Frequently Asked Questions
1. What steps are involved in buying a home?
Answer: After you make the decision to buy a home, you’ll want to plan a budget and contact a real estate professional to guide you through the entire process. You’ll also need to research and compare available lenders to finance your home beyond your down payment. Your real estate professional will likely be able to suggest prospective lenders if you need assistance in choosing one. A lender will pre-qualify you for a loan in the amount it determines you to be able to afford, so that sellers will consider you a serious and capable buyer. Once you’re pre-qualified, your real estate professional will begin showing you possible homes. When you decide on a particular home, your real estate professional will make an offer on your behalf to the home’s seller — usually for a price slightly less than the asking price. This may lead to a counter offer, meaning that the seller tries to negotiate your purchase price closer to his or her original asking price. Once both parties agree on an amount, your real estate professional will work with a title insurance agent and/or escrow officer to draft all necessary paperwork. He or she will then schedule a date for you and the seller to meet for the closing, where the transaction is completed and ownership is officially transferred from seller to buyer. Click here to see the home buying process graphically represented in a timeline.
2. What steps are involved in selling a home?
Answer: The steps involved in the home selling process are very similar to those involved in the home buying process. Once you have made the decision to sell your home, you will need to establish an asking price for it. While some sellers successfully sell their homes on their own, a for-sale-by-owner arrangement can be complicated and will require a great deal more of your personal time throughout the process. For this reason, most people consider the commission paid to a real estate professional well worth the investment, for the convenience, time savings and overall guidance provided. Real estate professionals will also be able to tell you if your asking price is appropriate for your property or home. In addition, they will manage the marketing of your home — from front-yard sign to MLS listing — while guiding you in preparing the home to be shown to potential buyers. Once a prospect makes you an offer, you can either accept the proposed purchase price or make a counter offer. When both parties agree on a price, your real estate professional will work with a title insurance agent and/or escrow officer to draft all necessary paperwork. He or she will then schedule a date for you and the buyer to meet for the closing, where the transaction is completed and ownership is officially transferred from seller to buyer. Click here to see the home selling process graphically represented in a timeline.
3. What is title insurance, and why do I need it?
Answer: Title insurance is an insurance policy that protects you against loss that could result from defects in the title of the property you are buying. The premium is paid only once and is good until the property’s ownership changes. Unlike most types of insurance which protect policyholders from future events, title insurance protects you against defects that could already exist.
4. What is a 1031 exchange?
Answer: A §1031 exchange refers to legislation that allows an investor to sell a property, reinvest the proceeds in a new property and as such defer all capital gain taxes. Asset Preservation Incorporated (API) is recognized as one of the leading Qualified Intermediaries in the nation, meaning that they have a proven track record guiding investors through the exchange process.