California Buyer’s Guide 2024

A buyer’s guide in real estate is like a helpful handbook for people looking to buy a home. The goal is to give buyers the knowledge they need to make smart decisions during their real estate adventure.

Here you will find the Ultimate California Buyer’s Guide for 2024. This thorough blog is a go-to source for anybody navigating California’s ever-changing real estate market, regardless of experience level as an investor or as a first-time home buyer.

 

PRE-OFFERS

1. Find a Lender

Connect with multiple lenders to determine which one provides you with the most favorable terms and interest rate.

2. Get Pre-Approved

Provide your lender with documents such as income statements, tax returns, and bank statements. With this information, your lender will determine your maximum purchase price and provide you with a pre-approval letter. With this letter, we are ready to make offers on homes.

3. Find a Realtor

You need to find a trusted and experienced professional, ensure they are technology. You can check their reviews and reach out to a previous client. Ensure they are a good fit to represent you in the transaction. Hire a realtor who has your best interest at heart.

4. Define Your Criteria

Start by answering the following:

  • Are you inclined towards a single-family home or a condo/townhome?
  • Which neighborhoods or cities are of interest to you?
  • How many bedrooms do you require? And how many bathrooms?
  • What factors are important to you in a home?

5. Start Touring Homes

As soon as you find a home you like online, inform your realtor so they can arrange a tour. Tour as many homes as you need!

6. Make Offers

Don’t hesitate to take this step. You have a few contingencies during the escrow period that enable you to withdraw with no strings attached. Work with your realtor to ensure you submit the strongest offer possible to secure your dream house.

7. Negotiation

Your realtor will negotiate with the seller until both parties reach an agreement on price and terms. Ensure your realtor provides you with recent sales data in the area to confirm that you are paying a fair price and you can enter Escrow.

 

THE ESCROW PROCESS

Definition: Escrow is a legal arrangement in which a third party temporarily holds money or property until a particular condition has been met (such as the fulfillment of a purchase agreement). The escrow process starts when your offer is accepted, and it ends when the loan is funded, and title is recorded.

Who is Who?

  • Escrow:

The escrow company is chosen by the seller. They will be in charge of holding the funds, and making sure all the parties involved are in sync.

  • Escrow Officer:

This is the person the escrow company assigns to the file.

  • Buyer’s Agent TC:

This is the transaction coordinator of the buyer’s realtor. This person will be sending the buyer important documents to review and/or sign (disclosures, contingency removals, HOA docs, etc.).

  • Listing Agent TC:

This is the transaction coordinator of the seller’s realtor. This person will be sending the seller important documents to review and/or sign (disclosures, contingency removals, HOA docs, etc.). Both TCs will be in constant communication to ensure file compliance.

  • The Buyer’s Lender:

The lender will be in charge to process the buyer’s loan on time, and make sure all the timelines are met. The lender will be in close contact with escrow, the buyer’s agent, and the buyer.

 

THE ESCROW TIMELINE

Life of an Escrow: The escrow process can be anywhere from 10 days (usually for cash buyers), to 45 days. A standard escrow is 30 days long.

  • Day 1:

Once the offer is accepted, escrow is officially open, and the clock begins on contingencies.

  • Day 2:

Contact your insurance agent for homeowners’ coverage.

  • Day 3:

Earnest money deposit (EMD)* is due.

  • DAY 1-17 Seller Delivers Disclosures to Buyer

Seller’s disclosures: In the seller’s disclosure packet, you will find different types of disclosures (the broker’s disclosures, California disclosures, etc). The most important ones are the seller disclosures which typically include details regarding the physical condition of the property, any known defects or issues, past renovations or repairs, the presence of hazardous materials (such as lead-based paint or asbestos), any ongoing or previous structural problems, and any history of damage due to natural disasters or other events.

  • DAY 1-17 Investigation Period

During the investigation contingency period, the buyer may conduct as many inspections as needed to truly understand what they are buying and make an educated decision. Buyers may inspect the house, review the HOA rules if applicable, and review the seller’s disclosures about the property. Within this period, the buyer retains the option to withdraw from the agreement at any point without forfeiting their initial EMD.

  • DAY 1-15 Request for Repairs

After you receive inspection reports from your inspector, you can request repairs or credits from the seller. In California, every home is sold in as-is condition. But this does not mean the seller will not grant any of the requests.

  • DAY 5-17 Investigation Contingency Removal

If you agree with the HOA rules, the property condition and the disclosures, you are ready to remove the investigation contingency.

  • DAY 1-17 Loan and Appraisal Contingency Period

Your lender will guide you through this process. During the loan and appraisal contingency period, the loan application is being thoroughly evaluated and reviewed by a loan underwriter. The underwriter is responsible for assessing the borrower’s creditworthiness, verifying the information provided on the application, and determining whether the borrower meets the lender’s criteria for loan approval. During this period, the bank sends an appraiser to the property to appraise it. There are two potential outcomes:

The appraisal either matches the buyer’s offered price or exceeds it, which is considered an optimal outcome. In such instances, the bank recognizes that it’s making a good investment decision. The appraisal comes back under the price offered by the buyer. In this case, the buyer and seller negotiate how to proceed. Either the seller reduces the price to meet the appraisal’s value, the buyer gives the difference out of pocket, or they both meet in the middle. If there is no agreement, the buyer can back out and recover their earnest money deposit.

  • Day 10-17 All Contingencies are Removed
  • Day 15-27 Final Walkthrough

Arrange a final walkthrough of the property in the company of your real estate agent, typically scheduled within 5-4 days before the closure of the escrow. This walkthrough serves to ensure that the home remains in the same condition as it was at the time of your offer and confirms that any requested repairs have been satisfactorily completed.

  • Day 17-27

Call utility companies to make sure water, gas and electricity are on and under your name when you move in.

  • Day 10-30 Final Steps

The seller executes a grant deed, thereby transferring all rights to the property to the buyer. The buyer completes the signing of both the loan documents and the closing documents. The buyer transfers the remaining balance of the down payment and closing costs to the escrow account via wire transfer.

  • Day 10-45 Close of Escrow

Funding: the lender releases funds to the escrow company.
Recording: the deed and any other recordable documents are recorded with the County.

You get the keys!

When you’re buying or selling real estate, you deserve a team of people who are willing to fight for you and use every available resource to close the deal quickly and at the best price without missing a single detail – all while communicating with you every step of the way to ensure you’re comfortable and satisfied.

 

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341 Bayside Dr.
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