California Home Buyer Tips

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California Home Buyer Tips

Attention Home Buyer -
Our effort to save you money is only part of our job!
Our agents show you all homes you might want to see, even tenant-occupied, foreclosures, REOs, probate, government-owned, fixers, for-sale-by-owners, bank-owned, VA, HUD, mountain homes and other properties that most agents don't like to show. We negotiate on your behalf 100% on the purchase price and terms, as well as for needed repairs discovered in the inspection process. We give you our complete loyalty and maintain the utmost confidentiality. We make ourselves available to your schedule as much as possible by limiting the number of clients with whom we work. We will actually guide you away from bad deals. We never represent sellers. Your Banner Here

The National Association of Exclusive Buyer Agents (NAEBA) has strict requirements for membership: EBAs must never accept listings, never represent sellers in a real estate transaction, and must not be affiliated with any office or franchise which accepts listings or represents sellers in a real estate transaction. Therefore, an EBA represents buyers exclusively with no compromises and with no inherent conflicts of interest.

What is different about an Exclusive Buyer Agent?

The main difference between a brokerage with an Exclusive Buyer Agency and a brokerage with an ordinary real estate agency is the amount of representation a buyer will get.

Exclusive Buyer Agents are very strictly consumer oriented. Notice our national logo which says "Above All Is The Consumer". We are not allowed to represent sellers or to market their properties, so there can never be a question about our commitment and loyalty to our clients. We lean very heavily in the direction of "What can I do to best serve the interests of my client above and beyond my personal interests?" Our agreement with each of our buyers promises to help them get a property at the best price and terms.

Ordinary real estate agencies are mostly seller oriented. Until the late 1980's the common theme was caveat emptor, or let the buyer beware. Everything about the business from paperwork to agent training was geared toward how to best serve sellers and how to sell or convince buyers to buy a particular home, even if they didn't want it. This theme continues with most ordinary brokerages today even though agency laws have changed.
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There is a written contract between the listing brokerage and each seller which in effect promises that the listing company and all its agents will do their best to sell the property at the highest price and the best terms for the seller.
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Notice the difference with us. We, as Exclusive Buyer Agents, will do our best to help our clients buy a property at the best price and terms for the buyer. Since we and our companies are not allowed to represent sellers, we never have a conflict of interest.
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It is a relatively new practice, exclusive buyer agency, strongly opposed by some in our profession. We do not fit into their description as "a network of thousands of agents working hand in hand as a team to sell homes". Talk to EBA clients and you will know that we provide a valuable service and we do not sell homes. We provide an abundance of information and expertise while helping clients buy a home. This is a major change in the way the real estate business is done. As we in the National Association of Exclusive Buyer Agents pioneer the concept of exclusive buyer agency, we are reminded of this:
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"We're a fortunate bunch; we earn a decent living from a concept totally without shadows, where we harm none and empower all we serve to live better lives! In a world where it's tough to be a pioneer, we are in a position to make a difference, in the lives of those we serve, in the American institution of home ownership and in a major nation-wide profession." - - - Merrill Ottwein, former president of NAEBA.

HOT TIPS
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Hot Tips for Home Buyers... stuff that most buyers don't know.
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1. Terms... Did you know that it is to your advantage to pay $5,000,000 for a $500,000 home if you can name whatever terms you want? Be careful, "terms" are very important and can help you a whole lot, or they can hurt you! A low price can bring a smile to your face. But it can also be a rip-off.
2. Commissions for bringing in the buyer are built into the price of most real estate transactions. Whatever agent writes up a contract for you in California gets the commission, even if it is the sellers' agent. Did you know that in a national survey most buyers of homes thought the seller's agent was their agent? For the same price you can get your own Exclusive Buyer Agent and have someone representing you, instead of the seller.
3. Zero Down is now possible for non-vets, as well as vets, on most any home in most any price range up to the mid-$400,000s. Unfortunately, there aren't many houses left in this price range in Silicon Valley. Closest are a 2 hour commute. However, one bedroom condos can be found in the low $200,000s.
4. Credit problems are not a big hindrance to buying a home if you qualify on all the other usual requirements. However, it is unlikely you will get the interest rate and/or points you want.
5. Quick Qualifiers - loans that allow you to buy a home with minimum requirements of:
a loan application
25% down payment
a good credit report
a purchase contract
a preliminary title report
an acceptable appraisal
Lenders are not worried about possible unemployed or under-employed people defaulting on a loan when 25% of the buyer's money is put into the transaction.
6. Lease-Option possibilities dry up in a hot sellers market. Sellers can get their homes sold right away at top price. A lease-option locks the sellers into selling downstream at last years low price. Most homes with lease-options are considerably over-priced.
7. Competing for the sharp home you want in a hot sellers market with other buyers who are usually willing to pay over the asking price? You are in a group representing 95% of all buyers in the area. Go down the street to the ugly fixer-upper that needs paint, carpet, landscaping and some tender loving care (TLC). You won't have much competition there, and you will be in the other 5% of buyers. You will have a larger selection of homes with much less likelihood of participating in multiple offers.
8. Most fixer uppers can be made into a like-new home during the escrow period, often at the seller's expense with creative negotiating. When escrow closes, it's like moving into a newly refurbished home. And you won't likely have the competition of multiple offers during the negotiations!
9. When you "sign-in"at a new subdivision model home, you are giving up the commission that may have been reserved for your agent. If you come back later with your own agent, they will have your signature as the reason you were attracted to their property, and they will keep the commission for themselves. If you intend to use a buyer broker, and you should for your own protection (you have heard the horror stories, haven't you?), the fee will have to come out of your own pocket. Don't sign in at new home sales offices if you would like your own buyer's representative and the protection you deserve. Always have your agent with you when visiting model homes.

No Money Down is a possibility for anyone with good credit and an acceptable income when home prices are rising. The typical loan combination is an 80% LTV first loan and a 20% second loan. There are usually a few mortgage brokers doing these. Sometimes the same lender will do the 2nd, as is doing the 1st, but it is usually an investor. Their risk is low because of rising prices in this area. When prices stabilize, or start falling, these loans disappear. Call your lender for details. If you don't have a lender, ask for our client generated list of lenders.

Government Foreclosures can be purchased with little or no down payment if you plan to live in the home. If purchased for use as an investment rental property, these can be purchased with as little as 10% down. Unfortunately, there aren't many homes left in this price range in our area. We occasionally see a bank foreclosure, but rarely government foreclosures here. And because most of the time we have a hot market, foreclosures of any kind disappear quickly since the early 1990's. People could simply call a listing agent and get their home sold quickly in this market when faced with the possibility of foreclosure. Now there are loans allowing one to purchase any property as a primary residence with zero down. All 1-4 units rental properties can now be purchased with only 10% down. More details provided to clients.