The Benefits of Buyer Representation

A PARTNER YOU CAN TRUST

SUMMIT SOTHEBY'S INTERNATIONAL REALTY

12 locations

2,500

Your next chapter. Your next home. Your next escape. We always imagine ourselves in that next place, that next stage of our lives. Through Summit Sotheby's International Realty, your idea of next can be realized. We are Utah’s best agents, who curate experiences with incomparable attention to style and detail. We get to know you. We get to know what next is for you. Because, when you find it, nothing compares to it. Nothing compares to what's next. 270

DEDICATED TO YOU

Purchasing a property in today’s real estate market is more complex than ever. Our goal is to provide you with a level of elite representation, guiding you through this complex process – advocating for you every step of the way. Our team of sales advisors provide you with a calming, professional and stable force of experience throughout your property purchasing journey. From understanding your real estate goals to navigating the negotiation and offer presentation, Summit Sotheby’s International Realty simplifies the laborious process of selecting and purchasing the right property.

Navigating the Home Purchase Process

When you hire a Summit Sotheby's International real estate advisor, you're not just compensating them for the time and effort they put into one transaction; you're also benefiting from their years of experience and expertise. Having an experienced professional in your corner offers a competitive advantage when searching for your home and accessing local resources. A sales associate's broad perspective can provide a stabilizing force to assist you through what can be a challenging process.

Exclusive representation ensures that you will have a sales associate's utmost attention and loyalty. They assist you with the many tasks associated with the home purchase process, but will only receive a commission if you purchase a home. Here are ten reasons why working with a professional is the best choice you can make:

Deep Area and Lifestyle Knowledge

AGENT VALUE AND THE BENEFITS OF EXCLUSIVE REPRESENTATION 01 04

In addition to providing you with access to all public listings, real estate agents have in-depth knowledge about the local real estate market, including access to off-market properties, pricing trends, neighborhoods and what buyers should be looking for.

They use this knowledge to help guide you in making informed decisions.

Negotiation Skills

An experienced sales associate is able to help ensure you get the best price and terms when purchasing a new home—helping you to avoid overpaying. The skills your sales associate has gained through other transactions will help them build a purchase strategy, evaluate and negotiate offers on your behalf.

03

Networking

Real estate agents have a vast network of professional connections that they can recommend, from home inspectors to mortgage lenders. These trusted relationships can speed up processes or uncover opportunities you may not find on your own.

Understanding Reports and Forms

Real estate transactions involve a lot of legal paperwork, from contracts to reports and disclosures. An experienced sales associate understands the ins and outs of these contracts and can help you navigate them, reducing the risk of costly mistakes.

Problem Solving

Every real estate transaction has its unique challenges. An experienced sales associate has likely encountered many of the hurdles you will face in a transaction and can use that experience to help you overcome any issues that arise.

Time-Saving

While you might see your sales associate during showings or closings, there's a lot of work they do behind-the-scenes, from researching properties and coordinating with other agents to handling paperwork. Their expertise streamlines the process, ultimately saving you time.

07

Emotional Buffer

Buying and selling a home can be an emotional experience—for both parties. Your sales associate serves as a buffer, ensuring that emotions don't cloud judgment or derail a transaction.

08

Future Guidance

Many sales professionals provide value even after a transaction is complete, offering advice on home improvements, market trends or when might be a good time to buy or sell again.

09

Risk Mitigation

Mistakes in real estate can be costly. Whether it's missing a disclosure or not understanding a contingency in a contract, an experienced sales associate can help mitigate these risks.

10

Continual Learning

The real estate market and its regulations are continually evolving. Experienced sales associates invest in ongoing education and training to stay updated, ensuring they provide the best service to their clients.

In essence, the commission is compensation for the hours your sales associate and brokerage have already invested to develop the knowledge and expertise needed to guide you to a ratified offer and through the purchase of your home. Your Summit Sotheby’s International Realty sales associate is an experienced professional backed by exceptional leadership and support teams, all dedicated to providing you with a peerless level of service.

UNDERSTANDING AGENCY

Summit Sotheby’s International Realty will enter into an exclusive buyer-broker agreement with you that establishes an agency relationship in which your Summit Sotheby's International Realty sales associate will represent you in all aspects of the purchase of a home. This agreement creates a fiduciary relationship where Summit Sotheby’s International Realty and your sales associate have duties to you of loyalty, honesty, obedience, confidentiality and reasonable care. A better way to put it is this agreement requires your sales associate to act in your best interests at all times.

Limited Agency

Brokerages can legally represent both a buyer and a seller on the same transaction; they may even represent multiple buyers on the same sale. A sales associate may also represent both sides of a transaction, but only if you agree in writing.

UNDERSTANDING COMPENSATION

Brokerage Commission

The buyer-broker agreement is a contract for professional services between you and Summit Sotheby’s International Realty in exchange for the payment of a commission. The amount a brokerage charges is not fixed by law and the commission amount is set by the brokerage.

Compensation Division

The compensation paid for buy-side representation is shared between the sales associate and the brokerage to cover business operations and necessary expenses.

Who Pays Commission?

Sellers often offer to compensate buyers' sales associates out of the proceeds of the transaction and include the commissions for all sales associates in the purchase price. In the event a seller does not include commissions in the purchase price, buyers can request that the seller pays the commission due to the buyer's broker in the purchase agreement, allowing the commission to be incorporated into the final sale price and financed if there is a loan. Finally, buyers can directly pay commissions to their sales associates in the event it is more advantageous for them.

WHY SUMMIT SOTHEBY'S INTERNATIONAL REALTY?

At Summit Sotheby’s International Realty, we don’t define luxury as a price point. Instead, luxury represents high-quality service, knowledge and an experience that every client receives regardless of area, size of home or price point.

OUR MISSION

It can be easy to assume that all real estate brokerages and sales associates are the same. The truth is, we’re passionate about being different—our unique qualities are at the heart of everything we do. For us, our responsibility goes beyond assisting our clients in the purchase and selling of real estate. We’re ambassadors of our communities and our industry. We look at each moment as an opportunity to bring irreplaceable value to our clients around the world, and in the process, redefine the real estate industry. Luxury isn’t tangible. It isn’t a price tag. Luxury is an experience and a commitment to going beyond the status quo. Being different isn’t for everyone, but to us, it is everything.

LOCAL REACH AND COMPANY CULTURE: THE POWER OF SHARED COLLABORATION

Our Goals: Be exceptional to one another and be exceptional in business. In today's real estate industry, trusted local connections play a vital role in marketing to the right audience, maximizing opportunities and facilitating successful transactions. Our company culture is built around teamwork, shared collaboration and supporting the communities that we call home. Utah boasts a dynamic landscape filled with unique cities, towns and neighborhoods—each with its own traits and lifestyle. The importance of partnering with a local professional with deep market knowledge is paramount.

Our local reach is unmatched—each week, our leadership team, brokers and sales professionals gather in company-wide sales meetings to exchange industry information and touch base on new listings and buyer needs. As a result, our clients receive valuable insight into current market trends, changing property values, new zoning regulations and evolving community dynamics. By leveraging cultivated internal connections, our sales associates can access off-market listings, tap into niche markets, and build strong relationships with other industry stakeholders—including contractors, inspectors and lenders.

Our company culture fosters collaboration and partnership—because of this, our sales professionals offer better representation and personalized service tailored to the unique needs and preferences of each client. In an increasingly competitive real estate landscape, where access to accurate information and timely opportunities is vital, the partnership between company culture and local reach remains indispensable for thriving in today’s dynamic industry.

OUR SUPPORT TEAM

The staff and management of Summit Sotheby’s International Realty are a unique team of talented, diverse individuals who have combined their efforts in the goal of delivering the most effective real estate services to our clients. With a 4-to-1 sales associate to employee ratio, our clients have the daily support of in-house marketing, transaction coordination, legal, operations, relocation, property management, photography and videography departments.

70OVER SUPPORT STAFF

PROVIDING A STRONG FOUNDATION FOR SUCCESS

ACCOUNTING AND OPERATIONS

LEADERSHIP

Our executive team is composed of seasoned brokers with deep market expertise—they are vetted professionals who play a vital role in providing strategic direction and comprehensive support for our sales agents, setting a visionary course to best serve our clients in today’s evolving industry.

IN-HOUSE LEGAL COUNSEL

This diverse group of professionals ensure our brokerage operates smoothly day in and out—completing wire transfers, directing calls, answering questions and generally assisting our agents to ensure you – our clients – receive the highest level of service possible.

TRANSACTION MANAGEMENT

Our transaction management professionals coordinate and oversee each transaction from start-to-finish. Industry tested and vetted, they manage all listing documents to ensure an organized, streamlined and on-schedule process for our sales professionals and their clients.

MARKETING

Our in-house marketing agency provides award-winning creative services for our clients and their properties—ensuring our messaging is impactful, effective and visually compelling. Utilizing graphic design, photography/video, digital campaigns and more, this dynamic team of creative professionals provide innovative marketing for today’s modern real estate industry.

PROPERTY MANAGEMENT

Locally owned and operated with a commitment to excellence, our property management team provides a comprehensive suite of professional rental management services for our clientele.

Design Team

Photography Videography Development Services

Managing Brokers Operations

Accounting Agent Concierge

MAJESTIC REALTY COLLECTIVE

5

58 states

250 offices

1,200 support staff

sales associates

LEADING SOTHEBY'S INTERNATIONAL REALTY OFFICES

Majestic Realty Collective is comprised of Desert, Group One, Las Vegas, LIV, Richardson, Sierra, Summit and Sun Valley Sotheby’s International Realty, operating in key luxury communities throughout California, Colorado, Idaho, Nevada and Utah. The Collective has been recognized by Inman, Real Trends, RIS Media and Who’s Who in Luxury Real Estate for excellence in marketing, philanthropy, sales and new construction projects.

DESERT

CALIFORNIA

Indian Wells | Palm Springs | La Quinta

GROUP ONE

IDAHO Boise | Eagle

LAS VEGAS NEVADA

Las Vegas | Lake Las Vegas

LIV

COLORADO

Beaver Creek | Boulder

Breckenridge | Cherry Creek

Colorado Springs | Crested Butte

Douglas County | DTC

Dillon | Edwards

Evergreen | Telluride

Vail | Winter Park

CALIFORNIA

Ojai | Ventura

RICHARDSON

CALIFORNIA

San Luis Obispo

SIERRA

CALIFORNIA AND NEVADA

Olympic Valley | Tahoe City

Truckee | Reno

Incline Village | South Lake Tahoe

SUMMIT UTAH

Deer Valley ® | Draper

Glenwild | Heber City

Moab | Old Town Park City

Park City Mountain | Salt Lake City

St. George | Victory Ranch

SUN

VALLEY

IDAHO Ketchum

THE ONLY TRUE GLOBAL REAL ESTATE BRAND

SOTHEBY'S INTERNATIONAL REALTY

The Sotheby's International Realty brand is globally recognized, lending credibility to your offers and elevating your representation. Our success is defined by our deep commitment to our clients and trust built over 270 years of the Sotheby's auction house selling their clients' most valuable treasures, including their homes, through Sotheby's International Realty affiliates worldwide.

84COUNTRIES & TERRITORIES

1,115OFFICES WORLDWIDE

$143 billion

2023 TOTAL SALES VOLUME

26,500SALES ASSOCIATES

# 1

most profiled real estate brand in the news

52M

sothebysrealty.com visits in 2023

over 1M

engaged social media followers

88M

videos played in 2023

STEPS TO A SUCCESSFUL PURCHASE

THE JOURNEY OF HOMEOWNERSHIP

INITIAL CONSULTATION

FINANCIAL ASSISTANCE AND PRE-APPROVAL 1

2

An initial meeting is important to ensure that you get access to properties both on and off the market, as well as exclusive and upcoming listings. We want to help prepare you to be able to write offers quickly in a competitive market when needed.

Understanding Your Real Estate Goals

• Purchase time frames

• Past experience purchasing real estate

• Risk tolerance

• Financing and pre-approval if a loan is needed

Refining Property Search Criteria

• Location and neighborhood

• Price range

• Size of home, style and amenities

• Specific non-negotiables and requirements

• Condition of home and flexibility to make improvements

• School districts, commute, walkability, etc.

Before beginning your home search, it is important to evaluate your financial situation and secure pre-approval from a lender if you plan on financing your home. Your sales associate is able to do many things to assist you with your financing needs:

• Provide a list of lenders who can pre-qualify you and confirm your price range

• Suggest that you obtain pre-approval subject to the property selection

• Collaborate with the lender on any complex purchasing scenarios, such as a bridge loan so you can buy before you sell

• Provide requested documentation

• Show the property to the appraiser and provide supporting market comparisons

Working with a Lender

In addition to pre-approval, lenders can estimate the down payment and closing costs for homes in your price range and determine what your monthly payment will be. Your lender can also help you to understand the different types of loans and programs that you may qualify for.

Our sales associates view properties continually, follow local market dynamics and are here to guide you in finding the right home. Your sales professional can assist you in many ways:

• Determine property selection and refine search criteria based on your needs and wants, location, size, amenities, style and price range

• Set up automated listing alerts that meet your search criteria

• Provide quarterly market updates

• Present off-market or pre-market listings as they arise

• Communicate with sales associates to schedule private showings

• Map out and tour properties together

• Recommend properties that are available to view in-person at open houses

• Provide monthly market reports

• Review the pros and cons of each home after viewing

Evaluating Selected Properties

A sales associate can help you professionally assess how a property compares to others currently on the market or that have recently sold:

• Request the Disclosure Package, Preliminary Title Report and other information from the listing agent

• Discuss if you may want to get any additional inspections or reports and then determine the time frame for needed contingencies

• If the home is in an HOA, and the seller has not already provided the HOA docs, your sales associate can explain the typical timing of the process to receive and review the documents

• Recommend a Title and Escrow Company

WRITING A COMPETITIVE OFFER

Once you have found a property that meets your needs, your sales associate will assist in determining the optimal price and terms before skillfully negotiating on your behalf.

• Communicate with the listing agent to get the best information possible about competing offers and seller's preferences regarding terms and the timeline for offer submission

• Review comparable sales and discuss the price and terms for your offer

• Prepare a compelling offer that includes all necessary advisories and disclosures; attach the loan approval letter along with proof of funds when submitting the offer

• Get signatures on all offer documents to provide a complete offer

Presenting Your Offer

Real estate professionals affiliated with reputable brands—which are highly regarded by other agents—often play a crucial role in assisting their clients in evaluating competing offers.

• Present the offer in-person or by email in a timely manner

• Maintain communications and forward any counter-offers for review

• Negotiate on your behalf and write any addenda or subsequent counter-offers

Negotiate Successfully

After presenting an offer you should be prepared to negotiate on many key factors—including the initial price, deposit amount, inclusions plus dates and deadlines. In addition to knowing your budget and requirements, working with an associate well-versed in negotiation is vital to ensuring you don't commit to any additional costs beyond your limits during the negotiation process. Your sales associate can help you navigate the many situations that may arise before reaching an accepted offer.

• Multiple Offers: High-demand, low-inventory areas often create additional competition, so you should be prepared to bid against other buyers. In these situations, due-diligence is required on your part and the part of your sales associate to ensure the offer you submit is strategic, competitive and reflects what you are willing to pay for the property.

OFFER ACCEPTANCE

Once negotiations have concluded and both parties have come to an agreement, you will move on to the next steps in the buyer process. You will have a set period of time in which to satisfy legal conditions agreed to in your contract, including completing a home inspection and securing financing. Once these conditions have been removed you have a legally binding document.

Congratulations! This is just the start of the transaction process. Your sales associate will guide you through the requirements that are contained in your accepted offer.

CONTINGENCIES, INSPECTIONS AND DEADLINES

Contingencies—such as inspections, financing approvals and appraisals—all serve as safeguards that allow buyers to thoroughly assess the property and secure necessary financing. There may be numerous contingencies during the purchase process; your sales associate is there to help you navigate through them.

• Recommend or help you locate inspectors

• Arrange inspection appointment times

• Forward and review inspection reports with you

• Communicate with your lender as requested

• Assist the appraiser with access to the home and provide comparables, as needed

• Provide resources for homeowner's insurance and options—this is a critical step in the process given the current insurance climate

• Assist you in making a request for repair, if applicable

Property Inspection

As part of your due diligence, you can request a multitude of inspections and evaluations of the home. A Buyer’s Due Diligence Checklist will be provided to you that contains suggestions of evaluations and inspections you may want to have conducted on the home. We encourage you to meet the inspector at the end of any inspections so they can point out any concerns about the property and answer any questions you may have. They will give you a report for your review that identifies potential areas of concern. If repairs are needed, your sales associate can assist in requesting that the seller complete them, or if the condition of the home is unacceptable you may cancel the contract—provided contingencies have not been removed.

SELLER

DEADLINES

Meeting contingency deadlines is crucial throughout the real estate transaction—this ensures the smooth progression of the deal, while also protecting the interests of all parties. Timeframes for these deadlines can vary greatly from contract to contract, highlighting the importance of your real estate professional’s expertise to keep the transaction on schedule. Adhering to these deadlines is essential for maintaining trust and transparency between parties—and preventing potential delays or legal disputes. Below are some of the deadlines and the typical timeline you can expect during the purchase process—beginning once your offer has been accepted to the final possession of your new home.

Seller's Disclosure

Deadline:

Seller must provide required documents, including but not limited to; property condition, Title Insurance commitment, HOA and CC&Rs, any rental agreements in place after closing, evidence of water rights, any known environmental problems and building or zoning code violations.

Earnest Money Due:

Your earnest money will be held in our Brokerage Trust Account until settlement, at which time, these funds will be credited toward the money you'll be bringing to the table.

Buyer Due Diligence Period:

During this time you will review and approve the contents of the Seller Disclosures plus any other tests, evaluations and verifications of the property deemed necessary or appropriate.

Finance and Appraisal

Deadline:

If you are obtaining a loan and have made your purchase contingent on financing, you will work with your lender to get final loan approval.

If the purchase is contingent on appraisal, it must be completed during this time. If the home appraises below the purchase price, your sales associate will guide you through your options.

Final Walkthrough:

The Utah Real Estate Purchase Contract allows you and your sales associate to conduct a final walkthrough within seven days of settlement to ensure there are no major changes or new damage to the home since going under contract, any agreed-upon repairs are complete, and all included items are still on-site.

WITHIN

21-30 DAYS AFTER ACCEPTANCE

Settlement (Signing Day):

Settlement occurs once both the buyer and seller have signed and delivered all required documents and all funds required to be paid by the buyer or seller have been delivered.

Closing:

Once Settlement is complete, Title will disperse funds as required by contract and lender instructions. Title will then record the closing documents with the County Recorder.

Possession

AFTER RECORDING OR AS NEGOTIATED

Possession:

Most likely, you’ll be able to take possession of your new home upon recording. However, depending on the negotiations between buyer and seller, it’s possible for possession to occur a specific number of days or hours after recording.

Closing is when you take ownership of your new property. As this day nears, your sales associate and lender will monitor your transaction to ensure that no last-minute issues arise that may need to be dealt with before getting to the settlement table.

• Recommend movers, interior designers, landscapers, general contractors, gardeners, cleaning services and home maintenance services, as needed

• Arrange for a final walkthrough of the property

• Provide resources for a Home Warranty Policy

• Accompany you to the settlement signing

• Upon recording title, provide keys

The Home Purchase Process

REVIEW OBJECTIVES & SEARCH CRITERIA

FINANCING APPROVED?

ANYTHING WORTHWHILE AVAILABLE?

SCHEDULE TOURS & VISIT OPEN HOUSES

ANYTHING WORTH PURSUING?

REVIEW DISCLOSURES, INSPECTIONS & REPORTS.

CONDUCT RESEARCH, WEIGH PROS & CONS AND ESTIMATE COST AS NECESSARY

READY TO MAKE AN OFFER?

EVALUATE COMPETITIVE SITUATION, PREPARE AND PRESENT OFFER

ACCEPTED?

SEEK FINANCING CAN YOU WAIT?

SEARCH FOR NEW OPTIONS

RENEGOTIATE?

COORDINATE

APPRAISED

REMOVE

CONGRATULATIONS!

MOVE

APPRAISAL CONTINGENCY?

NON-CONTINGENT OFFER?

ALL

FINAL

DOES WORK

FREQUENTLY ASKED QUESTIONS

HOW AND WHERE DO I SEARCH FOR HOMES ONLINE?

Your sales associate will customize a property search for you that encompasses both new construction and resale opportunities. As a member of the local Multiple Listing Service (MLS) your sales associate has access to the most accurate and complete information.

WHAT ARE MY FINANCING OPTIONS?

The first decision is whether you'll be purchasing the home with cash or getting a loan. If you choose to get a loan, your sales associate can recommend a skilled lender who can explain all of the financing options available to you.

HOW DO I GET A LOAN?

You can finance a home with a loan from a bank, a combination of savings and a loan, a credit union, a private mortgage company or various state government lenders. Lenders offer different interest rates and fees which will impact your monthly payments. Talk with several lenders before you decide; keep in mind, this decision will impact your finances for many years. When you take out a home loan, you enter into a long-term relationship with your lender. Accordingly, it is important to find a lender you can trust.

IS A DOWN PAYMENT ALWAYS REQUIRED?

In most cases, a down payment is required. However, there are several factors involved when determining your down payment amount, including the loan type and your financial situation. As a general rule, the more money you can put down on your home, the lower your loan amount and interest rate will be. Most lenders suggest paying at least 20% of your new home’s price or appraised value to avoid having to pay private mortgage insurance. Some types of loans require 10-20% of the purchase price. Many firsttime homebuyers turn to FHA loans which require very little down. Loan types and options should be discussed thoroughly with a mortgage professional.

WHAT IS THE DIFFERENCE BETWEEN PRE-QUALIFICATION AND PRE-APPROVAL?

Pre-qualification is an informal calculation to see how much house you can afford. A mortgage professional will analyze your income, debt and credit score to determine how much you may be able to afford. Pre-approval is a thorough, verified analysis of your mortgage application.

I ALREADY OWN A HOME, SHOULD I PURCHASE ANOTHER BEFORE SELLING MY CURRENT HOME?

There are pros and cons both when buying a home before selling your current home and when selling your current home before buying another. If you are able to purchase your new home without making your offer contingent upon the sale of your old home, that may be your most beneficial option. If you do need to sell your home in order to purchase a new home, you can make the offer to purchase contingent upon the sale of your current home. This is different for each buyer and their unique financial situation and goals.

HOW LONG DOES A HOME PURCHASE TAKE?

The timeline for finding a property varies greatly because there are so many variables. Once you find a home and have an accepted offer, it usually takes around 30 days to close.

WHAT IF MY OFFER IS REJECTED?

They often are, so don't let that stop you. Now you begin negotiations with the help of your sales associate. You will often go back and forth several times before a deal is agreed upon. Just remember— don't get so caught up in negotiations that you lose sight of what you really want and can afford.

WHAT INSPECTIONS SHOULD I CONSIDER? WHAT ARE THE OPTIONS IF REPAIRS ARE NEEDED?

Your sales associate will advise you to review the Buyer's Due Diligence Checklist. This document contains a host of suggestions for what inspections may be most helpful for your particular purchase. Your sales associate can refer you to a trusted home inspector to perform the necessary inspections.

HOW DO WE KNOW THE SELLER WILL TELL US ABOUT PROBLEMS IN THE HOUSE, ARE THEY REQUIRED TO DISCLOSE ISSUES?

Yes, that's an important part of the inspection process. Sellers are legally required to disclose material facts to the buyer, which will be submitted during the Seller's Disclosure period for your review during the Due Diligence period.

WHEN DOES MY EARNEST MONEY BECOME NON-REFUNDABLE?

Each offer strategy is different depending on the buyer, seller, market conditions and competitive environment. You will have the option of adding in a variety of conditions to allow for the protection of your earnest money while inspections, loan approval, review of disclosures, title search, etc are completed. There will come a point when the Earnest Money is nonrefundable; your sales associate will review those dates with you when submitting your offer.

DO I NEED A HOME WARRANTY?

The decision to invest in a home warranty for your purchase is entirely up to you, the buyer. A home warranty may provide coverage on appliances and specific items for a specific amount of time, typically at least a year. Many first-time homebuyers purchase a home warranty so they are covered immediately after making their home purchase in the event of unexpected costly repairs or replacements. Keep in mind that home warranties do not cover pre-existing conditions.

WHAT IS TITLE INSURANCE AND WHO PAYS FOR THAT?

When obtaining a mortgage on a home, two policies are ordered; one that covers you as the homeowner and one that covers the lender. In Utah, state-approved contracts stipulate the seller pays for the homeowner's policy and the buyer pays for the lender's policy. Title insurance is crucial as it provides coverage for defects or issues that were not discovered during the initial title search. This coverage protects the policyholder from financial loss and legal expenses related to these hidden problems.

WHAT ARE PROPERTY TAXES?

Property taxes are calculated as a percentage of a home’s worth. These taxes typically pay for local schools, public transportation, roads and infrastructure. The tax rates of your property vary depending on location and value and vary widely from state to state.

HOW MUCH ARE CLOSING COSTS?

Closing costs can vary greatly with each home and Lender. This is an important piece to the financing consultation you should do with a trusted Lender.

WHAT SHOULD I EXPECT AT CLOSING?

When your settlement deadline arrives, you will have the opportunity to review any loan documents and the final settlement statement, and will be given instructions on how to submit the funds to purchase. You will also meet with a title agent and/or notary to sign the final documents including the deed that is recorded for your new home.

WHEN DO I ACTUALLY GET THE KEYS TO MY NEW HOME?

Like most things in real estate, this can vary depending on the negotiation and situation of parties involved. Possession normally happens after the deed to the home has been recorded in the buyer's name. Exact timing for possession is negotiated as part of the offer and can be anywhere from time of recording to days or weeks. This is an important discussion you'll want to discuss thoroughly with your sales associate when negotiating the offer.

GLOSSARY OF TERMS

AACCEPTANCE

The formal term for coming to an agreement on an offer and establishing a contract between the buyer and the seller. This is when documents are created and signed, and if either party backs out, there are consequences.

APPRAISAL

A professional analysis of the property, including examples of sales of similar properties in order to determine an estimate of the value of the property.

APPRAISAL CONTINGENCY

A clause in the contract that will negate it if the appraisal comes back and the house is worth less than the sale price.

AS-IS

Legally, this means the seller is not providing warranties regarding the physical condition of the property. Also can mean the owner will not be making any improvements or changes to the house before the sale.

BBACKUP OFFER

An offer negotiated on a home that already has an agreement in place to put you next in line if that deal falls through. You will still need to commit money to this offer to hold your place.

BUYER'S AGENT

A licensed real estate professional or broker that operates on behalf of their client to help them find and purchase a property.

CCLOSING

The process of finalizing a real estate transaction. This includes completing Settlement (finalizing mortgage agreements, paying applicable transaction fees and signing on the dotted line to close the deal) and the funding and recording of the warranty deed.

CLOSING COSTS

Fees associated with finalizing a real estate transaction beyond the actual price of the home. Both the buyer and seller will have expenses during the closing process. Closing costs normally include an application fee, inspection fees, homeowner’s insurance, property taxes and sales associate commissions.

CLOSING DISCLOSURE (CD)

This document explains information about your mortgage, including interest, monthly payments and closing costs. Received at least three days before closing, it should match the loan estimate you received when you applied.

CLOSING (SETTLEMENT) STATEMENT

This is a list of all the costs involved in the closing for both the buyer and the seller. It used to be called the HUD-1 Statement but is now the Closing Disclosure Form.

COMPARABLES (COMPS)

A term that refers to the prices of recently sold properties that are used to determine the market value of other similar properties. Appraisers use this to come up with the fair market value of the home you are interested in.

COMPARATIVE MARKET ANALYSIS (CMA)

A process used to determine the value of a home based on the sale prices of similar properties in the area.

CONTINGENCY

A clause in a contract that must be met in order for a real estate contract to be finalized. If the condition is not met, the contract is renegotiated or canceled.

COVENANTS, CONDITIONS & RESTRICTIONS (CC&R s )

Rules and regulations established by a homeowner’s association (HOA) or neighborhood association that outline what you can do with and on your property, along with any monthly fees required to maintain common areas and keep the association running.

DDAYS ON MARKET (DOM)

The duration of time a property has been or was available to the public.

DEBT-TO-INCOME RATIO (DTI)

A comparison of your monthly gross income to your monthly payments or debts owed. This percentage helps lenders measure your ability to pay your debts and calculate their risk lending to you as a borrower.

DOWN PAYMENT

The amount paid upfront as part of a real estate transaction. It is usually expressed as a small percentage of the overall price of a property. Most mortgage lenders will require a down payment as collateral.

DUE DILIGENCE

A period of time written into the purchase agreement, when the buyer can inspect the property and review important information before closing on the sale.

EEARNEST MONEY

A cash deposit put down by the buyer during an offer to indicate they are serious about purchasing the property. Sometimes called a good faith deposit, if accepted the earnest money will go towards the down payment.

FFINANCING CONTINGENCY

A clause in your offer contract where you can back out if you can’t secure a mortgage with the specified terms in a certain amount of time.

FSBO (FOR SALE BY OWNER)

The property owner is not using a real estate agent to sell their home, usually in an attempt to save money. With the complexity of state and federal rules that need to be taken into account when buying or selling a home, extra caution should be taken when placing an offer on a home that’s for sale by owner.

HHOMEOWNER ASSOCIATION (HOA)

A private association that takes care of the property around a condominium complex or planned housing development. It issues rules and collects dues.

IINSPECTION

An examination of the overall condition of a property by a professional. It is ordered by the buyer and typically covers plumbing, foundation, roof, electrical, HVAC and more. The inspector will then provide an official certificate verifying the inspection's completion and the condition of the home.

INTEREST

The profit a mortgage lender makes in exchange for the loan, quantified as a percentage of the total loan amount.

LLENDER

A financial institution or organization that lends funds to buy, build or renovate a property with the expectation that the funds will be repaid—usually with interest—within a predetermined time period.

LEASE-BACK

An arrangement between the buyer and seller that allows the seller to remain in the home after closing. Also known as a rent-back, the seller typically pays rent and a deposit for a limited time period.

LIEN

A claim on a property that must be paid before it can be sold. These may be placed by a lender if the home is used as collateral for another loan, or by the county for failing to pay taxes.

LIMITED AGENCY

A situation where an agent represents both the buyer and seller.

LISTING

The description available for a property that is up for sale, and an agreement that allows the home to be shown and marketed.

LISTING AGENT

The agent or broker who operates on behalf of the property owners to help them sell their property.

LISTING AGREEMENT

A legally binding contract that allows a real estate agent to sell a property on behalf of their client, the property owner.

MMARKET VALUE

The value of a property based on its appraisal value and similar properties in the area.

MULTIPLE LISTING SERVICE (MLS)

The database of current real estate listings that provides accurate, up-to-date information about the status of local listings. Real estate professionals use this to see listings in the area you're looking for and will typically add a listing to this database when a house goes up for sale.

OOFFER

A proposed contract outlining the price you are willing to pay plus any additional conditions you are willing to promise in exchange for a home. Your sales associate will write and submit it to the seller or seller's agent. If they accept your offer, it becomes the purchase contract.

OPEN HOUSE

A scheduled in-person event that allows prospective buyers to visit a property without an appointment to generate interest and showcase the property in a casual setting.

PPRE-APPROVAL

A letter from a mortgage company that states what you can afford and what they are willing to lend you. This is a vital piece in the process of making an offer on a house, indicating to the seller your offer is valid and allowing the purchase process to proceed more quickly.

PRELIMINARY REPORT

Completed by the title company, this report researches the title on the house to make sure it’s clear of any potential problems. Typically the seller pays for this report, but that’s negotiable. It’s a requirement for title insurance.

PRE-QUALIFICATION

An informal calculation completed by your sales associate to determine how much you can afford in a house by comparing your income to your debts. This helps your agent look for homes in your price range.

PRINCIPAL

The total amount borrowed in a mortgage loan that you must pay pack. This amount does not include the interest you owe and paying it down early can save you money that you would otherwise have paid in interest.

PRIVATE MORTGAGE INSURANCE (PMI)

An insurance policy that may be required by a mortgage company to protect them in case the borrower goes into default. Typically this additional fee is required if you put less than 20% down on a home, but should be removed once your equity reaches a certain amount. This can be achieved by either by paying down your loan or appreciation in your home's value, verified by an appraisal.

PROOF OF FUNDS

Verified documentation that proves to a seller that you have enough money for the down payment and closing costs.

PROPERTY TAX

Taxes owed to the county or state for owning property. This can often be rolled into your monthly escrow payment.

RREALTOR®

A licensed real estate agent and member of the National Association of REALTORS ®. As a member they agree to abide by a strict Code of Ethics and other standards of conduct laid out by the NAR.

SSELLER CONCESSIONS

Things a seller might offer to a buyer to sweeten the deal, such as covering some of the closing costs.

SELLER DISCLOSURE

A document from the homeowner informing potential buyers in detail about a property's condition and how it might negatively impact the value of the home, including issues with the home itself, major construction, noise, pests, property line disputes, etc.

Another term for closing, settlement is a meeting that includes documents, signatures, checks and everything needed to officially buy or sell a home. SETTLEMENT

SUBJECT TO INSPECTION

This means the seller won’t show you the property without getting an offer first. If you are nervous about making an offer “sight unseen,” you should be. On the plus side, this requirement often eliminates a lot of competition for the home.

TTITLE

A record of who owns the property, recorded in the county land records office when you receive the deed on a house.

TITLE INSURANCE

Owners : Protects the buyer against unknown claims, debts or liens against the property and its title. The seller is typically required to pay for this per the terms of the purchase contract.

Lenders: Protects the mortgage company against any unknown debts or liens against a property and its title. The buyer is typically required to pay for this.

TITLE SEARCH

The process of searching through public records to ensure that the seller of a property has lawful ownership of it. A title search can uncover possible deficiencies or defects in ownership that could greatly impact a real estate transaction.

UUNDERWRITING

An analysis of risk in issuing a mortgage for a property, done by a mortgage lender.

UPFRONT COSTS

The costs a buyer must pay before closing. These may include appraisal fees, origination/service charges, taxes and government fees, hazard insurance, and prepaid and escrow payments.

ZZONING

A collection of local laws that dictate what you can build in certain areas. This can come into play if you want to change the purpose of the house you own or are buying. For example, if you want to start a home-based business or add a rental unit, you will need to check the zoning laws for your area.

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