How do you know if it’s time to buy instead of rent?
Buying a home is a big decision and its important to understand the benefits and drawbacks of buying and renting.
What is the Home Buying Process?
- Initial Meeting
- Lender Selection
- Begin the Home Search
- The Showings
- Negotiation
- How to Make a Winning Offer?
- Submitting the Offer
- Offer Accepted
- In Escrow
- Closing
How much do you need for a Down Payment?
The amount of downpayment you need for a house can vary significantly depending on the type of loan and the price of the property.
Typically Conventional loans require 5% to 20% of the home purchase price for a down payment. Other programs require as little as 3.5% down. VA Loans which are available to veterans and active military may offer the option of zero downpayment.
We recommend consulting with a bank or mortgage broker to understand the different types of programs and exactly how much down payment you’ll need for your specific situation.
Connect with us if you would like some recommendations on trusted lenders.
What does the Lender need from me to give me a loan?
Connect with a mortgage lender to get pre-approved for a loan. The lender will ask you questions about your income and debts. They can tell you what amount you can be approved for and how much your mortgage payments will be.
What’s the difference between pre-approved and pre-qualified?
These terms are often used interchangeably, but they actually have different meanings. Pre-qualification is an estimate of what you may be approved for based on the verbal information you provide. Pre-approval means the lender has verified your income and debt information and run a credit check.
How do I know which Mortgage Option is Right for me?
Your lender is the best resource for answering this question. Loan products and qualifications can vary over time, so they will have the most current information on what options are available to suit your needs.
What should I do when I see a house online that I like?
Contact your buyer’s agent: the agent assisting you in your home search. It’s beneficial to work with one real estate agent consistently because they become familiar with your preferences and can dedicate time to vetting properties for you. This agent represents only your interests. When you contact the agent advertising the home, you are dealing with the seller’s agent. While this agent can provide assistance, their primary focus is on securing the best price for the seller.
How do we write an offer?
When you find a home you’re interested in purchasing, we’ll conduct a thorough review of the property and perform a comparative market analysis. This will help us understand how the home compares to similar properties that have recently sold in the area.
We also need to determine if there are competing offers. Knowing the level of competition for the home you’re interested in can help you assess how much you truly want it and how aggressive your offer should be.
If it is a competitive market you should ask yourself – What’s the maximum price you’re willing to pay before deciding to walk away?
When you find the home you want to buy, we will thoroughly review the contract with you. We believe in educating you on the different terms and strategies so you can make a fully informed decision. This is a legally binding document so we want you to understand what you are signing.
Can you show me a house if it's not your listing?
Yes, as realtors, we can show you any house on the market, regardless of whether it’s my listing or not. Agents have access to multiple listing services (MLS), which means we can arrange showings for any property listed by any agent. This ensures you have a wide range of options to consider when searching for your perfect home. Our goal is to help you find a property that meets all your needs and preferences, regardless of who listed it.
What if I want to back out of a contract?
During the escrow process, if you discover something about the home that makes you reconsider the purchase, the offer contract includes various contingencies with specific timelines. These contingencies allow you to legally withdraw from the deal and recover your deposits. However, backing out of the contract without a valid legal reason may lead to a default. In such cases, the seller could potentially keep your deposits and even pursue legal action for breach of contract.
What happens if there are other offers on the house I love?
If you’re competing for a home you love, determine your maximum willing price. To avoid regrets, such as being outbid by $5,000, consider making your best and strongest offer initially. Ask yourself how you would feel if you lost the property over a $5,000 difference in price. If such a scenario would leave you with regrets, it might be wise to increase your offer to a level where you’d feel comfortable walking away if exceeded.
There are factors beyond price that can strengthen our offer. We can include special terms that boost the seller’s confidence, adjust or remove certain contingencies to make the terms more favorable for the seller, and offer to pay for expenses that are typically covered by the seller. These strategies can significantly enhance the attractiveness of your offer.
Ultimately, your decision depends on how much you want the home. If you’re determined to secure it and avoid future regrets, consider offering your highest price and best terms. However, if your interest in the property is less intense, you might choose to adjust your offer according to your level of desire.
What happens when my offer gets accepted?
Once both parties have agreed and signed on the price and terms of the purchase contract, we will go into contract also known as in escrow. When you get into a contract, typically you must deposit your initial deposit one day after the contract is signed by both sides. Your realtor should also schedule your home inspection as soon as possible.
Once both parties agree on the price and terms and sign the purchase contract, we will enter into a contract known as being in escrow. Typically, you submit your initial deposit one day after both sides sign the contract. You should also schedule a home inspection as soon as possible.
What does “in escrow” mean in real estate?
In escrow refers to the period after a buyer and seller have agreed on the price and terms of a purchase and have signed the contract. Following this agreement, the buyer is expected to deliver their initial deposit to the escrow company within the agreed-upon deadline, which is typically one or two days after the contract is accepted.
Escrow refers to a legal arrangement in which a neutral third party, often an escrow company, holds the funds during a transaction. This arrangement helps protect both the buyer and the seller by ensuring that no funds or property change hands until all the terms of the purchase agreement are met.
Do I need an inspection?
While an inspection may not be required, we highly recommend having one performed. This advice applies even to new constructions. An inspection can reveal issues with the home that are important to identify before you complete the purchase. It’s important to identify any issues during the inspection period, allowing you the option to cancel the purchase if you discover anything unacceptable. It also offers peace of mind by confirming that there are no hidden defects or problems
How much are inspections?
The cost of home inspections varies depending on the size of the property. Additional specialized inspections, such as for radon, mold, lead-based paint, septic systems, asbestos, plumbing, electrical systems, waste lines, roofs, HVAC, structural integrity, and geological stability, may also increase the overall expense.
It may be wise to start with a general home inspection, which provides an overview of the property’s condition. If the inspector identifies potential issues and recommends consulting specialists, bringing them in as needed could be more cost-effective.
What if my loan doesn’t get approved?
When you undergo the pre-approval process and supply the lender with all the necessary information, it’s likely that you will be approved. However, the amount for which you are approved remains the question.
However, if your loan does not get approved, its important to understand
When can I start moving?
Once your home is officially recorded in the Bureau of Conveyances, the seller will receive their money, and the buyer will receive the keys. At this point, the buyer can start moving in whenever they choose. Typically, transactions take 30-60 days from the acceptance date to the closing date. However, the exact timeline will be specified in the purchase contract.
Can I use my own bank to apply for a mortgage?
Yes, you can use your own bank to apply for a mortgage. Many people start the mortgage process with their current bank because of the existing relationship they have. This familiarity can sometimes lead to more favorable terms or streamlined approval processes, as the bank already has a good understanding of your financial history.
However, it may be a good idea to shop around and compare offers from other banks and financial institutions. This can help you find the best rates and terms available on the market.
Do I need to be on the island to close on the property?
You do not need to be on the island to close on a property. This process can be facilitated through the use of a remote online notary.
Fee Simple vs Leasehold Ownership in Hawaii
Fee simple ownership is the most absolute type of property ownership. When you purchase a property under fee simple, you own the land and any buildings on it indefinitely. This type of ownership grants the highest degree of control, allowing owners to sell, lease, or alter the property as they see fit, within legal bounds.
Leasehold ownership means you own the property, but not the land it stands on. Instead, the land is leased from the landowner (lessor) for a specified period. Lease periods can be quite long, often 50 to 99 years, but when the lease expires, the property reverts to the landowner unless the lease is renewed. It is essentially like renting except for a long period of time.