Buying in AZ maybe quite different from other states. There are several things you should know before you choose a REALTOR® to work with. First, we are not “an attorney state,” severals states have laws that mandate the involvement of an attorney to draft executed purchase contracts, amendments and estate closings. Arizona is unique in that Article 26 of the Arizona Constitution authorizes real estate salespersons to engage in the practice of law, in order to draft purchase contracts and other legal documents needed to transfer real property. Arizona Association of REALTORS® have boiler plate forms that your agent should be using, these forms are drafted by attorneys and approved by committees of Brokers, Mortgage Attorneys and other Board members, they are written according to the law with best regards to the Principals of the contract, Buyer and Seller. It is very important that your agent fully understand and be able to explain these contracts to you.
Who determines the value of the home? Keep in mind in AZ, it is not standard practice for the Seller to obtain an appraisal prior to sell. The listing price of the home could have been determined by several different sources. The listing agent hired by the Seller provided a Comparable Market Analysis in order to determine the value. The seller has a set amount that he needs to obtain in order to be able to sell the property. Automated Evaluation sites online, such as a Zillow’s Zestiment. Crazy as it sounds, one time I asked an agent where they came up with the listing price, “thats what the neighbor told the seller it was worth.” All of these sources can be completely inaccurate in their valuation of a property. So what does this mean to you as a Buyer? Typically the Buyer pays for the appraisal, if the home does not appraise for the purchase price, Buyer and Seller have two options, reduce the contract purchase price to meet the appraised value or cancel the contract. Therefore choose a Buyer’s agent that is competent, educated and skilled on providing you with a Market Analysis on the home, prior to you making an offer.
A revison to the AAR Purchase contract, was the limitation on Seller Warranties, basically the homes are sold as-is, where is. Sellers are not required to repair any items that were not working on the day you wrote the offer. This isn’t as bad as it sounds. Prior to writing the offer, you and your agent should throughly explore the property. If you notice something is not working, for example, the microwave door is falling off, if you would like this item repaired/replaced, your agent will address the issue in the offer. You are given a 10 day inspection period, highly recommended that you hire a professional home inspector. Your agent should also provide a Buyers Advisory to you so you can perform your Due Diligence and research, schools, crime stats, sex offenders, etc. You will also have an opportunity to give the Seller a notice of the items that you disapproved of during the inspection and the Seller will have an opportunity to repair those items or not. Should the Seller choose to not, you are given an additional 5 days after notice from the seller to cancel or accept the items, as-is and move forward with the purchase of the home. This is 10-20 day negotiation process, you will need a knowledgeable agent advising you on red flag repairs and negotiate strongly for your best interest.
If you are financing your purchase, your Buyer’s agent will follow up with your lender. In the purchase contract the Buyer agrees to update the Sellers with the loan progress. There are more than 38 boxes that need to be checked on in a specific time frame, in order for you to move into your new home on time. The Buyer’s agent should be requesting a Loan Status Update from the lender to ensure the loan is processing smoothly. It is very important that your lender and your agent have a good communication process through out the transaction. Many experienced real estate agents have gained strongly relationships with preferred lenders, ask your agent for recommendations.
Your agent will also be in communication with the Title/Escrow company facilitating the transaction and issuing the title insurance policy on your behalf. This will ensure that the title is free and clear of liens. The escrow officer will also receive your loan documents and facilitate the signing and notary of the Docs. At that point, your agent will review the Settlement Statement, provided by the Escrow officer to ensure that the fees being charged to you are accurate to agreed amounts of the purchase contract, to ensure your not be over charged. Your agent will arrange signing, if you are not in the state at the time of closing, no worries, the documents will be FedEx to you and you will have them notarized and send back with the enclosed FedEx packing slip. If you are in the state, the title company will graciously accommodate you and your work schedule. Most title companies have office valley wide, if need be, they can arrange a mobile signing at your home or workplace.
As you can see there are a lot of roles your Buyer’s agent will be playing on your behalf. Something else to consider when buying in AZ, although many states no longer allow “Dual Agency” it is legal here. Dual Agency is a limited representation from an agent that is representing BOTH the Buyer and the Seller on a transaction. Hopefully know that you see the significant role your agent performs on your behalf, you will also see why you would not want to work an agent that has already signed an agreement with the Seller to negotiate on behalf of their best interest. I am sure you can imagine it is a challenge for an agent to try to get a Buyer the best price on a home, while trying to get the Seller top dollar, all while the agent is getting twice the commission, who’s best interest is at stake here? This is why our team consists of “Buyer’s Specialist” and “Listing Specialist.” If you call on our listings, you will be working with the Buyer’s Specialist, whom has your best interest at heart.
Now you are probably wondering why I didn’t mention the one BIG THING, maybe the ONLY THING you thought a Buyers Agent does for you, FIND YOU A HOME. Am I right? We hear that all the time, “well I found the house” or “I don’t need an agent, I like to shop online and will find my own home” Well hopefully you can see now that finding a home, is important part of a Buyers agents role, it is no where near what the extent of our role as your agent. It is very important that you have and your agent have a consultation and they thoroughly understand your needs, wants and must haves. This will help them establish a search portal on the Multiple Listing System, now you will be alerted of a home that meets your criteria the instant it is listing by the Sellers Agent. Many websites you are searching online are 3-5days behind, the property could already be sold by the time you see it on Zillow or another website. It is very important that you and your agent have good communication and if your criteria in your home search changes in anyway, you let them know so they can set your search portal accordingly.
Unique thing about all this Buyer Representation does not cost you a thing. The Sellers pay the listing commission and the listing agent offers a split of that commission on the MLS for the Buyer’s agent. So why would you not have a Buyer’s Specialist representing you? If your would more information on Buying a home in AZ, call us for a no obligation Buyers consultation today.