The Buying Process
Define the neighborhood, the purchase price and the type and size of the property, contact a professional real estate sales agent whom you can trust and are comfortable to work with. Inform your real estate sales agent your requirements, financial affordability and the time frame you would like to have purchased the property.
Need not contact many real estate sales agents to show properties because all sales agents have equal access to the listed properties. Having contacted many real estate sales agents will result in duplicate effort and wasted time and good will. The real estate sales agents’ time are also valuable like yours.
Give your sales agent advance notice of your availability to view properties. It takes four parties (seller, seller agent, buyer & buyer agent) to schedule an appointment and also remember to be on time for the appointment. Do remember to give feedback after viewing properties so that the sale agent can adjust the property search accordingly to your updated requirements.
After identifying the property you want to purchase, email your real estate broker your offer with the following information to be submitted to the seller’s broker: Buyer name(s), offer price, buying method (all cash or mortgage-financed with the down payment amount and % financed), estimated closing date, and any other contingency request such as mortgage-financing contingency).
Also provide the pre-approved mortgage letter from the lending institution if mortgage financing is required, and the financial statement, with a brief introduction about the buyer(s).
Negotiation & Accepted Offer
There may be negotiation on the buyer’s terms and conditions between the seller and the buyer. When the seller has accepted the offer, both the seller and the buyer will exchange personal information such as buyer name(s), address, contact information and their respective seller and buyer’s representing real estate lawyer’s name and contact information.
Signing of the Sale Contract
Upon an accepted offer, the seller’s lawyer will send out the sale contract to the buyer’s lawyer usually within 24-48 hours. In the meantime, the buyer’s lawyer also would have received the building’s (Condo / Co-Op) Offering Plan and the most recent two years’ financial statement from the seller’s broker. The buyer’s lawyer will review the sale contract and perform the due-diligence on the building including the review of the building’s financials and board meeting minutes.
The buyer’s lawyer will brief the buyer on the result of the due diligence and will advise the buyer to “go-ahead” and sign the sale contract, and give a 10% down payment which will be in the escrow account of the seller’s lawyer. The seller will then counter-sign the sale contract and the seller lawyer will deliver the executed sale contract back to the buyer’s lawyer and to the buyer. Now we have an executed sale contract which is legally binding on both the seller and the buyer.
Mortgage Application (if financing)
Upon the receipt of the executed sale contract, the buyer should immediately apply for the mortgage and provide all the necessary financial information expeditiously. Your real estate broker will work with your mortgage broker/banker to coordinate the appraisal and provide the required information about the building, and the process may take about 30 to 60 days to complete.
(All cash purchase takes the shortest time to close and the least closing costs – preferred by all parties involved).
Both Condo and Co-Op buyers need to submit the buyer’s board package /purchase application for a resale purchase. (Not required for the purchase of a new condo from the Sponsor/Developer for there is no condo board established as of yet). Usually the buyer should submit the board package/purchase application within 5 to 15 days from the date of the executed sale contract. The completion and the submission of the buyer’s board package/purchase application must be taken extremely seriously. Follow your broker’s specific instructions and work in a timely manner with your broker to compile a complete and strong application that is professionally presented and will pass the board. The board has 30 days to respond before issuing the waiver for the seller and the buyer to go ahead for the closing.
Board Interview (applicable only to Co-Op)
Face to face interview is only required for the Co-Op purchase and NOT for the condo buyer(s). Upon review of your co-op board package, the board will usually schedule an interview to meet you within a few weeks of receiving the completed application. Again, you can rely on your real estate broker to prepare you for a successful interview. Typically the board’s decision is conveyed to your real estate broker or you within 24 to 72 hours, however some boards take longer. When buying a townhouse, neither a board application nor an interview is required.
Upon receipt of the waiver and approval by the Board, both buyer and the seller’s lawyers will schedule the closing date with all appropriate parties. The buyer’s real estate broker will coordinate and schedule a buyer’s inspection of the property a day or two before, or even the day of the closing, after the seller has vacated. Both the buyer and the seller’s broker will be present for the “walk-through” to ensure that all the appliances and fixtures are in working order, all personal property is removed and the home is in good condition and broom clean.
Closing & Title Transfer
The closing will usually be scheduled within 5~10 business days from the receipt of the Board’s waiver unless a different closing date is previously agreed upon at the sale contract. The buyer’s lawyer will advise you about the closing costs and the required certified checks to bring to the closing. Remember to bring your driver’s license or passport for identification, and your checkbook for any last minute adjustments. At the conclusion of the closing you will be handed the door and the mailbox keys to your new home…Congratulations!