Are you considering a home purchase?

Congratulations! You’re in the right place. The Cannon Group is among the most trusted names in real estate. We have the experience and the tenacity to take you from layperson to homeowner, and to date, we have a 100% success rate. We’ll have so much fun along the way, but you’ll be learning a lot too. Here are some terms we throw around a lot, discussed here for your quick reference.

1. Buyer’s Agent – You need a person who will represent your interests throughout the transaction. It is a buyer’s agent’s duty to maintain your confidentiality, to be loyal to your rights above all others, and to be competent in advising you. These are known as fiduciary duties, and there are more! Although all agents must study them for licensure, many have different interpretations of their meaning. They all fall under the category of trust, and it is of utmost importance you work with someone you can trust. Your buyer’s agent can assist with any of the following.
2. Lender – Your lender is the institution that will help you finance your home purchase. We always recommend having conversations with Pittsburgh-based mortgage specialists who are adept at navigating our unique markets and can realistically help manage your expectations.
3. Pre-approval – The lender of your choice will provide you with a pre-approval letter. You cannot put an offer in on a home until we have this letter in hand. A reputable lender will always ask you for lots of personal information and documentation up front so that they can get you from browsing online to the closing table without complication. It may feel invasive, but there is no shortcut to verifying your qualifications as a borrower. Beware of any online lender who claims there is!
4. Offer – Sadly, you can’t just pick a house and pay for it over-the-counter. It is strongly recommended that a PA licensee help you write up an offer, and then the seller has to accept. Your offer, written on a standard sales contract, will detail not only the price you plan to pay, but your terms and contingencies. (More on contingencies in a moment.) In this market, be prepared to discuss your options for writing a competitive offer without signing your life away. Only an experienced professional is qualified to do both.
5. Settlement or Closing Date – Typically 30-60 days after offer acceptance, this is the actual calendar date that you plan to sign all the necessary paperwork in order to take ownership of your new home. And we mean it! It’s not just a placeholder we stick into the offer that can easily be changed later. This needs to be a day that you are willing to take off work or get a sitter or make any other arrangements to physically appear at a location where you’ll sign the old-fashioned way in blue ink.
6. Hand Money AKA Earnest Money – Once your offer is accepted, the agreement is secured with a hand money deposit in an amount you’ve pre-determined on your offer. That money will be debited from your bank account and placed in an escrow account. Escrow is a word that scares people, but all it means is a dedicated account only for the purposes of this transaction, usually managed by your realtor’s broker. Hand money is almost always credited back to you at the closing table, meaning it’s less money you’ll have to bring with you on the settlement date. There are rare instances where you may forfeit this money to the seller. That happens when you violate the terms of your agreement (i.e. terminating the deal after your contingencies have been met). In short, it’s how a seller knows you’ve got skin in the game and are unlikely to waste 30-60 days of their time and finances. Hand money should be at least 1% of the purchase price of the property, but the higher the hand money you offer, the more qualified you appear as a buyer, and the more likely a seller will be to choose your offer among others.
7. Zestimate - Absolutely not a thing. It’s useless and inaccurate. Do not base your estimated worth of the home on this imaginary number. Trust your real estate advisor instead.
8. Contingencies – Quite simply, these are the conditions you put forward when making an offer. As referenced above, these are the items you intend to inspect or evaluate before you are willing to buy the home. It is your option to elect or waive a series of contingencies put forth in the PA sales contract. The fewer contingencies you elect, the more appealing your offer is to the seller, but you do have the right to elect them. Common examples include:

Mortgage Contingency – I have to be sure the lender is able to give me the necessary funds in order to complete this purchase.

Appraisal Contingency – I want to make sure the lender agrees that this home is worth my purchase price to help me prevent overpaying.

Inspection Contingency – I will send an inspector over to the home within the next 10 days and make sure there are no deal-breaking red flags for me.

Just because you choose to waive a contingency does not mean it’s unimportant to you. For example, of course the insurability of a property is essential to you taking ownership, but we can assume that if the current owner has insurance, you’ll be able to secure a policy too. It’s probably safe to waive in this case. Of course lead-based paint is bad! It’s also guaranteed to be present in a home built before 1978. By waiving this contingency, you’re not saying you love lead-based paint, just that you don’t intend to scrape up the layers of perfectly good paint to test for lead. (Seriously, don’t do that.) It’s under there somewhere. Just leave it alone, and remember never to eat paint chips.

We get it. There is so much to know, but you’re not expected to know it all. That’s what we’re here for. You deserve a professional who prides themselves on encyclopedic knowledge of the industry and of your rights and responsibilities as a buyer. You deserve an advisor who has your best interests at heart, who sets forth realistic expectations, who understands the emotional aspect of a home purchase, and who guides you through every step of the way. That is what The Cannon Group promises to each of our buyers. Contact us today to get started.