Fulfilling Your Dream of Buying a Home in
the Triangle, NC.
Who needs to read this?
The Role of the Buyers Real Estate Agent.
buyers agent members of the Kevin Lingard Team work exclusively
for YOU*, the buyer. We put YOUR
needs first, finding suitable homes, arranging showings,
negotiation on YOUR behalf and helping YOU
through closing and beyond. The great thing for
YOU, the buyer, is that all the commission is paid by the
seller, and while there will be expenses along the way for such
things as inspections, appraisals, brokerage fees and surveys,
The Kevin Lingard Team will expect no up-front payments or fees.
The Buying Process
Clients often ask 'how long will it
take to find a home?' This is a difficult question to
answer! This is down to YOU, it depends on
your flexibility and motivation for buying. Some clients are
moving from out of state and need to find a home in one
weekend visit and close very quickly, on the other extreme
other clients want a very specific property type and are
happy to wait as long as it takes to find their perfect
home. The Kevin Lingard Team consists of professional, full
time, agents who are happy to work with both extremes and
everything in between!
Once we have found you your dream home
the negotiations start. Most people thing that price is the only
thing that needs to be negotiated, whilst this is probably the
most important there are many other factors to consider. This
is where we need to talk about the NC Offer to Purchase and
Contract and how it is very different since the beginning of
2011. Previously there were several dates in the contract to
worry about and several 'get outs' for the buyer, there were
negotiations and arguments about repairs, financing, appraisals
etc. Now, like the majority of other states, we have a Due
In a Due Diligence contract there are only
3 dates to consider, the contract date (when the contract is
signed by both sides), the settlement (normally called the
closing) date and the due diligence date. Before 5.00pm on the
due diligence date buyers can withdraw from the contract for
'any or no reason' and have any earnest money returned to them.
By this time you, as buyer, need to be certain that you are in a
position to buy the house, you must be sure that you can get a
mortgage, you must have done an inspection and (with the help of
your agent) negotiated any repairs.
So before 5.00pm on the due diligence date, I, as a buyer,
can walk away for any or no reason, what's the catch?
There is not really a catch but there is some things to
consider. Firstly is the due diligence fee which is paid by you,
the buyer, to the seller to take their home off the market to
allow you to do your investigations. The due diligence fee
varies and depends upon several factors including how long the
house has been on the market, how long the due diligence period
is, how popular the house or neighborhood is etc. The due
diligence fee is only refundable to the buyer in a few very
specific situations. The due diligence period and fee are all
part of the contract negotiations, see FAQ below for due
diligence strategies. Secondly, by the time it gets to the end
of the due diligence period you will have a certain investment
in the home, inspections, survey and appraisal fees are all
normally paid up front and are not refundable if you decide not
to proceed with the contract.
Once the due diligence period is over you should proceed
smoothly to closing and home ownership. The Kevin Lingard team
has close working relationships with other professionals such as
home inspectors, mortgage advisors, home warranty and attorneys
who we can recommend to you. These will only be recommendations,
you are free to use whoever you want to provide these services.
There are obviously other issues involved in buying a home but
we will explain these to you as and when it becomes necessary
during the buying process. If you have any questions please feel
free to call Kevin, 919 388 4832.
Frequently Asked Questions (FAQ).
Q. My credit
is not as good as it needs to be to buy a home, can you help me?
A. The answer is, probably, yes. It depends how bad it is.
Our in house lender, Towne Bank has a credit repair program
called Home Ownership 101. To qualify you have to meet with one
of our mortgage advisors who will refer you to our credit
building specialist. If after an initial consultation he
believes he can get your credit score up sufficiently in 6
months you may elect to enroll in the course (cost $200,
refundable if you graduate and take out a mortgage with Towne
Q. I have great credit but very little cash for a
down-payment, do you have any programs that cam help me get a
A. There are a number of 100% financing
options including USDA, VA and North Carolina Housing. There are
qualifying criteria for all of these, call Kevin, 919 388 4832,
to arrange a meeting with a Towne Bank Mortgage Advisor to
discuss your options.
Q. How is the due diligence fee
A. The purpose of the due diligence fee is
to 'buy time', the longer you want the due diligence period, the
higher the fee. There are several ways of calculating the fee,
2. Based on Seller’s House Payment
3. Based on Monthly Rental Value of Property
4. Based on a Rate of Return of Sales Price
5. Flat Fee Amount
6. Based on Percentage of Sales Price
The correct one to use in any given situation will vary,
it will be between you and your agent to decide on the best
Q. So with the due diligence fee has earnest money gone
A. No, earnest money is still a factor but it is not at
risk until after the end of the due diligence period, your agent
will discuss earnest money and due diligence strategies with you
when you come to make an offer on a home.
Q. How much due diligence money and earnest money can I
expect to have to put down
A. Historically the average has been about 1% of the
purchase price, spilt between earnest money and due diligence
money. There are no guidelines, rules or laws governing this so
this again is part of the negotiation strategy.
Q. How much below list price can I expect to pay for a
A. Historically the sale price to final list price ratio
has been between 96-98% and this has not changed over recent
years. Some people are expecting in these difficult financial
times to be able to 'lowball' offers. In the Triangle this very
seldom works, sorry!
Q. I have heard that there are real bargains to be had
with foreclosures and short sales, can you help me?
A. The answer is yes, we can! Firstly however you need to
realize that the Triangle as a whole does not have the vast
numbers of distressed homes that other parts of the country have
seen, Cary, Apex and Morrisville have seen very few foreclosures
so very few REO properties come up for sale in those areas and
any that do get snapped up very quickly. There are some areas of
the Triangle that do have 'bargain' properties but you need to
know where to look. Kevin has a number of years experience in
helping investors find suitable investments, cal him, 919 388
4832 for more information. Also visit the
Distressed Property Page.
Q. I could buy a home but can't decide if the market has
hit the bottom yet, should I carry on renting or take the plunge
and buy a home?
A. Difficult to say! We can not say we will not see lower
house prices but the decline has been relatively small in Cary,
Apex and Morrisville and prices have remained fairly constant
over the recent past. The thing you really need to consider is
that mortgage rates are at historic lows. If the mortgage rate
rises by 1% this has the same effect on a house payment as a 9%
increase in price, on a $200,000 home that would mean payments
would go up as much as if the price jumped to $218,000.
Q. I am ready to buy a home, what do I need to do to put
myself in the strongest possible position?
A. Obviously the very best position to be in is to have
enough free cash to buy a home outright! We appreciate that this
is not possible for the vast majority of people. The most
important thing to do is to get yourself pre-approved for a
mortgage, this means talking with a mortgage advisor and having
them pull your credit score and check your income and employment
history. If you have no house to sell and a 20% down payment
this is ideal but not being in this situation is by no means a
bar to buying a home. Credit is the key, if your credit is good
and you have a stable job there should be no reason you can not
buy a home. Call Kevin, 919 388 4832 to discuss your options.