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First Time Buyer - Looking for advice & possibly representation


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#21 VicHockeyFan

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Posted 02 November 2017 - 07:42 AM

Closing is at the very end when you are about to move in.

That’s when your mortgage lender gives the developer all the money. And then you get the keys.

Edited by VicHockeyFan, 02 November 2017 - 07:43 AM.

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#22 Mike K.

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Posted 02 November 2017 - 07:46 AM

I'm currently dealing with a purchase scenario where the seller received some very, very bad news following a home inspection.

 

I won't get into the details but the seller's agent, lawyer and inspector all missed a crucial and very critical detail when he purchased the property last year. They all messed up. All three professionals.

 

This goes to show that mistakes can be made even by folks who's business it is to buy, sell and advise on real-estate all day, every day. So advising that real-estate purchases are a do-it-yourselfers dream is a bit questionable and could be problematic when you've made a serious mistake and have no recourse.


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#23 lanforod

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Posted 02 November 2017 - 07:49 AM

I'm currently dealing with a purchase scenario where the seller received some very, very bad news following a home inspection.

 

I won't get into the details but the seller's agent, lawyer and inspector all missed a crucial and very critical detail when he purchased the property last year. They all messed up. All three professionals.

 

This goes to show that mistakes can be made even by folks who's business it is to buy, sell and advise on real-estate all day, every day. So advising that real-estate purchases are a do-it-yourselfers dream is a bit questionable and could be problematic when you've made a serious mistake and have no recourse.

 

Absolutely. My realtor and home inspector missed a few crucial things at my place too that I've had to deal with, costing about 50k or so. There are other things outstanding that I need to get done yet too.


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#24 Matt R.

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Posted 02 November 2017 - 10:27 AM

If RBC is offering you a mortgage and they are also your bank of choice for credit cards, line of credit, everyday banking, etc, that you look very closely at whether or not they want you to enter into an umbrella mortgage.

We just bought a second house this fall and the mortgage progress was night and day compared to our first go around. Our credit union offered us a good deal but insisted on an umbrella mortgage, leading us to believe it was the cats pajamas. On further research we decided that it wasn't a good fit for us (more cons than pros) so we ended up going with another lender.


Matt.

#25 tjv

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Posted 02 November 2017 - 02:20 PM

I think you're forgetting we're trying to assist someone with their first home purchase.

 

We get it, you know your way around the maze. But advising someone who's obviously green in this whole process to "do all the research, look for the house/condo, view it, figure everything out.  Then when you are serious go to your lawyer say this is the house/condo, this is my offer, these are the subject to's, etc" , lol, is not helpful!

 

C'mon tjv, let's help this guy (or gal) out!

I thought I was by trying to save him/her out and save some money.  I don't have any formal education in real estate law, etc and I was able to do it without a realtor.  Why can't this first time homebuyer?

 

Sorry, but this isn't rocket science.  If you have any questions regarding things registered against the title, etc a lawyer can easily define these.  Any questions you can ask a realtor, you can ask a real estate lawyer, they are highly skilled at their job with a long university education behind them in just the things you are dealing with

 

Absolutely. My realtor and home inspector missed a few crucial things at my place too that I've had to deal with, costing about 50k or so. There are other things outstanding that I need to get done yet too.

Curious, did you sue your realtor and home inspector?  I know I would without a second thought



#26 Mike K.

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Posted 02 November 2017 - 02:30 PM

You can’t sue a home inspector. They tell you right in the report you purchase that their analysis may be incomplete and may be inaccurate. If you want an accurate this or that seek the advice of an engineer, an electrician, a chimney sweep, a plumber and a geotechnical technician, etc.

As for a realtor, that’s a good question. Can you sue them if they miss a critical piece of the puzzle when representing you?

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#27 lanforod

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Posted 02 November 2017 - 02:41 PM

No. First off, for the reason Mike listed. Second, the Realtor is family. A good one, but yeah, missed this. It was more in the domain of the home inspector anyways. I was impressed with the home inspector... now not so much.



#28 tjv

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Posted 02 November 2017 - 03:40 PM

You can’t sue a home inspector. They tell you right in the report you purchase that their analysis may be incomplete and may be inaccurate. If you want an accurate this or that seek the advice of an engineer, an electrician, a chimney sweep, a plumber and a geotechnical technician, etc.

As for a realtor, that’s a good question. Can you sue them if they miss a critical piece of the puzzle when representing you?

True, but I think the bigger question is what specifically did they miss if you don't mind me asking Langforod.


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#29 Bingo

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Posted 02 November 2017 - 05:54 PM

Home inspectors are a dying breed as you don't have time to get an inspection done while all the offers flow in. If you loose you snooze.



#30 LJ

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Posted 02 November 2017 - 07:26 PM

That's a tough one. From a realtor's perspective, a $7000 flat fee would not be enough for many houses. In the market of the past few years, it would be enough - except for realtors who don't get much business. In a slow market, it wouldn't be near enough. In a luxury market, where a realtor may only sell a handful of multimillion dollar houses, it isn't enough.

 

Perhaps if the realtor could also charge for costs for marketing?

If a realtor doesn't get much business he should find another line of work. It is not up to me to pay exorbitant fees so he can sell two houses a year and make a living. I wouldn't mind paying the marketing costs, the more you want the more you pay but then the realtor's cost, in this market are virtually nil.

 

When the housing boom is on everybody wants to be a realtor, we don't need as many as we have.


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#31 Mike K.

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Posted 02 November 2017 - 07:33 PM

Just remember that there were 640 sales in October. And there are 1,500 realtors.

So the market’s taking care of itself.

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#32 LeoVictoria

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Posted 02 November 2017 - 09:24 PM

As for a realtor, that’s a good question. Can you sue them if they miss a critical piece of the puzzle when representing you?

 

Yes, absolutely if it was negligence and they should have caught it, or they gave you bad advice, or they didn't give you the advice to run something past a domain expert.  You can sue a realtor for any number of reasons.  You can also file a complaint with the BC Real Estate Council https://www.recbc.ca.../complaint.html


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#33 LeoVictoria

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Posted 02 November 2017 - 09:26 PM

Home inspectors are a dying breed as you don't have time to get an inspection done while all the offers flow in. If you loose you snooze.

 

Not at all.  In fact during the market frenzy it was relatively common for several people to get pre-inspections done.  So instead of one inspection on a house after offer, there could be several..  Business booming for inspectors.



#34 RustyNail

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Posted 02 November 2017 - 11:58 PM

Thanks to all for your responses and discussion thus far.

Regarding the RBC mortgage:
As Magmazing said, the rate they offer now is the stress test rate (4.99) and it is good until the mortgage starts. Perhaps, as Chard's partner in this development, it is BC Housing requiring the Stress Test on eligible purchasers despite it not being jan 2018 yet? Anyway, 120 days before closing, they will revisit rates again and if they are lower, you will get the lower rate.

At first glance I didn't think much of this but upon second glance maybe it's better than it sounds. When 2020 rolls around, if standard rates have risen to 5% or even just 4% and im still shopping around for mortgages, won't these other institutions have to stress test me at 6 or 7% interest? That would obviously lower the max mortgage amount I am eligible for, to the point that I might not be able to afford the Vivid purchase. And if the rates haven't gone up much then I get the lower rate anyway. Seems reasonable doesn't it?

Obviously there are other things to consider in a good mortgage besides just the interest rates, as some of you have already brought to my attention (renewals, missed payments, yearly paydowns etc). I don't think I'm beholden to RBC so there should be nothing preventing me from shopping around.

Regarding Realtors and Lawyers:
It was a coincidence when I came across the Vivid at the Yates. I figured I would register and see what it's about. After my meeting with the sales guy where I picked out the floor plans that I liked, I thought to myself: I should probably get the advice of a professional at some point. As Marko said though, since I've already visited the showroom it's a bit of a gray area as to whether I can/should still get a realtor. I reached out to the sales guy to ask him how they would feel about this. Will hear back from him tomorrow.

Could they refuse to offer the commission to any realtor I bring into the process at this point? I wonder if it would be worth it to bring one on anyway and pay him myself?

After reading through all the responses here, I'm still a bit confused where, at each stage of the process, I should be using a lawyer vs a realtor vs neither. The process for Vivid at the Yates is supposed to go like this:

1. Figure out if you qualify (see my original post)
2. Acknowledge you must commit to live here for 2 years
3. Make sure you will be able to put 10% down
4. Provide T4s and mortgage preapprovals (for BC Housing)
5. Sign a purchase agreement
6. Read the covenant, meet with a notary & 3rd party admin, and attend the mandatory education session (this step to be completed within 72 hours of purchase agreement according to magmazing?)
7. ?Closing?

I'm between step 4 and 5 right now.

-Who would be best to review the purchase agreement with me? A realtor?
-Isn't there supposed to be a 7 day cooling off period after signing the purchase agreement?
-‎where does the "closing" step fit into all of this? Not till 2020, upon move in? Is this where the lawyer comes into play?
I don't know if I'm being a bit overly paranoid at this point. Im thinking the fact that Chard is partnered with BC Housing probably makes this all a bit safer than usual for buyers.

Thanks guys. So far in your discussions you've answered a lot of my unasked questions in addition to those I did ask.


Any more thoughts on my Q's above?

Also, regarding TJV's suggestion to have a lawyer act as my realtor... how do I approach one about this? "Hey would you mind acting as my realtor and making my offer for me? You gotta give me the commission though" I don't mean to be snide but I'm not sure how I would go about approaching it.

Also, when I spoke with one of the Vivid people, she mentioned that because this development is a partnership with BC Housing, buyers don't make offers in the traditional sense. Instead applicants (or their realtor) apply to purchase and then it is BC Housing who considers the applicant and decides whether or not to offer the unit for purchase. I believe commissions are still awarded to Realtors in the traditional sense though. I'm not sure what to make of the above setup though.

Edited by RustyNail, 03 November 2017 - 12:03 AM.


#35 tjv

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Posted 03 November 2017 - 06:31 AM

^in my case as I said previously, my lawyer was the one who suggested it to me.  Do you have any relationships with a real estate lawyer now, if so I would ask those people first.  Other than that your guess is as good as mine.  Maybe google it real estate lawyers and make some calls and discuss that arrangement before you come in, I am sure you can find someone who will do it and he will also will be your lawyer for closing too don't forget.  I would recommend my lawyer, but he is in Vancouver and he is backed up

Just remember that there were 640 sales in October. And there are 1,500 realtors.

So the market’s taking care of itself.

True, but it also takes 2 realtors to make a sale so that means 1280 realtors or 85% had a commission last month



#36 Mike K.

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Posted 03 November 2017 - 06:54 AM

Oooh, you’re right!

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#37 lanforod

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Posted 03 November 2017 - 07:21 AM

^in my case as I said previously, my lawyer was the one who suggested it to me.  Do you have any relationships with a real estate lawyer now, if so I would ask those people first.  Other than that your guess is as good as mine.  Maybe google it real estate lawyers and make some calls and discuss that arrangement before you come in, I am sure you can find someone who will do it and he will also will be your lawyer for closing too don't forget.  I would recommend my lawyer, but he is in Vancouver and he is backed up

True, but it also takes 2 realtors to make a sale so that means 1280 realtors or 85% had a commission last month

 

Nope, many would have had multiple transactions. I'm sure there were plenty of Realtors with no sales, certainly more than 15%.



#38 Mike K.

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Posted 03 November 2017 - 07:24 AM

Ah, another good point.

Does the 20/80 rule apply to real-estate sales, where the top 20% of agents account for 80% of sales?
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#39 lanforod

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Posted 03 November 2017 - 07:26 AM

I'm not sure. Further complicating things is groups of Realtors that may have 20 sales between the 4 of them, with 2 of the 4 primarily acting as buyer agents, but the name on the sale may be the lead Realtor (who is the well known one). They all get paid through whatever arrangement they have.



#40 MarkoJ

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Posted 03 November 2017 - 10:36 AM

I've seen 7 plus 3 a lot, but if 6 plus 3 is more the norm so be it, as someone else pointed out, its a difference of $1000

 

Lawyers need access to the system and lockboxes?  Why? as the buyer you do all the research, look for the house/condo, view it, figure everything out.  Then when you are serious go to your lawyer say this is the house/condo, this is my offer, these are the subject to's, etc, etc and here is my deposit cheque.  Lawyer makes the offer, a few consults back and forth with client and you are done.  total commission say $500

 

other way on a $1 million dollar house =  commissions (lets do 6 plus 3) 6k on first 100k plus 27k on the rest = 33k/2 realtors  $16,500 for each agent

 

my way save $16,000

 

more and more people should know about this, its why I posted it

 

Lawyers "don't have expertise in real estate LAW"!!!!!!!!!!!!!!   that is the funniest thing I have heard.  They have a 7 year degree and realtors took a multiple choice exam.  Damn I need a good laugh this morning

 

Couldn't agree more.  As per above example $33k to sell a house, ya right!

 

Don't know how to put this politely, but you are giving out incredibly bad information.

 

First of all, where have you "seen" 7%+3%? Unless you are a broker at a real estate brokerage you can't see this anywhere. 

 

If using a lawyer who is going to show you the house? Secondly, how will you get around this clause in listing contracts

 

"Buyer agent must physically introduce Buyer to property or Co-op fee reduced to $1,000."

 

When I started in real estate in 2010 I offered 70% cash back to my buyers. A number of REALTORS® decided to copy the business model; however, not all of them were actually showing the houses like I was. Therefore, clauses such as the one were brought to limit the amount of buyers calling the listing REALTOR® to show the property and then simply having the Buyer's REALTOR®or lawyer draft a contract.

 

I totally understand where you are coming from and I've been running creative real estate models for 7.5 years now but while your concepts are bang on there is also real life.

 

Finally, would you go see a dermatologist about your knee pain? I've represented a lot of lawyers over the years as very few lawyers actually practice real estate law. Interestingly enough most of my lawyer clients on the sale end of things have gone full service despite the fact I offer mere postings.


Edited by MarkoJ, 03 November 2017 - 10:49 AM.

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