To get started on finding your new home, we just need to handle a couple of things first:
Buyer Broker Agreement
✔ This is a mandate by the National Association of Realtors. This nationwide procedure requires all Realtors to have a signed contract with any buyers prior to showing a home. If any Realtor is caught showing properties without this employment agreement, they will be fined!
✔ Here is what the buyer broker agreement establishes: How long you agree to work exclusively with your Realtor. For this reason, it is important that you interview your Realtor just as you would if you were going to sell your home. This agreement also outlines HOW your Realtor will be compensated.
✔ As of 8/1/2024 the MLS no longer allows sellers to advertise how much they are willing to pay in commission to the buyer agent. Sellers now have the option to not pay your buyer agent, negotiate your buyer agent commission based on the offer you write, or continue to offer a set commission regardless of your offer. (Which is how it used to be)
✔ If the seller does not pay your buyer agent, that fee becomes a buyer responsibility. This is where it becomes extremely important that you interview your Realtor, discuss what their fee is, and whether or not you have the ability to pay their fee. If you have questions about this process, contact me to discuss it in detail.
Getting Pre-Qualified or Providing Proof of funds
✔ Did you know that we cannot submit an offer without this? Line 69 of the Arizona residential purchase contract says "An AAR Pre-qualification form IS attached hereto and incorporated herein by reference."
✔ Consider all perspectives when you are getting ready to buy a home. If you were the seller, would you accept an offer without verifying the buyer's ability to perform? Would you take your home off the market if they cannot or will not provide proof that they possess the funds to purchase your property? Would you accept a job from a company that agrees to hire you but won't tell you if/or how much you are getting paid? That's what you are asking of your Realtor when you do not produce proof of funds, or a pre-qualification letter. Before we invest hours of our time searching for homes and driving around, would you agree that it is fair that we know for sure that we are looking at homes that meet your financial ability?
✔ Now that seller's do not have to pay buyer agent compensation, this fee could become a buyer responsibility. Again, the buyer agent will need to know you have the funds to cover this fee should you choose to purchase a home where the seller is not covering their compensation. Otherwise, you need to give your buyer agent explicit instructions in your buyer broker agreement to not show you any homes if the seller is not willing to cover all or some of their fee.
✔ How will you know what your monthly payment is, if you won't run the numbers with a lender first (it takes 20-30 minutes to apply)? Let's say you are qualified for a home at $850,000 because of your amazing credit score and high income. However, after running the numbers with the cost of the interest, property taxes, HOA, and insurance you decide you don't want to spend that much money every month. Just because you CAN afford it, doesn't mean you want to. Therefore, it would not make sense for a Realtor to show you $900,000 homes only to later find out you would prefer to purchase a home closer to $600,000. It's the highest and best use of all parties' time, to narrow down your numbers and get qualified BEFORE you shop for real estate.
✔ Some homes are occupied even when they are on the market. If we are asking families to step out of their homes with their pets, it is common courtesy that we are looking at homes that are within your predetermined budget. Just as you would want when you are selling a home.
✔ Realtor safety! I bet you didn't know this, but as a female Realtor with our contact information all over the internet, we get odd calls..... ALL THE TIME. I have had imposters call pretending to be the police department, pretending to be homebuyers, and pretending to have real estate questions, only for the conversation to turn into something inappropriate. If we agree to meet with a complete stranger in a vacant home, it mitigates our risk when we know that we have a serious buyer. If you have taken the time to give a lender your social security number and bank statements, it is more likely that you are a serious buyer and not a stranger danger! Likewise for cash buyers. If you have provided me with a copy of your bank statement showing your name and address with your ability to buy real estate, again it's less likely that you have bad intentions when you are providing proof of who you are.
