2015 Buyers Guide

Buyers’ Guide The Home Buying Process Barbara Robin, ABR, CRS, e-Pro, GRI, SFR, SRS (281) 467-5013 Barbara@BarbaraRobin.com www.BarbaraRobin.com 9000 Forest Crossing The Woodlands, TX 77381

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Rent vs. Buy Analysis The Disadvantages of Owning a Home Renting •More fixed costs for term of the lease.

•Not gaining equity, but not losing any either.

•When the lease is up, you can just move.

•There is generally less work in maintaining a home or apartment.

•Smaller amount of “up-front” cash.

Buying •More variable costs.

•Equity may go up, down, or stay stagnant.

•If you want to move, home generally must be sold.

•Work needs to be done by you--or paid for by you.

•Generally a larger initial investment--the down payment.

The Advantages of Owning a Home Renting

•No matter what happens with the value of the home, you will never gain equity.

•Limited--or no--ability to personalize your living quarters.

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•No tax advantage to renting.

Your landlord gets any and all tax breaks that are available.

Buying •Mortgage balance decreases and equity builds, even if the value does not increase.

•The freedom to remodel the home to match your needs and desires.

•There can be tax advantages attached to home ownership.

Consult competent legal and accounting advice for details on your situation.

The Home Buying Process

START START

STEP 1 Consulting Your Realtor速 Establish your expectations.

Learn about buyers agency Assess home needs and wants

STEP 2 Getting Pre-Approved Consult with a loan officer.

Organize financial records Obtain pre-approval letter

STEP 5 Negotiating the offer Agent presents offer to listing agent Negotiate price and terms as needed Arrange inspections and review results Manage transaction details

STEP 6 Processing the loan Complete loan application Underwriter reviews file Lender arranges appraisal Contingencies removed Final loan approval given

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STEP 3 Finding The Home Determine homes in price range.

Select lifestyle neighborhoods Select the Home!

STEP 4 Making an Offer Determine fair market value of home Decide on financing options Decide on other terms such as deposit, date of possession and repairs.

STEP 7 Closing and Funding Select homeowners insurance Arrange final walk-through of property.

Obtain certified funds for closing Arrange for utilities and movers Sign loan papers at title company

Step One Consulting with Your Realtor速 What Buyers Want Most From a Realtor速 Real estate professionals best serve their clients when they know what home buyers expect from them. After reviewing the chart below, what are some of your expectations from your agent?

5 Source: National Association of Realtors速 Profile of Home Buyers and Sellers

Step One Consulting with Your Realtor® Why Choose Buyer Representation One of the most important services I can perform for you is to represent you in the purchase of your home! My fiduciary duties to you are fully disclosed in a buyer’s representation agreement which I will include under separate cover for you to review. A summary is below.

As your buyers agent, I will be able to: 1. Offer advice and counsel.

2. Show you all the homes listed in the MLS, new construction and many “For Sale By Owner” homes.

3.. Show you the market trends and comps surrounding the home you wish to purchase 4.. Most important of all – NEGOTIATE IN YOUR BEHALF

Whether you're a first time buyer or an experienced buyer, it is good to know that your real estate agent has your best interests in mind as you select a home.

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I’ve also included for your review, “Information about Brokerage Services” required by law and approved by the Texas Real Estate Commission. The form explains broker representation. As a buyer, please review thoroughly so you are familiar with the types of representation and understand the parties duties and obligations to each other. I will have you sign this when we meet.

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Step Two: Getting Pre-Approval

Have you worked out the details of how you will pay for your new home?

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Step Two: Getting Pre-Approval Meeting with a Loan Officer Starting the financing process early will help us make sure we are looking at homes in the right price range. It will also give you any “heads up� in case there are some credit issues or anything else in the way of you getting a loan on the house you want. You can talk with more than one lender.

Getting a pre-approval letter is not an obligation for a loan. A pre-approval will tell you how much home you can afford, give you the power to negotiate and even make an offer, and show sellers that you're a qualified buyer.

The pre-approval process involves: 1. Calculating your income vs. debt ratios 2. Running a credit check.

Pre-approval is different than pre-qualify. Prequalification is an initial step in the loan process, where your finances are presented and the loan officer can give you a guesstimate of the amount of your purchase power – but there is no analysis of your credit report or an in-depth study of your ability to purchase a house.

Organize your personal information

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Check with your lender for a complete list, but listed below are a few items you might want to start gathering for the process: ____ Names, addresses and social security numbers for all borrowers involved ____ Copies of bank statements, account numbers, names and addresses of institutions ____ Copies of last 2 months of pay checks ____ Copies of last two years of tax returns ____ Loan numbers, names and addresses of all credit card accounts ____ Contact information for your current mortgage or landlord ____ Information regarding retirement funds, stocks and bonds etc ____ Gather documents such as financial statements and tax forms.

Step Three: Finding The Home  Online Tools:  I’ll perform an initial search to find homes matching your criteria and set up an e-mail alert so we’ll be the first to know when a new listing enters that matches your criteria.  Feel free to use the Lifestyle/Community search on www.BHGRealestate.com to find the right community – and let me know which homes you would like to see!  Use our Look tool to find statistics on neighborhoods, schools, and other demographic information important in your search for a home. I can send you additional info as well.

 Search for a home:  Allow me to give you a tour of the area(s) you are interested in. You’ll get a feel for different neighborhoods.  It’s also good to visit your preferred neighborhoods at different times of the day and on different days of the week to observe patterns of noise and traffic.  As your buyers agent, I can also show you any “For Sale By Owner” homes or builder homes that you may see. You will want someone to represent you in any transaction that involves the purchase of your home.

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Step Four: Making the Offer Before making the offer – my research on home values in the area will assist in determining how much to offer.

Competitive Market Analysis  Recently sold homes  Current competition  Homes that did not sell Written Offers  Leverage your negotiating power

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Step Four: Making the Offer What Makes for a Winning Offer?

1. Offer a Competitive Price Making an offer to purchase involves more than picking a price.

We will review comparable properties in the neighborhood that have sold recently and examine the sellers disclosure in detail.

Market conditions will dictate the selling price.

2. Make a strong deposit part of your offer You'll want to submit an earnest money deposit when writing an offer, payable to a reputable escrow company, to be delivered by your agent no more than three business days after the acceptance of the offer.

Even when delivering an offer below asking price, offer a large deposit if possible, and it will pay dividends in the end. A higher deposit will most likely strengthen your negotiating power.

3. Submit offer with pre-approval letter When an offer is submitted with a pre-approval letter, sellers will know it is serious. Many prefer to negotiate with a pre-approved buyer because they know you are able to obtain the financing needed to close the transaction. Buyers with a pre-approval letter usually have an advantage in cases where there are multiple offers.

4. Understand and adjust to the seller’s interest Asking the right questions prior to writing an offer can often make the difference between an accepted offer and a stalled negotiation. Some contract terms may be of great significance to the seller, whereas only a slight inconvenience for you. Remember that price is not the only negotiating factor in a contract. Other items include: Repairs, home improvements, closing costs and date of possession.

5. Provide an appropriate time for the seller's response Time is of the essence once you decide to take the plunge, especially regarding a newer listing in which the risk is high that other buyers will potentially submit offers. Typically, the seller is given until 5PM on the third day from receipt of the offer to respond, unless you write in a different date and time. If the offer is strong, speed up the response time.

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Step Five: Negotiating the Offer I’ll be your advocate during all negotiations  Assist you in strategizing and counter offers for the best price and terms  Deliver your message clearly and professionally to the seller and their agent  Keep the seller and their agent moving in a timely manner  Keep the transaction at arm’s length while maintaining a professional attitude and demeanor

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Step Five: Negotiating the Offer Negotiating the repairs Once the offer is submitted, I will work diligently to assure you that you have purchased your home for the best price and terms possible. A major component of the negotiating process is repairs. It is important for you to call and interview the inspector and determine what your inspections will cover. The buyer pays for and selects the inspections to be performed on a property. These inspections will serve as an education in the structure and systems of the property you are purchasing. The inspector(s) will give you information regarding condition, maintenance, lifespan and more.

A TYPICAL HOME INSPECTION MIGHT INCLUDE THE FOLLOWING: •STRUCTURAL •ELECTRICAL •MECHANICAL •PLUMBING •ENVIRONMENTAL •OTHER SYSTEMS (Pool etc) Structural Systems Foundation, Roof Ceiling, Floors Walls, Doors, Windows Water penetration Fireplace and chimney Stairs and landings Decks and porches

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Mechanical Systems Heating and cooling systems Built-in appliances

Plumbing Water heater Tubs, showers Toilets Faucets and drains Electrical Main breaker box Circuit breakers Aluminum wiring Switches, outlets Fixtures, ceiling fans G.F.C.I. test

Environmental Lead based paint Asbestos Wetlands Other Systems Swimming pool & equipment Spa, hot tub, sauna Sprinkler system Security and smoke alarms Outdoor cooking equipment

Step Six: Processing the Loan

It’s important for you to  Submit documentation in a timely manner  Provide lender with additional documents as required  Stay in touch with the mortgage officer It’s important for me to  Communicate with the appraiser  Stay in touch with the mortgage officer

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Step Six: Processing the Loan Final Loan Approval Now that you have the seller’s final approval, we need the lender’s final approval.

Final approval means unconditional. All conditions on the loan have been removed.

If there were any conditions on the loan, those conditions have been met. Your lender will need a copy of the sales contract, and information on access to the property for the appraisal.

After the appraisal, and verification of clear title from the title company, final approval will be given: #1. There are no liens on the house #2. The house appraised at a value equal to or greater than the agreed upon sales amount

Your lender should also be providing you with an expectation of payment and closing costs. Your house payment has four components: Principal and Interest $ __________________ Taxes $ __________________ Homeowners Insurance $ __________________ (PMI) Private Mortgage Insurance $ __________________ (if down payment less than 20%) 16 TOTAL ESTIMATED MONTHLY PAYMENT:$ __________________

Step Seven: Closing Just before settlement, we will make one last inspection of the property to ensure that the home is in the condition we expect.

Your loan officer should provide you with an estimate of closing costs broken down as provided in the sample below. You will need this information because you will have to bring certified funds for down payment and closing costs the day of closing. You should verify the estimate is correct before arranging for funds. They will send you a more detailed list.

Purchase Price of home $ _____________ Down Payment $ _____________ Amount Financed $ _____________ Estimated Closing Costs $ _____________ (Title fees, Settlement fees Recording fees, loan origination fees etc) Prior to closing: ___Arrange for Homeowners Insurance ___Arrange for a Home Warranty (optional) ___Arrange for change of utilities ___Arrange for movers ___Arrange for change of address At closing you will: Sign documents The loan will be funded Title will be recorded

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And you will get KEYS TO YOUR NEW HOUSE!

Checklist for Moving CHECKLIST FOR MOVING 1. Contact and arrange for a reputable moving company.

2. Check with your accountant or relocation company to see if any moving expenses will be deductible.

3. Arrange to have school records transferred.

4. Arrange to transfer any medical or dental records if needed 5. Arrange for homeowners insurance.

6. Obtain change-of-address cards from the post office. Send after final loan approval and walk through 7. Arrange for change of utilities 8. Separate important financial and personal records. Do not include them with your personal belongings in the move.

9. Pack and extra supply of medications (if moving out of town) AFTER MOVE: 1. Arrange for transfer of vehicle licenses and driver’s licenses.

2. Read the “Make It Your Own Series” on www.BHGRealestate.com and have fun decorating, landscaping and making it your own! .

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Moving Tips Moving with Young Children

Are you excited and happy about moving? Or are you dreading the sorting, packing and other chores?

If you look at moving as an exciting adventure full of fun, new possibilities, then you’re halfway to getting your children on board for the ride. Your children will absorb your enthusiasm like little sponges.

– There will be some worries, of course, but you can defeat those with a little preparation and understanding.

– Most children don’t like the changes associated with moving. The younger the child, the less able they are to "see into the future" as you do. They tend to focus on losing the security they’re used to, and they worry about missing friends and family.

– You can make childish anger and doubt grow into a sense of wonder and adventure. You can do that by acknowledging and empathizing with the loss they feel and showing them how to balance their feelings with what they have to gain.

1. Communicate with your child patiently and frequently. Let your children know, step by

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step, what is happening and what is likely to happen next. Tell them what the move means to the family ……

2. List all the advantages there are for the child in the move. For example, will the family be closer to Grandma, the ocean, or another favorite person, place, or activity? Will they be able to see old friends and family frequently? Or at least at holiday time?

3. Show the child as much as you can about the new home. When you show your child their room, bath, and play area, make a game of it by asking where certain favorite toys or furniture should go. Have fun by showing your child the new house plans, or draw them yourself and let your child cut out furniture and toys to place in the rooms.

4. Introduce your child to the new community online. Draw a map, and show how close Mommy and Daddy work, where schools are, where Aunt Bea lives, and other points of interest to help them orient themselves in their new surroundings.

5. Be ready for those "What about me?" questions. If your child is in scouts, little league, or other organizations, contact those associations for referrals in your new neighborhood or city. Knowing they won't have to give up favorite hobbies or sports goes a long way toward helping children adjust.

6. Let your child participate. Make a fun activity out of researching services you’ll need online, like finding a new veterinarian for your dog. Older children can find blogs online about their new school.

7. Keep your child occupied by letting them plan and pack a box or two of their special things. Consider their input on new decor and the layout of their new rooms. Encourage them to take the time to exchange good-byes and contact information with friends..

8. Try to stick to normal routines as much as possible. Let your children know that, although they will soon live in a new house, the rules of the household will still be the same. Bedtime is still at 9 p.m., and homework must still be completed before TV time is allowed.

9. On moving day, have a bag packed of personal belongings for each member of the family, being careful to include medications, clothes, and personal items. Let your children choose what amusements and favorite "loveys" they wish to take along, and reassure them they will see their other favorite toys when they arrive in their new home.

Your preparedness will go a long way in reassuring your children that their needs are being considered, even while big changes are happening around.

Company Background The company - Founded in 1963 in Houston by Gary Greene, the founder is still associated with the company. Gary Greene is the longest existing real estate firm in Houston.

Locally owned and operated by partners, Mark Woodroof and Marilyn Eiland.

Years of experience Number of agents

50 850

Accomplishments In 2011, the firm was ranked Number 1 in Houston by the Houston Business Journal and the HAR-MLS Broker Ranking Report by dollar volume closed, number of listings sold and number of buyer transactions. It was ranked Number 44 nationally in 2011 by Real Trends in the Top 100 Brokers by closed transactions.

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Mark Woodroof and Marilyn Eiland, Partners of Better Homes and Gardens Real Estate Gary Greene.

Building Relationships for Life  Call on me at any time  Tell your friends and colleagues about the service you received

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