Frequently Asked Questions

What is the first step in buying a home?

If you want your offer on a home to be accepted, the first step is to obtain proof of funds or pre-approval from a lender. Without mortgage approval, it may be challenging, if not impossible, to secure the property. You’ll need to have all of the necessary documentation in hand before submitting an offer.

What is an agent’s commission fee?

Real estate agents are usually compensated through a commission paid by the seller, rather than a flat fee. The commission percentage typically ranges from 2-6% of the final sale price. In most cases, the buyer's agent and seller's agent split the commission equally, receiving a percentage of 2-3% each.

What is a mortgage and how does it work?

When purchasing a property, many people require a mortgage to finance the transaction. Unlike cash buyers, most individuals do not have the financial means to purchase a home outright. A mortgage is a secure loan that offers a fixed interest rate and is typically paid off over a 15 or 30-year term.

How much money do I need to buy a house or sell a house?

When buying or selling a home, it's important to consider the closing costs involved. For sellers, the total closing costs can be around 8-10% of the sale price, with realtor commission typically making up 5-6% of that total. Other costs can include title transfer fees, taxes, and various other fees. As for buyers, the closing costs can vary depending on the type of loan. First-time home buyers can qualify for programs with as little as a 3.5% down payment, while conventional loans require 3-20% down payment. Regardless of the loan type, buyers can expect to pay at least 2% of the total sale price in closing costs, which can include title transfer fees, insurance, inspections, appraisal, escrow, and title fees.

What’s the difference between a full-time and part-time agent?

As full-time real estate agents, we have the experience and availability to provide top-notch service. While a part-time agent may offer a lower commission fee, they may not have the necessary expertise or availability to meet your needs. When choosing an agent, it's important to consider their level of experience and commitment to serving you.

What is an appraisal?

When buying or selling a property, an appraisal is necessary to determine its value. Appraisals are conducted by a third-party appraiser who is not affiliated with the lender or realtor. The valuation is used for various purposes, such as financing, insurance, tax, or to assess the current value of a home.

What are contingencies?

Contingencies are an essential part of a real estate transaction and are designed to protect both the buyer and the seller. If certain conditions are not met, escrow can be terminated. There are four major contingencies in real estate, including inspection, appraisal, loan, and home sale/purchase. An inspection contingency involves a visual assessment by a certified inspector, while an appraisal contingency requires a third-party valuation of the property's price and condition. The loan contingency is based on loan approval and includes factors such as funds/work, debt-to-income ratio, and credit. Finally, a home sale/purchase contingency is used when a sale or purchase is contingent on the sale of another property or the purchase of a replacement home.

How long is the process?

In California, the real estate escrow process typically takes around 30 days to complete. However, the duration may vary depending on the complexity of the transaction. Some straightforward transactions can close in as little as 18 days, while more complicated ones may take longer.

What happens if I decide to back out of buying a house?

If contingencies have been removed, forfeiting the earnest money may be a possibility. This amount is typically around 1-2% of the home's sale price. If you're early enough in the process, you can request the funds be returned through escrow, but it may take a few days for the process to complete.

How should I prepare my house before selling it?

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