- Know The Home Buying Process
- The Inventory
- The Right Professionals
Buying a home can be a rewarding
and fun experience if you follow the
above steps. Eliminate any and you
can easily run into trouble. Hopping
into a car and looking at homes is
the most frequent method people
choose but it’s also the worst. Like
anything else, you have to know what
you’re doing first so that you can
make the very best decisions for
As you read this guide, you will
understand why it is so important to
take the time to get prepared
properly before you find your new
home. It is to your advantage to
have your mortgage banker, attorney
and home inspector all selected in
advance. I am assuming that you will
also find a real estate agent to
help you but this is up to you. You
can certainly purchase a home
without the help of an agent but you
cannot without the help of those
I’ve named above.
I think you will see that if you
don’t have everything lined up in
advance, not only will you be under
a lot of pressure in the future but
you won’t have the time to pick the
best choices for yourself.
Qualify yourself properly
BEFORE you look at homes and stick
to your budget. When you speak to
the mortgage banker, tell him/her
how long you think you will stay in
the house and describe your
financial planning goals - these are
critical factors. With this
information, as well as other data,
your mortgage banker can help you to
choose the mortgage product that is
best for you.
Only use a direct lender - a FDIC
licensed mortgage bank. The other
companies are mortgage brokers –
they aren’t licensed and they go to
other banks to get their funding.
They are, essentially, a middleman.
This creates added fees with no
advantage to you.
Be careful of how you shop for a
mortgage –too many credit inquiries
can lower your credit score. The
mortgage industry does understand
that people shop around for a
mortgage. However, shopping rates
for months in advance is a mistake.
There are so many things that affect
your credit score. Even taking out a
credit card for an extra 10% off at
a department store sale day can
spell disaster. A professional
mortgage banker can advise you
Another mistake often made is to
shop for rates – a company can
advertise any rate if it shows up
for one moment in the mortgage
market with obscure requirements.
Don’t let this fool you. If it’s too
good to be true, it generally
What I tell everyone is this –
Why would you choose the cheapest
brain surgeon to operate on you? You
know, the doctor with the big ad
that says he operates for less than
everyone else? Is that the doctor
you want operating on your brain?
This is your home but it is also
your biggest investment; please be
careful to choose fine professionals
who have only your needs as their
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2. The Home
A tremendous amount of
stress associated with buying a home
is easily eliminated if you just
know what’s going to happen and
when. Once you have found your home
here’s what really happens:
- You make an offer on a
contract form (Realtor’s
Contract) which includes a good
faith deposit made out to the
Agency’s trust account. The
home’s street address is noted
on the check.
- Your agent presents your
offer to begin negotiations with
- If you and the seller agree
on price and terms (what’s
when you buy the house, etc),
the seller signs and dates your
offer and you now have a
contract to purchase the house.
- The contract is immediately
faxed to both buyer and seller
attorneys. This begins the
Attorney Review process.
- During Attorney Review, the
lawyers fashion the contract for
your particular situation. Once
this is completed, the contract
- The home inspection is done.
- If there are any issues with
the home inspection, this is
negotiated through the
attorneys. If you cannot come to
agreement, the contract is
cancelled; you get your good
faith deposit back and the home
goes back on the market. If you
come to agreement then you move
on to closing.
- The full deposit is sent to
the seller’s attorney to be held
in trust and applied to your
closing costs as is the good
- The mortgage is finalized –
appraisal ordered, etc.
- If not already done, your
attorney will order the title
search and survey and prepare
the necessary closing documents.
- Your attorney will tell you
what funds to bring to the
- On the way to the closing,
you go to the house for a final
walk through inspection to see
if everything is as it should
- You then go to your
attorney’s office to first close
on the mortgage and then close
on the home.
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- Choose more than one to
- Research thoroughly the
town, schools, commuting and
- Drive through the areas –
see if there’s an emotional fit
for you, if you like the feel of
the town, the types of homes
there, how it looks.
- If you use an agent, refuse
to work with one who won’t do
this extra work for you – it’s
extremely important to pick the
right location. You can change
the house but not the town.
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- Learn the inventory – see
homes and take your time doing
- Ask your agent to send you
market data - what’s for sale,
what’s under contract and recent
sold listings in your areas of
- Have your agent give you the
background on any home that
interests you. This includes the
listing history, tax map and
flood map checks and anything
else your agent can find.
Your objective is to learn the
inventory well enough to be able to
have a good sense of the market
values. You will also want to get as
much information as you can on any
home that interests you. How long
has it been on the market? Was it a
rental property before being put up
for sale? Such things come from the
listing history. You can never have
too much information.
As you look at homes, you will
discover what you do and do not like
in a home. Keep an open mind – its
not at all unusual for you to change
your mind from what you first
thought would be ideal. It’s really
a learning process.
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5. The Right
Only a FDIC mortgage bank and
only a licensed mortgage banker.
Only an active member of the NJ
State Bar Association. If you
think of NJ as Wyoming, NY as
Delaware and Connecticut as
California, you’ll understand
that these are 3 different
states with 3 different legal
systems so a NY attorney cannot
automatically close on your NJ
Only an attorney who does a
large amount of residential
sales in his/her practice.
Commercial real estate is
radically different. Your
attorney must be experienced in
what you need.
Call several on the phone. Most
of what you do is by telephone
so you need to have a good
rapport with your attorney over
the phone. It doesn’t matter if
the attorney was #1 on the
Harvard Law Review if he/she
can’t understand your needs.
Communication is key.
- Home Inspector.
Only one who is licensed by NJ
and whose sole business is
inspecting homes. Most have
websites you can research as
well. Check with your attorney
for suggestions. You will want
to do a structural, pest and
radon inspection plus anything
else that is a concern for you.
Have your Realtor check on any
company you choose to make sure
that they are on the NJ State
- Real Estate Agent
What should you expect from your
- Complete loyalty and the
very best service possible.
- Good communication is
crucial – if you and the
agent can’t understand each
other, find another agent.
- A real estate agent
should be your strongest
advocate and your best
source for information and
- A good agent takes the
extra time to prepare and
educate you so that you can
make the best informed
decisions for yourself.
- A good agent should also
be able to anticipate your
needs and help you with
future needs as well such as
helping you to organize your
move and make your
transition to your new home
- Unless faced with a
bidding war, a good agent
should never make you feel
- Sometimes the agent who
sells the most houses gives
the worst personal service;
ask for references.
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I hope you
just call me
or you can
email me at