College Football season is starting this weekend, and I was thinking about how Teams are put together, and what makes a good team. Buying a new home in North Carolina is literally a “team sport,” in my mind, because there are different strategies for getting a good deal, there are a multitude of tasks, important timelines and responsibilities that all need special skill and attention.
A great Real Estate Team in North Carolina might have different players than the ones you are familiar with in other states, primarily because we are an “Attorney” state – and close loans with an actual Attorney representing the Seller and the Buyer at the closing (as opposed to a State that requires 2 attorneys or closes with a Title Company).
The Closing attorney is the one who checks the “Title” of the property – and insures that you are not going to have anyone coming after you purchase the property with a claim! They also handle the transfer of funds from the mortgage company and pay the Real estate commissions, pay the current mortgage off (if there is one), make sure the Homeowner’s Insurance Premiums are paid, Homeowner Association Dues are in order, and that the Property Taxes are in order. They also coordinate the Title Insurance and have you sign a MILLION copies of all the documents they must record!
We always recommend that you use a Real Estate Agent in the purchase of a home in NC. A Realtor® is a licensed agent that belongs to the National Association of Realtors®, which means they are pledged to a strict Code of Ethics and Standards of Practice. They’ve also taken an incredible number of hours of continuing education. They will help with many of the important details of the transaction, including:
- Determine your home buying needs
- Define your property search criteria – neighborhoods, school districts, local amenities…
- Provide insight on market trends, potential for property values
- Negotiate purchase contracts
- Pay attention to due-diligence periods and other important timelines
- Articulate inspection and appraisal reports
- Professionally estimate fair market value on listings
A common misconception of many First-Time Home Buyers is that hiring a real estate agent will end up costing more money! Not True! in most transactions, the Seller pays for the Buyer’s “Representation.” This is a transaction that likely has a comma and MULTIPLE zeros… it’s ALWAYS a good idea to have a professional help you with the negotiations! The Agents also has access to information about the history of the home, who built it – and what might be planned to go near the property in the future. Is there an Interstate planned for the backyard??? We work with some of the best Real Estate Agents in the State, and we’d love to refer you to one!
We like to think that as the Mortgage Professional in the team – we act as the glue that holds the entire transaction together (granted, it’s a biased comment). In addition to pre-qualifying you for the purchase price and monthly payment… it is our job to communicate with all of the other players on the home buying team throughout the entire process. Buying a home, and going through the mortgage process is not easy – we know that there are likely to be bumps between the time you sign the contract and the time you get the keys. We do OUR BEST to help ease those issues. Remember, you need to ask the Loan Officer more than just “what’s the rate!”
Another important part of the Home Buying Teams is the Insurance Company. The lender in any mortgage transaction will require a homeowner’s insurance policy (hazard insurance). This policy protects the property in the case of fire, theft or other damage (except flood or earthquake, those are separate policies and may be optional). If it is determined that the property that you want to purchase is in a flood zone, flood insurance is not optional, it is mandatory. The flood zone determination will be done with a “flood certification” from a third-party provider. The Home Owner’s Insurance is completely different than Mortgage Insurance.
Just like it’s always a good idea to have a Real Estate Agent involved on the team, a Home Inspector is also important. It’s not a Mortgage Requirement – but you want to have an inspection done. My one note of caution, remember that you are paying this person to find something WRONG with the home. They will look at the functionality of the home to make sure the electrical, plumbing and physical aspects of the home are strong, which will help the buyer make an educated decision about following through with the purchase, or renegotiating certain aspects of the contract. Important note about Home Inspections and USDA Home Loans.
Keep in mind, the home inspector and appraiser have different jobs. An appraiser determines value, while the inspector is to look for structural problems, defects or maintenance issues. The home inspector in North Carolina is doing this strictly for the buyer’s sake. So, an inspection is not required, but it is recommended. As a matter of fact, one of the forms in an FHA application package is one that says “For Your Protection: Get a Home Inspection.” Who knew that HUD was poetic.
There’s also an Appraiser in the Home Buying Process… but I wouldn’t add them to the “team.” Because of the way Congress allows us (read DOESN’T”T allow us) to talk to an appraiser, we have no control over what they do. Once the appraisal is back, if the value they place on the property is less than the contract price, negotiations may take place. This is one of the times that understanding the Due Diligence period is so important!
If you have questions about the Steps to Home Ownership, first time home buyer programs, or specific concerns about buying a house in NC – please call Steve and Eleanor Thorne NC’s Mortgage Experts 919 649 5058 We offer the best rates, and we would love to help you buy a home in NC!