Kauai Real Estate article: The Sophisticated Buyer

You have decided “the time is NOW” to buy Kaua`i property. Where do you begin? What steps should you take? Here are a few pointers for the Kauai real estate buying process:

Get pre-qualified. Before you begin looking at Kauai real estate, visit a lender for a complimentary pre-qualification process. The lender will consider your source and amount of income, credit rating, total debt, total monthly payments, etc, and calculate what you can afford to buy. It is recommended that you not only get pre-qualified by your primary bank, but by mortgage brokers who may be able to “shop” for mortgages. Ask for WRITTEN proposals from lenders.

Select a Kauai real estate agent. While you may not want to commit to one agent, you will be at a disadvantage if you go at it alone. Why would you want to have several agents put you “on the back burner” because you have not committed to them, rather than have one professional giving you 110%? Ask friends and family for referrals. Interview a couple of agents. Find out if the agent is knowledgeable in the Kaua`i community or condo project you are interest in, his/her level of professional training, and ask for names of “satisfied customers”. Select an agent you feel is knowledgeable, yet you are comfortable with.

When you have made your selection, make a courtesy phone call to the agent you did not choose, and inform him/her of your decision. The designated buyer’s agent will be able to research properties daily on your behalf, represent you in the negotiation process, as well as guide you through the escrow process. Don’t be offended if the real estate professional asks you to sign a contract regarding Buyer representation. The contract will solidify a mutual commitment between you and your agent.

Help your agent search. Give your agent as much information as possible as to your wants and needs in a Kauai property. You can search the internet, check ads, visit open houses, and check out neighborhoods. If you see anything interesting, inform your real estate professional. If you want the type of property that is in demand, make yourself readily available to view the listing when your agent calls. Be ready to decide whether to make an offer or pass at the time of the showing.

Follow the contract. If and when your offer is accepted, there will be time frames to be met and contingencies to be satisfied. Do your part to meet the contractual time frames. Know how long you have to submit a loan application, have the home inspected, obtain final loan approval. If there is a need to cancel the sale based on one of the contingencies or conditions, notify your real estate, in writing, well before contingency deadlines have passed.

The real estate agent will have minimal involvement in the confidential loan application process. The lender will require tax returns, pay stubs, bank statements, verification of income, and explanation of unusual debt or income. Respond quickly to the requests of the loan officer; he is trying to get your loan approved!

Reply promptly to communication from escrow to assure a timely closing. As soon as the parties agree to the terms of the sale, “escrow” will be opened. Escrow is the unbiased third party that will make sure clear title is passed to you, all terms of the contract are satisfied, monies are passed, expenses are prorated, the deed is prepared, and title insurance issued.

Have the Property Inspected. Most contracts will call for a Property Inspection Period in which you are given a specific time frame to research the property records and have the property physically inspected. Take advantage of this opportunity, as you will not normally be provided with a continuing warranty once the sale closes.

Read, read, read. You will receive an assortment of documents from your real estate agent, the lender, and escrow. Before filing away, always READ and understand these items of communication regarding your Kauai property purchase!

Your role as a Buyer is much more than choosing a property and letting things happen. Your quest to be the “sophisticated” buyer requires active involvement and a conscientious effort. Good Luck and Happy Buying!