Buyer's Guide

At the beginning of the home-buying process, you need to consider how you will finance the purchase. Knowing how much you will be able to borrow before you start looking at homes is essential. It is the basis upon which you can determine the feasibility of buying a particular home and will allow me to show you only the homes in your price range. It will also place you in a much stronger negotiating position.

You can address this part of the home-buying process by getting pre-qualified or pre-approved. While these terms sound the same, they have some important differences.

GLOSSARY OF TERMS

APPRAISALS: The Purchase and Sale Agreement does not contain a preprinted appraisal contingency. However, some lenders will only offer the buyer a loan if the property appraises for the contract price. The buyer and seller may choose to renegotiate to the lesser appraised value. Where a buyer has added an appraisal contingency to the special stipulations, the disposition of the contract will follow the terms of contingency.

BINDING AGREEMENT: A binding contract is created when one party presents a signed written offer to purchase or sell property to a second party and that party accepts the same request in writing and delivers written acceptance back to the offering party before the time limit in the offer expires.

CLOSING DATE AND POSSESSION: The Purchase and Sale Agreement provides that the closing shall be on a specific date or such earlier date as agreed to in writing by both parties. It also states that both parties agree that should the loan be unable to be closed on the proposed date or that the seller fails to satisfy title, either party, upon written notice provided before the agreed-upon closing date, can extend the contract closing date up to seven days. 

Residential real estate closings are handled in several ways among the various states. In some states, title companies manage the process; escrow companies manage the process in others. In Georgia, most closings occur with the assistance of an attorney who specializes in real estate transactions.

Regardless of whether a choice is permitted, the attorney represents only the lender. Because of ethical considerations due to a possible conflict of interest among the various parties to a closing, an attorney representing the lender should not represent any other party to the closing. Therefore, if the borrower desires representation, independent counsel should be obtained. Of course, if a lender is not involved in financing the transaction, the purchaser will select an attorney to represent their interest.