Home prices guaranteed to increase December 1, 2009
As of December 1, 2009 home prices are guaranteed to increase by $8,000 for first time homebuyers. You must take possession of your new home by November 30, 2009 to qualify for the first time homebuyer tax credit. The train is leaving the station, be on it or pay more come December 1st.
August and September are the months to begin your home search
On average, it takes around 60 days from contract to closing. With this in mind, a first time homebuyer would need to be under contract by October 1st. There are plenty of homes to choose from right now. Get started early, so you don't have to feel rushed.
Timeline to purchase a home in New Jersey
Financing - 1 day to 1 week
Before the home search begins, make sure that you have all your ducks in a row. First item is to be pre-approved from a reputable mortgage company. In this difficult credit market it makes sense to have a pre-approval in hand. A pre-approval means that you have spoken with a mortgage person, submitted all necessary documents and have had your credit report pulled. This lets the home seller know that you have been thoroughly screened and that you are ready to purchase. The only items that you are waiting for are the home and the appraisal value.
Finding the home - 1 day to 2 months.
Each home search is unique. There are people who can look at 5 homes and make an instant decision. Other folks want to make sure that they have seen every home available. Only you and your Realtor know for sure how long this process will take you.
Negotiating the contract - 1 day to 2 weeks
Once you have picked the home that you want to purchase you will write up an offer. This process can take as little as one day. (If you pay full price and agree to whatever terms the seller wants). The reality of today's market is that everybody wants to negotiate. Typically buyers want to make an offer below the asking price. There are a couple of issues here:
- Getting in touch with the seller and/or the sellers agent. There are plenty of Real Estate agents who spend their summers "Down the Shore". There is also the possibility that the owner is on vacation and not accessible. In a negotiation, you don't want to appear too anxious. Patience is important in order to get the price that you want. If you wait until the last minute you will not have this advantage.
- Attorney Review Process - In New Jersey, once the contract is signed by both buyer and seller the status is changed to Attorney Review in Process. The buyers and sellers attorneys contact each other to finalize the contract. This process typically takes three business days. The process can be sped up or can take weeks, it all depends on communication. Some attorneys may be in court and not available. Other times buyers and sellers aren't easy to get a hold of. During this status either party can cancel the contract for any reason. Sellers have been known to cancel the contract if they receive a better offer.
Under Contract, Inspection Contingencies - 1 day to 2 weeks
After the attorneys have finalized the contract, all the contingency timelines will begin. You will want to have the home inspected for structural issues, termites and radon. If the home you are buying has septic, oil and/or well water, you will want to have those checked as well. During this time you will have to set appointments with inspectors. As we get closer to the tax credit deadline, people will become very busy. If there are issues with the home and you are not comfortable with going forward with the purchase you will need to start the process over and all the time invested in this particular process will be lost.
Mortgage Processing, Appraisal 30 - 90 days
At the conclusion of the inspections, the appraisal is ordered. There have been many new laws passed regarding Appraisals. Unfortunately, this has slowed down the process. Having the appraisal done and the filing of the report can take anywhere from three days to one month. Once the appraisal has been entered, the final underwriting of the mortgage takes place. Depending on how backed up the pipeline is, there can be delays in this stage.
"Lack of preparation on your part, does not constitute an emergency on our part."
This quote was posted in the Bursars office of St. John's University when I was a student there in the early 1990s.
I'm pretty sure that the US Government will feel this way if for some reason your closing gets delayed and you end up closing on December 1st and not November 30th. Get started soon, seize the day.
Get Educated. Get Empowered.
For more information on this or any other topic, call Sal Poliandro, Broker Associate, Realtor, Marketing Advisor,
Short Sale Specialist and CDPE, Certified Distressed Property Expert
ePRO, SRES at 201-259-2187, visit our websites: www.SalAndDawn.com or shortsaleguy.org
Follow me on Twitter: @salanddawn
Sal can be reached by snail mail at RE/MAX Properties 73 East Allendale Road Saddle River, NJ 07458
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