By John Mandaluk & Susan Benoit
While jumping out of a perfectly good airplane at the direction of your jumpmaster is the best way to get a birds-eye view of Fayetteville’s growth, a leisurely drive about town can serve the same purpose, albeit without the adrenaline rush.
Whichever way you choose, one thing remains certain – low interest rates and new homes springing up daily continue turning renters into first-time home buyers. While buying your first home might not be as groundbreaking as the Wright brothers’ first flight, conducting a pre-flight check before takeoff ensures that your flight into home-ownership will be as smooth as possible.
Your initial and possibly most important choice is selecting the right co-pilot. You want someone who’s done this before. Enter the real estate agent, who is by your side from takeoff to landing. An agent who has the right stuff possesses important knowledge regarding the area school districts, the development in the area that might affect your home’s prospective value, and if you’re looking near the edge of town, has an idea about the city’s annexation plan.
In addition, your agent might be able to negotiate for seller concessions such as a reduction in price, or for a seller contribution toward closing costs. Another benefit of the buyer hiring a real estate agent is that the services of the buyer’s agent are provided free of charge, at least to the buyer. While subject to variations, most residential contracts for sale compensate both the buyer’s and seller’s agents by charging a commission to the seller only. Who said there’s no such thing as a free lunch?
Once you’ve jet-setted around and found a great house, you’ll need to figure out how you’ll pay for it. Our men and women in uniform prefer applying for a VA loan, and rightfully so. A loan insured by the Veterans Administration has several benefits, including a favorable interest rate and no monthly private mortgage insurance premiums (also known as PMI). However, a common assumption is that larger lenders closely affiliated with the military can only give a VA loan.
The simple fact of the matter is that most lenders can offer a VA loan. In many instances, consulting local lenders results in a more favorable interest rate and less costs at the closing table, as a local lender does not have the overhead associated with larger banks. Additionally, in this increasingly digital world it can be comforting to deal with one person locally, instead of navigating through a Bermuda Triangle of a call center where information is lost with a mysterious and alarming frequency.
With your home selected and your financing secured, it’s time to land at the closing table where the money and keys are exchanged. Your real estate agent may have a preferred attorney, however the choice on the attorney to use is ultimately up to the buyer. Law firms, like airplanes, are not created equal. Some are high performance firms that harness today’s technology, possess a knowledgeable staff to meet compressed deadlines, boast the experience to locate and address problems as they arise, and always have an attorney attend the closing.
To avoid any turbulence at the closing table, if you must bring money to the closing, it should be in the form of certified funds. A standard bank check will not suffice. Secondly, if you are married, there is a strong likelihood your spouse will need to be available to sign a couple of documents, even if he or she is not a responsible party to the loan.
With deployment being a way of life in the military, signing closing documents by power of attorney is a routine practice. However, if this document becomes a part of your closing, notify the agent, lender and attorney immediately to avoid a hold pattern, as lenders require recordation of the power of attorney along with the other transfer documents
A prudent pilot always has at least an extra 30 minutes of fuel to account for the unknown, and the same should hold true with your home purchase. Your eagerness to disembark and begin loading baggage to your new home should be tempered with a stand-by plan, as nothing is more frustrating than having your fully loaded truck there to pick you up, only to discover a delay in arrival. The best practice is the allow two to four weeks after the closing before you must move in to your new home.
We hope that this information armed you with enough knowledge for you to step to the ramp and make the jump into home ownership on your own terms, and enjoy the stress free ride.
John Mandulak, Esq. is an associate at Hutchens Law Firm and Susan Benoit, Esq. is partner at Hutchens Law Firm