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Buying

 

Congratulations! You are contemplating home ownership or have decided to purchase a home. You’ll be joining the ranks of hundreds of families who realize that home ownership offers a number of benefits including building equity, saving for the future and creating an environment for your family. When you own a home, your hard-earned dollars contribute to your mortgage. The equity you earn is yours. Over time, your home will increase in value. Purchasing real estate is the single largest investment a person will ever make and Moongate Realty is here to ensure that our clients have a positive and rewarding experience throughout this process.

 

Below are the steps one must take to embark on this exciting journey!

 

Pre-Approval
If you require mortgage financing, seeking pre-approval from our local banks (HSBC, Butterfield Bank or Clarien) is the first step in this process. Meeting with a loan officer will determine the amount you are able to borrow and which properties you should be viewing (based on their price range). It is important to note that many sellers will not take a prospective buyer at face value if they aren’t pre-approved or have provided proof that they are able to purchase a home with cash.

The process of obtaining a pre-approval letter requires that you contact your bank’s lending department and schedule an appointment with a loan officer. They will assess your finances and issue a letter which is usually valid for a six (6) month period. A copy of this letter can be provided to your realtor and the house hunting can begin.

 

Call Moongate Realty

Once you have been pre-approved, contact your Moongate Realty Agent to start the house hunting process for you! Allow us to search for properties island-wide within your price range and arrange viewings on your behalf. If you see a property advertised with another agency, we can also show you the property under a co-brokerage agreement.

 

Making an Offer
Once you’ve found a home you like, submit an offer right away! The early bird catches the worm. If this is the house of your dreams, you don’t want to lose out! The negotiations begin and once a price is accepted by all parties, you then move into contract.

 

Selecting an Attorney
You are required to engage the services of a real estate attorney when purchasing a home, you. A lawyer will assist in ensuring that the mortgage documents are in order, review the sales and purchase agreement on  your behalf and represent your best interests during this process, such as a mortgage commitment letter, good faith estimates of closing costs, escrows and proper calculation of lender’s fees. You may to hire an attorney who regularly handles real estate transactions. Check with family, friends, your real estate agent or the yellow pages. In addition to reviewing the contract with you, your lawyer will negotiate contract changes with the seller’s lawyer and provide notice to the seller’s lawyer regarding the results of such items as financing discussions, engineering surveys and other agreed conditions to the contract. He will also liaise with the lending institution, undertake the title search and disburse the funds at closing.

 

Sale and Purchase Agreement
Once your offer has been accepted by the vendor, a Sales and Purchase Agreement is drafted by the vendor’s lawyer and forwarded to the buyer’s attorney for comment and review. This standard contractual agreement The SPA is the legal document that fixes the rights and obligations of the parties, and establishes the terms of the transaction that binds the parties. The agreement will also set out obligations and conditions that the buyer and/or seller must abide by. These may include what access the buyer may have to inspect the property before settlement and ensuring the property remains insured until the settlement date, etc.

Once signed by the parties, this agreement becomes a binding contract with regard to the purchase of the property.

If all conditions have been met on the sales agreement, then it becomes fully enforceable on either party. The deposit placed by the purchaser is non-refundable and is paid to the seller in the event of purchaser default. This occurs very rarely and the normal closing period is 30 days from the satisfaction of all conditions as set out in the Sales Agreement. Why 30 days? Well, once all conditions have been met, your lawyer will notify the Department of Planning of the sale. They, in turn, require up to 28 days to inspect the property for any illegal development. After this time, the property is deemed to be free from any development that contravenes the Planning Act. This is an important step and should not be missed. If you take possession before the Department of Planning has inspected the property, then you become liable for any illegal development which may have occurred prior to your ownership.

The closing period can take longer for various reasons, but it is normally negotiated into the contract. It is important to notify your lending institution of the closing date. At this point, you may also consider insuring your property which your agent can help you with.

Typically, the day of closing or the previous day, the purchaser will sign the conveyance documents then the seller will follow. All funds are placed with the purchaser’s lawyer including the deposit, less any commissions. The purchaser’s lawyer will then disburse the funds, including paying any mortgages or liens on the property. The lawyer then gives the balance to the seller, keys are exchanged and the deal is closed.

 

If you would like to further discuss the possibilities of owning your own ‘piece of the rock’, please contact Ambika Scott at 232-2387, 735-2386 or ascott@moongatebda.com.

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