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Most buyers know what kind of house they want, but have a vague idea of how much they can comfortably afford to pay for it. To learn what you can and cannot afford, contact a lender or mortgage broker who will help you determine the type and amount of the loan for which you can qualify.
There are two general steps in the loan process: Pre-qualification and pre-approval. Pre-qualification gives you a good idea how much “home” you can really afford, while pre-approval is the actual amount a lender will fund to you. A firm understanding of your funding limits puts you in a stronger negotiating position when the time comes to make an offer.
Choosing a Realtor
Be sure to choose a realtor that belongs to the local Board of Realtors. Your agent should be knowledgeable about the neighborhoods and types of properties that interest you. Your realtor should be able to guide you through the intricate and potentially frustrating process of buying a home in San Francisco. They should provide you with up-to-the-minute market data, information about local and state ordinances, and the negotiation expertise to get you the transaction that’s best for you.
Shopping for Properties
San Francisco offers a diverse mix of single-family homes, condominiums, lofts, co-ops, and townhouses, but focusing on location in San Francisco can be tricky. Each neighborhood acts as a city within the city. Once you have decided on a neighborhood, ask your realtor about transportation, schools, and shopping in the area.
Different Types of Houses
San Francisco offers an abundance of older houses, such as Victorians, Edwardians and Mediterranean styles. Often these properties have classic features that are distinctive and unique to their era.
New homes are often hard to find in San Francisco because of the lack of open space. However, if you do buy from a builder, you may get your choice of appliances, fixtures and other enhancements.
Fixer-uppers can dramatically increase in value with even a few small improvements. However, be sure not to over-improve. Let the neighborhood be your pricing guide. Also, remember that a majority of fixer-uppers must be purchased “as-is.”
Managing the Purchase Process
1. The first rule in negotiation is to make sure both parties feel they come away with value. That means both sellers and buyers need to be flexible. Your realtor can explain the purchase contract in detail and don’t hesitate to ask as many questions as necessary.
2. Stay calm even when the stress level rises. Traditionally sellers feel they are selling below market value, while buyers believe they are paying more than market value. It is customary that once your offer is accepted, you are allowed a certain period of time to retain various inspections for the property; this is referred to as an inspection contingency. It is advisable that buyers retain their own inspectors to investigate all the systems and the structure of a house. Another contingency is a loan contingency, which allows you time to obtain a loan commitment from a lender. The close of escrow period is usually 30 days. If you’re considering a condominium or co-op, remember that the residents themselves make the Homeowners Association rules. Therefore, it’s important to be sure the rules are right for you. A majority of condos and co-ops also have monthly fees, which cover management and maintenance costs. Your realtor can give you more information about the monthly fees for any dwelling you are interested in.
Planning for Closing Costs
It is customary in San Francisco County for the buyer to pay for the following expenses:
Escrow and Title Fees Loan Points Inspection Report Fees
Also, note that probate and other court confirmed sales might request the buyer to pay the seller’s City and County Transfer Tax and Energy Conservation cost. Contact your title company for a thorough itemized list of expenses.
The cost of repairs, recommended by licensed inspectors, are usually negotiated between buyer and seller. Also, consider moving expenses, the cost of painting and repairs, including replacing old items or fixtures before you finalize a transaction.
Preparing to Move
With a little up-front planning, the move to your new home can be surprisingly simple. Here are some basic steps for making your move easier:
A. Complete a change of address form to make sure the post office will forward your mail.
B. Notify friends, business associates, creditors, doctors and dentists of your new address and phone number.
C. Contact your utility, phone and water company to transfer your service the day you move.
D. If you are transporting pets, ask your moving company about state regulations for pet entry and your veterinarian for travel safety requirements.
E. Meet the neighbors and enjoy your new home!
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