If you are a first time home buyer or a buyer/investor buying a house in Hawaii without a real estate agent, there are several things you should be aware of when purchasing your Hawaiian home:
Agency Relationship
The Listing Agent represents the seller. The seller pays the Realtor’s commission. The Realtor has an agency relationship with the seller. It is best to represent yourself in connection with the home purchase if you do not have a buyer’s real estate agent representing you.
Negotiating the Contract Terms
When you buy a house in Hawaii, you want to negotiate the most favorable contract terms such as price, down payment, financing or cash, contingencies and the closing date. Find out the seller’s motivation for selling first. This will help you with the negotiations. It may be that the seller needs a longer closing so you can factor that in and negotiate a reduced price. Remember when negotiating your contract, all parties need to walk away from the table feeling that it was a win win situation for everyone, but you want to win more.
Contingencies
Every contract should have a buyer’s inspection contingency, loan and appraisal contingency and you may want to negotiate a third party review contingency. An example would be that you make the contract contingent upon the review and approval of your attorney, your partner or another third party. This way, if you decide that you want to get out of the deal, you have another out.
Make sure you have your financing already lined up so you can close the deal quickly. If you are paying cash that might be an incentive to getting the price you want because the seller does not have to worry about the house appraising or you qualifying for a loan. With tight credit markets these days, sellers appreciate having a buyer they know will close on the transaction.
Assignment of Contract
Another contingency that you may want to include in your negotiations is an assignment of the contract in case you are buying the property for an investment and have another buyer lined up, you can assign the contract and obtain an assignment fee from your buyer without having to purchase the home and incur the costs yourself.
Keep in mind if you are purchasing a bank foreclosure or a short sale property, the lender will probably not allow an assignment of the contract.
Closing Date and Closing Costs
You will want to negotiate a reasonable mutually acceptable closing date for you and the seller. Typical closing dates for buying a house in Hawaii can range from 30 to 45 Days. The quicker you close, the sooner you get possession of the home.
There are certain customary closing fees that each party is responsible for. Make sure you get a written statement from the title company as to all your closing fees and costs.
Title Insurance
Ask the seller to provide and pay for an owner’s title insurance policy reflecting that the house has clear title.
Advantages of Buying a House in Hawaii Without a Real Estate Agent
- The biggest advantage for buying a house in Hawaii without a real estate agent is that it will save the seller money because they will not have to pay a full real estate commission if there is no selling agent involved.
- You can deal directly with for sale by owners, and there is no real estate commission that the owner has to pay thereby passing the savings on to your purchase price. A Realtor is less apt to show you any for sale by owner properties unless they get an agreement signed by the seller to pay their commission.
Disadvantages of Buying a House in Hawaii Without a Real Estate Agent
- It may take you longer to find the right house to buy in Hawaii if you do not use a real estate agent because the real estate agent has access to the local MLS where most of the homes in the area are listed. As a buyer, you do not have access to the same information.
A local real estate agent has knowledge of sellers who may want to sell their house, but have not listed their property yet.
Read the original: How To Buy A House In Hawaii Without A Real Estate Agent
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