Redfin Home Buying Class
The Redfin San Diego City Team
May 7, San Diego, CA
Lisa Padilla – Team Lead/Agent
● Agent for 14 years
● Redfin Employee for 2 years
● Closed 61 with homes with Redfin and
● Specialize in: First Time Home Buyers,
Condos/Urban, High End, Single
Family, Short Sales.
● Services: San Diego City
● Lives in North Park
● Team Members:
► Tamara Markey & Chris Priola
● Overview of the process
● Are you ready to buy?
● Understanding the market
● Never miss a home
● Choosing an agent
● Short sales & foreclosures
● Making an offer
● Acceptance to closing
A Little Bit About Redfin
Redfin is a real estate brokerage on a mission to make buying
and selling a home better for you.
● Accountability: we’re on your side, giving you honest
● Technology: sellers get more traffic; buyers tour homes first
● Value: a full-service brokerage that saves you thousands
Overview of a Buying a Home
Are You Ready to Buy?
● Do you have a family and need room to grow?
● Do you expect to stay put for 5 or more years?
● Have you saved up for a down payment? 3.5% to 20+%
● Have you saved up for closing costs? Typically 0-2%
● Can you rent for less?
Where Is the Market Headed?
● Supply of homes is at a five-year low and won’t increase
much more this year
● Rents have been rising, making buying more attractive
● Market stabilized – price increases in many areas
● Rate increases – biggest potential issue for buyers
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● IMPORTANT! Be sure to go in to any New
Home Office with your agent
● Verify Options and upgrade pricing
● Changes to home
● Property Inspection
● Check builders reputation
What to Ask Any Agent
● Is this your full-time job?
● Where were your last five deals?
● Who else will be working with me?
● When am I committed to working with you?
● Has a client ever filed a compliant?
● How are you paid?
● Can I see some reviews of your work?
Redfin’s Partner Program
Partner agents are employed by other brokerages, and have
teamed up with us to provide Redfin-certified service
We’ll refer you to a Partner Agent when:
►A home is outside of our service area
►If it’s in your financial advantage to work with a partner
►We’re experiencing unusually high customer demand
We survey all partner agent clients
►All surveys are published on their Redfin page
►97% of customers would recommend Redfin Partners
Slide 25 of 55
How Touring with Redfin Works
● Led by agent or associate
● Up to six homes per tour in
two hour blocks
● Go on as many tours
as you need
● No obligation, no
Making the Most of Your Tour
1. Bring a camera, notebook & tape measure
2. See how much sunlight the place gets
3. Look for wavy or discolored wood siding
4. Make sure water spouts drain away from
5. Take stock of storage space
6. Turn off any music playing in house
7. Check for hardwood floors
8. Ignore the appliances and carpets
9. Check the closets
10. Compare the property’s tax records to the
Local Recommended Lenders
In no way does
lenders – we just
think they’re great
Review Your Financial Situation
● Pull credit report, look for errors
● Establish comfort level for monthly payment
● Figure out how much monthly income goes towards debt:
28 – 33% healthy
● Pay down credit balances to 1/3rd
● Don’t open any new lines of credit
● Don’t buy any big ticket items
● Source of money
● Current employment status
Get Pre-Approved Early
A pre-approval letter is a letter from a bank or a lender estimating
how much they'll lend you
● Establishes what you can afford & makes offer process go faster
● Redfin asks that you get pre-approved before your third tour
● Good for 90 days, depending on lender
● W-2, two pay-stubs, tax returns, bank statements
Where Are Rates Headed?
Type of Loan May 1, 2014 April 10, 2014
30-Year Fixed 4.29% 4.34%
15-Year Fixed 3.38% 3.38%
5/1 ARM 3.05% 3.09%
1-Year ARM 2.45% 2.41%
Types of Loans
► As low as 5% down
► Fixed or adjustable rates, conforming or non-conforming
● Federal Housing Administration Loan (FHA):
► Always have mortgage insurance
► Buyers need only a 3.5% down payment
● VA Guaranteed Loan:
► Veterans, active duty personnel, reservists/national guard, surviving
► No down payment
● Ask your lender if they have special loan programs
► Example: BB&T Chips Program
Start Shopping for Lenders
Compile a list of 3-4 local lenders
Good sources include:
● Redfin's partner lenders
● Referrals from friends, family & co-workers
● Online review sites, such as Yelp
● Local chains and offices
*Know your lender
10 mins 5 mins End
Let’s Get Started!
What is a Short Sale?
The owner owes more on the mortgage than the home is
● Usually pre-foreclosure, but not always
● Listed for less than what’s owed to the bank
● Requires 1 - 2 banks’ approval (usually 2)
● May have other liens (taxes, utilities, HOA)
What is a Bank-Owned Property?
● A foreclosed home owned by a bank or lender
● Standard sale but:
►Longer response times to offer
►Sold as-is, no repairs made
►Bank required addendums
►Limited or no disclosures
►Some banks require use of their own contracts
►Time is of the essence, contingencies automatically
removed on the specified date. Very hard to get
Crafting Your Offer
● Evaluate – your agent will provide you with information
about market conditions and recent sales in the area
● Consider the situation – the seller’s preferences, days on
the market, and other interest will influence the process.
● Decide on price & strategy with your agent
● Common contingencies & terms:
Tips for Winning a Bidding War
1. Just win, baby! Simply have the best offer.
► Cash is King
► Escalate your price?
► Tighten your timelines
2. Get pre-approved with a local lender
3. What’s important to the seller?
4. Write a letter & appeal to the seller
Steps After Mutual Acceptance
● Earnest money deposit – usually 1-3%+
● Inspection – approximately $500
● Other inspections – sewer scope, foundation, etc.
● Loan application – 5 days or less
● Title review
● Loan approval
● Document signing
● Walk through
● Receive your keys!
We recommend that you have a home inspection
● Cost runs $350 to $1200 depending upon the home’s size
● Your agent will accompany you
● Your time to evaluate the property
Let’s talk about:
● What an inspection contingency covers and doesn’t cover
● Types of inspections – Plumbing, Electrical, Roofing,
What are Contingencies?
This means the seller has accepted an offer on the property,
but success may still depend on passing a home inspection or
● Appraisal – Performed in conjunction with financing
What is Escrow?
● Escrow is a third party intermediary that represents neither the buyer nor the
● What do they do?
● Hold the earnest money
● Arrange for payoff of any liens (seller’s mortgage, utilities, etc.)
● Coordinate the signing appointments for all parties
● Receive and disburse funds for closing
● Arrange to notify county offices to change ownership
What is title?
● Prepares the final documents, including the HUD-1
● Conducts the closing
● Examines and clears the title to the property
● Records the deed, mortgage and any other recordable instruments
● Issues title insurance to the lender and the buyer
Signing and Closing
A few days before closing you will sign your closing documents
and have a walk through.
On closing day, you’ll probably get your keys at about 5pm.
● We’re on your side
►Agents paid on your satisfaction
● Double your exposure
►Premium placement on Redfin
►Zillow, Trulia, Craigslist and Realtor
● 1.5% listing fee
We’ve helped over 50 people sell their homes in the last six
Better Service, Lower Fees
So What Now?
● Make sure it’s the right time for you
● Start browsing online
● Check out our Home Buying Guide
● Find the right agent
● Look for a local lender and get pre-approved
● Start seeing homes in person
● Make an offer & close the deal
Thanks for Coming!
Questions? Get in touch:
Lisa Padilla – email@example.com
Check out our upcoming classes:
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