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Free Redfin Home Buying Class

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  • 1.Redfin Home Buying Class Redfins North Coastal Orange County Team August 12, 2014 Fountain Valley, CA Host: Rob Brandon @Redfin

2. 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 3. A Little Bit About Who We Are Redfin is a full service 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 4. Understanding the Buying Process 5. 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? 6. Overview of a Purchase Research Neighborhoods Real Estate Agents Mortgage Options Preapproval Consider your needs Search Define Preferences Saved Search Home Tours Open Houses Offer Comparables Draft Offer Docs Negotiate Mutual Acceptance Closing Earnest Money Inspection Loan application Title Review Appraisal Financing Approval Closing 7. Understanding the Market 8. Current Market: Low Inventory 9. Current Market: Rising Prices 10. Fountain Valley Overview 11. Never Miss A Home 12. 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 13. Never Miss a Home 14. Redfin On the Go. Mobile Apps See every new home, just minutes after it's listed while away from your computer with your smart phone or tablet. 15. Choosing the Right Agent 16. 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? 17. Redfin Agent Reviews 18. Seeing Homes in Person 19. 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 its thick 12. Ignore the appliances and carpets 13. Check the closets 14. Get the disclosure packet 15. Compare the propertys tax records to the listing details 20. Slide 20 of 55 How Touring with Redfin Works Up to six homes per tour in two hour blocks Go on as many tours as you need, we just ask for your pre-approval or proof of funds prior to the 3rd tour. Led by agent or associate agent No obligation 21. Mortgages 22. Local Recommended Lenders In no way does Redfin benefit financially from recommending lenders we just think theyre great lenders! 23. Review Your Financial Situation Pull credit report, look for errors. Earlier the better Establish comfort level for monthly payment Figure out how much monthly income goes towards debt: 45% Max Conv, 56.9% Max FHA 43% Max Jumbo, 41% VA Pay down credit balances to 1/3rd Dont open any new lines of credit Dont buy any big ticket items Source of money Current employment status 24. Get Pre-Approved Early A pre-approval letter is a letter from a bank or a lender estimating how much they'll lend you (May vary from what you want to pay monthly) 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 (Credit reports are good for 90 days) Info needed: W-2s, 2 years tax returns (with all schedules, K-1s etc) 1 month of pay-stubs, asset statements (Show all funds used to close loan) Drivers License, If you own a home or homes, need mortgage, tax, and insurance information 25. 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 Dont allow lots of lenders to pull your credit score repeatedly Pull a free credit report. One of the best is 26. Non Traditional Loan Programs!!! If you are self employed or have a unique income situation, ask your lender about special programs that can help you qualify. At Banc of California Banc Home Loans we offer loans that turn bank deposits into income for qualifying purposes. We also offer stated income loans to people with high net worth. 30% down and assets of 1MM in reserves. Loans up to 3.5MM Lastly offer loans to people that Short Sold or Foreclosed 1 day after the event, provided they have 20% down and a 660 credit score. For people that tried to work with bank and didnt have a hardship but needed out. REX program for Equity Sharing 27. Start Shopping for Lenders YOU will want to see that they have a competitive rate. Although the rate and terms are important, finding a lender who will communicate with you and answer all your questions and make you comfortable with things is invaluable. They also need to have the ability to close your loan in 15-20 days. (Why?) Lender should be willing to answer calls at night and on weekend, and even talk about your qualifications directly with the listing agent to complement the cover letter to set you apart. YOUR REALTOR will want to see that they are trustworthy, communicate well, and can close your loan on time or early. It is these qualities that will allow your agent to sell your ability to close to the listing agent. Good sources include: Redfin's partner lenders Your real estate agent Banks or credit unions you have accounts with Online review sites, such as Redfin and Zillow BEWARE OF OUT OF STATE LENDERS!!! (Based on accountability factors that make listing agents nervous) 28. Break! Rob Brandon North Orange County Denise Merhoff North Orange County Courtney Rice North Orange County 29. 10-Minute Break Feel free to come ask us questions! 10 mins 5 mins End Lets Get Started! 30. Short Sales and Bank Owned 31. What is a Short Sale? The owner owes more on the mortgage than the home is worth or will sell for Usually pre-foreclosure, but not always (divorce, hardship) Listed for less than whats owed to the bank Requires 1 - 2 banks approval, sometimes more (usually 2) May have other liens (taxes, utilities, HOA, mechanics) 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 Redfins commitment to customer service Get a 15% commission refund 32. What is a Bank-Owned Property(REO)? 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 theyve signed contract Earnest money deposit usually held by listing agent 33. Making an Offer 34. Crafting Your Offer Evaluate your agent will provide you with information about market conditions and recent sales in the area Consider the situation the sellers 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 35. 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. Whats important to the seller? 4. Write a letter & appeal to the seller Try and make a personal connection 36. ESCROW 37. Your Offer has been Accepted! Earnest money deposit usually 1-3%+ Inspection approximately $500 Other Inspections sewer scope, roof, electrical, geological etc. Loan Application 5 days or less Review Title Order Appraisal approximately $500 Loan Approval remove contingencies! Escrow appointment to sign loan documents Walk through/ Verification of Property Loan funds, title records, escrow closes Receive your keys! 38. Home Inspection We recommend that you have a home inspection Cost runs $350 to $1,200 depending upon the homes size Your agent will accompany you Your time to evaluate the property, bring notepad, ask questions. Get to know the property and know what your buying Lets talk about: What an inspection contingency covers and doesnt cover Types of inspections 39. What are Contingencies? Standard timeline for contingencies in local market: 17 days Inspection Appraisal Performed in conjunction with financing Financing Disclosures 40. What is Escrow? Escrow is a neutral 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 (sellers mortgage, utilities, etc.) Coordinate the signing appointments for all parties Receive and disburse funds for closing Arrange to notify county offices to change ownership 41. Walk Through to Closing Walk through/Verification of Property: 2-5 days prior to close date. Not a contingency in the contract. 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. In Orange County title can record on the same day as funding. Give you Keys!!! 42. So What Now? Make sure its the right time for you Check out our Home Buying Guide Find the right agent Look for a local lender and get pre-approve

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