Dear Michael: I am interested in buying a home, which the seller has listed “as is.” Will a bank require a home inspection or a termite report before approving a loan?
Answer: It is essential for a buyer to get a home inspection. But it is not required by the mortgage holder. If there are obvious major noticeable repairs that affect value, the appraiser may note it in the appraisal report. However, the appraiser’s job is not to inspect the home but to determine value in retrospect to the current market. Although the bank doesn’t require a home inspection, your purchase contract does mention a termite inspection, the lender will require it to be performed and pass inspection before you close escrow. A termite report lists more than pest infestations. It also mentions obvious structural defects caused by pests, such as wood dry-rot, leaks and etc. These are classified into two groups – Section one and two. All items in section one must be repaired prior to closing. However, the lender does not stipulate who must pay for those repairs (it is usually paid by seller). Section two is preventative and is usually the buyer’s responsibility.
Dear Michael: I need to obtain a loan on our new home. How do I choose the right lender for me?
Answer: Choose your lender carefully. Look for financial stability and a reputation for customer satisfaction. Be sure to choose a company that gives helpful advice and that makes you feel comfortable. A lender that has the authority to approve and process your loan locally is preferable, since it will be easier for you to monitor the status of your application and ask questions. Plus, it’s beneficial when the lender knows home values and conditions in the local area. Do research and ask family, friends, and your real estate agent for recommendations.
Dear Michael: We are just about to begin our search for a home. How can we determine our housing needs before we start our search?
Answer: Your home should fit in correlation to the way you live, with spaces and features that appeal to the whole family. Before you begin searching for a home, make a list of your priorities. Ask yourself the following questions— How important is location and size. Should the house be close to certain schools or your work? Public transportation? How large should the house be? What type of lot do you prefer? What kinds of amenities are you looking for? Establish a set of minimum requirements and a wish list. Minimum requirements are features a house must have in order for you to consider it, while a wish list covers items that you’d like to have but are not essential. Don’t forget to speak to a lender before you start your search, he or she can help you determine your purchase price qualification.
Michael Kayem is a Realtor with Re/max Execs serving Culver City and the Westside since 2001. You can contact Michael with your questions at 310-390-3337 or e-mail them to him at: homes@agentmichael.com