Redfin Home Buying Class
South Bay Los Angeles Team
January 16, Pasadena, CA

Host: John Venti
@Redfin
facebook.com/Redfin
John Venti – San Gabriel Valley
● Agent for 25 years
● Closed over 121 homes
● Specialize in: First Time Home
Buyers, Cond...
Agenda
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Overview of the process
Are you ready to buy?
Understanding the market
Never miss a home
Cho...
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%...
Understanding the Buying
Process
Are You Ready to Buy?
●
●
●
●

Do you have a family and need room to grow?
Do you expect to own the home for 5 or more yea...
Overview of a Purchase
Research

Search

Offer

Closing

Neighborhoods

Define Preferences

Comparables

Earnest Money

Re...
Understanding the
Market
Los Angeles Inventory
Los Angeles Prices
Los Angeles Overview
Where Are Rates Headed?
Interest Rates - snapshot
Type of Loan

January 9, 2013

January 2, 2013

30-Year Fixed

4.51%

4.53%

15-Year Fixed

3.56...
LA Market Trends - November
●
●
●
●

Prices up 20.8% YoY, down 1% MoM
# homes sold down 16.2% YoY, down 13.6% MoM
# homes ...
Redfin Price Tracker
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
...
Never Miss a Home
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...
Redfin Agent Reviews
Redfin Partner Program
Partner agents are employed by other brokerages, and have
teamed up with us to provide Redfin-certi...
Seeing Homes in Person
Making the Most of Your Tour
1.
2.
3.
4.
5.
6.
7.
8.

Bring a camera, notebook & tape measure
See how much sunlight the pl...
Real Estate Sites: What to Look For
● Has all the homes for sale
● Updated every 15 minutes
● Real-time sales data

● Insi...
Mortgages
Review Your Financial Situation
● Pull credit report, look for errors
● Establish comfort level for monthly payment
● Figu...
Get Pre-Approved Early
A pre-approval letter is a letter from a bank or a lender estimating
how much they'll lend you
● Es...
Pulling Credit: Is It Harmful?
● Your credit report must be reviewed by a lender before you
can obtain a pre-approval
● If...
Start Shopping for Lenders
Compile a list of 3-4 local lenders
Good sources include:
● Redfin's partner lenders
● Referral...
Local Recommended Lenders
Break!
John Venti
San Gabriel Valley
10-Minute Break
● Feel free to come ask us questions!

10 mins

5 mins

Let’s Get Started!

End
Short Sales and Bank Owned
What is a Short Sale?
The owner owes more on the mortgage than the home is
worth
● Usually pre-foreclosure, but not always...
What is a Bank-Owned Property?
● A foreclosed home owned by a bank or lender
● Standard sale but:
► Verbal negotiations
► ...
Making an Offer
Crafting Your Offer
● Evaluate – your agent will provide you with information
about market conditions and recent sales in ...
Tips for Winning a Bidding War
1. Just win, baby! Simply have the best offer.
► Cash is King
► Escalate your price?
► Tigh...
ESCROW
Your Offer has been Accepted!
●
●
●
●
●
●
●
●
●
●
●

Earnest money deposit – usually 1-3%+
Inspection – approximately $500...
Home Inspection
We recommend that you have a home inspection
● Cost runs $350 to $1,200 depending upon the home’s size
● Y...
What are Contingencies?
Standard timeline for contingencies in local market: 17 days
● Inspection
● Appraisal – Performed ...
What is Escrow?
Escrow is a third party intermediary that represents neither the
buyer nor the seller.
What do they do?
• ...
HUD–1 Settlement
Walk Through to Closing
Walk through: 5 days prior to close date
Escrow: sign loan documents, transfer funds for your down...
Better Service, Lower Fees
● We’re on your side
► Agents paid on your satisfaction
● Double your exposure
► Premium placem...
Selling Your Home
with Redfin
Better Service, Lower Fees
● We’re on your side
► Agents paid on your satisfaction
● Double your exposure
► Premium placem...
All Done!
So What Now?
●
●
●
●
●
●

Make sure it’s the right time for you
Check out our Home Buying Guide
Find the right agent
Look ...
Thanks for Coming!
Questions? Get in touch:
John Venti
john.venti@redfin.com

Check out our upcoming classes:
http://www.r...
Future Events!
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Redfin's Free Home Buying Class - Pasadena, CA

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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 – Updated every time]
  • [REQUIRED – Updated every time]
  • [REQUIRED – Updated every time]Agents should use this slide to talk about what they’re seeing on the streetTell some stories!
  • Chart:http://www.mortgagenewsdaily.com/mortgage_rates/charts.aspPrediction:http://www.bankrate.com/finance/mortgages/mortgage-rate-trend-index.aspx
  • [REQUIRED – Update each time with latest rate information]http://www.freddiemac.com/pmms/
  • [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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  • [OPTIONAL – cut or skip this slide if not relevant for your market or class]
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  • [REQUIRED]Add Lender’s name if he/she’s presenting
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  • [REQUIRED – Update with local lender]
  • 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!
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  • [Required]Add visual
  • [REQUIRED]Add visual
  • OPTIONAL: Would need to adjust by market. Not all markets use the term Escrow in this way.
  • 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
  • Notes from Matt:- Update this slide so it is easier to read
  • We’ll stick around…
  • Redfin's Free Home Buying Class - Pasadena, CA

    1. 1. Redfin Home Buying Class South Bay Los Angeles Team January 16, Pasadena, CA Host: John Venti @Redfin facebook.com/Redfin
    2. 2. John Venti – San Gabriel Valley ● Agent for 25 years ● Closed over 121 homes ● Specialize in: First Time Home Buyers, Condos, town houses, Single Family, Multi-Family (up to 4 units) ● Services: San Gabriel Valley ● Lives in San Gabriel Valley  Enough about me! Meet my team…
    3. 3. Agenda ● ● ● ● ● ● ● ● ● ● ● Overview of the process Are you ready to buy? Understanding the market Never miss a home Choosing an agent Touring Mortgages Break! Short sales & foreclosures Making an offer Acceptance to closing
    4. 4. 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
    5. 5. Understanding the Buying Process
    6. 6. Are You Ready to Buy? ● ● ● ● Do you have a family and need room to grow? Do you expect to own the home for 5 or more years? Have you saved up a down payment? Can you rent for less?
    7. 7. Overview of a Purchase Research Search Offer Closing Neighborhoods Define Preferences Comparables Earnest Money Real Estate Agents Saved Search Draft Offer Docs Inspection Mortgage Options Home Tours Negotiate Loan application Preapproval Open Houses Mutual Acceptance Title Review Consider your needs Appraisal Financing Approval Closing
    8. 8. Understanding the Market
    9. 9. Los Angeles Inventory
    10. 10. Los Angeles Prices
    11. 11. Los Angeles Overview
    12. 12. Where Are Rates Headed?
    13. 13. Interest Rates - snapshot Type of Loan January 9, 2013 January 2, 2013 30-Year Fixed 4.51% 4.53% 15-Year Fixed 3.56% 3.55% 5/1 ARM 3.15% 3.05% 1-Year ARM 2.56% 2.56%
    14. 14. LA Market Trends - November ● ● ● ● Prices up 20.8% YoY, down 1% MoM # homes sold down 16.2% YoY, down 13.6% MoM # homes for sale up 4.1% YoY, down 12.3% MoM 76.5% homes faced competition, up from 72.2% last month, down from 86.5% last year ● 29.6% of homes went pending in 2 weeks up from 28.7% last month, down from 36.9% last year ● Winning Offers ► 27.3% Homes sold over asking ► 36.4% included a cover letter ► 9.1% waved financing ► 6.1% All cash
    15. 15. Redfin Price Tracker
    16. 16. Never Miss A Home
    17. 17. 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
    18. 18. Never Miss a Home
    19. 19. Choosing the Right Agent
    20. 20. 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?
    21. 21. Redfin Agent Reviews
    22. 22. Redfin 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
    23. 23. Seeing Homes in Person
    24. 24. Making the Most of Your Tour 1. 2. 3. 4. 5. 6. 7. 8. Bring a camera, notebook & tape measure See how much sunlight the place gets Check the bathrooms for rot & mold Look for wavy or discolored wood siding Make sure water spouts drain away from house Take stock of storage space Turn off any music playing in house Check for hardwood floors 9. 10. 11. 12. 13. 14. 15. Peek into the attic Bring a marble or two When sharing a wall, make sure it’s thick Ignore the appliances and carpets Check the closets Get the disclosure packet Compare the property’s tax records to the listing details
    25. 25. 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
    26. 26. Mortgages
    27. 27. 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
    28. 28. 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
    29. 29. 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
    30. 30. 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
    31. 31. Local Recommended Lenders
    32. 32. Break! John Venti San Gabriel Valley
    33. 33. 10-Minute Break ● Feel free to come ask us questions! 10 mins 5 mins Let’s Get Started! End
    34. 34. Short Sales and Bank Owned
    35. 35. 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
    36. 36. 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
    37. 37. Making an Offer
    38. 38. 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
    39. 39. 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
    40. 40. ESCROW
    41. 41. Your Offer has been Accepted! ● ● ● ● ● ● ● ● ● ● ● Earnest money deposit – usually 1-3%+ Inspection – approximately $500 Other Inspections – sewer scope, septic, etc. Loan Application – 5 days or less Review Title Order Appraisal – approximately $500 Loan Approval – remove contingencies! Escrow – appointment to sign documents Walk through Loan funds, title records Receive your keys!
    42. 42. Home Inspection We recommend that you have a home inspection ● Cost runs $350 to $1,200 depending upon the home’s size ● Your agent will accompany you ● Your time to evaluate the property, bring notepad, ask questions Let’s talk about: ● What an inspection contingency covers and doesn’t cover ● Types of inspections
    43. 43. What are Contingencies? Standard timeline for contingencies in local market: 17 days ● Inspection ● Appraisal – Performed in conjunction with financing ● Financing ● Termite
    44. 44. 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
    45. 45. HUD–1 Settlement
    46. 46. Walk Through to Closing Walk through: 5 days prior to close date Escrow: sign loan documents, transfer funds for your down payment and closing costs. Lender: Reviews your documents, sets up loan to fund Title: Title records the day after funding in LA County. Keys after 5PM!
    47. 47. Better Service, Lower Fees ● 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 ► Professional photos ► Beautiful flyers
    48. 48. Selling Your Home with Redfin
    49. 49. Better Service, Lower Fees ● 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 ► Professional photos ► Beautiful flyers We’ve helped over 50 people sell their homes in the last six months.
    50. 50. All Done!
    51. 51. So What Now? ● ● ● ● ● ● Make sure it’s the right time for you 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
    52. 52. Thanks for Coming! Questions? Get in touch: John Venti john.venti@redfin.com Check out our upcoming classes: http://www.redfin.com/events
    53. 53. Future Events!
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