Buying A Home

Buying a Kauai Home

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If it is your dream to own a home in Hawaii, Kauai Realty would be honored to assist you in making that dream come true. Kauai Realty has been helping families buy and build their dreams on Kauai for over 45 years.  You will appreciate our exceptional service and working with professional Kauai realtors with many years of market experience and knowledge during this exciting time.

 

If this is your first time purchasing a home, below is a brief overview to familiarize yourself with the process of buying a Kauai home.  If you haven’t done so already, take a look at all of Kauai’s real estate listings to begin your Kauai home search today.  For more information on real estate in Kauai, Hawaii for sale, contact us today.

The Home Buying Decision

The best way to start the home buying process is to take a realistic look at what you can expect from home ownership. You must be ready for the increased responsibilities that come with home ownership. If you’re planning to buy a home, you probably have good reasons in mind, ranging from purely personal to very practical. A survey conducted by the National Association of Realtors listed pride and satisfaction as top home buying reasons, as well as the following: dislike of paying rent, ability to control and modify a home’s features, good investment, long-term appreciation, leveraged investment, source of savings, tax benefits, and others. Another consideration is the stability of the housing costs. Your 30-year fix mortgage is set—who knows where rental rates will be?

What Can I Afford to Buy?

When you are ready to buy a home, the first step is to get pre-qualified for a loan. You should seek a lender that not only offers competitive rates, but also offers the level of service you feel comfortable with. Ask your realtor, friends and associates for recommendations. Our agents’ experiences in working closely with lenders during transactions enable them to effectively assist you in the buying process. Once you decide on a lender, find out how much they are willing to lend you and/or how much you would like to borrow. That amount, with the money you are willing to invest, will determine your budget.
Besides the down payment for the home, other costs you will incur include:
    •  The loan application fee, which covers the appraisal and credit report
    •  The loan origination fee
    •  The loan points, which is typically around 2% of the loan amount
    •  The state mortgage recording fee
    •  The title insurance
    •  The first year prepaid homeowner’s insurance
    •  Prepaid Private Mortgage Insurance (PMI), if applicable
    •  Inspection fee, if applicable
    •  Interest from the date of closing till the end of the month
    •  Loan impound account funding for property tax and insurance
    •  Escrow fees
Your realtor and lender can work with you to determine these figures and inform you of other possible charges and credits.

Choosing your Kauai Realtor

Once your budget is determined, it’s time to find a realtor. This is perhaps the most important step in finding the right house and having a smooth transaction. There are quite a few choices and this can be confusing. Remember, this is one of the largest investments you’ll make in your life, so it’s very important that you choose someone who is knowledgeable and that you feel comfortable working with.

Working with a competent real estate agent will save you endless amounts of time, money and frustration. Our team of Kauai realtors at Kauai Realty is ready to make your home buying experience rewarding, fun and hassle-free. Contact us today for an initial consultation.

Finding a Kauai Home

Your initial consultation will begin with a discussion of your housing needs. Our agents will help you identify your preferences regarding price range, number of bedrooms, approximate square footage, location, and other items you desire in your new home. You’ll be asked to list your “must haves” and your “want to haves,” and based on your criteria, our agents will search the island to identify available properties that meet your needs. Another resource to search for your perfect home is our online property search, which accesses the Kauai MLS (Multiple Listings Service). Our realtors will work with you to find, pre-screen and schedule visits to potential homes. Thereafter, you may decide which home is right for you.

Negotiating an Offer

Congratulations! You have found your dream home and are ready to make a purchase. Your agent will prepare a comparable market analysis, which shows the homes that are currently for sale (the competition), homes that are currently being purchased (in escrow), and the most recent sales, to help you to determine a reasonable offer.

In addition to the price, there are a variety of terms to be addressed in structuring your transaction to best suit your interests, including developing provisions to allow for certain financing, incorporating any necessary contingencies, and setting reasonable time frames. We will guide you through this process.

Earnest Money

These are the funds that you submit with the offer to let the Seller know you are negotiating in good faith. If a deal is successfully negotiated, this is deposited to the escrow account on your behalf.

Inspections

A thorough inspection of the property is a key element in determining the condition of property that you are buying. This is generally done after you reach an agreement with the Seller. If any major issues with the structure or components of the structure are uncovered, they should be addressed early on in the process. Your agent can provide you with suggestions on your options available in dealing with such issues.

Financing

Hopefully, you pre-qualified for a loan and began discussions with your lender about the loan process. By the time you negotiate the purchase of your home, you should have a clear idea of the financing you need or want. If not, it is now time to visit your lender.

Escrow and Title Research

Now that you have successfully negotiated the purchase of your home, an escrow account is opened to coordinate the processing of documentation needed to complete your purchase. Your realtor will have the Escrow Company provide a Title Report, which will show not only the ownership interest being conveyed, but also any encumbrances affecting the property. Our extensive experience in working with various escrow companies ensures your transaction will move along as timely and smoothly as possible.

Homeowner’s Insurance

Most lenders will require you to purchase homeowner’s insurance coverage for fire or storm damages, which protects you and the lender from loss in the event that the home experiences an unfortunate incident. Your realtor can point out property features that may result in lower insurance premiums.

Termite Inspection

In Hawaii, termites are definitely an issue. Usually, lenders require a Termite Inspection Report showing the property to be without any live infestation before they will fund the mortgage loan. There are provisions in the standard purchase contract used by realtors addressing termite issues.

Property Boundaries—Survey vs. Staking

Most Buyers wish to have the property’s boundaries marked to verify their purchase. There are basically two levels of service available, staking or surveying. In staking, the survey crew will locate existing pins and verify their location or put in new pins if there is a discrepancy or if the pins cannot be located. In a survey, typically a boundary survey, the same verification or location of the pins is performed and any improvements near the boundaries are sketched on a plot plan to determine if there are any potential encroachments over boundary lines.

The Final Walk-Through

An opportunity for a final inspection of the property is provided to the Buyer prior to closing to satisfy any concerns over the property’s condition and continued maintenance since the time the offer to purchase was made.

Closing

Once all the funds have been submitted and the paper work completed, the conveyance documents are sent to the State of Hawaii Bureau of Conveyance for recording. Thereafter, you officially become the property’s new owner.

If you would like to explore  buying a home on Kauai , contact the Kauai real estate experts at Kauai Realty today for more information on real estate in Kauai, Hawaii.

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