your Buyer s Agent fee. When you sign a buyer s agency agreement, you get a professional, experienced agent devoted to protecting your needs and to helping you make one of the most important investment decisions of your life.
WHY YOU NEED A REALTOR HOW VICTORY HOME TEAM CAN HELP As licensed real estate professionals, we provide more than service. We are members of the National Association of REALTORS and must abide by a Code of Ethics and Standards of Practice. A professional REALTOR is your best resource when buying your new home. Let us be your guide. As knowledgeable REALTORS... We can save you significant amounts of time, money and frustrations. We know the housing market inside and out. We can help you with any home either listed with other agencies or for sale by owner. We know the best lenders in the area and can help you understand the importance of being pre-approved versus pre-qualified for a mortgage. We are excellent sources for both general and specific information about the community and its services, schools, shopping, and transportation. We are experienced at presenting your offer to homeowners and can help you through the negotiation process. We bring objectivity to every transaction and can point out the advantages and disadvantages in any property.
OVERVIEW OF THE HOME BUYING PROCESS Buying a home is one of the biggest investments and financial decisions you can make. While it is a major commitment and responsibility, it is also a very exciting time in your life. We are proud that we will get to play a part in it and have the privilege of handing you the keys to your new home! With that said, it is important to keep in mind that buying a home is a complicated process. We will be working hard to make sure that everything is as rewarding as possible, guiding you at every step and making sure that your needs and desires are met. This guide was designed to inform you about all the steps of the home buying process so that you can feel confident, make informed decisions and be an educated buyer. It will also help us understand the things that you re looking for in a home so that our search can be made as easy as possible. Please take some time to carefully review all the information presented in this guide. If you have any questions about the topics discussed, we will be happy to go over them with you in detail. Since every real estate transaction is unique, you will most likely have questions or concerns not presented here. That s what we are here for - to assist you at every step, to answer your questions, and to help you find the home you desire!
THE HOME BUYING PROCESS Below is a typical outline of the home buying process. Most transactions close within 45-60 days of the accepted offer. However, the timeline can vary depending on the situations and lender programs available for the two parties. REALTOR, Co-Founder Victory Home Team powered by LABELLE REAL ESTATE GROUP Cell 651.472.1506 nick@victoryhometeam.com victoryhometeam.com
YOUR FINANCIAL COMFORT ZONE Most homebuyers find that they need to finance at least part of their home purchase. Therefore, the first stage in finding the right home is to review your personal financial situation and make an informed estimate of your true purchasing power. Your purchase power will depend on: Your Income Your Credit Rating Your Monthly Expenses How Much Home Can You Buy? The next steps discussed will help you review home financing and get you prepared to speak in detail with a lender. Step 1 Make a rough estimate of how much home you can afford based on your income. Here is a method that will give you an approximate starting point for how much home you can afford: A house payment should be no more than 30% of your gross monthly income (before taxes and deductions). Annual Salary $50,000 $60,000 $70,000 $80,000 $90,000 $100,000 $110,000 $120,000 $130,000 $140,000 $150,000 $160,000 Gross Monthly Income $4,167 $5,000 $5,833 $6,667 $7,500 $8,333 $9,167 $10,000 $10,833 $11,667 $12,500 $13,333 Max House Payment $1,250 $1,500 $1,750 $2,000 $2,250 $2,500 $2,750 $3,000 $3,250 $3,500 $3,750 $4,000 Keep in mind that these are guidelines. There are many other factors that determine how much home you can afford.
DETERMINE YOUR FINANCIAL COMFORT ZONE Step 2 Preparing to Meet with a Lender Below you will find a list of documents you may be required to produce regarding your financial situation when you speak to a lender. It is a good idea to gather these things now. Social Security Number Pay stubs (most recent months) Bank statements for checking and savings accounts IRA / Retirement Plan Life insurance policies Creditor information - includes debts like student loans, auto loans, credit cards, child support payments W2 Forms from previous two years Employment history summary Federal tax returns (for past two years) Complete record of assets Stocks, bonds, and investment accounts Automobiles owned Documentation of other income Step 3 Talk to a Qualified Lender After looking at this information for yourself, it s time to speak to a qualified lender. A professional advisor will not only be able to give you information on the best rates and terms available in the current market, but they can also explain to you what options you have given your unique financial situation. Talking to a lender at this time will help you get a more accurate idea of what you can afford. What NOT To Do There are a few actions that you can take that will negatively affect your credit score and therefore your home purchasing power. If at all possible, you should avoid making a major purchase or changing your job if you are seriously considering buying a home in the next few months.
10 TIPS FOR A SMOOTH TRIP TO THE CLOSING TABLE Don t change jobs or become self-employed Don t make any major purchases until long after the closing (such as an automobile or large appliances) Don t use your credit cards or let your payments fall behind Don t spend the money you have saved for your down payment Don t buy furniture before you buy your house Don t originate any new inquiries on your credit report Don t make any large deposits into your bank account Don t change bank accounts Don t co-sign for anyone DO try to keep your financial picture as clear as possible until closing day by following the tips listed above RECOMMENDED LENDERS Dan Post Sterns Lending (651) 324-3421 dpost@sterns.com danpostlending.com Beau Heidelberg M&M Mortgage (651) 278-8062 BHeidelberg@themmmortgage.com Beauknowsloans.com Shawn Paige Bay Equity Home Loans (612) 269-8569 spaige@bayeq.com bayequityhomeloans.com/shawn-paige
WRITING AN OFFER When you have found a home that you are interested in, it s time to write an offer. As your Buyer s Agent, we will draw up a contract with your offering price and necessary contingencies into a formal contract. We will take the time to sit down with you to go over each part of your offer. EARNEST DEPOSIT You will need to provide an earnest deposit. Typically an earnest deposit equals between 1% to 3% of the property purchase price. You will not be at risk of losing your earnest deposit as long as you do not default on your contract. The amount will be credited towards your down payment at closing and will be cashed and held at the seller s brokerage. After you have made your offer, the seller will be able to: Accept your offer Reject your offer Execute a counteroffer In most cases, a seller will not accept your initial offer outright. Typical counteroffers include modifications to: Purchase price Closing price Inclusions When you make an offer on a house, you should be prepared for the negotiations to go back and forth several times before both parties agree to the terms. You might also have to compete with other interested buyers in certain market conditions. When an agreement is reached on all issues and both the seller and you, as the buyer, have signed the offer, you are both under a legally binding contract. OUR OFFER HAS BEEN ACCEPTED, NOW WHAT DO WE DO? Your offer is accepted! Now it s time to get to work. The following pages highlight the steps that need to be taken before we can close and to make sure the purchase is a sound decision.
HOME INSPECTION BUY WITH CONFIDENCE, GET A HOME INSPECTION The property inspection is one of the most important stages of the purchase process. This can also be a time when emotions and stress become elevated. Our job is to guide you through the inspection process, and give you the resources and opinions you ll need to make good decisions. You are free to use whichever inspection companies you wish. We will also be giving some reference of companies we use consistently, but please keep in mind that we cannot warranty or guarantee the work done by the professionals we refer, in the same way you would not expect a friend to guarantee the work done by a dentist they refer to you. Also, we do not get anything from the professionals we refer except the confidence that they ve done a great job for our clients in the past. A HOME INSPECTOR SHOULD: Search for any structural, mechanical and/or other flaws in the property Inspect all heating, air conditioning, electrical wiring, plumbing and other systems in the home Examine the exterior of the house, including the roof, foundation, chimney, etc. Inspect the attic and the home s interior for proper venting, insulation, electrical outlets, etc. Test all appliances and plumbing fixtures to verify they are all in working condition Inspect all bathrooms for moisture and/or if it has affected the areas around the tub, shower, or sink Depending on the results of the inspection, you will have the opportunity to: Approve the results of the inspection, satisfying the inspection contingency At the inspector s recommendation, give notice to the seller that you intend to have additional inspections conducted by a licensed contractor or specialist Negotiate that repairs are made by the seller before final purchase of the property Terminate the written agreement, and have your earnest deposit refunded if major problems are discovered
KEY POINTS ABOUT HOME INSPECTIONS No property is perfect and all properties have issues - this is very important to know, and it is without exception that even newly built homes have issues. Some are minor and some are major. We will sort through the issues (there will be many) and see which are major and which are minor. Don t sweat the small stuff - we will focus primarily on big issues that are costly to fix. We want to zero in on the biggies ; in other words we don t want to trip over dollars to pick up pennies. The inspection report could be 30+ pages - we like to make people aware of this upfront because it can be intimidating. There will be a lot of items that are cited in the report and close-up pictures of issues that can make the house look like it is in awful shape. After reviewing the report, many people feel like they ve stumbled across a house that is about to fall down! But the reality is most issues are usually minor and can be taken care of by either the buyer, the sellers, or a little bit of effort from both with minimal out-of-pocket expense. Inspectors know a little about a lot - inspectors are NOT specialists. They are not electricians, plumbers, roofers, etc. So, it s quite likely the inspector may call for further investigation by a licensed specialist should they find something questionable, which may be an additional cost to you. Inspectors are human too - the inspectors we work with on a regular basis are great. They re very specific and they uncover issues that both ARE a problem and could BECOME a problem. Nonetheless, inspectors miss things too. There probably isn t an inspector who catches 100% of everything in a house... that s just the nature of property inspections. Some properties have a private well and septic system. In most cases, the sellers are responsible for ordering, obtaining, and paying for the well and septic system inspections/tests. You will have the opportunity to review the results and should an action be necessary, your Buyer s Agent will guide you through the process. RECOMMENDED INSPECTORS Zach Gustafson Home Inspector, ASHI Associate Zach's Home Inspections LLC (763) 516-3276 Zach.inspect@gmail.com Jon Haven Home Inspector, MSHI Member Inspecta-Homes (651) 641-0641 inspector.haven118@gmail.com This list is provided for your convenience. It is not a guarantee of the qualifications but merely a list of some of the individuals and companies who are active in the applicable trade or profession. We suggest you independently determine the qualifications of the individual or company to be hired and confirm they hold applicable state credentials, if any, for the inspection being performed.
TITLE COMPANIES ROLE Title Insurance: Clearing the home title, what is title insurance and why is it needed? Simply explained, title is the right to own, possess, use, control and dispose of property. Protecting purchasers and lenders against loss is accomplished by the issuance of a title insurance policy. Who is covered? Typically, there are two policies issued: Lender s policy insures the lender for the amount of the loan Owner s policy insures the purchaser for the purchase price How is title insurance different than other types of insurance? While the function of most other forms of insurance is risk assumption through the pooling of risks for losses arising out of unforeseen future events (such as sickness or accidents), the primary purpose of title insurance is to eliminate risks and prevent losses caused by defects in title arising out of events that have happened in the past. To achieve this goal, title insurers perform an extensive search and examination of the public records to determine whether there are any adverse claims (title defects) attached to the subject property. Said defects/claims are either eliminated prior to the issuance of a title policy or their existence is excepted from coverage. What s involved in a title search? A title search is done to determine: That the person who is selling the property actually has the right to sell it That the buyer is purchasing the correct parcel of land Possible defects in title. A title search is really made up of three separate searches: 1. Chain of Title - History of the ownership of the subject property 2. Tax Search - The tax search reveals the status of the taxes and assessments 3. Judgement and Name Search - Searches for judgements and liens against the owner s and purchaser s name How does title insurance protect you? Should there be a claim made against your title as covered by our policy, it is then the title company s obligation to protect you by: Defending your title, in court if necessary, at the insurer s expense Bearing the cost of settling the claim if it proves to be valid, in order to perfect your title and keep you in possession of your property
HOME APPRAISAL An appraisal is an estimate of the value of the property made by a qualified professional. The appraisal of your home is as important as your credit history in obtaining a mortgage. After all, the property you are purchasing serves as collateral for the loan. Although the primary goal of the appraisal is to justify the lender s investment, it also protects you from overpaying. Your lender will hire the appraiser and will charge you as the buyer a fee for the service. If the appraisal falls short of the amount you wish to borrow you may be refused a mortgage or offered a smaller amount on the mortgage. Your official contract will be contingent on whether the appraisal comes in at or above the purchase price you and the seller have agreed upon. Step 4 TASKS TO DO: Obtain homeowner s insurance and notify your lender of the selected insurer Coordinate cancellations, transfers, and change-of-address notifications Organize the connection of services and utilities at your new home Step 5 WALK-THROUGH OF THE PROPERTY Conduct a final walk-through of the property prior to closing. This will give you an opportunity to see that the condition of the house is the same as it was at the time of contract. Additionally, you will be able to ensure that any repairs agreed to by the seller, based on the inspection contingency, have been completed. Step 6 SIGNING & CLOSING All the preparation is complete. Now it s time for closing! Closing is the legal transfer of ownership of the home from seller to buyer. Your closing officer will coordinate the signing of the documents and the collection and disbursement of funds. In order to ensure a smooth closing you will need to: Review the Settlement Statement that your lender or closing agent will provide you 1-2 days prior to closing. These documents will contain a detailed description of all costs associated with the transaction, including the exact dollar amount you will need to bring to closing. Verify with your lender and/or closing agent any other items that you need to bring with you such as a valid driver s license or other form of identification.
AFTER THE CLOSING An Ongoing Relationship With Our Clients While the closing may mark the end of the purchase process, we hope it will mark the beginning of our ongoing relationship. We make a concerted effort to keep in touch with our clients and to continue to be a resource for their real estate and neighborhood needs. As a client, you can look forward to receiving updates on the market and neighborhood events. Of course, if you need referrals for plumbers, electricians, and other service professionals, we are always happy to provide you with a list of trusted vendors. Your Referrals Are Key! Maintaining ongoing client relationships is part of our commitment to providing a level of real estate service well above and beyond expectations. Our clients share their positive experience with friends and associates who then seek us out. This has allowed us to build a successful real estate practice based on referrals. As a result, we can devote more of our time helping clients and less time looking for new ones. If you are happy with our services, we hope you will spread the word and send people our way so we can help them the same way we helped you. That s a win-win all around!
MEET YOUR ictory home Team OUR HISTORY Nick and Josh met in 2010 by chance and their relationship blossomed into a strong friendship through their love for the Minnesota Vikings. Although their business relationship went different ways through executive sales/sales leadership, they decided to ditch the corporate careers to pursue their "passion for people" while helping guide clients through the ever-changing Twin Cities real estate market. Whether buying, selling or investing, we are ready to effectively guide you through the process. Like-minded with the same core values, Josh and Nick founded the Victory Home Team in 2017 after several years of success as solo agents. Victory Home Team is a real estate team designed to redefine your real estate experience (while earning your business for life). Welcome to the Victory Home Team family! NICK WIMPERIS (left) is a talented REALTOR specializing in home sales in the fast, growing Northeast Metro. A devoted husband and father of three wonderful children, Nick is a lifelong resident of the Northeast Metro with deep roots in the area. He is committed to his community and takes pride in the many strong relationships he has formed. On game day, he can be found cheering on his beloved Minnesota Vikings! JOSH PELOVSKY (right) Outside of going above and beyond as a REALTOR, Josh enjoys hanging out in the wilderness fishing, hunting, or just enjoying a microbrew overlooking the scenery. He enjoys spending time with family, friends and his dog, Rocky. Josh grew up in Owatonna, MN, went to school in Duluth, MN and finally settled in NE Minneapolis in 2008. Josh has developed a keen feel for the region. Josh is also an avid Minnesota Vikings fan. SKOL!
CONTACT US WE ARE COMMITTED TO GIVING YOU THE BEST POSSIBLE SERVICE AVAILABLE Contact us through email, phone, or text. We communicate however you like to communicate. Please inform us about ALL you real estate needs. We are members of the Regional Multiple Listing Service and have access to every listing of all Real Estate Companies in Minnesota. Should you call another office for information, please tell them you are working with us. They will still be happy to answer all your questions. Nick (651) 472-1506 NICK@VICTORYHOMETEAM.COM Weekdays 7am-7pm Josh (651) 605-5101 JOSH@VICTORYHOMETEAM.COM Weekends By appointment WWW.VICTORYHOMETEAM.COM WELCOME TO THE VICTORY HOME TEAM FAMILY! We empower our clients to make smart decisions through clear communication, education, and complete transparency. We use our extensive real estate experience to successfully guide you through the fast-paced, ever-changing real estate market to achieve your housing goals. We do all this in a FUN, FOCUSED, and FRIENDLY way to earn your business for life! ictory home Team