 |
|
California Mortgage - Things to Know about Buying a Home in California First, you usually don’t use a closing attorney like in other states. In fact, you don’t really need an attorney at all if you have a really, really good Real Estate Agent working for you. All Real Estate Agents have to be licensed by the State of California, and since your home is such a big investment, it’s worth the effort to shop around and get yourself a good agent. |
|
Ask around (friends, co-workers, etc) for a the name of a good agent. The Agent will then help you find the house of your dreams. The seller of that house will have an “asking” price already on that house. But you are (hopefully) not going to make that your first offer. Your Agent will help you write up an offer to the Seller on what is officially called a “Deposit Receipt form” All of the details of your offer are entered onto this form, such as the location of the property, the description of the property, what you are offering, the deposit (earnest money) which is usually 3% of your offer, any inspections that you want to have done, who will pay which fees at closing, and how long this offer is good for (there needs to be some sort of deadline). |
|
Next, since you are offering less than what the seller was asking for the property, there is a possibility that the seller will make a written counter offer, wherein he may accept portions of your offer and make some changes. These counter offers may continue back and forth a few times until you reach an agreement or until neither of you accept the terms of the offers. Once an agreement is reached, an “Escrow” will be opened. The Agent takes the written agreement and the earnest money (deposit) and deposits them in Escrow. The purpose of an escrow account is to enable a buyer and a seller to deal with each other without risk. Escrow is a third (unbiased) party (usually a title insurance company or escrow company). The escrow company will handle transferring the title from the seller to the buyer after the seller’s old mortgage is paid off with a new loan from the buyer. Both parties (buyer and seller) deposit funds or documents with the Escrow Company as required for delivery and execution of the terms of the agreed upon contract. The buyer is responsible for obtaining his loan from a lending institution (bank/mortgage company) of his choice. Once the loan is approved, the bank will send the loan documents to the Escrow Company. The buyer will sign all loan documents ahead of the closing date, and the seller signs the deed before the closing date. A few days before closing the buyer will pay any remaining down payment owing as described in the original agreement. Once all the terms of the original agreement have been complied with, the Escrow is officially closed, and the escrow company records the deed with the County Recorder. The Escrow Company notifies the Real Estate Agent(s) that the deed has been recorded and that’s that. No need for an official closing.No need for a closing attorney. But you do see the need for a good reputable Agent – one that knows what they are doing and one that can make sure you are getting a good deal and one that can give you good advice through the entire process from the first offer through the close of escrow. Now go and find yourself a home! Resources: California Association of Realtors |
|