Should I Arbitrate or Not?
One of the issues you need to think about when comleting an offer to purchase in California is whether to use arbitration to resolve any conflicts that arise as the result of the transaction (this may not apply to other states).
I am not an attorney and cannot advise you on whether you should or should not, as it is a personal choice. That said, I have been told by legal advisors in our state that arbitration often can be a faster way to resolve issues, if any, adn less expensive than going to court. And most people tend to choose this option.
If you do not elect to use arbitration, the seller will also have to agree, since both parties must agree on which way to go.
Know that there are some issues that fall under the jurisdiction of small claims court (e.g., deposit issues) that can get resolved in court even if you elect the arbitration route first. Our Residential Purchase Agreement (RPA – CA) explains this in more detail.
I Don’t Want That in the House
Buyers are often confronted with lots of stuff when they are touring homes they are considering buying. And, equally often, the question is ” does that stay with the house or does it go?”
This is a great question, and one every buyer should ask.
When you submit an offer you will want to define or clarify any issues about stuff that you want vs. what you don’t/ Without making it complicated, in general ALL the sellers’ personal possessions or “personal property” are expected to be taken (including the trash), while things that are “attached” generally stay. Things like appliances can become big issues in negotiations since the sellers may want some of them (often the washer, dryer, and refrigerator). Commonly the MLS will list which appliances convey with the house, but NOT ALWAYS. So if these are important, you should check AND list them in the offer as remaining with the house.
Bear in mind that this is negotiable, and simply asking for all the appliances, or other things, does not mean the seller will willingly leave them. That may depend on your offer. Admittedly some sellers are not very clear about these things,, change their minds, etc. which can lead to confusion, and disrupt the negotiation.
By the same token, if there are things you do NOT want, it does not hurt to spell that out in writing so there is no confusion. You are in a much stronger position to demand something be removed if it is spelled out in the contract both you and the seller signed.
Talk with your agent about these issues before you get too far along. It can help avoid any problems.
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If I can provide more information about Carlsbad and surrounding areas, or the housing market in general, or otherwise assist you in your homes search, please contact me by phone or text at (760) 840-1360 or email me at JDowler@remax.net.
All content copyright © 2007 Jeff Dowler Carlsbad Homes and Real Estate Tidbits
When Do I get the Keys to My New Home?
The most exciting thing about buying your new home is having closing, obtaining the keys, and walking through the front door. So when does this happen?
Keep in mind that closing occurs in different ways in different states. In some locales you may sit down with your agent and an attorney, or some other professional, to sign paperwork and then receive your keys right there.
Here in California you normally receive the keys once the escrow company has received all the paperwork, your loan has been funded (i.e., the money is in escrow’s account), and the recording of the deed and other documents has occurred). You might meet your agent at the house, or be able to pick up the keys somewhere else once closing has occurred and you receive a call to that effect. Check with your agent as closing gets close so you know what to expect.
Sometimes folks want to get the keys early so they can start moving in, especially if they have movers bringing things. You will have to obtain permission from the sellers in order to do this, and often they are unwilling to do so becuase of liability issues. But there are exceptions
When making your offer, make sure you specify in the offer when possession is to take place. It could be, say, 5 PM on the date of closing. But sometimes sellers want it to be later so they can move out. You will have to come to an agreement on this.
WARNING!I recommend that you do not make specific plans with movers, arranging for vendors to do work, etc. on the day or closing, adn perhaps not even the day after, unless they can be changed. Sometimes things get delayed, through no fault of your own. If you do get possession when expected you could be in a bind.
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If I can provide more information about Carlsbad and surrounding areas, or the housing market in general, or otherwise assist you in your homes search, please contact me by phone or text at (760) 840-1360 or email me at JDowler@remax.net.
All content copyright © 2007 Jeff Dowler Carlsbad Homes and Real Estate Tidbits
How Long Should I Search for a Home?
I’ve been asked this question a number of times. And there is no real right or wrong answer – it depends on you.
Some folks are able to find the house of their dreams, or at least one they want to live in, fairly quickly. A few weeks, a month or two. They may look at 5 – 10 houses and they are done. The shortest time was 1 day (for a relocation) in my personal experience.
Others may take much longer, for a variety of reasons. Can’t decide, don’t like what they see, are too picky, are afraid of making the decision, keep hoping a better deal will come along, etc.. I have had buyers take over a year to find the right house and finally buy.
I wouldn’t get it into your head that finding a home has to take a certain period of time, since so much depends on your personal decision making style, the inventory in your price range, the amount of time you have to look, and more. Some first time home buyers like to set a goal of buying by a certain time, or need to due to their rental or family situation.
But if you find yourself getting frustrated, take a look at what might be causing the problem. And is there something you can do about it?
Carlsbad Homes – Short Sales Q and A
I am often asked questions about short sales. Let’s face it, they have an appeal for many buyers, even though they may end up not being a great deal, and there are a good number of them around in various markets. Sooner or later you will come across one in your Carlsbad home search, or anywhere else you may be looking (keep in mind that laws regarding some of these issues MAY vary from state to state).
I have been writing a series on common questions that Carlsbad buyers typically ask. I will update this list as I post other articles; these are probably pretty common for buyers everywhere:
Who Pays the Taxes and Penalities?
Can I make an Offer Contingent on Selling my Home?
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Start your CARLSBAD HOMES SEARCH here (and other San Diego communities)
Download FREE BUYER AND SELLER REPORTS here
Visit CARLSBAD COMMUNITY REPORTS for profiles on communities, subdivisions and neighborhoods (including other nearby towns)
What are CC and Rs?
As part of the disclosure process, once you have an accepted offer on California real estate in Carlsbad (or elsewhere), you will have to review the CC & Rs (if there are any) that exist for the home you are buying.
CC & Rs stands for Covenants, Conditions and Restrictions. Sounds complicated, but it’s not really…although they can be lengthy with lots of legalese. You will find them most commonly in subdivisions and they are generally recorded documents.
Simply put, this is a description of the things you can and cannot do with your property on the area in which the property resides. Restrictions limit the activities of homeowners (you can’t turn your property into a farm) to assure that the property use is consistent with land use in the general area.
Covenants are promises to do or not do certain things. You might be prohibited from parking your RV on the street or in the driveway (a separate area would normally be provided). A penalty is usually monetary damages or an injunction (a court order to stop what you are doing).
Conditions are pretty much the same as covenants, except that the penalty could be return of the property to the grantor.
If there is a Home Owner’s Association (HOA) they have the authority to enforce these rules.
These are not negotiable, and you will be expected to review and approve these as part of the contractual process. You, of course, will have a copy for your files. If you should decide you cannot abide by the rules, then your best course of action is to withdraw your offer before the end of the contingency period (see your contract).
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Start your CARLSBAD HOME SEARCH here (and other San Diego communities)
Download FREE BUYER AND SELLER REPORTS
As My Agent, What Will You do For Me?
As a buyer, you have lots of decision to make and many responsibilities. And some buyers decide to pursue purchasing a home without using an agent – making decisions without advice from a professional, making offers without really understanding the market and the value of the target property, and so on. And that’s a personal choice.
I guess I don’t understand why, when making the biggest purchase decision of your life as a consumer, you would not want to have the expert advice of someone who knows the real estate business and the market, to help you.
I’m sure you are asking, well, as my agent, what will you do for me?
There are a lot of things I can and will do as a licensed real estate professional and I have written several articles about this (read more here):
- A critical thing I will do is help you strategize about your offer – how much (making sure you know the value compared to similar properties that have sold), contingencies you should request, timing, financial terms, and more. And I will help you complete the 8 pages of the purchase agreement here in CA (plus multiple other documents).
- The other major issue is confidentiality. I will honor that, and keep all information confidential from the seller and listing agent unless your permission is granted to share it. Some things SHOULD be shared to help you in your negotiations, while others should not.
All in all my responsibility as YOUR AGENT is to look out for YOUR fiduciary interests, and to represent YOU in the real estate transaction and NOT the seller.
What Do I Do If the Seller Rejects My Offer?
There is a good chance that a seller will reject your offer if it is a low ball one, say 15-20% below the asking price.
The best approach to negotiation when making an offer is to propose a sale price that the seller will at least consider, and will counter-offer if they are not willing to accept it. But some buyers insist on making really low offers in the hope of getting a great deal, especially in this market where the inventory is large and homes are sitting on the market for long periods (in some cases).
Just as you have the right to make any offer, so can the seller respond any way desired.
If your offer is simply rejected without a counter, you have a couple of choices:
- Come back with another, better offer if you are truly interested in acquiring the house
- Walk away from the deal and pursue something else
You must decide what the home is worth to you and if pursuing it makes sense. While rejection of a low-ball offer is to be expected, I think, a seller may also reject a reasonable offer for a variety of reasons, which is harder to understand as the buyer.
If you really want the property and feel you can get to the point where you and the seller can agree on a price, then negotiations should continue. Otherwise it’s time to say NEXT!
Should I Ask for Seller Concessions?
When buying a home in today’s market (at least in those areas where the market favors buyers, not sellers), it is not unusual for buyer’s to wonder if they should ask for seller concessions.
And sellers will often consider offering them as well.
Is this something to ask for?
- First, you should find out from your agent if the seller is offering anything up front. It may be common in your competitive market and if so these terms will be listed in the MLS listing (e.g., seller is offering a credit of $XXX for carpet, or paint).
- Second, are concessions fairly common in your marketplace. This does not mean you can’t ask if they aren’t, but it is easier if it is commonplace. And sellers might not be taken by surprise.
- Third, consider the advantages and disadvantages of asking for any concessions and what those concessions might be.
- It is common for buyers to ask that some of the closing costs be paid for by the seller. And some sellers might be willing to pay a fee toward the loan to paydown the mortgage rate (e.g., the points). Does it financially make sense for you to have these concessions or not?
- Further, you must consider whether asking for concessions will make your offer less desirable or even unacceptable to the seller. If you make a good offer, accepting concessions will be easier for the seller, depending on their financial circumsances.
What is Property ID?
“I have heard of Property ID but don’t know what it is or what they do?”
Property ID is a national company, founded in 1976 in California, that provides natural and environmental hazards disclosures for both residential and commercial property.
As a buyer here in California (and many other states), the natural hazards disclosure is an important of the due diligence process once your offer has been accepted. The purpose here is to uncover any issues related to natural and environmental factors that may impact your home, and to communicate those to you in a detailed report so you know what you are buying. The cost of the report is normally paid for by the seller.
The report will detail whether you are:
- in a earthquake fault zone
- near an airport
- near a former military installation
- in a flood zone
- in a protected wildlife are
- in or near a fire hazard area
and much more. Once you have this information, you have the option of deciding if you still wish to purchase the home or not based on the natural and environmental hazards in the area. Certain factors (earthquakes, fires, flood) may impact your insurance as well.
