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Below are some of the most common questions we receive from our Buyers.

Buyer's FAQ

1. Does it cost money to use a Realtor? How does commission work?

Buyer’s do not pay realtor commission in WA state.  *Seller’s via the Listing Agreement, agree to pay both sides of the commission plan – Listing/Seller Side & Buyer Side. Essentially, this means that both buyer and seller agents are working for free until the deal is closed! For rentals, the tenant is usually charged a fee of one month’s rent that is often split between two cooperating brokers. A few exceptions for special circumstances.

2. What are the upfront costs of buying a home?

Ernest Money Deposit (with offer): Typically 1-2% of the Purchase Price. EM remains the Buyer’s funds and is used towards Buyer’s Closing Costs. Home Inspection. Typically $400-$600. Appraisal Fee (requested by Buyer’s Lender). Typically $600-$800. Final Closing Costs: Typically 2.25% of the Sale Price (but can vary). These costs include escrow, title, recording fees, etc.

3. How much do I need for down payment?

3% on up. A down payment of 20% affords Buyer the luxury of not having a Mortgage Insurance fee included in the loan.

4. What's the difference between assessed, appraised, and market value?

Assessed Value: the county’s calculated value for tax purposes. 

Appraised Value: the value assigned to the home by a professional appraiser for a lender - if there is financing being obtained on a home. 

Market Value: Simply put, this is what a buyer is willing to pay for a property.

5. Where does my Earnest Money Check that I submitted with my offer go?

It is forwarded within 48-72 hours to the Closing Agent (Escrow) to be placed in a trust account. Some real estate brokerages have their own trust accounts. The check is cashed & held by the Closing Agent. The EM deposit is applied towards the money that the buyer is paying for the purchase, specifically the down payment.

6. What is a bidding war?

Our current market conditions are simply a function of supply and demand, because of this, there are often multiple buyers bidding on the same one property, which creates “the auction effect” – or a bidding war. It’s not always the highest price that seals the deal, sometimes, other aspects of the offer that add significant value to the seller.
Submitting your best offer and using the proper NWMLS escalation form is the absolute best practice. Sellers are not obligated to counter-offer & communicate further. Having a broker that is experienced with multiple offer situations is invaluable. They know how to best communicate and present your offer it the most favorable light.

7. “I’ll get a better deal working with the listing agent, directly, right?”

Simply put, if you work with the listing agent directly, you have no representation or advocate in your corner and you may not save money in the long run. The listing agent has a fiduciary responsibility to the Seller first. Where this conflict is most evident: the home inspection & further negotiation.

8. Why shouldn’t I wait to buy once the market cools down?

It’s all relevant, especially if you are buying & selling. The house you are buying may be less, but so will the house you need to sell. It is best to talk to a mortgage professional sooner rather than later to discuss various scenarios for your next purchase.

9. Is a Condo or Single Family Residence a better investment?

Single Family Residence. Your out-of-pocket expenses (insurance, general maintenance, etc) are higher overall, but the resale / buyer preference is always stronger. Depending on your personal situation - Condo’s or Townhomes make great sense from an affordability and maintenance standpoint.

10. Do I need a pre-approval letter? And How do I get one?

Yes. If you want to be considered a serious Buyer in the eyes of any Seller, a Pre-Approval letter is necessary in today’s market. Talk to a mortgage professional prior to looking for a new home. What is the difference between a Pre-Approval Letter and a Pre-Qualification Letter? The pre-qualification letter, while not as strong, can be turned around in hours. You would complete a simple online application with formal name, address, SS#, employer & estimated income. The mortgage professional will generate a letter with the maximum purchase price and follow-up requirements for formal pre-approval. A Pre-Approval Letter can take a couple of days to generate, requires a more extensive application plus additional documentation. 2-3 years of tax returns. 2-3 months of bank statements. 2-3 months of recent pay-stubs, other asset statements, etc.

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