This article may include partner links. If you click, visit or buy from these links, we will receive a fee or products from the companies mentioned in this post. Please read our disclosure policy for more details.
“Real estate cannot be lost or stolen, nor can it be carried away. Purchased with common sense, paid for in full, and managed with reasonable care, it is about the safest investment in the world.” — Franklin D. Roosevelt, U.S. president
If you’re one of the many home buyers who were initially on the fence and just recently felt the need to plunge into homeownership, either for the first or the Nth time, this guide will show you the steps involved in a Real Estate transaction; from shopping, viewing, to closing on the home of your dreams.
A BRIEF BACKGROUND: Why I chose Real Estate as my side hustle
About 10 years ago; at the height of the real estate boom, my wife and I decided to take the plunge and hired our then friend who was a realtor.
At the end of the transaction, we got stuck with a property that the previous owners stripped down and made a dump out of, with trash all over, all because the final walk through and inspection was not performed as required; needless to say, our so called friend, in the end was only after his commission and did nothing to correct our situation.
I never forgot that experience and vowed that I will pursue a real estate license to make sure my friends or family members who decide to buy will never experience that same problem, ever.
Fast forward 2017 and I’ve been in Real Estate industry now for more than 20 years, first working at a Mortgage Bank and then having my own license as a Real Estate agent.
I work primarily with friends and family, through word of mouth and recommendations, since I hate selling.
There, I had to get that out of my chest. I really do hate selling.
I already make a good living in the IT industry so I have no motivation other than to look after my client’s needs.
So In my opinion, a Real Estate professional’s objective as a trusted advisor should always be to advocate for their client’s needs by providing unbiased education and advice so they can make the best possible decision, relevant to their motivation and needs, as it translates to a Real Estate transaction.
WHY I BELIEVE HOME BUYERS NEED HELP
The home buying process can be daunting, with lots of paperwork involved, most of which will end up being signed and not even read.
The role of a Real Estate Agent is to provide relevant, timely, and appropriate information to help clients navigate the Real Estate process.
HERE ARE THE STEPS TO KNOW AND CONSIDER IN A REAL ESTATE TRANSACTION:
THE LOAN PROCESS
The home buying process starts with the loan application. A trusted Real Estate professional should work with a client’s lender of choice with regard to finding the best possible loan rate and terms.
They should also be a competent guide throughout the loan qualification, appraisal, and closing process to make sure all relevant documents are understood before signed, documents are delivered in a timely manner, and all loan contingencies are explained and met, to ensure the purchase transaction closes in a timely manner.
FINDING THE RIGHT PROPERTY 
After dealing with the financing aspect, the next step is finding the right home, neighborhood, or school district relevant to a buyer’s needs.
Granted there are online resources like realtor.com, Zillow.com, and others; those should just be supplementary tools that complement an actual real-life agent who can hand hold and guide buyers as they show actual homes; advising on pros and cons of an area and navigate the house hunt with their clients.
MAKING THE OFFER
Depending on client’s motivations, the trusted agent should negotiate in favor of and always pursuant to the client’s wishes.
They should prepare the purchase offer in the ‘standard contract’ relevant for each State, and explain the contents of the contract prior to buyers signature; making sure they are fully aware of what they are signing is a legal document.
ONE THING to note though is that Real Estate agents ARE NOT legal professionals and therefore CANNOT advise regarding legal matters.
IF clients are uncomfortable with any part of the ‘standard’ clauses of the purchase contract, the agent must advise buyers to seek legal help with a licensed Real Estate Attorney who are competent to advise in legal aspects of the contract.
NEGOTIATING WITH THE SELLER
When negotiating with a seller or their agent, the Real Estate professional should always deliver the most updated information relative to the offer, that includes price, terms, and other considerations.
They should always inform clients about all material aspects of the home that affect the value and should take everything into consideration in the offer stage and arrive at an agreement and a win-win proposition for both parties.
ESCROW PROCESS
When buyers and sellers agree and sign a contract of purchase, next thing that happens is the escrow process.
Escrow is a neutral third party whose sole purpose is to ensure the terms of the agreed upon contract are fulfilled and both parties comply with their roles; the buyer by doing due diligence and loan approval, and seller by making sure the home is delivered in proper condition prior to the turnover.
The agent is also responsible for making sure all paperwork necessary to comply with local, State and Federal laws are satisfied in order for the transaction to close.
DUE DILIGENCE PROCESS
So the contract is signed, escrow process is underway; now comes the due diligence part.
This includes making sure the property appraises for the sale price, necessary inspections are done which include property and pest inspections, and checking with the Title company to ensure there are no clouds on title (fancy way of saying there aren’t any ownership issues with the Title before it is transferred).
A competent agent will ensure all these are properly scheduled, done, explained and agreed upon by the client buyer.
CLOSING
Within the agreed upon escrow time period and all due diligence have been done, repairs completed, and loan process finalized; the final step would be for closing.
This involves buyer completing and funding his loan from the lender, signing official loan documents such as the Note and Deed of Trust; turning in necessary compliance documents to escrow company, and making sure a final walk through inspection is done prior to closing to ensure the condition of the property is the same as when the offer was made.
The highlight of closing would be the funding, or when the lender wires over the funds to escrow and sellers sign over the grant deed for transfer to the new owners. At that point, the Title Company records the document at the local County recorder’s office.
Title has now passed from seller to buyer.
POSSESSION
Legal possession of the property happens after the Title Company has recorded the Grant Deed transferring title from previous owners to the new owner.
Once that happens, the Real Estate agent will contact the seller’s agent and arrange for a turnover of the keys and other hardware related to the house.
This is when the transaction ends and the new owner gets the keys and gets to relax after a grueling home purchase period.
Personally, I always look forward to the turnover. Seeing my client’s big smiles and getting their grateful hugs, it’s a good feeling knowing i’ve done my job and helped fulfill another family’s dream.
WRAPPING UP
The Real Estate transaction might be an overwhelming and sometimes difficult undertaking, but having a trusted professional working your corner will surely make all the difference when it comes to simplifying the process and realizing the dream of homeownership.
Do you have any questions regarding the Real Estate process? Have you bought property in the past that left you wondering if it was worth hiring a Real Estate professional?
Please do share by leaving a feedback or comment below, or emailing us at thedebtfreejourney@gmail.com.
And if you like our articles, please consider subscribing to our mailing list to get the best content delivered weekly in your email.
Peace and Blessing to you All.
Leave a Reply