Redfin Berkeley Home Buying Class
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Redfin Berkeley Home Buying Class

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    Redfin Berkeley Home Buying Class Redfin Berkeley Home Buying Class Presentation Transcript

    • Redfin’s Home Buying Event Redfin’s Oakland – Berkeley Team June 24, 2014 - Berkeley, CA Host: Tom Hendershot @Redfin http://www.facebook.com/Redfin
    • Meet Redfin’s Oakland – Berkeley Team
    • A Little Bit About Who We Are Redfin is a real estate brokerage that has helped over 20,000 people buy or sell a home; 97% would refer us to a friend. ● Customers, not commissions ● Informed decisions ● Right home for the right price  No obligation  Commission credit
    • Save $6,000 on Average
    • Agents Paid on Your Satisfaction
    • Understanding the Buying Process
    • Overview of Buying a Home Research Your needs The market Neighborhoods Agents Mortgages Preapproval Search Define Preferences Instant Alerts Open houses Home tours Offer Comparables Draft offer Negotiate Mutual acceptance Closing Earnest money Inspection Loan application Title review Appraisal Financing approval Closing
    • Understanding the Market
    • Current Market: Low Inventory
    • Current Market: Rising Prices
    • Berkeley Current Market Stats
    • Never Miss A Home
    • Real Estate Sites: What to Look For ● Has all the homes for sale ● Updated every 15 minutes ● Real-time sales data ● Insights from agents ● Lots of data ● Mobile apps
    • Making the Most of Your Tour 1. Bring a camera, notebook & tape measure 2. See how much sunlight the place gets 3. Check the bathrooms for rot & mold 4. Look for wavy or discolored wood siding 5. Make sure water spouts drain away from house 6. Take stock of storage space 7. Turn off any music playing in house 8. Check for hardwood floors 9. Peek into the attic 10. Bring a marble or two 11. When sharing a wall, make sure it’s thick 12. Ignore the appliances and carpets 13. Check the closets 14. Get the disclosure packet 15. Compare the property’s tax records to the listing details
    • Slide 15 of 55 How Touring with Redfin Works ● Led by agent or associate agent ● Up to six homes per tour in two hour blocks ● Go on as many tours as you need ● No obligation, no pressure
    • Choosing the Right Agent
    • 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 complaint? ● How are you paid? ● Can I see some reviews of your work?
    • Redfin Agent Reviews
    • Mortgages
    • 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 ● Good for 90 days, depending on lender Info needed: ● W-2, two pay-stubs, tax returns, bank statements
    • Getting Pre-Approved Income oSalary—Past 30 days oHourly—Consistency and history oSelf-employed—Two year average Assets o Down Payment o Closing Costs o Cash Reserves Credit o640 for FHA o680 for Conventional o720 for Rate Improvement
    • Review Your Financial Situation ● Pull credit report, look for errors ● Establish comfort level for monthly payment ● Pay down credit balances ● Don’t open any new lines of credit ● Don’t buy any big ticket items ● Source of money ● Current employment status
    • Pre-approval Scenario oEarns $6,500/month oHas car payment $300 oWants to buy a home for $500,000 oHas 20% down payment o $6,500 x 45% = $2,925 o $2,925 – 300 (other debt) = Allowed $2,625/Month! $400,000 Loan o30/Yr Fixed, 3.75% = $1,852 oProperty Taxes o1.41% on purchase price = $588 ($7,050/yr) oHomeowners Insurance = $100 ($1,200/yr) oTotal: $1852+588+100 = Qualified $2,540/Month!
    • Where Are Rates Headed? Type of Loan June 19, 2014 June 12, 2014 30-Year Fixed 4.17% 4.20% 15-Year Fixed 3.30% 3.31% 5/1 ARM 3.00% 3.05% 1-Year ARM 2.41% 2.40%
    • 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
    • Local Recommended Lenders In no way does Redfin benefit financially from recommendin g lenders – we just think they’re great lenders!
    • 10-Minute Break 10 mins 5 mins End Let’s Get Started!
    • Making an Offer
    • 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: ►Earnest Money ►Inspection ►Financing ►Appraisal ►Title Review
    • 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 getting financing. Other types: ● Appraisal – Performed in conjunction with financing ● Financing ● Inspections ● Preliminary Title Report ● Insurability
    • Tips for Winning a Bidding War 1. Just win, baby! Simply have the best offer. ► Cash is King ► Escalate your price? ► Tighten your timelines ► Remove some contingencies? 2. Get pre-approved with a local lender 3. What’s important to the seller? 4. Write a letter & appeal to the seller
    • Acceptance to Closing
    • Steps After Mutual Acceptance ● Loan application ● Earnest money deposit – usually 3%+ ● Inspection – approximately $500 ● Other inspections – plumbing, structural, roof etc. ● Title review ● Appraisal ● Loan approval ● Document signing ● Walk through ● Closing ● Receive your keys!
    • What is Escrow? Escrow is a third party intermediary that represents neither the buyer nor the seller. 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
    • Home Inspection 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
    • The Closing Process Tour homes Find dream home Consult with agent, write offer Submit offer to listing agent Negotiations Success! Mutual Acceptance Earnest money [Within 3 days] Inspection contingency [10-17 days] Loan & Appraisal Contingency [17 days] Title review [5 days] Waiting for loan approval Escrow signing appointment Get keys and take possession! Closing! Overview of a Purchase Receive Redfin refund Complete Redfin survey Get pre-approved
    • 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
    • All Done!
    • Thanks for Coming! Questions? Get in touch: Presenter1 tom.hendershot@redfin.com Presenter 2 davey.centina@redfin.com Check out our upcoming classes: http://www.redfin.com/buy-a-home/classes-and-events