Podcast: The Purchasing Pathway System
Transcript
Read Time: 12 Minutes
Welcome to The Home Helper Show, a conversation about all things people, places, and everything in-between. I'm your host and local Real Estate Professional, Michael Unis.
The home purchasing pathway system helps a buyer purchase with the greatest peace of mind through a Realtor they trust.
You must have a plan for your purchase because the alternative is that others have a plan for you, which might not be the best fit for your needs.
Working with a professional ensures you navigate the homebuying process with discipline and direction. Ultimately saving your time, energy, and money.
I pour 100% of my efforts into working with clients. I am dedicated to serving their needs before, during, and after the sale. Therefore, when choosing a real estate professional, you'll want to be sure they have a clear understanding of the purchasing process and a deliberate way of working from the moment of contact with you to after closing the transaction.
Here is a look at the 10-step Purchasing Pathway System I use in my business. Whether we are working together or listening to this 1000 miles away, I hope that you gain value from what I'm about to share with you and apply it to your own real estate purchase.
Let's walk through this step-by-step. The following steps are a game plan. It guides you on what to expect from the initial consultation through the closing of your home. So, instead of reading all ten steps, I'll walk you through each in a conversational form. And in the show notes is a link to a PDF with each of the 10 steps outlined for you.
The process begins with the initial appointment, also referred to as the buyer consultation. The purpose is to better understand your "needs and wants" as a buyer. This may be the most critical part of the home buying process. It ensures that you have a clear vision of the home you want before your tour. This ensures your expectations and desired outcome are matched appropriately.
Here's why this is so important. According to Zillow's recent press release, 75% of recent homebuyers have regrets about their new home. Here are a few highlights from the report.
The top regret cited by recent buyers is purchasing a home that needs more work or maintenance than expected.
Nearly three-quarters of successful buyers wish they had done at least one thing differently; almost 40% wish they had taken more time searching for a home or weighing their options.
Most recent home shoppers faced buyer burnout, pausing their home search at least once during the process.
One way to remedy this is to buy in a less frenzied market, which could ease buyer's remorse by giving would-be homeowners more time to weigh their options. But, regardless of the market conditions, having a clear vision and way to get there is essential.
During the buyer's consultation, you'll discuss the purchasing parameters and review lending options if taking advantage of mortgage financing.
There are three criteria every buyer uses to find their home. They are location, price, and style/condition. These three criteria, along with the "needs and wants," determine the properties you'll search for online and initially tour in person.
Location is determined by the town of choice; the price ultimately should allow you to meet all the needs while potentially needing to reconsider the wants. Style refers to the type of property, meaning a ranch that is a one-level home, a colonial, cape cod, or another kind of choice. And the condition is determined by how well cared for the house was or when it was last updated. Shifting any one of these criteria helps you to choose the purchasing parameters. Most real estate agents and their clients focus on price, while the focus is best placed on these top three criteria; location, price, and style/condition.
Equipped with the needs and wants and the ideal location, price, and style/condition of the home in mind, it's time to acquire the pre-approval. I have a good blog post that dives into the differences between a pre-qualification and a pre-approval. It's worth a quick 3 minute read, but I'll be sure to post this link in the show notes for now.
Viewing homes without a pre-approval is like driving a car without a license. You know how to drive a car, you're old enough to do so, but you don't have permission yet. A pre-approval creates an opportunity for you to not just under what you qualify for but ultimately decide what you can afford. This is critical. This conveys to the seller the seriousness of your offer because it's backed by a commitment of funds. This greatly enhances your negotiating position, especially in a competitive market.
Now it's time to head out and view homes. Viewing homes provides you with information to make the best decision possible. Helping you find a home is a process of elimination, not selection. And viewing homes you don't like is not a waste of time; it helps build a frame of reference to guide you toward what you do like.
When you find that home you like, it's time to write the contract. The best way to prepare for the contract phase of a transaction is to review a blank copy of the purchase agreement beforehand. This will also make you more comfortable during the negotiation phase.
With the contract accepted, it's time to deposit the earnest money. An earnest money deposit is the best way of communicating to the seller that you're serious about purchasing their property. Earnest money is kept safe in a trust account until those funds are used to close the transaction.
But, before you can move to close, it's essential to host a Home Inspection. The inspection will allow you and the inspector you hire to take a more thorough look at the property. This inspection will give you a far greater understanding of your purchasing home. And, if needed, you'll have a chance to address any concerns with the sellers before you move to execute the closing documents.
Once the contract is accepted, the home inspection clause is closed out, and you've conducted the final walkthrough, you are good to move to close. Just a quick note on the final walkthrough; after the mortgage has been approved (remember, you were "pre-approved" before, not "approved"), a final walkthrough is encouraged. It's not a second home inspection. Instead, it's a chance to ensure the home is in an acceptable condition.
With the closing documents executed, it's time to deliver the home and officially claim homeownership!
Just to recap briefly, here are the 10 steps in order:
Initial Appointment
Determine the Purchasing Parameters (includes location, price, style/condition)
Acquire the Pre-Approval
View Homes
Write the Contact
Deposit Earnest Money
Perform the Home Inspection
Conduct the Final Walkthrough
Execute the Closing Documents
Home Delivery
No two people have the exact home purchase needs or financial situation. As a Coldwell Banker Realty network member, I seek to serve as a Real Estate Trusted Advisor. My goal is to help you determine which lifestyle factors are most important when making your upcoming home purchase. Think of today's conversation and the Purchasing Pathway System as your guide or the first step on your journey to enhance your lifestyle.
When my wife and I purchased our home here in Columbia, Maryland, we hadn't even seen the home yet. So there are ten steps here, and we followed them. But I tell you that because these ten steps can look different for everyone.
We had purchased, kind of at the height of the pandemic, 2021, and the schools were closed. We had two kids, another on the way. And so we were with family out of state, and our real estate agent, which I hired, I have a license, and I wasn't actively practicing at that time in the where I was living, and I wasn't even in that state at that time.
And so, we chose to work with our local real estate professional. I'm glad we did because he walked through the home on Zoom or face time, I should say. And we ultimately made the offer, acquired the house, and didn't see it after everything was eventually signed and agreed to, and the home inspection was scheduled, and we still followed. Hey, have a home inspection that was really important to us and talk about those concerns with the seller. And we just walked through the steps together, and ultimately, it led to a smooth transaction. We closed on time. And when it comes to number two, the purchasing parameters are determined.
We started by looking at townhomes, seeing location, price, down condition, and the location we wanted. Townhomes were kind of what we could afford. When we started to shift the location a little bit, we were able to move into single-family homes, and we also increased the price to match. And then we gave up some on style and condition because it was a lower-priced home with more opportunity to grow by doing some of the work ourselves and the home we landed in. Ultimately we love.
But those purchasing parameters are not set in stone. They're going to change and shift throughout your journey to homeownership and working with a true professional who's going to listen with empathy. Being where you are in that process is critical. No two people have the exact home purchase needs or financial situation. As a Coldwell Banker Realty Network member, I seek to serve as a real estate trusted adviser, and you want to find someone like that to have in your corner no matter where you are in the country or world making your purchase. So my goal is to help you determine which left all factors are most important when making your upcoming home purchase. Think of today's conversation and the Purchasing pathway system as your guide or first step on your journey to enhance your lifestyle.
As your local real estate professional and trusted advisor, thank you for being here today. See you next time and be good.