The words you are searching are inside this book. To get more targeted content, please make full-text search by clicking here.

Tammy Lewis -DF Buyers Package - (1)

Discover the best professional documents and content resources in AnyFlip Document Base.
Search
Published by tammymarielewis, 2016-01-09 13:54:13

Tammy Lewis -Buyers Guide

Tammy Lewis -DF Buyers Package - (1)

Tammy Lewis
www.anchornaples.com
[email protected]

Cell: 239-398-8536

1|Page Downing Frye Inc. is a Licensed Florida Real Estate Brokerage
180 Ninth St South, Suite 300, Naples, FL 34102

Table of Contents •The loan process & mortgage
questions
The Benefits of Working with Tammy
Lewis --.Pages 3-9 The Loan Process Pages 30-34
A closer look at The Tammy Lewis & our •Personal counseling to determine
team's experience and achievements
•Advantages of working with us your needs
•Buying a home is a team effort •5 reasons to get pre-qualified
•Our pledge to buyers and customer •Loan application process & items
service standards
•Let us help you! needed
Why Buy? Pages 10-12 •Mortgages at a glance
•Reasons to buy a home •Financial information worksheet
•The real cost of renting •Understanding closing costs
The Home Buying Process Pages 13- Home Warranty.-Pages 35
21 •Why to buy a home warranty
•Before, during, and the Conclusion of Home Inspection -Page 36-37
the home search •What is contained in a home
•Viewing homes
•Purchasing New Construction inspection report?
•What happens prior to the closing? Moving Checklist -Pages 38-39
•Your Home Buyer's Wish List •Things to do for local and long
Frequently Asked Questions Pages 22-
29 distance moves
•Looking at homes Purchase Contract -Page 40
•Deciding on a home •Details about making an offer on a
•Home inspections
home
•Making an offer Glossary of Terms-Pages 41-45
•Defining important terms related to

the home buying process
Notes on Appealing Properties -
Pages 46-47

Tammy Lewis
www.anchornaples.com
[email protected]

Cell: 239-398-8536

Benefits
Of Working With Tammy to Buy a Home!

Buying a home is a complicated business. Mistakes could literally cost you thousands of
dollars or the missed opportunity of owning the home of your dreams. As a buyer, you are always
in competition with all of the other buyers who are looking to buy your dream home. There is a
vast difference in the level of expertise and quality of service provided by real estate agents. Give
yourself the advantage of working with the Very Best ... work with Tammy Lewis and get these
value-added services that will make a big difference for you!

• Highly Trained Buyer Agent
Who focuses on nothing else but finding a perfect home for you. They are not taken out of
focus like many other real estate agents by making brochures, following escrows etc... (We have
other Specialists who do these things).

• A Computerized Tracking System
that instantly alerts us about properties coming on the market that meet your needs.
Through our highly sophisticated computer search system, we will constantly alert you to
properties that meet your requirements as they hit the market and before most other real estate
agents and buyers even know about them.

• Expert Negotiation Skills
We are experienced negotiators. Our level of success is a testimonial to the expertise and
negotiating skills that give clients of Tammy Lewis a major advantage over buyers working with
other agents.

• A Highly Trained Team of Specialists
We work together as a team to make sure that all of the important details are handled
perfectly.

Let Tammy Lewis guide You in The Right Direction!

Tammy Lewis
www.anchornaples.com
[email protected]

Cell: 239-398-8536

A Closer Look at Tammy Lewis

PROFESSIONAL QUALIFICATIONS

 42 years of combined experience in the Real Estate Industry
 Florida Real Estate License
 Active member of the Naples Area Board of Realtors
 Active member of the National Association of Realtors
 Active member of the Florida Association of Realtors

ADDITIONAL

We offer a written guarantee of services

 They're focused on making sure their client's needs interests are protected and
represented

 They have complete information to allow them to make good decisions

Tammy Lewis
www.anchornaples.com
[email protected]

Cell: 239-398-8536

What are the Advantages of Working
With Us to Buy a Home?

Real estate is a complicated business. There are a million details
that must be handled on .a timely basis in order to provide the quality of Service that you
deserve. The Tammy Lewis have grown and developed their own marketing and servicing team
to insure that their customers receive memorable real estate service ... not just satisfactory, but
MEMORABLE!

Buying a home is certainly one of the most rewarding experiences most of us ever have; it's
also one of the most challenging. If you're buying for the first time, the process may seem
overwhelming. And even if you've been through it several times, every move is different, and
presents new challenges. So one clear advantage of enlisting the help of The Tammy Lewis is
simply that you don't have to "go it alone." The Tammy Lewis has the training, the know-how, to
help you through each step of the process, and make the process of finding, buying, and moving
into your new home as smooth, quick, and enjoyable as it can be. Another advantage is that The
Tammy Lewis represents a valuable source of information about market trends, communities and
neighborhoods, and especially, homes for sale throughout the area.

Remember, not every home seller runs an ad in the local paper or puts a sign up in the
yard; you could be driving by some outstanding properties that may be just what you're
looking for in a home. The Tammy Lewis , on the other hand, offers you access to complete,
regularly updated information about every home listed by area agents through the Multiple
Listing Service (MLS).

In addition, Tammy Lewis is a professional that promises to ensure a smooth process every
step of the way ... all the way home.

Tammy Lewis
www.anchornaples.com
[email protected]

Cell: 239-398-8536

Buying a Home is a Team Effort!

Just the size of this book should give you a clue that buying a home can be a complicated
business. Also, there is a lot of competition out there trying to "buy your perfect home." Our
Team is committed to providing you with the best service in the business ... right through moving
day! Work with professionals you can trust to help you find your way home ... call The Tammy
Lewis !

Our Pledge to Buyers

To provide unsurpassed service to help you buy your
home at a fair market price, in the shortest time, with

the least inconvenience to you, we will:

• Explain real estate agency • Coordinate appointments and show
relationships all properties of interest,

• Maintain communication during the • Provide relevant market data as to
term of the agreement fair market value of homes

• Analyze buyer's property needs and • Disclose all material defects of the
desires property known

• Orient buyer to current market • Discuss relevant information about
conditions the seller as known

• Provide helpful community data • Explain the process of offer
presentation
• Explain local real estate practices
and procedures • Deliver any state required
Property Disclosure Form
• Provide information on lenders and
financing alternatives • Carefully explain and prepare
Offer to Purchase forms
• Search the local multiple listing including necessary Addendums
service for suitable properties (i.e. Appraisal Addendum) to
protect your interest

• Arrange to present all offers to • Keep confidential any
seller in a timely manner information buyer designates in
writing as confidential
• Strive to obtain the best
possible price and terms for • Show you how to never over-
buyer pay for a home

• Explain post-purchase activities • Advise you on resale factors that
and responsibilities may affect the home you are
considering
• Follow-up on all post-purchase
activities

We feel so strongly about our Pledge to Buyers
that we went a step further and put it in print!

Client & Customer
Service Standards

I have a basic belief: that our job is not work with brick, mortar and parcels of land, but with
PEOPLE ... PEOPLE who buy their homes through us ... but first, last and always, PEOPLE. Our
philosophy has never changed. We know that our success is based entirely upon our ability to
satisfy the real estate needs of PEOPLE. Therefore Tammy Lewis will make the following pledge
to you:

Our Pledge to our Customers (Buyers) •Explain process of offer presentation.
•Coordinate all appointments and showings.
To provide unsurpassed SERVICE to help •Carefully review the offer to purchase.
you BUY your home in the SHORTEST TIME, •Conscientiously facilitate the negotiations.
with the LEAST INCONVENIENCE to you ... •Explain post-purchase activities and
responsibilities.
OUR CUSTOMER ... WE WILL... •Follow-up on post-purchase activities.
•Initiate and maintain constant and •Keep in touch with you after moving day.
continuous communication with you.
•Carefully analyze your needs, being
sensitive to your special requirements.
•Orient you to current market conditions.
•Provide helpful community data.
•Explain local real estate practices and
procedures.
•Provide information on financing
alternatives.
•Thoroughly analyze the entire inventory of
homes on the market.
•Provide information on selected properties
that meet your needs.
•Avoid wasting your time.
•Professionally show selected properties.

Let Us Help You!

Buying a house can be confusing at times. There can be many different directions and
options. But no matter where you find a home you may be interested in seeing; you need only
call Tammy Lewis for help. Because we share a cooperating relationship with all real estate
offices within our community, it means we can show you properties that are listed with us or any
broker in our area. We can also assist you in "For Sale By Owner" transactions, just call Tammy
Lewis for all the information you need!

No matter what company or individual is marketing the home. In fact, just circle the
ads, drop off your paper and we'll find out all of the details!

Want to tour a New Construction project?

Someone from our team may need to accompany you to the property on the initial visit. By
letting us help you with builders, you get all the services offered in this presentation, as well as
those offered by the builder ... without paying more for it! Remember, we represent YOU, not
the builder. Be sure to tell the onsite sales agent that you already have representation!

Why Buy?

• Pride In Owning: Most people buy homes to have control over where they live. Although
investment features are important, the psychological reasons for buyer—the satisfaction of own-
ing and freedom from paying rent—are at least as important. In a survey done by the National
Association of Realtors of 6,000 homeowners and 2,0000 renters—perhaps the largest ever of
attitudes toward homeownership—showed that 76% of owners and 66% of renters considered
pride of ownership an important reason for buying.

• Dislike Paying Rent: Almost equal portions of owners and renters—close to 7 in 10—said a dislike
of paying rent was an important reason to buy. Renting offers a lifestyle that's nearly maintenance-free.
That may appeal to you, but consider that renting offers you no equity, no tax benefit, and no protection
against regular rent increases. Writing a rent check is just like watching your hard earned money sail away!

• Settling Down: More than 6 in 10 renters said "settling down" was an important reason to buy.

• Good Investment: 76% of owners and 69% of renters said the investment aspect of ownership
was important.

• Tax Advantages: Property taxes and qualified home interests are deductible on Schedule A, for
itemized deduction.

• Long-term Appreciation: People consider home ownership a good investment because they view
it as a long-term venture. Historically, home prices have risen at relatively steady rates.

• Leverage Investment: People borrow a great deal to buy a home, yet they receive the
full benefits of price appreciation. In the long run, investments in homes far outpace inflation.

• Source of Saving: Home ownership always has and continues to comprise the single largest
source of savings for American households. Homeowners build equity and can borrow against it.

• Sacrifices are Worth It: Almost 7 in 10 renters in the National Association of REALTORS® home
ownership survey said they planned to buy a home in the future. More than three-quarters of these
people said they were willing to sacrifice to do that

Home Buying Process

We have designed this book to assist you with the purchase of your new home. We
understand the many questions and concerns of home buyers and how this information will be
helpful throughout the transaction. We assure you that it is our goal to provide you with the
most professional and informative service available. Tammy Lewis is always just a call away
when you have question.



Before We Begin The
Home Search Process...

We will help you review your financial position to determine the price most
suited to your ability to pay and comfort level. This step will help you in the following ways:

• Interest rates are usually locked in for a set period of time. You will know in advance
exactly what your payments based upon your budget

• You won't waste time considering homes you cannot afford.
• You can select the best loan package without being under pressure.
• Seller may choose to make concessions if they know that your financing is secured, and

this may make your offer more competitive

During the Home Search...
Tammy Lewis will:

 Estimate purchase costs and explain them in detail.

 Explain financing alternatives to help you select the one best suited for you.

 Discuss home styles, availability, location, schools and any specific features that you
desire.

 Explain the Offer to Purchase Agreement in detail

 Prepare a market report, pricing recommendations and an estimate of equity from the
sale of your present home, if applicable.

 Provide you with information on all properties currently for sale, including new and
 Pre-owned homes, single family homes and condominiums.

 Discuss the benefits and drawbacks of each home in relation to your specific needs.

 Keep you informed on a regular basis.

 Check the MLS data base and with other brokers daily for new listings that meet your
criteria.

 Prepare an itinerary and "tour" map on which all homes meeting your criteria have been
located.

 Keep you up to date on changing financial conditions that may affect the housing market.

 Be available to answer your questions or to offer assistance regarding your home
purchase.

 Discuss market trends and values relative to properties which may be of interest to you.

I will assist you with homes offered by "For Sale By Owner." A homeowner trying to sell
their home themselves is usually doing so in hopes of saving the commission. Coincidentally,
this is the reason a buyer wants to deal directly with a homeowner. Many times a homeowner
will work with an agent, even though his home is not listed, if the agent introduces the buyer to
the property. If you should see a FSBO and want the advantages of our services, please let us
contact the owner and set the appointment. We will Show you new homes as well as pre-owned
homes if you desire.

Introduce you to local builders to discuss building your next home. We can work with most
builders and can get all the information you need to make any decision, but we will need to
accompany you to the property on the initial visit. By letting us help you with builders, you get all
the services offered in this presentation and those offered by the builder as well. You'll get more,
but you won't pay more for it.

IMPORTANT NOTE:
As members of the Multiple Listing Service, we can show you ANY property. If you should
see an ad in the paper or a sign in a yard, call us for more information. If you want to see it, we'd
be happy to show it to you!

At the Conclusion of the Home Search...
Tammy Lewis Will:

1. Prepare an Offer to Purchase agreement and explain each detail. Our job is to make sure
the contract is prepared to protect you throughout the home buying process.

2. Provide you with copies of all the documents involved in the purchase agreement and
financing.

3. Assist you in determining the appropriate financing and help you select the best
financial institution to handle your mortgage.

4. Negotiate on YOUR behalf and be your advocate through the home buying process.
5. Provide you with an estimated cost of closing or settlement including points, title

insurance, appraisals, credit reports, etc. prior to the loan application.
6. Manage the entire transaction and attend final settlement.
7. Make arrangements for the mortgage with you and review the final settlement docu-

ments to make sure everything is in order.
8. Coordinate any necessary inspections of property to evaluate the major elements of the

home.
9. Assist in securing interim financing if your present home has not yet sold.

Viewing Homes

After your initial counseling appointment, The Tammy Lewis will have a good idea of your
wants, needs, price range, and location and will enter your requirements in the Multiple Listing
Service (MLS) computer. From the many listings in its inventory, the computer will print a list of
homes tailored just for you. The Tammy Lewis will make arrangements to show you those that
seem to meet your desires.

As you walk through the homes, feel free to open the cabinets and closets. Most often the
sellers will be absent, but should they be present, they will understand your need to examine the
home carefully. When a home appeals to you, make notes. It is easy to forget details. Often there
will be a brochure available for you to take along to help you recall the home as you review your
tour, and whenever possible, The Tammy Lewis will have given you a copy of the MLS
information on homes you are viewing.

Don't be surprised if the first home you see is the perfect one for you, and don't be
discouraged if none of those you visit the first day are what you want. We are committed to
finding the one that you will want to call 'home' and will work diligently until you find it. Usually,
The Tammy Lewis will be able to find the home of your dreams rather quickly and will find 3-5
homes that best fit the desires you expressed.

Purchasing New Construction

Why should you use us to purchase new construction?

The advantages of having Tammy Lewis help you purchase a new home are the same as
those for purchasing a resale home.

 We can provide you with valuable insight into the new construction industry, help you
find the perfect home quickly, and then provide you with expertise in contract writing,
negotiating, and closing assistance.

The builder has professional real estate representative watching out for his or her interest,
and you need and deserve the same expert representation watching out for your interests.

Buying a new home is a little more difficult and time consuming than buying a resale. The
Tammy Lewis can professionally guide you through this process. Having spent years working with
builders, The Tammy Lewis has rapport with them. We are also very familiar with new home
warranties and the nuances of the builder's purchase contracts and various home inspections.

It is very important that your interests be professionally represented when you are entering
into a contract for a semi-custom or built-to-suit home. These transactions are complex and the
contract details must be exact in order to protect you and to ensure you get exactly the home
you want!

 Don’t forget about a home inspection. Tammy Lewis will explain to you why it is
essential to hire an independent home inspector to thoroughly inspect a newly
constructed home.

Are there any advantages to not using a licensee to purchase a new home?

There is no financial advantage for you to buy directly from the builder. Builders have a
“single-price” policy, meaning you will be charged the same price whether your interest is
represented by a licensee or not. Just as in any resale, the seller pays your licensee’s fee.

Prior to the Closing ...

The Tammy Lewis Will

Confirm the mortgage loan approval, which may include the following:
• Loan Commitment
• Credit Report
• Appraisal
• Verification of Employment
• Verification of Assets
• PMI (Private Mortgage Insurance)
• Submission to underwriter
• Verbal approval
• Written approval
• Need to amend contract

Coordinate the following as applicable to your transaction:
• Occupancy permit
• Survey

• Home Warranty Application
• Special agreements
• Amendments
• Escrow agreements
• Lien Waivers
• Title Policy
• Closing/escrow statement

Provide you with a closing checklist of items to prepare for the final closing or settlement.

Remind you to coordinate tasks prior to closing!

Home Buyer's Wish List

Community Requirements
These are communities I'm interest in learning more about:

For the Following circle the appropriate number in the box below in order to rank
Importance: 3=Must Have 2=Desirable 1=Not Important

Community Services

Churches 3 2 1

Beaches 3 2 1

YMCA/park district 3 2 1
facilities

High quality 3 2 1

healthcare

Convenience

Close to present or 3 2 1

future jobs

Near grocery and 3 2 1

other stores

Parks/play areas 3 2 1

Tennis/Golf Activities 3 2 1

Easy freeway access 3 2 1

Attractions 3 2 1

Neighbors

Relatives/friends in 3 2 1

the neighborhood

Children for your kids 3 2 1

to play with

Active community 3 2 1

groups

Golfing/Clubhouse 3 2 1

etc.

HOME REQUIREMENTS
What home styles do you prefer? (Examples: Floridian Style Home, Contemporary, Ranch,
Victorian)

Older or Newer Home?

How many bedrooms? How many bathrooms?

Rate these rooms and features according to how important they are to
you, then add your comments about special requirements you have or features you'd like:

For the Following Rank Importance:

INDOOR

Living Room 3 2 1 Dining Room 3 21
Den/Study 3 21
Family Room 3 2 1 Extra Bedrooms 3 21
Special Request 3 21
Master Bedroom 3 2 1

Fireplace 3 21

OUTDOOR

Pool 3 2 1 Jacuzzi 3 21
21
Garage 3 21 Patio or Deck 3 21

Size of yard 3 2 1 Landscaping 3

Play area 3 2 1

Comments:

PERSONAL TASTE/SPECIAL NEEDS
Requirements for children:

Requirements for pets:

Requirements for a home office:

Other important features:

Specific features that you will NOT accept:

SPECIAL REQUIREMENTS
What days will you be available to view homes?
What times are best for you?
How quickly do you want/need to buy?

Questions and Answers

Everything you’ve always wanted to
know about buying a house but were afraid to ask…

1. When I start visiting homes, what should I be looking for the first time through?
The house you ultimately choose to call home will play a major role in your family’s life.
A home can be an excellent investment, of course, but more importantly, it should fit the
way you really live, with spaces and features that appeal to everyone in the family.

"At each home, pay close attention to these important considerations."
 Is there enough room for you now, and in the near future?
 Is the homes floor plan right for your family?
 Is the yard the size that you want?
 Is there a pool?
 Are there enough bathrooms?
 Focus on floor plan more than cosmetics.

2. Is an older home as good a value as a new home?
It’s a matter of personal preference. Both new and older homes offer distinct
advantages, depending upon your unique taste and lifestyle. New homes generally have
more space in the rooms where todays families do their living, like a family room or
activity area. They’re usually easier to maintain, too. However, many homes built years
ago offer more total space for the money, as well as larger yards. Taxes on some older
homes may also be lower. Some people are charmed by the elegance of an older home
but shy away because they’re concerned about potential maintenance costs. Consider a
home warranty to get the peace of mind you deserve. A good Home Warranty plan
protects you against unexpected repairs on many home systems and appliances for a full
year or more after you move in.

3. Do I need to bring anything along when I’m looking at homes?
Be prepared to "snoop around" a little.
After all, you want to know as much as possible about the home you buy. Sellers
understand that because their home is on the market, it will be looked over pretty
thoroughly. Don’t forget to bring along this Home Buyers Workbook as a reference guide
when you are looking at homes. The pages in the back of the book, allow you to make
notes on specific homes, which will make it easier to remember the specifics about each
home. Be sure to ask any questions you have about the home, even if you feel you’re
being nosy. You have a right to know. It’s important to know that the seller will supply
the buyer with a Residential Property Disclosure, which will disclose any defects known
by the seller. A copy of this form is found towards the back of this book.

20 | P a g e

4. What should I ask Tammy Lewis about each home that I look at? As a rule of thumb,
ask any questions you have about specific rooms, features or functions. Pay particular
attention to areas that you feel could become "problem" areas—additions, defects, areas
that have been repaired. And above all, if you don’t feel your question has been
answered, ask until you do understand and are satisfied. In most cases, The Tammy Lewis
will be able to provide you with detailed information.

5. What should I tell Tammy Lewis about the homes I look at?

Tell them what you liked and didn’t like about each home you saw. It is important for
them to really get a feel for what you’re looking for in a home in order to find your dream
home. Don’t be shy about talking about homes shortcomings. Was the home perfect
except for the carpeting? Let The Tammy Lewis know that, too!

6. How many homes should I look at before I buy?
There is no set number of homes you should look at before you decide to make an offer
on one. That’s why providing The Tammy Lewis with as many details as possible up front
is so helpful. The perfect home may be waiting for you on your first visit. Even if it isn’t,
the house-hunting process will help you get a feeling for the homes in the community and
narrow your choices.

If you’re looking in more than one community, try to make the most of each house-hunting
trip. Because information changes daily, we recommend you check out a website named
“walkscore.com”, it will assist in narrowing down needed information about schools, churches,
and recreational facilities in the area of interest to you. Also, you may wish to take along a
camera and snap some pictures of all the homes you like. That’ll make it easier to remember.

"House Hunting Tips"
When you find a home you may be interested in buying, make sure you ask

The Tammy Lewis the following questions:
 How much are the monthly utilities?
 What features have the owners enjoyed most about living in this home?
 Are there defects or problem areas that need to be fixed right away?
 How old is the furnace and central air conditioning system?
 How old is the roof? Have the owners experienced any leaking?

7. What should I think about when I’m deciding which community I want to live in?
Services, beaches, nice parks and playground facilities, convenient shopping and
transportation, a track record of sound development and good planning— these are just
a few considerations that are important to many people when they choose a community
in which to live.

8. Where can I get the latest information about schools? Again, things change quickly; we
rely heavily on resourceful websites such as walkscore.com and www.greatschools.org.

9. How can I find out what homes are selling for in a given neighborhood? The Tammy
Lewis will search for recent sale histories, sale prices (or average sales prices), time on
the market and other listing information for sales in any given area.

21 | P a g e

It is best you use Tammy Lewis ’s services as a way for you to get this information. If you’re
interested in a particular home, they may be able to provide you with a list of comparables—

sale prices of homes in the area that are roughly the same size and age as the home you’re
considering. Besides having all the data, they have the professional expertise to properly analyze

it on your behalf. Although there will certainly be some differences between the homes and
locations—the house next door may have an extra bedroom, or the one down the block may be

older than the one you’re looking at—it’s a good way to evaluate the seller’s asking price?

10. I’d like to have a professional look at the home before I buy it. What does a home
inspector do? For your own safety, and to make sure you’re getting your money’s worth
in the home you choose, using a professional home inspector is highly recommended. A
home inspector will check a homes plumbing, heating and cooling, electrical systems,
and look for structural problems. They will check everything from the foundation to the
roof!

Usually, you call an inspector immediately after you’ve made an offer on a home. However,
before you sign any written offer, make sure that it includes an inspection clause or other
language which says that your purchase obligation is contingent on the findings of a professional
home inspector. The Tammy Lewis contracts automatically contain this important verbiage.

Your home cannot "pass" or "fail" an inspection, and your inspector will not tell you whether
he or she thinks the home is worth the money you are offering. The inspectors job is to make you
aware of repairs that are recommended or necessary.

A seller may be willing to renegotiate a price to accommodate needed repairs, or you may
decide that the home will take too much work and money. A professional inspection will help you
make a clear-headed decision. In addition to the overall inspection, you may wish to have
separate tests conducted to check for termites, or the presence of radon gas. Talk to Tammy
Lewis for information about these tests and companies in the area that perform them.

In choosing a home inspector, consider one that has been certified as a qualified and
experienced member by a trade association. Tammy Lewis may refer you to several qualified
inspectors.

Remember, the purpose of a home inspection is to help you learn things
about the home that are not easily discoverable during your home-buying tour.

IT IS NOT INTENDED TO BE A "LAUNDRY LIST" OF
MINOR REPAIRS FOR SELLERS TO COMPLETE.

11. Should I be present during the inspection?
Yes. It’s not required, but it is very much to your advantage. You’ll be able to clearly
understand the inspection report, and know exactly which areas need attention. Plus,
you can get answers to many questions, tips for maintenance, and a lot of general
information that will help you when you move into your new home. Most important,
you’ll see the home through the eyes of an objective third party.

12. Do I need to talk to my insurance agent?

22 | P a g e

Yes! Once you’ve found a home, work together to develop a homeowner’s policy that
meets your individual insurance needs. You’ll need to supply your prepaid policy to your
mortgage lender prior to closing.

13. What’s “earnest money”, and how much do I need?
When you sign an offer to purchase, The Tammy Lewis will ask you for earnest money-
that is, money that shows you are serious about wanting to buy. Usually, you will be
asked to write a check for a percentage made payable to the listing firm.

14. Is there any way I can protect myself against emergency repair bills in my new home?
Yes. Home warranties offer you protection against many potentially costly problems not
by your homeowners insurance. The coverage provided can save you thousands in the
event of a major mechanical breakdown, at a time when your cash reserves have been
depleted by your down payment and moving expenses. Ask The Tammy Lewis whether a
Home Warranty is offered when looking at homes. But remember, if it is not offered, feel
free to ask for it when writing the offer to purchase. The Home Warranty will give you the
peace of mind necessary to feel comfortable in your new home. In most cases, the
warranty plan will cover appliances, hot water heater, air conditioning units, electrical
systems, garage door openers, plumbing systems, heating systems, faucets, ceiling fans
and water softeners.

15. How do I determine the amount of my initial offer?
There is really no rule to use in calculating a realistic offer. Naturally, the buyer wants the
best value and the seller wants the best price, but negotiations can be influenced by
many factors, such as a seller who may be changing jobs and wants to sell quickly, or a
buyer who really wants a specific home.

After you’ve looked at the homes features, asked questions, checked comparables, and talked
about it with The Tammy Lewis you should have a good idea of what the homes value is in the
current market. Consider what you can afford and make an offer that you consider to be fair.

When the price is agreed upon, the paperwork will be initialed by both parties. At that point,
you typically will begin the process of arranging for an inspection and applying for a mortgage.

16. If moving a considerable distance, is there any way I can gather I information before I
start traveling? Yes, we rely on internet resources, in order to streamline your moving
process and needs we suggest you start with a website such as www.1stopmove.com

17. Should I move myself or use a moving company?
In almost every case, you can save yourself time and energy by using a reputable moving
company to help you move. Ask friends, and co-workers for recommendations, get
estimates from several companies. Don’t choose a mover based on price alone—consider
the reputation and professionalism of the company, too. Work closely with the moving
company to coordinate your efforts and your move will be achieved with maximum
efficiency.

18. What is a mortgage, and what are the benefits of different kinds of mortgages?
Simply put, a mortgage is a loan that a home buyer obtains directly from a lender to

23 | P a g e

purchase real estate. The mortgage is a lien on the property that secures a promissory
note (promise to repay the debt) that states the terms of the loan, including the interest
rate, and the number of payments.

19. What are the different types of lenders, and how do I choose the right one for me?
Before someone lends you the money to purchase your home, they’ll want to know a lot
about you. And you’re entitled to know as much as you can about them, too.

It’s important because getting a mortgage is not just a one-time signing of documents, a
handshake and a check. You will be depending on your lender to fund the loan as promised, on
time, and over the life of the loan, to keep good payment records, pay your taxes and insurance

(if included in your monthly payment) and many other continuing services.

Look for a lender that has the authority to approve and process your loan locally. It’s easier to
obtain information on the status of your loan and discuss conditions directly with the person who

will approve your loan, rather than some far away loan committee. It’s important that your
lender know home values and conditions in your local area. And while biggest doesn’t always
mean best, financial stability, reputation, qualifying procedures, and unique program benefits are

what they offer home buyers.

20. How much of a down payment will I need to buy a home?
Typically a down payment of 20 percent has been the benchmark for conventional
financing, but today each customers situation is treated delicately. Your mortgage expert
can help you determine which down payment option is right for you and your budget.

21. How does a lender determine the maximum mortgage I can afford?
The three primary areas lenders examine in determining the size of mortgage you can
handle include your monthly income, non-housing expenses, and cash available for down
payment, moving expenses and closing costs. There are a number of different ways
lenders interpret these variables to estimate your mortgage capacity. The most popular
method is detailed here. Most lenders feel a family should spend no more than, 40% of
its gross monthly income on housing costs, including the mortgage, insurance, and real
estate taxes. Also, these housing costs plus your long-term debts (car loans, student
loans, etc.) shouldn’t exceed 50% of your income. If your down payment is limited, some
lenders will tighten these restrictions further. Some lenders may also include home
maintenance costs and utility payments in their calculations.

22. What are the steps involved in the loan process?
The information your lender needs is not much different than what is needed when you
apply for a major credit card: names and addresses of your employer and bank account
numbers and balances. The lender will also need other financial information such as
installment payments, auto loans, charge cards, and department store accounts. The
location and description of the property also are required. Your lender will verify this
information with your present and past employers, order a routine credit report on your
current and past accounts, and order a professional appraisal of the property you want to
purchase. Many lenders can do this for you over the phone. Allow yourself two to four
weeks to complete the application process. Then once all the verifications have been

24 | P a g e

completed, your lender will underwrite and approve the loan. Overall, it’s best to be pre-
approved for your mortgage before you begin shopping for a home.

23. What are "Points"?
In real estate, the term "point" refers to 1% of the total mortgage loan amount. Buyers
often pay lenders this supplemental fee, calculated in points, to get a better interest rate
on a particular mortgage.

For instance, a lender may offer you a choice of two 30-year mortgages: the first at 4.75% (for
instance) with no points, and the second at 4.00% with an additional three points (you bought
your rate down ). If the loan is for $100,000, those-three points will cost you an extra $3,000 up
front—but you’ll get a payback of significantly lower monthly payments. We will help you review

the payments.

Many lenders will advise you to pay the points for the better rate if you can afford it,
especially if you plan on keeping the home for more than a few years. Like interest, the money
you pay for points may be tax-deductible, and the investment may pay for itself through savings

generated by lower monthly payments. We suggest you call your tax preparer.

24. What is APR, and how is it calculated? The Annual Percentage Rate is a calculated rate of
interest for a loan over its projected life. This rate includes the interest, all points (which
are considered prepaid interest), mortgage insurance, and other charges associated with
making the loan that the lender collects from the borrower. The APR is calculated by a
standard formula that all lenders use. This enables the borrower to comparison shop
between lenders and/or loan products.

25. What is a good faith estimate? Your lender or loan agent must provide you with a good-
faith estimate within three days of your application. This is the information you need to
make a fair and accurate judgment when shopping for a loan. Your estimate is a written
document that shows all the costs that can be estimated in advance by the lender. You
need this information so there are no surprises on the day you close your sale on the
property to be purchased. You will be expected to pay closing costs. The Tammy Lewis
will make sure you have a good faith estimate before making an offer on a home. We will
also make sure you know your monthly payments and cash needed before the offer is
made.

26. What does my monthly mortgage payment include? And what does PI and PITT stand
for? The bulk of your monthly mortgage payment goes toward paying off the principal
and interest of your loan. (You may hear lenders refer to this as "PI", for Principal &
Interest). In addition, most lenders require that you pay a sufficient amount to cover your
local real estate tax, plus your homeowners or hazard insurance. (You may hear this
"total" payment referred to as "PITI", or Principal, Interest, Taxes & Insurance.) This
amount is placed in an escrow account, from which your lender then pays your tax and
insurance bills as they come due. When shopping for a loan, it is important to ask the
lender if the monthly payment you are being quoted is PI or PITI.

27. What are the respective advantages of 15-year and 30year terms?
The 30-year fixed rate mortgage remains the standard mortgage, with an array of
valuable benefits designed especially for buyers who expect to stay in their homes for a

25 | P a g e

long time. Because the borrower pays more interest than principal for the first 23 years,
the tax deduction is substantial. And as inflation causes income and living expenses to
increase, your unchanging monthly mortgage payments account for a relatively smaller
portion of income as the years go by.

As you’d expect, a 15-year monthly mortgage means higher monthly payments than an
equivalent 30-year loan ... but not as high as you may think. At the same rate of interest,
payments on the 15-year mortgage are roughly 20-25 % higher than a loan that takes twice as
long to pay off. And one of the benefits of choosing a 15-year mortgage is that you can generally
get a lower interest rate for an otherwise similar loan. Another advantage is faster equity build-
up because a larger portion of your early payments are going to pay off principal. This makes the
15-year mortgage an ideal alternative for couples approaching retirement or anyone else

interested in owning their home free and clear as quickly as possible.

28. How can I find out what my property tax bill will be?
Usually, the total amount of the previous years property taxes is included on the listing
information sheet for the home you’re interested in. Remember, tax rates change from year
to year, and each person has a different situation at hand when purchasing their home i.e.
primary, secondary or investment unit, so the previous years bill should be considered simply
as a "ballpark" figure of what you would pay. For a more precise projection, call the local
assessors office for assistance, or simply ask The Tammy Lewis .

29. What can I do if I have a fixed rate loan, and interest rates go down?
When interest rates drop significantly, the homeowner should investigate the financial
advantages of refinancing. Essentially, this means taking out a new loan to pay off your
existing loan.

Refinancing may require paying many of the same fees paid at the original closing, plus
origination fees. Most mortgage experts agree that if you can get a rate 2% less than your
existing loan, and you plan on staying in your home for at least 18 months, refinancing is a

good investment.

30. What is a pre-approval? A pre-approval for a mortgage up to a certain amount is an
increasingly popular practice among buyers who don’t want to worry about going
through the approval process after they’ve found the home they want. It’s a verbal
exchange in which the lender tells you in advance approximately how much money the
buyer is able to borrow, based upon the information you provide the lender on your debt
and income.

When you are pre-approved for a mortgage, it puts you a step further along in the process of
buying a home. It is an actual commitment to lend, provided that, when you are ready to buy,
you still meet all the qualifying conditions that were met at the time of conditional approval. We

strongly recommend you get a Pre –Approval prior to looking for your home!

Confidential Personal Counseling to Determine Your Needs

A personal consultation will help The Tammy Lewis find you the type of home that meets
your needs. We will also discuss your financial situation with you in order to determine the price

26 | P a g e

range that will be suitable, if you have not already been pre-approved. It is important for the
Tammy Lewis , or your lender to know:

1) How much of your savings you intend to use toward down payment and closing costs.
2) Your annual gross income (before taxes).
3) The length of time with your current employer and previous employers, for the past 2
years.
4) Your monthly payments on long term debts (such as a car payment) and credit card
balances.
5) Child care expenses and/or alimony, if any.
6) Whether or not there have been any bankruptcy or credit problems.
The information which you provide will be held in strict confidence.

Pre-Approval and Lender Requirements

The Tammy Lewis is familiar with the lenders requirements and, using the above
information, will able to determine your price range and your ability to qualify for a loan. In this
counseling session, they will tell you approximately how much you can anticipate in closing costs
and prepaid items at the time of closing. The Tammy Lewis will suggest that you actually meet
with a lender before house-11 hunting if there is any question regarding your qualifications or

simply to get a head start on financing.

Financing Options range from A to Z.
Talk to your lender about custom fitting
the financing to meet your needs and lifestyle!

You can select the best loan package without being under pressure. There are many options to
choose from in today’s market.

Sellers may find your offer to purchase more favorable if they
Know in advance of your ability to secure financing. This may make your offer more competitive if

you are in competition with other offers Peace of Mind.

Loan Application

Once the purchaser(s) and the seller(s) have agreed on the price and terms of a contract, the
next step is the loan application. The Tammy Lewis can recommend several lenders who have
earned our trust and with whom we’ve had good experiences in the past.

Then, a preliminary loan application is completed with a loan originator. The loan originators
goal is to expedite all the necessary paperwork and information, including ordering a credit
report and appraisal of the property. It is very important for you to get the appraisal as soon as
possible. You will need to furnish the lender with the information as outlined on the items
needed for loan application page.

27 | P a g e

Your loan originator understands your concerns and is there to help with the approval of your
loan. Feel free to ask questions at the loan application about anything that you do not fully
understand. Also, you will receive a GOOD FAITH ESTIMATE OF CLOSING COSTS at this time so you
won’t have any surprises at the time of closing.

Total time from loan application to loan approval averages between 20 and 45 days or more,
depending on the loan type, market conditions and/or the complexity of verifying the borrowers
information and qualifications.

Homeowners (Hazard) Insurance and (Flood) Insurance
A Homeowners Insurance Policy (or a Binder), also referred to as Hazard Insurance, will be
required to be brought to and paid for at closing. This is true in absolutely all cases when
financing of any type is involved. Even if you are paying cash for the home, and no one is
requiring the insurance, it would be foolish not to protect your investment with Hazard
Insurance. If your home is located in a flood zone, you will need to purchase Flood Insurance.
There are many variables to consider in choosing which insurer and which policy best meets your
individual needs and preferences. These variables should be carefully discussed with your
insurance agent before purchasing the policy.

Items Needed For A Loan Application

Employment
Addresses for two full years
o Gross monthly income
W-2s, if available
Proof of pensions, retirement, disability or Social Security Proof of income from rentals,
investments, etc.
Year to date pay stub
If self-employed:
o Two years 1040 Tax Returns
o Current year profit and loss statement

Creditors
 Each creditors name, address and type of account
 Account numbers
 Monthly payments and approximate balances
 Amount of child care expenses

Banking
 Names and addresses of saving institutions
 Account numbers for all accounts
 Type of accounts and present balances

Miscellaneous
List of assets in stocks, bonds, land

28 | P a g e

Life insurance cash value (documented if used as cash down payment) If applicant is
selling a home, a copy of sales contracts

Social Security numbers for all parties
Veterans—Certificate of Eligibility & DD-214
Cash or check to pay for application fee

Real Estate Agents
 Copy of sales agreement
 Copy of listing on property
 Instructions on how appraiser is to gain entrance

Mortgages at a Glance

Mortgages used to be simple. You made a down payment on the house of your dreams and
borrowed the balance at a fixed rate of interest, promising to pay it back in regular monthly
payments over a period of years.

Today you must make choices. Do you want the traditional 30-year fixed rate mortgage with
its guarantees of unchanging monthly payments? Perhaps a fifteen-year loan would be better? Or
would you prefer an adjustable rate mortgage with monthly payments that can rise and fall in
accordance with an index reflecting economic conditions?

30-Year Mortgages:
How Much Will You Pay?

The chart below shows the amount of principal and interest you can expect to pay on a 30-
year mortgage over a range of interest rates and loan amounts. You can use it to estimate a
"ballpark" figure for monthly payments you can expect to pay on a home. Keep in mind that the
figures do not include the escrow portion of your payment most lenders require for real estate
tax, mortgage and hazard insurance.

Payments for Loan Amount versus Interest Rates
5.875 295 354 414 473 532 591 650 709 768 828
6.125 303 364 425 486 546 607 668 729 789 850
6.375 311 374 436 499 561 623 686 748 811 873
6.625 320 384 448 512 576 640 704 768 832 896
6.875 328 394 459 525 591 656 722 788 854 919
7.125 336 404 471 538 606 673 741 808 875 943
7.375 345 414 483 552 621 690 759 828 897 966
7.625 353 424 495 566 637 707 778 849 920 990
7.875 362 435 507 580 652 725 797 870 942 1015
8.125 371 445 519 593 668 742 816 890 965 1039
8.375 380 456 532 608 684 760 836 912 988 1064

29 | P a g e

Financial Information

Name
Address
City
State
Zip
Home Number
Cell Number
Work Number
Email:

Including taxes & insurance, what monthly payments do you want:

What approximate price range do you want to look in:

How much cash do you have available for a down payment:

Does this include closing costs? Yes No

Are you currently renting? Yes No

Do you currently own? Yes No

Do you need to sell before buying? Yes No

How much do you think your home is worth? $

What is the unpaid balance? $ Interest rate?

Dated Type of Loan Monthly Payment $
Term yrs.

List your regular monthly payments (installment debt, auto, revolving charges, student loan,

etc.)

1. Mo. Payment $ Balance$

2. Mo. Payment $ Balance$

3. Mo. Payment $ Balance$

Are you current with all debts? Yes No

Are you aware of any problem with your credit? Yes No

What is your gross monthly income?

Are you Employed? ___________ Are you Self-Employed?__________

Your spouses gross monthly income: $

Other monthly income? Yes No

If you are Self Employed or employed, what is the name of your business or the employer you

work for and for how long?

Have you or your spouse ever filed bankruptcy? Yes No

If yes, explain:

Have you or your spouse had a home foreclosure? Yes No

If yes, explain:

Understanding Closing Costs

 Application Fee: Fee charged by lender to offset fixed costs related to mortgage loan
processing such as appraisal, credit report, and underwriting.

30 | P a g e

 Closing Fee: The fee charged by the closing agent who prepares the closing documents
and closes the loan on behalf of the lender.

 Commitment Fee: This is often called an origination fee and is generally computed at 1%
of the mortgage amount.

 Discount Points: Each point is equal to 1% of the mortgage amount. Points are used by
the lender to adjust the yield on the mortgage when it is sold to an investor. By paying
more points, the borrower can obtain a lower mortgage interest rate.

 Funding Fees: Normally applicable on VA loans only, equal to LTV of the loan amount. The
fee is due at closing or may be added to the loan amount and financed.

 Homeowner's Insurance: One year premium is due in advance at time of closing.
 Mortgage Insurance: Insurance required by the lender when the down payment is less

than 20% LTV. In the case of loan default, this insurance reduces the lender's loss.

 Pre-payables: Adjustment to escrow accounts from the date of closing to the date of the
first payment. Interest is paid through the end of the month of closing; taxes are paid
through the end of the month of closing plus the following month. Two months of PMI,
(Principle Mortgage and Interest) are collected. Two months of homeowner's insurance
may be collected. A homeowner's insurance policy must be provided along with a receipt
showing that the first year's premium is paid.

 Processing Fee: Fees charged by the escrow processor, either working for the Escrow
Company, Title Company, or real estate Company, for administrative escrow services
performed from the point of contract through closing.

 Recording Fees: Fees charged by state or municipal entities for entering the closing
documents into the public record.

 Survey Fee: Is usually required and is used by the lender to check for encroachments
from within or from outside the subject property.

 Title Insurance: Provides protection for lenders and homeowners against financial loss
resulting from legal defects in the title. Rates are regulated by the state, based on the
price of the home you purchase.

 Underwriting Fee: Usually included in the application fee.

31 | P a g e

Home Warranty

If the seller does not provide a home warranty policy, the buyer may purchase one at the
time the contract is accepted:

The Tammy Lewis can facilitate your purchase of a Home Warranty.

Why the Home Warranty is so important to you for your peace of mind:
If you're buying a home, your expenses only begin at closing. Most people have lots of
renovations to make. Or furniture to buy. And so on. So the last thing you want is to have to
spend additional money for repairs due to unexpected mechanical failures of certain working
components in the home. With so much that could go wrong, the odds are against you.

Benefits when you're the buyer:
Your home is one of the biggest investments of your life. Why take chances? Be covered against
the expense of an unexpected repair or replacement for a full year after closing, less standard
deductible. Think about it. No matter how closely you inspect a home before you buy, you just

can't predict certain things. Like breakdowns from normal wear and tear, or the possibility of
mechanical failure during the first year of ownership. Things like internal plumbing, electrical
wiring, or vital parts of the air conditioning and heating systems. Working components such as
the washer, dryer, oven, refrigerator, and other items. Only a good home warranty program can

give you the protection you need.

Coverage by a home protection plan can give you peace of mind:
When the major systems and appliances in your home are protected by a Home Warranty, both
buyer and seller can relax. Because home warranty protection is solid and reliable. You can count

on peace of mind you want in your home.

What could be easier when something goes wrong than make a call to one company to manage
the issue?

Here's what most home Home Warranty plans can cover (depending on type of policy):
 Heating System
 Plumbing System
 Electrical System
 Hot Water Heater

The Home Inspection

It's easy to make sure the home you've chosen is a smart buy. By having a home inspection,
the home's vital systems are checked. A home inspection allows you to purchase your home with
confidence. The Tammy Lewis will help you set one up after you have chosen the home you like.
We recommend the following minimum standards when choosing an inspector:

1. Membership in ASHI (American Society of Home Inspectors) and adherence to its "
Standards of Practice and Code of Ethics

2. Written report at the time of inspection.

Items on your inspection report will include:

 FOUNDATIONS AND STRUCTURES

32 | P a g e

floors and walls, proper drainage and ventilation, evidence of water seepage.
 EXTERIOR SIDING, WINDOWS, DOORS

Exterior walls, windows, and doors; porches, decks, and balconies; garage.
 ROOF

Roof type and material, condition of gutters and downspouts.
 INTERIOR PLUMBING SYSTEM

Hot and cold water system; the waste system and sewage disposal; water pressure and
flow; and hot water equipment.
 ELECTRICAL SYSTEM
Type of service, the number of circuits, type of protection, outlet grounding, and the load
balance.
 CENTRAL HEATING SYSTEM
Energy source, type of cooling equipment, capacity, and distribution.
 INTERIOR WALLS, CEILINGS, FLOORS, WINDOWS AND DOORS
Walls, floors, ceilings, stairways, cabinets, and countertops.

 ATTIC
Structural, insulation, and ventilation information.

 FIREPLACE
Notes about the chimney, damper, and masonry.

 GARAGE
Doors, walls, floor, opener.

 POOL
Functionality / code

 APPLIANCES
Includes a wide range of built-in and other home appliances, smoke detectors, and
television/cable hookups.

33 | P a g e

 LOT AND LANDSCAPING
Ground slope away from foundation, condition of walks, steps, and driveway.

Moving Checklist ... For Long Distance Moves!

PLAN AHEAD BY:
 Deciding what to move and what not to move. Possibly plan a garage sale!
 Getting estimates from several moving companies or truck rental companies, depending

on how you plan to make the move.
 Planning your travel itinerary and making transportation and lodging reservations in

advance. (Leave a copy with a friend or relative.)
 Transferring your bank accounts. They will be happy to open your accounts by mail.
 Contacting your local credit bureau to find out if they are on the same system your new

home town subscribes to; if not, they will be able to transfer your credit file.
 Requesting records from doctors and dentists, including eye glass prescriptions, dental x-

rays and vaccinations.
 Obtaining your children’s' school records to make for an easier transfer.
 Drawing up a floor plan of where your furniture should be placed. This will help avoid

confusion for you and your movers.
 Paying existing bills and closing out local charge accounts.
 Recording expenses incurred during your house-hunting trips. You will also want to save

your moving expense receipts (if the move is employment-related) for tax deductions.

Moving Checklist ... For Local Moves!

PLAN AHEAD BY:
 Deciding what to move and what not to move. Possibly plan a garage sale (extra cash &

less to move).
 Getting estimates from several moving companies or truck rental companies if you're

moving yourself. Be sure to obtain a hand truck (appliance dolly) if you're moving
yourself.
 Arranging transfer of children's school records if applicable.
 Drawing up a floor plan of where your furniture should be placed to avoid confusion for
you and/ or your movers.
 Arranging any special movers, such as for an expensive piano, or such as is necessary to
break down and move a pool table or above-ground swimming pool.

34 | P a g e

Don't Forget To...

 Cancel or transfer deliveries, newspaper, garbage collection, etc. Coordinate the transfer
of gas, electric, (water & sewer when not handled by title company.) with the next
occupant of your old home, as well as with the previous owner of your new home, so as
to avoid lapses in service and extra re-start expenses.

 Check on personal items that might be at the photo shop, bank safe deposit box, a
neighbor's house, on lay-away or in the repair shop (i.e., shoe repair, jewelry store, small
appliance repair or dressmaker).

 Make arrangements for transporting your plants and pets.
 Save the phone book from your former city residence for tying up loose ends or for

future correspondence.
 Transfer insurance policies or arrange for new policies.
 Gather all valuables, jewelry, important papers (birth certificates, deeds, documents) to

take with you personally.
 Have the car serviced for the trip.
 Pack an arrival kit of necessities just in case you arrive before the mover.
 Get refunds from your present utility and phone companies and arrange for service at

your new home.
 Purchase moving insurance. Your mover's liability for lost or damaged goods will not

equal their replacement cost.
 Appraise valuable items, such as antiques, art pieces, etc.
 Check with your attorney about your will if crossing state lines.
 Ask for professional referrals if available (i.e. doctor, accountant, etc.)
 Change these addresses: Post Office, charge accounts, subscriptions (at least four weeks

in advance), relatives and friends, national and alumni organizations, church, mail order
clubs (books, tapes, catalogues), firms with which you have time payments, past
employer in order to receive your W-2 form.
 Save your old address labels to speed up your change of address forms.

35 | P a g e

Purchase Contract

(Offer and Acceptance)

In negotiating the purchase of your new home, the initial purchase. This offer should be in
writing and accompanied by good faith.

The offer will include:
1. The amount you are willing to pay
2. Financing terms
3. Any personal property specifically included
4. Loan commitment date
5. Closing and occupancy date
6. Other contingencies, including inspections

The offer will be written on a standard contract form. If the initial offer is not accepted by the
seller, further negotiations generally reach terms agreeable to both buyer and seller. When buyer
and seller agree on terms, the buyer immediately completes financing and arranges for
inspections. Our team's Contract Manager, will assist you in these processes.

Earnest Money Deposit

At the time a written offer on a property is initiated, you will be required to make a deposit in
the form of a personal check. The amount deposited will be kept in an escrow account and will
not be turned over to the seller. This money represents your sincerity in the attempt to purchase
and is fully refundable if the offer is not accepted, if your loan is not approved or if some other
condition of the contract is not met by the seller. In homes over this price range, expect to
deposit a percentage of the purchase price. This earnest money will be credited to you at closing
as part of your down payment and/or closing costs.

Title Insurance

When property is sold or refinanced, the lender and/or Buyer needs a preliminary title report
to see exactly what liens and encumbrances are against the property. Items that a preliminary
title report show include:

1. Easements of record
2. Restrictions, covenants and conditions
3. Liens and/or judgments
4. Exact vested owner of record
5. Legal description
6. Flood Zone report

When the sale of the subject property is final and the title company has recorded the
necessary documents, they then will issue a policy of title insurance to the new lender and the
buyer showing clear title to the property.

36 | P a g e

Glossary of Terms

 Abstract of Title: A summary of the public records relating to the ownership of a
particular piece of land. It represents a short legal history of an individual piece of
property, and traces the ownership of that property from the time of the first recorded
transfer to present.

 Acceptance: Consent to an offer to enter into contract.
 Adjustable-rate mortgage (ARM): A mortgage that allows the interest rate to be changed

periodically.
 Agency: A legal relationship in which an owner-principal engages a broker-agent in the

sale of property or a buyer-principal engages a broker-agent in the purchase of property.
 American Society of Home Inspectors (ASHI): A professional trade association that

provides training and education in home inspections. Members must meet qualification
requirements to join.
 Amortization: The gradual repayment of a mortgage by periodic installments.
 Annual percentage rate (APR): The total finance charge (interest, loan fees, and points)
expressed as a percentage of the mortgage amount.
 Appraisal: An evaluation of a piece of property to determine its value. Appreciation:
Increase in value due to any cause.
 Asbestos: A mineral fiber used in some building materials such as flooring, siding,
insulation and roofing. It is presently banned for most uses in real property.
 Assessed value: The valuation placed on property by a public tax assessor as the basis of
property taxes.
 Assumption of mortgage: An agreement whereby the buyer assumes responsibility for a
mortgage owed by the seller.
 Balloon mortgage: A mortgage where the amount financed is not fully amortized over
the period of the loan. When the loan becomes due, a large sum or "balloon" payment is
required to satisfy the mortgage.
 Bridge loan; A short-term mortgage made until a longer-term loan can be made; it's
sometimes used when a person needs money to build or purchase a home before the
present one has been sold.
 Broker: A person licensed by a state real estate commission to act independently in
conducting a real estate brokerage business. Although requirements vary from state to
state, an individual must usually have at least one year of experience in the industry and
pass an examination to earn a broker's license.
 Building codes: State and local laws that regulate the construction of new property and
the rehabilitation of existing property.
 Cap: The maximum amount an interest rate or monthly payment can change, either at
adjustment time or over the life of the mortgage.
 Chinese Drywall: refers to an environmental health issue involving defective drywall
manufactured in China and imported to the United States starting in 2001. Laboratory
tests of samples for volatile chemicals have identified emissions of the sulfurous gases
carbon disulfide, carbonyl sulfide, and hydrogen sulfide. These emissions, which have the
odor of rotten eggs, worsen as temperature and humidity rise and cause copper surfaces
to turn black and powdery, a chemical process indicative of reaction with hydrogen
sulfide. Copper pipes, wiring, and air conditioner coils are affected, as well as silver
jewelry. Homeowners have reported a variety of symptoms, including respiratory

37 | P a g e

problems such as asthma attacks, chronic coughing and difficulty breathing, as well as
chronic headaches and sinus issues.
 Closing: The final step in the sale and transfer of ownership of a property. The title is
transferred from the seller to the buyer; the buyer signs the mortgage and pays costs of
settlement; any money due the seller and purchaser are paid.
 Closing costs: Fees and expenses, not including the price of the home, payable by the
seller and the buyer at the closing (e.g., brokerage commissions, title insurance
premiums, and inspection, appraisal, recording, and attorney's fees).
 Closing Statement: A financial statement rendered to the buyer and seller at the time of
transfer of ownership, giving an account of all funds received or expended.
 Cloud on the title: Any condition which affects the clear title to real property.
 Commercial bank: A financial institution authorized to provide a variety of financial
services, including consumer and business loans (generally short-term), checking
services, credit cards, and savings accounts.
 Comparables: Properties similar in size and character to the one being bought or sold.
Condominium: Ownership of a unit only, rather than of the entire building with the land.
 Consideration: Anything of value to induce another to enter into a contract (i.e. money,
services, a promise).
 Contingency: A condition that must be satisfied before a contract is binding.
 Contract: An agreement to do or not to do a certain thing.
 Conventional mortgage: A fixed rate, fixed-term mortgage not insured by the federal
government. Deed: A legal document conveying title to a property.
 Deed (quit claim): A deed that transfers only that title or right to a property that the
holder of that title has at the time of the transfer. It does not warrant or guarantee a
clear title.
 Department of Housing and Urban Development (HUD): A U.S. Government agency
established to implement certain federal housing and community development
programs.
 Disclosure laws: State and federal regulations which require sellers to disclose such
conditions as whether a house is located in a flood plain or whether there are known
defects in or affecting the property.
 Encroachment: A condition that limits the interest in a title to property such as a
mortgage, deed restrictions, easements, unpaid taxes, etc.
 Equity: The value of real estate over and above the liens against it. It is obtained by
subtracting the total liens from the value.
 Equity mortgage: A mortgage based on the borrowers' equity in their home rather than
on their credit worthiness.
 Escrow: The placement of money or documents with a third party for safekeeping
pending the fulfillment or performance of a specified act or condition.
 Federal Housing Administration (FHA): An agency within the Department of Housing and
Urban Development (HUD) that administers loan guarantee programs and loan insurance
programs to make more housing available.
 Fannie Mae: Nickname for Federal National Mortgage Corp. (FNMA), a tax paying
corporation created by Congress to support the secondary mortgages insured by FHA or
guaranteed by VA, as well as conventional home mortgages.
 FHA Insured mortgage: A mortgage under which the Federal Housing Administration
insures loans made, according to its regulation, by approved lenders.
 Fixed rate mortgage: A loan that fixes the interest rate at a prescribed rate for the
duration of the loan.

38 | P a g e

 Foreclosure: Procedure whereby property pledged as security for a debt is sold to pay the
debt in the event of default.

 Freddie Mac: Nickname for Federal Home Loan Mortgage Corp. (FHLMC), a federally
controlled and operated corporation to support the secondary mortgage market. It
purchases and sells residential conventional home mortgages.

 Graduated-payment mortgage: A mortgage that starts with low monthly payments and
increases at a predetermined rate.

 Growing-equity mortgage: A mortgage loan in which the monthly payments increase by
a specific amount each year, with the "Overpayments" applied to the principal.

 Installment debts: Long-term debts that usually extend for more than one month.
 Investor: The holder of a mortgage or the permanent lender for whom the mortgage

maker services the loan. Any person or institution that invests in mortgages.
 Joint & Survivorship Deed: (Also known as "Warranty deed creating tenants in common

with right of survivorship") Upon death of one of the owners, title to the interest
transfers "by contract" to survivors.
 Lease purchase agreement: Buyer makes a deposit for the future purchase of a property
with the right to lease the property in the interim.
 Lien: A legal claim against a property that must be paid when the property is sold.
 Loan-to-value ratio: The relationship between the amount of a home mortgage and the
total value of the property. Lenders may limit their maximum mortgage to 80-95 percent
of value.
 Lock-in-rate: A commitment made by lenders on a mortgage loan to "lock in" a civilian
rate pending mortgage approval. Lock-in periods vary.
 Market value: The highest price a buyer will pay for a property and the lowest price the
seller will accept. Mortgage: One type of document used to make property the security
for the payment of a loan.
 Mortgage broker: An individual or company that obtains mortgages for others by finding
lending institutions, insurance companies, or private sources to lend the money; may also
make collections and handle disbursements.
 Mortgagee: The lender of money or the receiver of the mortgage. Mortgagor: The
borrower of money of the giver of the mortgage document.
 Negative amortization: An increase in the outstanding balance of a mortgage resulting
from the failure of periodic debt service payments to cover required interest charges on
the loan.
 Note: A written promise to pay a certain amount of money.
 Origination fee: A fee or charge for work involved in the evaluation, preparation and
submission of a proposed mortgage loan.
 Pre-payment penalty: A fee paid to the mortgagee for paying the mortgage before it
becomes due. Also known as pre-payment fee or reinvestment fee.
 Private mortgage insurance (PMI): Insurance issued to a lender by a private company to
protect the lender against loss on a defaulted mortgage loan. Its use is usually limited to
loans with high loan-to-value ratios. The borrower pays the premiums.
 Promissory note: A written contract containing a promise to pay a definite amount of
money at a definite future time.
 Radon: A colorless, odorless gas formed by the breakdown of uranium in subsoil. It can
enter a house through cracks in the foundation or in water and is considered to be a
health hazard.

39 | P a g e

 REALTOR® and REALTOR®-Associate: Registered collective membership marks that
identify real estate professionals who are members of the National Association of
REALTORS® and who subscribe to its strict Code of Ethics.

 Rent with option: A contract which gives one the right to lease property at a certain sum
with the option to purchase at a future date.

 Savings and loan association (S&Ls): Depository institutions that specialize in originating,
servicing, and holding mortgage loans, primarily on owner-occupied residential property.

 Savings bank: A financial institution organized to hold individual depositors' funds in
interest-bearing accounts and to make long-term investments, such as home mortgage
loans.

 Second mortgage/Second deed of trust/Junior mortgage or junior lien: An additional
loan imposed on a property with a first mortgage. Generally a higher interest rate and
shorter term than a "first" mortgage.

 Severalty ownership: Ownership by one person only. Sole ownership.
 Shared equity mortgage: A home loan in which an investor is granted a share of the

equity, thereby allowing the investor to participate in the proceeds from resale.
 Survey: The process by which a parcel of land is measured and its area ascertained.
 Tenancy in common: Ownership by two or more persons who hold an undivided interest

without right of survivorship. (In the event of the death of one owner, his/her share will
pass to his/her heirs.)
 Title: A document that's evidence of ownership.
 Title defect: An outstanding claim or encumbrance on property that affects
marketability.
 Title insurance: Protection for lenders and homeowners against financial loss resulting
from legal defects in the title.
 Veterans Administration (VA): A government agency that provides services for eligible
veterans of the armed forces. Among other programs, it guarantees mortgage loans
made by private lenders to veterans.
 Variance: A special suspension of zoning laws to allow the use of property in a manner
not in accord with existing laws.
 Zoning restrictions: Local municipal ordinances that classify property according to
specific uses such a single family, residential, commercial, industrial, multi-family, etc.

40 | P a g e

Notes on Appealing Properties

ADDRESS:
PRICE:
BEDROOMS:
BATHS:
STYLE:
POSITIVES:
NEGATIVES:
NOTES:

ADDRESS:
PRICE:
BEDROOMS:
BATHS:
STYLE:
POSITIVES:

41 | P a g e

NEGATIVES:
NOTES:
ADDRESS:
PRICE:
BEDROOMS:
BATHS:
STYLE:
POSITIVES:
NEGATIVES:

42 | P a g e


Click to View FlipBook Version