Redfin's Free Home Buying Class - Chicago
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  • [REQUIRED – please add the main presenter’s photos]
  • [REQUIRED – to be updated by the presenter to suit their strong points]
  • [REQUIRED – Update with local home in the $400-$500 range, ideally listed by Redfin]Talking points:- Refund is based on your offer price not the sales price- You’ll get it as a closing credit or check after close, depending on your lender
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  • Nate
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  • [REQUIRED – Updated every time]Agents should use this slide to talk about what they’re seeing on the streetTell some stories!
  • [REQUIRED – Should be updated once a month]The info on this slide is great. Lets add a visual so its more interesting after all the data slides.
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  • [REQUIRED]Add visual
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  • 5 minute break timer.To begin the timer, when in presentation view on the slide, click advance once and you will see the red appear from left to right. When the entire bar is red your break is up!
  • [REQUIRED]Add Lender’s name if he/she’s presenting
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  • [REQUIRED – Update with local lender]
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  • [Required]Add visual
  • [REQUIRED]Add visual
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  • The visual of the HUD would be great and could eliminate some of the verbiage here. REQUIREDA HUD is divided into two parts:Lender charges Includes origination fee, appraisal fee, credit report, insurance and tax escrowsTitle chargesIncludes settlement fee, and owner’s and lender’s title insuranceGovernment chargesIncludes recording fees, recordation taxes and property taxes
  • OPTIONALThis is different by market so we should have different slides for each.
  • Notes from Matt:- Update this slide so it is easier to read
  • We’ll stick around…

Redfin's Free Home Buying Class - Chicago Presentation Transcript

  • 1. Redfin’s Home Buying Class Redfin’s Far North/Northwest Team August 13, 2013 Chicago Follow: @RedfinChicago Like: http://www.facebook.com/RedfinChicago
  • 2. Chris Chesne, Chicago N/NW Agent ● I live in 60613 ● I have been a real estate agent for 14 years, a consultant for 23 years ● I currently specialize in buyer brokerage, but also represent sellers ● I have experience with foreclosures and short sales ● I am a real estate consultant, a negotiator, a bulldog, a helper Here’s what my clients are saying: “Chris is by far the most educated and confident relator we have ever worked with. He knew exactly what to look for and helped us with whatever questions we had. His knowledge of homes and home building is unmatched. We look forward to working with him again in the future.”
  • 3. Clayton Jirak – Redfin Chicago Agent, N/NW Side ● I live in the Ravenswood Neighborhood, on the North side of Chicago – 60640, just down the street from Chis Chesne. ● I specialize in helping my clients find the perfect home, but especially new home buyers and 1st time buyers in Chicago ● I’ve been in real estate for several years, and most of that time has been spent with Redfin Chicago (but not as long as Chris) ● I’m originally from Seattle, but have lived in Chicago for almost 10 years ● Here’s what my clients are saying: ● “Clayton was a pleasure to work with and helped us through a difficult sales process. He was very responsive and worked through the weekend to ensure we got the property we wanted”….Buyer that closed in May
  • 4. Agenda ● Overview of the process ● Are you ready to buy? ● Understanding the market ● Never miss a home ● Choosing an agent ● Touring ● Break! ● Mortgages ● Short sales & foreclosures ● Making an offer ● Acceptance to closing
  • 5. 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 advice ● Technology: sellers get more traffic; buyers tour homes first ● Value: a full-service brokerage that saves you thousands  No obligation
  • 6. Save $4,000 on Average
  • 7. Understanding the Buying Process
  • 8. Overview of a 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
  • 9. Buying a Home Talk to Lender Search Homes Negotiate Offer to Contract Attorney Review – 5 bus. days Inspection – 5 bus. days Loan Commitment – ~30 days - - - - - - - - - - - - - - - - Home-Sale/Close contingency Other inspection contingencies Contingency Periods Appraisal Final Walkthrough Closing Redfin Rebate…
  • 10. 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?
  • 11. Understanding the Market
  • 12. Case-Shiller: Chicago Area v. 20-City 0.00 50.00 100.00 150.00 200.00 250.00 Chicago Area 20-City Composite
  • 13. Case-Shiller – By the Numbers Chicago Area Up 9.3% year-over-year Peak was September 2006 Down 32.6% from peak As of April 2013, selling at June 2001 prices, but also mid- 2010 prices Case-Shiller: 20-City Composite Up 12.1% year-over-year Peak was July 2006 Down 26.2% from peak As of April, 2013, at January 2004 prices
  • 14. Story of 2013: Low Inventory
  • 15. Story of 2013: Rising Prices
  • 16. Chicago Area Overview
  • 17. Current Average Rates Type of Loan August 1, 2013 August 8, 2013 30-Year Fixed 4.39% 4.40% 15-Year Fixed 3.43% 3.43% 5/1 ARM 3.18% 3.19% 1-Year ARM 2.64% 2.62%
  • 18. Where Is the Market Headed? ● Supply of homes is at a five-year low and won’t increase much more this year ● Foreclosures have been driving price declines, and years of inventory remain. Investment groups might have impact ● Rents have been rising, making buying more attractive ● Market stabilized – price increases in many areas ● Rate increases - biggest potential issue for buyers
  • 19. Never Miss A Home
  • 20. 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
  • 21. Never Miss a Home (Instant Updates)
  • 22. Choosing the Right Agent
  • 23. 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?
  • 24. Redfin Agent Reviews
  • 25. 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 below Redfin’s minimum price ► 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
  • 26. Seeing Homes in Person
  • 27. 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
  • 28. Slide 28 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
  • 29. Break! Chris Chesne Clayton Jirak
  • 30. 10-Minute Break 10 mins 5 mins End Let’s Get Started!
  • 31. Mortgages
  • 32. 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
  • 33. 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 Info needed: ● W-2, two pay-stubs, tax returns, bank statements
  • 34. Pulling Credit: Is It Harmful? ● Your credit report must be reviewed by a lender before you can obtain a pre-approval ● If you know your score, a lender should be able to give you ballpark pricing for their loan products ● Better to know sooner rather than later about credit problems ● Maintaining a pre-approval has a negligible impact on your credit score
  • 35. 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
  • 36. Local Recommended Lenders In no way does Redfin benefit financially from recommending lenders – we just think they’re great lenders!
  • 37. Short Sales and Bank Owned
  • 38. What is a Short Sale? The owner owes more on the mortgage than the home is worth ● 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) We Can Help With a Short Sale! ● See short sales with a Redfin Agent ● If you want to buy, work with a Redfin Agent or a short sale partner agent ● Redfin partner agents work for other brokerages but share Redfin’s commitment to customer service ● Get a 15% commission refund
  • 39. What is a Bank-Owned Property? ● A foreclosed home owned by a bank or lender ● Standard sale but: ► Verbal negotiations ► Long response times ► Repairs unlikely ► Legal addenda may require an attorney ► Limited or no disclosures ► Banks demand use of their own contracts ► Bank can back out any time until they’ve signed ► Earnest money deposit usually held by listing agent
  • 40. Making an Offer
  • 41. 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
  • 42. Tips for Winning a Bidding War 1. Just win, baby! Simply have the best offer. ► Cash is King ► 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
  • 43. Acceptance to Closing
  • 44. Steps After Mutual Acceptance ● Earnest money deposit – usually 1-3%+ ● Inspection – approximately $500 ● Other inspections – sewer scope, septic, etc. ● Loan application – 5 days or less ● Attorney review ● Appraisal ● Loan approval ● Final Walkthrough ● Closing ● Receive your keys! ● …and Redfin rebate… …and rate your Redfin agent…
  • 45. Home Inspection We recommend that you have a home inspection ● Cost runs $350 to $600 depending upon the home’s size, type ● 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
  • 46. 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 ● Termite ● Other
  • 47. Title Companies ● Usual location of a closing, sometimes instead at an attorney’s office ● Prepares the final documents, including the HUD-1 settlement statement ● “Closer” 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
  • 48. Closing: HUD–1 Settlement
  • 49. Signing and Closing ● You’ll have a final walk-through on closing day or just before ● What to bring: ► Government issued photo ID ► Certified check or wired funds ● Closing typically takes 1.5 to 3 hours, but can run long ● Get keys and take possession!
  • 50. Selling Your Home with Redfin
  • 51. ● We’re on your side ► Agents paid on your satisfaction ● Double your exposure ► Premium placement on Redfin ► Zillow, Trulia, Craigslist and Realtor ● 4.0 % listing fee ► Professional photos ► Beautiful flyers We’ve helped over 50 people sell their homes in the last six months. Better Service, Lower Fees
  • 52. All Done!
  • 53. 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
  • 54. Thanks for Coming! Questions? Get in touch: Chris Chesne chris.chesne@redfin.com Clayton Jirak clayton.jirak@redfin.com Check out our upcoming classes: http://www.redfin.com/buy-a-home/classes-and-events