Home Buyer FAQ is intended as a crash question and answer session.  Common questions and honest answers. Home Buyer FAQ's for those who are serious about making a purchase.

...it just makes cents

Are there any real estate costs involved when I purchase a home?
None - If a real estate broker suggests charging the Michigan homeowner, Run... This is the wrong brokerage to be working with.

Do I need money to purchase a home?
Never thought I'd actually hear myself say this, but... Not necessarily.  More important than having money, the Michigan homeower needs to have the means and the track record to repay the loan.  Qualified Lenders can help in determining what and how Michiganders can achieve this and still remain  in a "comfort zone." 

Should I stay... Or should I buy ?
Tis the decade to buy!  The Michigan Real Estate Market is at an absolute low.  Extremely unfortunate and heartbreaking for those trying to sell a home in Michigan, but ideal for those in a position to purchase.  It is the contention of Sensible Realty, that the market has not yet, hit rock bottom.  There are a number of financing options available for those who want to purchase and some WONDERFUL programs for those who are 1st time Michigan Home Buyers.  In addition, fantastic homes and never before seen pricing.  If you've been thinking about it, now is the time. Sensible Realty encourages Michigan Home Buyers to calculate renting vs buying.

Is Realtor.com a good place to shop for Michigan homes?
It depends... Realtor.com is a good place to start.  This way the Michigan home buyer can see what's going on out there in the Michigan real estate market and kind of get the feet wet.  Once the buyer gets serious about purchasing a home, the buyer will want to contact a real estate professional in Michigan and be set up to receive the Automatic Home Search which is current within hours, where realtor.com can sometimes take up to 10 days to post new homes and Michigan home sales. 

Do I need a realtor to help me find a home?
Good question and thank you for asking.  Need or highly recommend... Both!  As a Michigan homeowner, only a qualified agents (lawyer, doctor, engineer...) working for the homeowner is going to do.  The interest of the homeowner is at the forefront.  The list is endless with items that should be taken into consideration, brought to the attention of Michigan home buyers and suggested terms when purchasing.  Stop calling realtor after franchiser realtor based on the sign in the yard, or the ad in the paper.  There is soooo much more to consider when shopping for a home.  Whatever it is that the Michigan homeowner may choose, traditional practices needs to be #1 on the list and choose someone that will keep the home buyer informed of new listings, and has their ears and eyes out for Michigan properties that meet the needs of the Michigan home buyer and have not yet been exposed to all the other buyers.  Pick a Michigan realtor that is enjoyable to work with, who is competent, professional and educated... Then stay with that real estate professional.

What is the process that purchaser and realtor take to find a home?
First, Real Estate Professional and Michigan home buyer will determine purchasing power.  Once that's established, determining the needs and wants of the buyer for the next home and building a list of criteria that meets those needs.  Once that is accomplished, buyer and realtor start looking at homes that fall into the desired price range, has the features and the Michigan location is correct.  Most of this will be done via e-mail and computer.  Buyer and agent meet at an agreeable time and start touring those homes that are of interest.  The Michigan home buyer will know when they've found the house that best suits their needs.  (please refer to the home buying process overview at the bottom of this page)

What if I want to purchase a home that is being sold "by owner"?
You can!  It's in the best interest of the purchaser to allow the Michigan Realtor that the Michigan home buyer is working with to contact the "For Sale by Owner" to discuss what terms are being offered, price and negotiation.  If the Michigan home buyer is under contract with a Michigan Realtor, which is likely, the Michigan buyer will want to honor their contract and let the Michigan Realtor do their jobs.  A commission is due and if the home buyer purchases without the Michigan Realtor under contract, the Michigan home buyer may be held liable for that commission.  Many times, "by owners" are overpriced and not up on the market trends or the Michigan Real Estate Market itself.  The Michigan Realtor can provide the "For Sale by Owner" the stats needed to make a sound judgment on the offer that may be proposed.

Do I need to be pre-qualified?
Well... If the Michigan home buyer is serious about buying a home, then seriously get pre-APPROVED.  There is a difference between the two.  Pre-qualified means the Michigan home buyer has inquired through a reputable Michigan lender and answered a few questions.  Pre-approved means that the Michigan home buyer has provided documentation to support previously answered questions at the pre-qual session.  Don't wait until the last minute to do this.  We've seen it break many a deals.  

There a number of factors that accompany this... First and foremost the Michigan home buyer doesn't want to be wasting any time considering homes the buyer can't afford.  Getting pre-qualified determines purchasing power.  Price is only one part of the process during negotiations.  Purchasing power, or strength of the Michigan home buyer is equally important.  If you're competing for a home or participating in a bidding war, higher price does not necessarily guarantee the home to that prospective Michigan purchaser.  Factors, such as length of escrow (closing date), can play a crucial role in getting an accepted offer as well as funds available for down payment.

Is there a "magic number" that I should be offering on a home?
This is the number 1 question asked by Michigan home buyers.  There is no magic number.  The Michigan real estate market is very funny and the Michigan home sellers aren't necessarily certain of what they're willing to accept until it's seen in writing.  Nobody wants to offend anyone by the terms of their offer whether it be too low, too high, asking for everything including the kitchen sink... Who knows?  Worst case scenario... the answer is no and the Michigan home buyer either moves on (if purchasing for investing purposes) or come to agreeable terms by both parties (if the buyer REALLY want the house).  The objective of the realtor is for the Michigan home buyer to get the MOST house for the least amount of money.  Boy, oh boy... there are many stories of both scenarios that can be shared with Michigan home buyers and Michigan home sellers.

What is the purpose of an appraisal?
Appraisals are provided by the qualified Michigan lender.  Their main focal point is to ensure that the Michigan home that's being purchased is worth the purchase price. The bank will not allow the mortgage to take place if the Michigan home buyer is  overpaying for the house.  In the event that the home is not worth what's being offered, 1) The Michigan home seller reduces their price to meet the value of the appraisal.  (The Michigan home seller has an option to pay for an appraisal independently in attempts to get the value higher... we've yet to see that happen worth any significance).  2) the Michigan home buyer can walk away from the deal unharmed or come up with cash to bypass the need for an appraisal).

Is it required that I get a home inspection?
No, it's not required to get a home inspection.  Sometimes getting or not getting a home inspection in Michigan can be used as a negotiating tool.  Depending on the condition and age of the Michigan home, would help the agent help the buyer in making that decision.  Some of the items covered in an inspection are as follows;

1. Foundations

2. Roof

3. Heating and air conditioning systems

4. Ventilation

5. Radon / Carbon Monoxide Testing*

6. Common areas (for condos)

7. Septic tanks, wells or sewer lines*

8. Insulation

9. Plumbing and electrical systems

10. Ceiling, walls and floors

11. Doors and windows

12. Hazardous material concerns*
    
    *There may be an additional fee for this service -
    Some other key points in a home inspection could also include;

Wood-destroying organism inspection report?
A wood-destroying organism inspection report is a written opinion by a qualifed state licensed structural pest control inspector based on what was visible and evident at the time of inspection.  The inspection report does not in any way represent or guarantee the structure to be free from wood-destroying organisms or their damage, nor does it represent or guarantee that the total damage or infestation is limited to that disclosed in the report.  Wood-destroying organisms include subterranean termites, dampwood termites, carpenter ants, wood boring beetles and wood decay fungus.

Hazards of lead based paint?
All buyers and sellers are required by law to receive and read a pamphlet outlining the hazards of lead-based paint for homes built before 1978.  Be sure to ask the real estate agent for a copy. As a buyer, the opportunity to assess the degree of lead base paint, if desired.  It would be considered a "contingency" to the purchase of the home.

What documents are generally included in the Purchase and Sales Agreement?

• Purchase Agreement
• Agency Disclosure
• Financing Addendum / Clause
• Earnest Money Receipt
• Inspection Clause
• Conditions / Disclosures Addendum
• Contingency (if any)
• Addendum Outlining Special Conditions
• Lead Base Paint Notification
• Property Disclosure Form (Completed by Sellers) 

Buyer 1 Considers purchasing a home 2 Selects a real estate agent 3 Determines needs and wants 4 Discusses financial issues 5 Views & researches target homes 6 Makes an offer to buy	Seller 1 Decides to sell property 2 Selects a real estate agent 3 Determines needs 4 Prepares home for marketing 5 Agent markets the home 6 Accepts, rejects or counters offer
7 Offer Accepted 8 Loan Application 9 Inspections 10 Title Search 11 Appraisal 12 Loan Approval 13 Closing Papers Signed 14 Documents Recorded 15 Funds Available To Seller
16 Seller Moves Out	17 Buyer Moves In

Houses and/or property which are reaching little sales proportion, include foreclosures, new construction, residential lease or rent, vacant land are all a victim of pricing.  Sensible Realty wants the value to compete with the prices… but the privilege is not always available.  Cheap and cheapest are keywords and not intended to describe the #1 service offered.  Traditional real estate and the practices that accompany it, are simple, just not affordable.  Other agencies need to get that.  Even the cheapest of bargain hunters want to be on that SOLD list. 

The objective with Sensible Realty is to offer reduced fees, such as 1% commission in exchange for market knowledge and exposure.  The fees are at a discount.  Sensible Realty and the agency offers discount fees, it is not the service that is discounted.  It doesn't make sense for the FSBO or the traditional homeseller to spend money on alternative, or flexible methods of real estate thinking homsellers will save money while purchasers search homes that are priced right, and properly exposed. To reduce price, should be as simple for the homeseller, as it is for the real estate professional.
Just do it.