Home Desired Sonoma County Real Estate Specialists

Welcome to Sonoma County's best local Real Estate brokerage!

If you have any questions about anything covered or not covered please do not hesitate in contacting us.

We are here to help and we're always extremely happy to hear from you...

Office: 707.975.4588      or email us: Contact HomeDesired!

Owning a Home

Is buying a home the right thing for you to do? There are many advantages to homeownership:

• You enjoy being part of a community and a neighborhood.
• Houses can increase in value over time, which means you increase your net worth.
• As your home appreciates in value, you build equity in your home. This equity works for you if you decide to take out a home improvement loan or home equity loan. Increasing equity also increases the amount of cash you may receive if you sell your home in the future.
• Real estate is an important part of a diversified financial portfolio.
• The interest you pay on your home mortgage is often tax deductible.
• Homeownership offers more flexibility to make changes to your living space, such as painting your walls or putting in new carpeting.

There are added responsibilities that come with homeownership:

• You are responsible for fixing and maintaining the exterior, such as roofing, windows, and landscaping; and the interior, such as carpeting, plumbing, and painting.
• You may need to purchase basic household items such as a lawn mower, garden tools, and major appliances.
• Upkeep on a house can be time consuming and costly.

Why Buying a Home is a Good Idea

Freedom and Individualism

When you rent, you are normally limited on what you can do to improve your home. You have to get permission to make certain types of improvements. Nor does it make sense to spend thousand of dollars painting, putting in carpet, tile or window coverings when the main person who benefits is the landlord and not you.

Since your landlord wants to keep his expenses to a minimum, he or she will probably not be spending much to improve the place, either.

When you own a home, however, you can do pretty much whatever you want. You get the benefits of any improvements you make, plus you get to live in an environment you have created, not some landlord.

More Space

Both indoors and outdoors, you will probably have more space if you own your own home. Even moving to a condominium from an apartment, you are likely to find you have much more room available - your own laundry and storage area and bigger rooms. Apartment complexes are more interested in creating the maximum number of income-producing units than they are in creating space for each of the tenants.

If you are moving to a home for the first time, you are going to be very pleased with all the new space you have available. You may have to even buy more "stuff."

The Best Investment

As a fairly general rule, homes appreciate about four or five percent a year. Some years will be more, some less. The figure will vary from neighborhood to neighborhood, and region to region.

Income Savings

Because of income tax deductions, the government is subsidizing your purchase of a home. All of the interest and property taxes you pay in a given year can be deducted from your gross income to reduce your taxable income.

For example, assume your initial loan balance is $150,000 with an interest rate of eight percent. During the first year you would pay $9969.27 in interest. If your first payment is January 1 st , your taxable income would be almost $10,000 less - due to the IRS interest rate deduction.

Property taxes are deductible, too. Whatever property taxes you pay in a given year may also be deducted from your gross income, lowering your tax obligation.

Stable Monthly Housing Costs

When you rent a place in Sonoma County, you can certainly expect your rent to increase each year - or even more often. If you get a fixed rate mortgage when you buy a home, you have the same monthly payment amount for thirty years. Even if you get an adjustable rate mortgage, your payment will stay within a certain range for the entire life of the mortgage - and interest rates aren't as volatile now as they were in the late seventies and early eighties.

Forced Savings

Some people are just lousy at saving money, and a house is an automatic savings account. You accumulate savings in two ways. Every month, a portion of your payment goes toward the principal. Admittedly, in the early years of the mortgage, this is not much. Over time, however, it accelerates.

Second, your home appreciates. Average appreciation on a home is approximately five percent, though it will vary from year to year, and in some years may even depreciate. Over time, history has shown that owning a home is one of the very best financial investments.

Market Timing Is Difficult

One problem with attempting to time your purchase to the business cycle is that no one can accurately predict the future. Another challenge is that interest rates are generally higher during a depressed market and income may not be keeping up because less overtime is available and bonuses or commissions are down. With higher interest rates and lower earnings, fewer people can qualify for a home purchase than in more prosperous times.

Why You Should Not Wait

Plus, "timing the market" generally works best for first-time buyers. People who already have a home usually need to sell it in order to buy their next one. If a "move-up" buyer wants to buy a home during a depressed market, that means they usually have to sell one during the slow market, too. If a seller wants to sell his home to take advantage of a "hot" market when prices are fairly high, they generally have to buy their next home during that same hot market. It tends to equal out.

Finally, the business cycle can change over time. Since 1983, we have had two fairly long expansions with only a slight recession in between each. You would not want to wait nine years to buy a home, would you? You could miss out on a substantial amount of appreciation by waiting, and end up paying much higher prices.

Are You Buying a House or a Home?

As you read and study about buying real estate, you will often find the words "house" and "home" used interchangeably. There is a huge difference between a house and a home.

A house can be a place to eat, sleep, park your car, and put all your "stuff" (including other family members). It is a material possession and an investment. A home is where you feel comfortable, warm, safe, and protected. A home is where you live.

A house is something you buy logically. A home is an emotional purchase. When buying real estate you have to balance your emotional wants and your logical needs because there will almost certainly be a time when the two conflict.

Balancing Act

The trick in buying real estate is to view all decisions with both a logical perspective and an emotional perspective. If a situation presents itself that requires a trade-off, decide on whether there is a huge conflict or a small one. Logic should win the big conflicts, but emotion should always be a factor, even winning the small ones.

You will find yourself owning a warm, happy, safe home - and an investment for the future at a price you are willing to pay.

Things you should never do prior to purchasing a house

It's highly advisable not to make major purchases of any kind .

Debt-to-Income Ratios and Car Payments

You see, when determining your ability to qualify for a mortgage, a lender looks at what is called your "debt-to-income" ratio. A debt-to-income ratio is the percentage of your gross monthly income (before taxes) that you spend on debt. This will include your monthly housing costs, including principal, interest, taxes, insurance, and homeowner's association fees, if any. It will also include your monthly consumer debt, including credit cards, student loans, installment debt, and.. car payments.

Don't Move Money Around

When a lender reviews your loan package for approval, one of the things they are concerned about is the source of funds for your down payment and closing costs. Most likely, you will be asked to provide statements for the last two or three months on any of your liquid assets. This includes checking accounts, savings accounts, etc. It's easier for everyone if you stay at your current bank until you close escrow on your new home.

• Credit bureaus compile a record of your debts and how you have repaid them. They gather their information from credit card companies, banks, department stores, and other firms. This information makes up your credit report.
• Your credit history shows how well you have paid your debts in the past.
• Capacity is your financial means for repaying your debt.
• Capital indicates whether you have enough money for a down payment and closing costs.
• Collateral serves to protect the lender if you fail to repay the loan.

• Equifax (800) 685-1111
• Experian (800) 682-7654
• Trans Union (800) 916-8800

Errors in Credit Report
Your credit report may contain inaccuracies. The best way to ensure there are no errors in your credit report is to request copies and review the information.

Since each of the main credit bureaus keeps its own records, you may want to request copies from all three: Trans Union, Equifax, and Experian.

If you have been turned down for credit because of the information in your credit report, you are entitled to receive a free copy of your report within 60 days of the denial. If you haven't been denied credit, you can still request a copy of your credit report, usually for a nominal fee.

If you find errors in your report, follow the directions in the credit report, and contact the agencies to have the errors corrected. They will investigate the targeted items and remove incorrect information.

You don't have to delay applying for a mortgage while errors in your report are being corrected. Explain the discrepancies in the report to your lender, and state that the credit agency is correcting them.

Many lenders are excellent in dealing with credit issues. So, most of the time a few dings on you credit report can be addressed easily.

How Much Can You Afford ??
One of the best ways to determine how much house you can afford to purchase is to contact a respectable lender. Working with your lender you will find a mortgage product that will best suit your financial situation.

Remember, if you're buying a house with someone else -- a spouse, parent, partner, or companion, for example, that person's annual gross income and debts can be considered in computing the cost of the home.

Preparing a budget might be a good way to help the lender know whether you have enough money for a down payment, closing costs, monthly mortgage payment, taxes, insurance, and other costs associated with buying a home.

Lenders use guidelines to determine whether prospective home buyers will be able to pay their monthly mortgage payments comfortably. Though flexible, the guidelines generally state that a household should spend no more than 28 percent of its income on housing expenses and no more than 36 percent of its income on total debt obligations (including the monthly mortgage payment).

Pre-qualification
Before a prospective home buyer applies for a loan, pre-qualification determines how much money he or she will be eligible to borrow.

Real Estate Sales Professional
A buyer usually does not pay for the real estate sales professional's services. Instead, the seller of the house typically pays -- most often through a commission based on the selling price of the home.

When buyers work with HomeDesired Real Estate they can be confident! HomeDesired is a local family run company and it's obvious to our clients that we have their best interests in mind. We are members of the community just like you are, or hopefully soon will be. Our reputation matters, and, our good fortune only continues as long as our clients dreams are fulfilled.

There are two "sides" to every sale.  The seller's side is represented by the listing agent.  The buyer's side is represented by the selling agent.  The selling agent can also be referred to as the buyer's agent.   In Northern California it is common for agents to work as both selling and listing agent in their day to day business. Most agents split their time equally between buyers and sellers.

Actually, the best thing for you to do when you see an advertisement in the paper is to call your own HomeDesired Agent and tell them about the ad. Since addresses usually do not appear in advertisements, your agent will call the listing agent and find out the MLS number for the property.  If the listing is on the internet database, it probably already provides the MLS number.

The house may turn out to be a great home for you, but it may also be a property that we have already disregarded because it backed up to a busy noisy street and you want a quiet neighborhood, etc. 

There are many things that should be considered when buying a home. Since most homebuyers expect to buy a bigger and better home someday in the future, resale value is an important factor in decision-making. You use the proceeds from selling one home to buy the next one.

While no one can guarantee that your home will grow in value, there are steps you can take that maximize your potential gain.

"Location, Location, Location"

Mostly, "location" is repeated to emphasize that it is extremely important to the resale value of your home. The idea is to buy a house that will appeal to the largest number of potential future homebuyers. A careful choice of location can minimize potential negative influences on future resale value, and maximize positive influences.

Focusing on resale value requires you to make several different "location" choices. The first choice you have to make is "which community?" At the very least, you should narrow your choice down to just a few local communities.

Location - Local Community, Town, or City

Before you can actually pick out a house, you need to choose what cities or communities you would like to live in. The re are many factors you should pay attention to, not only for yourself, but because you intend to eventually sell the home to someone else. Carefully choosing your community is the first step in "location, location, location" and can help maximize your future potential resale value.

Economic Stability

When choosing a community for your purchase, it makes the most sense to buy in a city with a viable and stable economy. Five, ten, or even fifteen years from now - whenever you want to sell your home - you can have a reasonable expectation that your community will still be a desirable place to live.

In addition to residential neighborhoods, there should be a healthy mixture of commercial and business districts. These not only provide jobs to the local residents, but also add an income source that the city can use to upgrade and maintain roads and city services.

In fact, you should take a drive and see how well the community is maintained. You have probably heard of "pride of ownership" when referring to an individual home or an automobile. Look to live in a city that demonstrates community pride, as well.

Schools

Even if you do not have school-age children and do not intend to have children, you must pay attention to the local school system. That is because when you sell the property, many of your potential buyers might have concerns of this nature.

You will want to know if the local schools are overcrowded. Take a drive around and see if there are auxiliary trailers outside the local schools. Call up the local school district and see if elementary aged children always attend the school closest to their home. If not, ask why. Are there enough schools to support the local population? If not, are there plans to build new schools? How will building new schools affect local property taxes?

You should also check to see how local students score on the standardized tests. You can ask your agent about these things, but you should also get the local phone numbers so you can ask yourself.

There are also school reports available for free on the Internet.

Location - The Residential Neighborhood

Within a paticular residential neighborhood, you want the nearby properties to be well kept and of the highest possible quality for the price range.

Visit the neighborhood at various times to get a more complete understanding of its activity. Talk with your prospective neighbors about what it's like to live in the area. Take a day and commute to your job from the area. And look at the home more critically -- you may discover flaws, or even benefits you hadn't noticed during your first visit.

Lots and Landscaping

Even though most real estate value is usually concentrated in the building, the lot is important, too. Obviously, it should be as level as possible.

Yard sizes are smaller in modern homes than in older homes, but there should still be a decently sized front and back yard. Be careful of a house where the entire back yard is taken up by a swimming pool, for example.

Watch out for an over-landscaped property as well. You would normally pay a premium for that, which you may not be able to recover when you sell. You will get your best value if the house is moderately landscaped or under-landscaped for the area. You can always improve the landscaping during your ownership by improving the grass and adding bushes and trees.

House Size

In each residential neighborhood, houses will vary in size and rooms. If resale value is an important consideration, you may not buy the largest model in the neighborhood. When determining market value, the homes nearest to yours are most important. If most of the nearby houses are smaller than your house, they can act as a drag on appreciation.

On the other hand, if you buy a small or medium house for the neighborhood, the larger homes can help pull up your value. This is one of those times where determining your "wants" versus your "needs" can be extremely important. Buying what you need in a more prestigious neighborhood may provide more financial reward than getting what you want in a less desirable neighborhood.

Bedrooms and Bathrooms

Three and four bedroom houses are the most popular among homebuyers, so if you can stick in that range you will have more potential buyers when it comes time to resell. Five is okay, too, as long as you do not have to pay too much extra for the additional bedroom.

It's best to have at least two bathrooms in a house, preferably at least two and a half. One bathroom with a place to wash up for day-to-day visitors, one for the master bedroom, and at least one to be shared by the other bedrooms.

Closets, Garages and Laundry

Walk-in closets are extremely desirable for the master bedroom. For the rest of the house, just be sure there is plenty of closet space. Don't forget space for linens and towels.

Garages add to the resale value and you should always make sure to get at least a two-car garage. Three-car garages have become even more desirable.

The laundry facilities should be located somewhere convenient on the main floor of the house, but not in a place it will create an eyesore. Think about whether you will have to walk up and down stairs when carrying loads of laundry.

The Kitchen

Family activity centers around the kitchen, so this is the most important room of the house. Larger kitchens are better, and they should be provided with modern appliances. The dining room and breakfast nook should be located adjacent to, or close to the kitchen. In newer houses, the family room should also be extremely close to the kitchen.  

Fireplaces

If a fireplace is on your 'must have' list, the only room where you absolutely have to have a fireplace is the family room. A fireplace in the living room may be nice, but you pay extra for it and will probably rarely use it. At best, it serves as a focal point of the living room, but does not add much in real value.

Swimming Pools

Safety issues about families with younger children have become more publicized than in the past, so some families with small children tend to avoid homes with pools. Nowadays, pool fencing is readily available and can be an attractive addition to the outdoor landscaping, not to mention a perfect safety precaution.

A pool can provide endless hours of refreshing entertainment on a warm day for the whole family. If you are seeking a pool and there is not a house with one on the market for sale, your Home Desired agent will help you find a home whose lot is large and level. This will ensure enough room to build a pool and still leave a sizable lot for lawns, a garden, etc.

When you prepare an offer to purchase a home, you already know the seller's asking price. But what price are you going to offer and how do you come up with that figure? Determining your offer price is a three-step process.

First, you look at recent sales of similar properties to come up with a price range. Then, you analyze additional data, such as the condition of the home, improvements made to the property, current market conditions, and the circumstances of the seller. This will help you settle on a price you think would be fair to pay for the home. Finally, depending on your negotiating style, you adjust your "fair" price and come up with what you want to put in your offer.

Comparable Sales

The first step in determining the price you are willing to offer is to look at the recent sales of similar homes. These are called "comparable sales." Comparable sales are recent sales of homes that compare closely to the one you are looking to purchase. Specifically, you want to compare prices of homes that are similar in square footage, number of bedrooms and bathrooms, garage space, lot size, and type of construction.

If the home you are interested in is part of a tract of homes, then you will most likely find some exact model matches to compare against one another, and you can mentally equalize the upgrades and places that need help in your mind.

There are three main sources of information on comparable sales, all of which are easily accessed by you Home Desired real estate agent. It is somewhat more difficult for the general public to access this data, and in some cases impossible. Two of the most obvious information sources are the public records and the Multiple Listing Service.

Comparable Sales in the Public Records

The most accessible source of information on comparable sales is the public record. When someone buys a home the property is deeded from the seller to the buyer. In most circumstances, this deed is recorded at the local county recorder's office. They combine sales data with information already known about the property so they can assess property taxes correctly.

Provided there have been no additions to the property, the information available from the public record is usually correct regarding sales price, square footage, and numbers of rooms. This makes it easy to use the public record as a source of data for comparable sale information.

Accessing the data is another matter, at least for the general public. Home Desired agents can generally look up this information through updated databases the company pays for.

One problem with the public record is that it tends to run at least six to eight weeks behind. Add another four to six weeks for the typical escrow period and you can see the data is not current. The most current information is the most valuable.

Comparable Sales in the Multiple Listing Service

Most of the public is aware that the Multiple Listing Service is a private resource where agents list properties available for sale. Recently, the public has been able to access some of that information on such websites as ours, www.Homedesired.com.

Once a property is sold and the transaction has closed, the selling price is posted to the listing in the Multiple Listing Service. Over time, it has become a huge database on past sales, containing much more information on individual homes than can be gleaned from the public record. This information is only available to real estate agents who are members of the local Multiple Listing Service.

Comparable Sales in Pending Transactions

The most valuable information would be the most current, of course. A sale last week has more validity in helping you determine a purchase price than a sale from six months ago. The problem is that there is no actual record of the sales price until the transaction is completed. The information is not available in the public record because no deed has yet been recorded.

Neither is the information available in the Multiple Listing Service. Once a property is sold, it becomes a "pending sale" and all pricing information is removed from the listing. Prices are not posted until it becomes a "closed sale." This protects the seller in case the transaction falls apart and the property is placed back on the market. It would give an unfair advantage to future potential buyers if they already knew what price the seller had been willing to accept in the past.

Conclusions

Gathering and analyzing information from comparable sales helps to establish the range of prices you should consider when making an offer to buy a home. More weight should be given to the most recent sales, but even so, you need to do a bit more analysis before setting upon the price you will offer. That is because you also need to consider (with the help of HomeDesired ) the condition of the property, improvements, the current market, and the circumstances behind the seller's decision to sell.

How Property Conditions Affect Your Offer

Since you have toured the property you are interested in, you should know how it compares to the general neighborhood. All you have to do is put the home in one of three categories - average, above average, or below average.

When evaluating a home's condition, there are a number of things you should consider. Structural condition is most important - items such as walls, ceilings, floors, doors and windows. The n paint, carpets, and floor coverings. Pay special attention to bathrooms and bedrooms and whether the plumbing and electricity work efficiently. Look at the fixtures, such as light switches, doorknobs, and drawer handles. The front and back yards should be in reasonably good shape.

How Home Improvements Affect Your Offer

Even when comparing exact model matches within a tract of homes, you should note whether the previous owners have made any substantial improvements. Cosmetic changes should be largely ignored, but major improvements should be taken into account. Most important would be room additions, especially bedrooms and bathrooms. Your HomeDesired agent will be happy to give you guidance in this area, and whether or not permits were obtained.

How Market Conditions Affect Your Selling Price

A hot market is a "seller's market." During a seller's market, properties can sell within a few days of being listed and there are often multiple offers. Sometimes homes even sell above the asking price. Though most buyer's want to get a "deal" on a home, reducing your offer by even a few thousand dollars could mean that someone else will get the home you desire.

A slow market is a "buyer's market." During a buyer's market properties may languish on the market for some time and offers may be few and far between. Prices may even decline temporarily. Such a market would allow you to be more flexible in offering a lower price for the home. Even if your offered price is too low, the seller is likely to make some sort of counter-offer and you can begin negotiations in earnest.

More often than not, the market is simply "steady," or in transition. When a market is steady, no real rules apply on whether you should make an offer on the high end of your range or the low end. You could find yourself in a situation with multiple offers on your desired house, or where no one has made an offer in weeks.

Transition markets are more difficult to define. If the economy slows unexpectedly, as it did in the early nineties, people who buy on the high end of a seller's market (like the late eighties) could find their home loses value for several years. This is why you need to look at real estae as a long term investment. So far, no one has proven reliable in predicting when markets change or how good or bad the real estate market will become.

How Seller Motivation Affects Your Offer Price

Truthfully, it is rather rare that a seller's motivation will dramatically affect the price of a home, but it is often possible to save a few thousand dollars. The most common "motivated seller" is someone who has already bought his or her next home or is relocating to a new area. They will be under the gun to sell the home quickly or face the prospect of making two mortgage payments at the same time. Since that can drain a bank account quickly, most sellers want to avoid such a situation.

The Final Decision On Your Offer Price

Comparable sales information helps you to determine a base price range for a particular home. Adding in the various factors like property condition, improvements, market conditions, and seller motivation help determine whether a "fair" price would be at the upper limit of that range or the lower limit. Perhaps you will feel a fair price is outside of that price range.

The "fair" price should be approximately what you are willing to agree on at the end of negotiations with the seller. The price you put in your offer to begin negotiations is totally up to you and depends on your negotiating style. Most buyers start off somewhat lower than the price they eventually want to pay.

Although your HomeDesired agent may provide advice and guidance, you are the one who makes the decision. The price you put in the offer is totally up to you.

Once you find the home you want to buy, the next step is to write an offer - which is not as easy as it sounds. Your offer is the first step toward negotiating a sales contract with the seller. Since this is just the beginning of negotiations, you should put yourself in the seller's shoes and imagine his or her reaction to everything you include. Your goal is to get what you want, and imagining the seller's reactions will help you attain that goal.

The offer is much more complicated than simply coming up with a price and saying, "This is what I'll pay." Because of the huge dollar amounts involved, especially in today's litigious society, both you and the seller want to build in protections and contingencies to protect your investment and limit your risk.

In an offer to purchase real estate, your Home Desired agent includes not only the price you are willing to pay, but other details of the purchase as well. This includes how you intend to finance the home, your down payment, who pays what closing costs, what inspections are performed, timetables, whether personal property is included in the purchase, terms of cancellation, any repairs you want performed, which professional services will be used, when you get physical possession of the property, and how to settle disputes should they occur.

Contingencies In An Offer To Purchase Sonoma County Real Estate

In most purchase transactions there may be a slight challenge or two, but most things will go quite smoothly. These are called "contingencies" and you must be sure to include them when you offer to buy a home.

For example, some "move-up" buyers often agree to purchase a home before selling their previous home. Even if the home is already sold, it is probably a "pending sale" and has not closed. Therefore, you should make closing your own sale a condition of your offer. If you do not include this as a contingency, you may find yourself making two mortgage payments instead of one.

Basically, contingencies protect you in case you cannot perform or choose not to perform on a promise to buy a home. If you cancel a contract without having built-in conditions and contingencies, you could find yourself forfeiting your earnest money deposit.

Earnest Money Deposit In An Offer To Buy Sonoma County Real Estate

After you have come up with an offer price, the next step is to determine how large a deposit you want to make with your offer. You want the "earnest money deposit" to be large enough to show the seller you are serious, but not so large you are placing significant funds at risk.

Although significant problems are the exception and not the rule, they do occur. "Just in case" there is a nasty or prolonged dispute between you and the seller, the less money you have tied up in a deposit, the fewer funds you have placed at risk.

An average and prudent initial deposit for a $400,000 Sonoma County Property would from $2,000 to $4,000. Then, after all of you contingencies are removed and your sure the house is going to be yours the deposit should be increased to near 3% of the total purchase price. So, on a $400,000 the increased deposit would usually be about $8,000. You would then have a total of $10,000 to $12,000 in escrow deposits.

As with practically everything in real estate, there are exceptions to this rule, too. During a hot market there may be multiple offers on the property that interests you. A large deposit may impress a seller enough so they will accept your offer instead of someone else's, even when your unknown competitor is offering the same price or slightly higher.

Since large deposits do impress sellers, you may also find that by making a large deposit you can convince the seller to accept a lower offer. More money up front may save you money later.

The Closing Date

It is absolutely essential that you include a closing date as part of your offer. This way both you and the seller can make plans for moving, and the seller can make plans for buying his or her next home. Though most transactions actually do close on the right date, do not be so inflexible that a delay creates insurmountable problems.

For example, if you are renting and need to give the landlord notice that you are moving out, you may want to allow a little flexibility. Otherwise, if your purchase closes a few days late you could find yourself staying in a motel with your belongings packed in a moving van somewhere while you pay storage costs.

There are also times when closing can be delayed by weeks, through no fault of your own. Have back-up plans prepared for such a contingency.

Although you have toured the property, looked at the walls and ceiling, turned on the faucets and played with the light switches, you have not lived in it. The seller has years of knowledge about his or her home and there may be some things you want to find out about as quickly as possible. For this reason, you will require certain disclosures as part of your offer. These disclosures are called T.D.S's (transfer disclosure statements) and they are required by law. These are the sellers "tell all" forms and most people try to fill them out honestly. If they do not fill them out to the best of their knowledge serious liability can occur.

Your HomeDesired Real Estate agents will also make a visual inspection of the house and include the written inspection on a TDS form for you to read and sign.

Condition Of The Property

The last thing you want when you assume possession of your new home is to find it in a total mess. Therefore, you should make it clear in your offer that certain minimum standards are required.

Some of the requirements you might want to include in your offer are that the roof does not leak, the appliances work, the plumbing does not leak, that there are no broken or cracked windows, the yard has been kept up, and any debris has been cleared away. HomeDesired will make sure these crucial clauses are part of you contract.

Home Inspections

Besides appraisal and the termite inspection, you should also have a professional go through the house and seek out potential problems. Of course, you will have inspected the home, but you are not used to looking at some things that a professional will find. Even if they are not things the seller is expected to repair, at least you will have foreknowledge of any potential problems.

The seller will want this inspection performed quickly, so that you can approve the results and move forward with the purchase. Once you receive the inspection, you will want to allow yourself sufficient time to review and approve the report. If you do not approve the report, you may negotiate with the sellers on which repairs should be performed and who should pay for those repairs. Otherwise, you can cancel the purchase without penalty, provided you have included timetables in your offer.

Pest and Termite Inspections

As part of your offer, you may require a termite and pest inspection. This company not only inspects for termite damage and pest infestations, but also inspects for dry rot and water damage, among other things. The company that performs the inspection is important to you as a buyer, because you want to be sure they do a good job. It is important to the seller because it is customary that they pay for the inspection and some types of repairs that may be required.

Your Home Desired agent can help you find a reliable, local inspection company.

Final Walk-Through Inspection

Before closing, you will want to revisit the property to ensure it is in the condition you have required in your offer, and to inspect that any required repairs have been performed. You should do this no sooner than five days before you intend to close. Make sure this right to do a final inspection is included in your offer to purchase the home.

How Financing Detail Affect Your Offer

Most buyers do not have enough cash available to buy a home, so they need to obtain a mortgage to finance the purchase. Since you will probably make your purchase contingent upon obtaining a mortgage, the seller has the right to be informed of your financing plans in order to evaluate them. That is one of the major reasons that financing details are included in your offer.

Down Payment

As part of your offer, you will need to disclose the size of your down payment. Once again, this allows the seller to evaluate your likelyhood of obtaining a home loan. It is easier to get approved for a mortgage when you make a larger down payment.

Interest Rates

Another reason for including financing information in your offer is to protect yourself. If interest rates suddenly become volatile and rise quickly, as sometimes happens, you may looking at a mortgage payment much higher than you anticipated. By putting a maximum acceptable interest rate in the offer, you are protecting yourself from such an occurrence.

Asking For Closing Costs and Finance Incentives

There may be times when, as part of your offer, you request the seller to pay all or a portion of your closing costs, or provide some other financial incentive. One common request is asking the seller to provide funds to temporarily buy down your interest rate for the first year or two.

Whenever you ask for incentives such as these, you will probably find the seller less willing to negotiate on price. After all, what you are really asking for is have the seller to give you some money to help you buy their house. The end result is that, for a little relief in the beginning, you are willing to pay a little more in the long run.

Seller Financing

Another occasional request is to have the seller "carry back" a second mortgage to help facilitate your purchase of their home. In cases when the seller does not need all the proceeds from their sale in order to purchase their next home, this is an option. The advantage to the buyer is that by combining your down payment and the second mortgage from the seller, you may be able to avoid paying mortgage insurance and save yourself some money.

If such a carry-back is part of your offer, you should include the terms you wish to pay on such a second mortgage. Keep in mind that your first trust deed lender needs to know this information so they can underwrite your loan, and they have certain minimum requirements. The minimum term of the second mortgage can be five years. The minimum payment can be "interest only." Longer mortgage terms and payments that also include principle are also acceptable.

Cash Offers

If you are one of those rare individuals making a cash offer to buy a home, it makes sense to provide some documentation with your offer that shows you have the funds available. A bank statement would be fine. If you have to liquidate stock or some other asset, your offer should give a timetable on when you will provide proof you have converted the asset to cash.

Other Financing Details in Your Offer

Your offer should also contain information on whether you are obtaining a fixed rate or an adjustable rate mortgage. It should also state whether you are obtaining conventional financing or obtaining a VA or FHA loan. If you are obtaining a VA or FHA loan in order to finance your purchase, you must include that information in your offer. This is because government loans place additional financial and performance obligations on the seller.

Title and Escrow

In Sonoma County, Title companies also work as Escrow companies . Their job is to act as an "independent third party" between you and the seller. Without having a third party involved, how do you know that when you fork over the money, you are going to get the deed? This is the type of service provided by title/escrow companies. They will hold your deposit and coordinate much of the activity that goes on during the escrow period.

Title insurance is important because, by providing you with an Owners Policy, they insure that you have clear title to the property. If there are any problems later, you can always go back to the title insurance company and have them clear it up. It is customary in Sonoma County for the buyer to pay for Title and Escrow.

Buyer's Remorse - Did You Make a Huge Mistake?

When you were in hot pursuit of the "American Dream" you were excited about the future and owning your own home -- researching neighborhoods, searching MLS listings on the internet, viewing homebuyer's magazines full of appealing homes . Then, you found one that was "just right."

So you made an offer and waited anxiously and excitedly for the counter-offer. Finally, you and the seller agreed on terms and you bought yourself a brand new home!

Congratulations! Break out the champagne and celebrate!

Later that night or perhaps the next day, your nerves set in.

Did you make the right decision?  Can you afford it? Is it the right time? Should you have waited? Anxiety and stress set in. This is a normal reaction to buying a home.  It is called "buyer's remorse." It's a sort of 'mental checks and balances' system that most rational people feel at one time or another.

Take out a pen and paper right now and draw a line down the center of the paper. Calmly and logically, think of all possible advantages to buying a home and write them down on one side of the page. Afterwards, you should list all the disadvantages on the other side of the paper.

This process is supposedly how Ben Franklin used to weigh tough decisions.

After you get done writing your lists, you may think back on your anxiety and think you were being silly.  After all, buying a home is obviously a good decision.  Your list proves it.  But your reaction was normal and shared by many.  You see, buying a home is not entirely a rational process.  It is an emotional process, too.

You will not be totally stress-free, but it will help.

So, come on in, the water's fine - owning a piece of what Luther Burbank calls 'Nature's Chosen Land' is a wonderful opportunity.