Glossary

Home Inspector Home inspectors are certified and licensed by each State to provide home inspections for real estate transactions. Home inspectors have a lot of ground to cover. Every reasonable, visible inch of a home is evaluated from top to bottom, and the inspector records the findings in a report for the Buyer, a real estate agent, or another client.

Lease-To-Own Many people want the benefits of living in a single family home. However, whether you're a first-time homebuyer who's cautious about making such a large financial investment, you recently relocated and are unsure of which neighborhood to live in, or you would like to one day own a home and are creditworthy but cannot currently obtain a mortgage. ​ There are companies that offer leasing and rent-to-own programs that allow you to find a home that you want to rent initially, but may also like to buy in the next three to five years. There are many households who may be thinking about buying a home, but for whatever reason would like to rent at the current time. You can lease the home for three to five one-year terms, depending on the state, and you may purchase the home from us at any time at a predetermined price. ​ Let us know if you're interested in Lease-To-Own programs. We're happy to direct you to the right programs. Contact us for more information. Apply and Get Approved Prospective residents start the process by filling out a Pre-Qualification Application that checks key issues. ​ ​ Find A Home Prospective residents will work with a REALTOR® to find a home in an approved community. ​ ​ ​ Housing Program Buys the Home, You Lease from The Housing Program Prospective residents will be required to sign a one year Lease for the home as well as a Right to Purchase Agreement. Buy from Housing Program The Housing Program buys the home. You lease it and have the right to buy it later if you want to. ​ ​ ​

Pricing Strategy Being able to sell your home quickly is a matter of competitive pricing. There is a fine line between pricing low enough to sell, versus pricing just above market value. Your Realtor is responsible for conducting a market analysis in order to recommend the best possible listing price to help your property sell within a reasonable amount of time. ​ Although the Realtor may recommend a price, the Seller is ultimately the person who will make the final decision. Each Seller’s situation is different and you’re allowed to sell your property for lower or higher than your Realtor’s recommendation. But, speak with your Realtor to understand the implications of selling higher or lower than the recommended list price.​

Contingency of Sale If your proposal says, "This offer is contingent upon (or subject to) a certain event", you're saying you will go through with the purchase only if that event occurs. The following are two common contingencies contained in a purchase offer: Financing. You, the buyer, must be able to get specific financing from a lending institution . If you can't secure the loan, you will not be bound by the contract. Home inspection . The property must get a satisfactory report by a home inspector "within 10 days after acceptance of the offer" (for example). The seller must wait 10 days to see if the inspector submits a report that satisfies you. If not, the contract would become void. Again, make sure all inspection conditions are detailed in the written contract. The above two examples are contingencies that are common for residential real estate home purchases. However, contingencies can be more specific to your situation. And, technically, you can write in any contingency you would like in an offer or what the Seller would like to add in the counter offer . However, contingencies are only valid for a contract if both the buyer and the seller agree and accept the offer.

REALTOR (R) Buyer's Agent A REALTOR (R) is real estate professional that is both a licensed real estate agent or broker AND a member of the National Realtor's Association. They are experts in the residential real estate process and help represent Sellers and Buyers during their real estate transaction. ​ On this page, we will discuss the role, duties, and responsibilities of the Buyer's Agent: ​ Role Showings: Buyer's Agents will contact seller properties to schedule time and access for property showings. Negotiations: Buyer's Agents will assist the Buyer in the Offer Negotiation process when a Buyer decides to purchase a property. Management: Buyer's Agents will assist the Buyer in managing the entire buying process by organizing all of the requisite documents and ensuring all parties involved in the transaction are active in ensuring the buying process is being executed. ​ Benefits - You do not need a real estate agent to buy a home; in fact, some home buyers leave the Buyer's Agent out of the equation. However, you might benefit from hiring one. ​ To save time. Agents can often help you find homes in your price range, and they may have access to more properties than what you’ll see online. To get information and help with negotiations. Good agents should have wealth of information to help you make a decision. And, they’ll handle a lot of complex paperwork on your behalf. Offer Contract Contingency Negotiations Home Inspection Reports Appraisal Reports Earnest Money Escrow Extension Requests Another plus is that your agent will handle a ton of paperwork on your behalf. Unless you love filling out forms – and have experience in real estate transactions – this is a chore best left to the professionals, who should ensure that everything is done by the book. You could easily make a mistake with these documents. Mistakes can cause deals to fall apart or (worse) make you liable for an inadvertent breach of contract. (Licensed agent will have errors and omissions insurance to limit this risk.) An experienced agent will make sure that everything that needs to take place — counter-offers, extensions, appraisal, inspection, walk-through, loan approval — happens when it’s supposed to and how it’s supposed to.​ Market expertise: Conducting a home search by yourself can be a full-time job. Though the Internet makes it easy to find homes in your price range, a good agent usually has access to more properties. That includes For Sale By Owner (FSBO) properties and homes that aren’t yet listed. In addition, some sellers of desirable homes do not wish to “go public.” Only agents (and their colleagues) working with those sellers even know about those so-called “pocket listings.” The exception: There is ONE instance in which you must use an agent to purchase property. That applies if you bid on FHA foreclosure properties. The Department of Housing and Urban Development (HUD) requires all bidders to use licensed agents. ​ ​​

Mortgage Pre-Approval / Approval Mortgage Pre-Approval is a letter provided by a mortgage professional which shows you what you can afford to spend and what your monthly payment will look like. A pre-approval differs from a pre-qualification because a pre-approval means you have a conditional commitment by a lender for a specific loan amount. ​ A mortgage Pre-Approval letter from a lender assures you, sellers and real estate agents that you have the ability to a complete the purchase of any home that meets the lender’s guidelines. ​ You give your lender information and provide supporting documents as evidence. They will run a credit check and confirm the information you supply to provide an estimate of your borrowing limit. ​ Application - Required Documents - To secure a mortgage pre-approval, you must complete a mortgage application and submit all required documents. These can include (but are not limited to):​​ Social security number Proof of employment Last pay stub(s) W-2, 1099, or other income tax forms Pay stubs and W-2s (typically two years) Tax returns (typically two years if self-employed or you earn commissions or bonuses) Bank, retirement and investment account statements (two to 12 months, depending on loan) Financial statements (if self-employed) Letters of explanation for credit blemishes Divorce decrees, if you pay or receive spousal or child support ​ 3 Factors Influencing Loan Approval - Once you provide a mortgage professional the documents, you might be wondering what they're looking for to approval a loan. These are the 3 Factors they're evaluating from the documents you've submitted: Willingness to pay back the loan Refers to your credit history or a measure of your ability to pay your consumer debt Each individual is given a credit score ranging from 400 to 850 from one of the credit reporting agencies based on this history An individual’s credit score is a key determinant in influencing loan approval Ability to pay back the loan Front Ratio = monthly housing payments/gross monthly income (should be <30%) Back Ratio = total monthly debt obligations/grow monthly income (should be <40%) Appraisal or Appraised value of the property - This part is not part of the pre-approval evaluation. This is the third factor that a mortgage company will evaluate to determine whether they will approve a long for the property you've decided to purchase. An independent appraiser is hired to complete a full appraisal and submit it to the lender for review Appraiser uses a comparable analysis to arrive at the value of the property The appraiser’s evaluation of the property being financed must report a value greater than or equal to the purchase price ​ ​​

Accepted Offer You will have a binding contract if the seller, upon receiving your written offer, signs an acceptance just as it stands, unconditionally. The offer becomes a firm contract as soon as you are notified of acceptance. ​ As a buyer, if you receive a counter offer, you are able to accept the Seller's counter offer. Again, upon acceptance by both parties, the counter offer becomes a firm contract.

Deed of Title A deed of title, or title deed, is a specific legal document that transfers the title of real estate from one person to another. Full ownership to a piece of real estate is given to the new owner. Usually, such a transfer would happen through a traditional real estate sale; however, a title may be transferred in other ways. An example of this would be when someone gifts a piece of property to another person. ​ In most cases, the deed of title is classified as a general warranty deed. This is a specific type of deed in which the current owner guarantees that they hold a clear title to a piece of real estate. This means that they are not only guaranteeing that they received a clear title from the previous owner of the property, but that no other individuals retain any interest in the property. ​ A general warranty deed is utilized for most real estate deed transfers due to the fact that it provides the greatest amount of protection of any deed. It may be known as a grant deed in some states. ​ Deeds of title should not be confused with a deed of trust. A deed of trust simply grants a lender or mortgage lender a lien on the property if a debt is owed.

Prepare Home For Sale Of course, every home buyer is different. So, it’s impossible to prepare a home that is acceptable to every buyer. But, in order to improve the chances of selling your property, it is necessary to understand the buyers in your market. Each market is different so this page will only attempt to speak to the macro national trends in the market. ​ Although you may love your property the way it is, new buyers will be looking for a fresh face. Spend time preparing your home for sale by conducting a deep cleaning, and refresh its appearance by providing a fresh coat of paint. Your agent can also help provide guidelines, such as decluttering, removing overly personalized effects and getting rid of pet odors. ​ Millennial Home Buying Statistics It’s no secret millennials continue to make up the majority of today’s home buyer demographics. Millennials make up 66% of first-time home buyers, and 34% of the home buying market overall, so if you plan to sell a property, it is in your best interest to familiarize yourself with some millennial home buying statistics. According to Inc.com, only 11% of millennial home buyers consider their first home as permanent, yet they have specific wishlists. Because down payments are so hard to save up for, today’s young home buyers tend to prefer turn-key properties. Some home buying trends stay the same regardless of the generation. Over half of Millennials prefer to purchase homes in the suburbs, with only 25% opting for urban areas. Current Home Buying TrendsWhether you position yourself as a real estate agent for millennials or as an investor looking to target millennial housing trends, it is still important to keep in touch with current home buying trends overall. Although millennial real estate trends are dominating the industry landscape, it is important to keep in mind that other generations still make up a significant proportion of potential buyers. Here are some key highlights on current home buying trends from the National Association of Realtors’ 2018 Generational Trends report: Previously owned homes prevail: In 2017, 85% of home buyers purchased previously owned homes, while the rest purchased new homes. The most common type of home purchased was the single-family home. However, interestingly, the majority of home buyers under the age of 37 who purchased a new home did so in order to avoid renovations and having to pay to remedy problems. Online presence is key: A vast majority of today’s home buyers first find their property online. Nine out of ten buyers stated that real estate photos were the most important feature on online listings. In addition, buyers between the ages of 53 and 71 felt that virtual tours were the most important, as this generation tends to move the longest distances. Financing remains a necessity: Although 88% of home buyers finance their home purchase, the statistic increased to 98% when it comes to buyers under the age of 37. Although most consumers use their savings for a down payment, the proportion increases for millennials, while older generations to use proceeds from a previous sale. Most buyers across all generations still view buying a home as a good investment. Agents are more needed than ever: 87% of all home buyers worked with an agent, but the share increased to 90% for buyers aged 37 and younger. Buyers who worked with an agent cited that they wanted help finding the right home, negotiating the purchase price and terms of sale, as well as help in understanding the purchase process. ​ ​ ​ Selling To The Millennial Home Buyer: What Do Millennials Want In A Home? ​ When devising a strategy on selling to millennial home buyers, it is important to ask yourself, “what do millenials want in a home?” Selling real estate to millennials is no easy feat, as they have a unique set of preferences and demands that set them apart from buyers of other generations. Check out the following list of “must-have” features for today’s youthful buyers: Updated kitchen and bathroom: Brand new fixtures in kitchens and bathrooms are important for budget-conscious millennials. Because of their limited budgets, most millennials’ savings will go towards a down payment and furniture, and not updates. Open floor concept: Although formal dining rooms used to be popular, today’s buyers prefer an open concept where the kitchen, dining and living areas all flow together. All rooms are used as hangout spaces. Home office space: The number of Americans who work remotely continues to grow each year, making a home office an important factor for home buyers. Having a dedicated space will help them focus on the task at hand. Proximity: It could be attributed to high gas prices and traffic, or to eco-consciousness, but young buyers tend to emphasize the property’s location. Proximity to work or public transportation, as well as walkability, are all important considerations. Low maintenance features: Today’s “weekend warriors” tend to not want to spend their weekends carrying out chores and honey-do lists. Instead, millennials are showing a preference for low-maintenance, low-upkeep features. Home technology: Technology has taken center stage in real estate for millennials, as these digital natives have saturated the home buying landscape. Prepare to talk to potential buyers about wireless service providers, carrier signal strength, and smart home features. Energy efficient: Energy efficiency features such as solar panels help millennial buyers kill two birds with one stone. Increased efficiency allows them to protect their budgets while satisfying their environmental consciousness. Online photography: Mentioned earlier, the vast majority of home buyers find their property online. Setting up a real estate website for millennials is essential, which should include photographs and virtual tours of the property after it has been professionally staged.

Listing Agreement (Illinois)

Title Companies A title company makes sure that the title to a piece of real estate is legitimate by conducting a title search and then issues title insurance for that property. Title insurance protects the lender and/or owner against lawsuits or claims against the property that result from disputes over the title. Title companies also often maintain escrow accounts — these contain the funds needed to close on the home — to ensure that this money is used only for settlement and closing costs , and may conduct the formal closing on the home. At the closing, a settlement agent from the title company will bring all the necessary documentation, explain it to the parties, collect closing costs and distribute monies. Finally, the title company will ensure that the new titles, deeds and other documents are filed with the appropriate entities. How much does a title company's services cost? The cost of title insurance depends on the size of the loan and varies greatly depending on the state. The good news is that the premium is a one-time fee you pay at closing, not an ongoing expense. According to the Federal Reserve, “a lender’s policy on a $100,000 loan can range from $175 in one state to $900 in another.” You’ll typically pay an additional amount — usually a few hundred dollars or more, depending on the size of the loan and your state of residence — for a buyer’s policy. Note that you may be able to get a discounted rate on your title insurance if the property was sold within the previous five years; just call and ask.

Your Real Estate Resource Helping home buyers and sellers in the Chicagoland area with all their real estate needs! Home Buying Process One-Stop Resource PadScouts' Real Estate Resource is here to tell you about all of the steps involved in the home buying and selling process. Our goal is to give you information about the processes so you can make informed choices for your real estate decisions. Personalized Consultation Home Buying Process Learn every step of the home buying process from start to finish. There are a lot of steps and many people involved. We want to make sure you're fully informed! Lease-To-Own Opportunities Not ready to buy a home? There are resources available that can help you secure the property before you can buy. Home Selling Process Learn every step of the home selling process and all of the costs associated so that you can make the best decisions when selling your home. Glossary There is a lot of terminology in real estate. Look them up here to learn about them before a real estate transaction. Reviews Our real estate experts are here to help you if the site doesn't have the answers you're looking for. See how they've helped others who've requested a free consultation. “This was a great resource to look up information about selling my home! I had a complex inheritance deal so I scheduled a personal consultation and spoke with Robin. He was amazing to work with and helped us navigate the resources available to help us buy the property! ” Gloria M. Contact