Spring on the North Shore seems to make it all the more profound, buying your first home is an exciting event, even for a seasoned North Shore buyer, it can be a challenging process. Some of the details can be intimidating for a first time real estate purchaser or experienced buyers may have forgotten a few key points. No need to panic, with a little preparation you’ll feel like an expert and you’ll be ready for anything!

The natural focal point of a real estate purchase contract is the selling price of the home, but the price isn’t the only factor that determines the net bottom line for both the buyer and the seller, especially in our current real estate market. Is a bargain for the buyer really a bargain if he or she is paying all the transaction costs? Is a top price for the seller really a top price if the buyer wants all the furniture to be included in the purchase price? Or what if the buyer can’t come up with the down payment or qualify for a mortgage?

Best Tip: Ask your experienced North Shore-Glencoe real estate agent to go over the standard contract with you before you receive or make a purchase offer. That way, you’ll know what to expect and be prepared to negotiate the best deal.

Before you decide to move forward, here are five other bottom-line points to consider:

1. What are the estimated transaction costs and who will pay for what? Typical costs include the brokers’ commission, a home inspection, a termite inspection, escrow or attorney’s fees, a title search, an owner’s title insurance policy, transfer taxes and recording fees. The price tags on these items can vary around the North Shore area. Who pays for what is a matter of both local custom and negotiation.

2. How much money is the buyer putting into escrow and when? A big deposit — called “earnest money” — and a substantial down payment are generally seen as a sign that the buyer is dead serious about completing the transaction. From the seller’s point of view, the more money the buyer places in escrow and the sooner the money is transferred, the better.

3. Is there a mortgage contingency and how specific is it? The mortgage escape clause is a must for buyers, unless they’re paying all cash for the home. Without this contingency, buyers could be legally obligated to purchase the home even if they can’t obtain financing. Further, an open-ended statement that says the buyer will obtain a loan “at the prevailing rate of interest” leaves the buyer completely exposed to interest rate fluctuations. A statement that says the loan must be at an interest rate “not to exceed xx percent” and on specified terms is ideal.

4. Exactly what furniture, fixtures and appliances, if any, are being sold with the property? Technically, anything that’s permanently affixed to or installed in the North Shore home is real property. Everything else is the seller’s personal property. This distinction is a narrow one and it naturally leads to a fair amount of confusion. Are built-in appliances real property or personal property? What about a shelving system? A chandelier? Window coverings? Potted plants in the yard? Sellers who intend to remove anything that’s attached to the home should have that specifically noted  in the contract. And the same goes for buyers who expect to acquire any of the furniture or other movables.

5. What happens if either side breaches the contract? Unless an unmet contingency triggers the abandonment of the contract, it’s a binding legal document. Buyers who fail to perform can lose their deposit or earnest money. Sellers who try to back out could be sued for “specific performance,” which forces the sale of the home to the buyer.

Our top performing Chicago’s north shore realtors provide legendary service and experience. Feel free to stop in our Coldwell Banker Office located at 640 Vernon Ave, Glencoe 60022. Our Glencoe realtor office has been providing outstanding real estate  knowledge for over 45 years. We look forward to assisting you.

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