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Redfin Home Buying Class

August 21st, Irvine, CA

Host: Jennifer Chen@Redfinfacebook.com/Redfin

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Agenda●A little about Redfin●Understanding the market●4 Tips in multiple offers●The purchase process●Mortgages●Selecting the right agent●Touring

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A Little Bit About Who We Are

Redfin is a real estate brokerage that has helped over 20,000 people buy or sell a home; 97% would refer us to a friend.

● Customers, not commissions● Informed decisions● Right home for the right price

No obligation Commission credit

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Partners in the Process

AGENTResponsible for your success

Writes your offerHandles negotiations

TRANSACTIONCOORDINATORPrepares paperworkWorks with escrow

TOURCOORDINATOR

Schedules toursPrepares paperwork

ASSOCIATE AGENTTakes you to see homesSees 50+ homes a week

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Save $4,000 on Average

• We refund back part of our commission to you!• New Construction – Redfin can provide our rebate if we sign you in the

first time you go to the sales gallery

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Redfin.com - Benefits of MLS Powered (Multiple Listing Service)

● All the homes for sale: 30% more listings● You see what the agent sees: 4x the data● Real-time market data: photos, details of just-sold

homes

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Understanding the Buying Process

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Overview of a Buying a Home

Research

Your needs

The market

Neighborhoods

Agents

Mortgages

Preapproval

SearchDefine

Preferences

Instant Alerts

Open houses

Home tours

Offer

Comparables

Draft offer

Negotiate

Mutual acceptance

Closing

Earnest money

Inspection

Loan application

Title review

Appraisal

Financing approval

Closing

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Understanding the Market

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Orange County Housing Report The market is on Cruise Control

Inventory is increasing, demand is flat and foreclosures and short sales are almost non-existent.

● We don’t anticipate home values to significantly increase or decrease anytime soon.

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Irvine Inventory

Tip: Local information can be found for any city, zip or county under “Stats and Trends” from the map page:

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Multiple Offer Situations

4 tips

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Tip #1: Make the competition eat your dust

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Sign up for Instant Alerts

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Tip #2: Get pre-approved with a local lender

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Questions to ask your lender

● How quickly can you close?● How quickly can you issue a loan commitment?● Are you available on weekends/evenings in case of

emergencies?● Can you call the listing agent after we present our

offer?

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Tip #3: Start the conversation early

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Writing a Winning OfferLet’s Do our Homework

Buyer’s agent should call the listing agent to find out what the seller’s situation is and what the competition looks like.

Do the seller’s need a quick sale? Will they need to remain in the property after

the closing?Build rapport with the listing agent

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Single Family Residence - Irvine

● Listed for $1,399,888● Seller received

multiple offers● Sellers accepted an

offer at $1,400,000, free 1 month rent back, “As Is” sale

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Tip #4: Write a love letter

to the seller

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Writing a Winning OfferPersonal Touch● Including a short letter to the seller and a picture

may help the seller connect and consider your offer.● Include a bit about you, your family, your profession.● Comment on the things you liked about the seller’s

home.● Send your agent a family photo to include.

► Won’t help as much with bank owned properties or investor sellers

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18742 Via Siena, Irvine

● Listed at $1,758,000

● Received Multiple Offers

● All cash buyer at $1,800,000

● My clients won the home for $22,000 less with a loan

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Overview of a Purchase

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Your Offer has been Accepted!

● Earnest money deposit – usually 1-3%+● Inspection – approximately $500● Other Inspections – roof, pool, etc.● Loan Application – 2 days or less● Review Title● Order Appraisal – approximately $500● Loan Approval – remove contingencies!● Escrow – appointment to sign documents● Walk through● Loan funds, title records● Receive your keys!

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Mortgages

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Review Your Financial Situation● Pull credit report, look for errors● Establish comfort level for monthly payment● Figure out how much monthly income goes towards

debt: 28 – 33% healthy

● Pay down credit balances to 1/3rd● Don’t open any new lines of credit● Don’t buy any big ticket items● Source of money● Current employment status

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Organize Your Assets ● Get ready for the down payment● Cash accounts (liquid funds)● 401(k), stocks, other investments● Gift funds? (Max. allowed varies)● Move funds around before you start

shopping

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Get Pre-Approved EarlyA pre-approval letter is a letter from a bank or a lender estimating how much they'll lend you● Establishes what you can afford & makes offer process go

faster● Redfin asks that you get pre-approved before your third

tour● Good for 90 days, depending on lender

Info needed:

●W-2, two pay-stubs, tax returns, bank statements

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Pulling Credit: Is It Harmful?● Your credit report must be reviewed by a lender

before you can obtain a pre-approval● If you know your score, a lender should be able to

give you ballpark pricing for their loan products● Better to know sooner rather than later about credit

problems● Maintaining a pre-approval

has a negligible impact onyour credit score

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Start Shopping for LendersCompile a list of 3-4 local lenders

Good sources include:● Redfin's partner lenders ● Referrals from friends, family & co-workers● Online review sites, such as Yelp● Local chains and offices

*Know your lender

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Types of Loans● Conventional:

► As low as 5% down► Fixed or adjustable rates, conforming or non-conforming

● Federal Housing Administration Loan (FHA):► Always have mortgage insurance► Buyers need only a 3.5% down payment

● VA Guaranteed Loan:► Veterans, active duty personnel, reservists/national guard,

surviving spouses► No down payment

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Local Recommended Lenders

In no way does Redfin benefit financially from recommending lenders – we just think they’re great lenders!

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Choosing the Right Agent

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What to Ask Any Agent● Is this your full-time job?● Where were your last five deals?● Who else will be working with me?● When am I committed to working with you?● Has a client ever filed a compliant?● How are you paid?● Can I see some reviews of your work?

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Seeing Homes in Person

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How Touring with Redfin Works● Up to six homes per

tour in two hour blocks● Go on as many tours

as you need● Led by agent or

associate agent● Need to be verified●No obligation

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Making the Most of Your Tour1. Bring a camera, notebook & tape

measure2. See how much sunlight the place gets3. Check the bathrooms for rot & mold4. Look for wavy or discolored wood

siding5. Make sure water spouts drain away

from house6. Take stock of storage space7. Turn off any music playing in house8. Check for hardwood floors

9. Peek into the attic10. Bring a marble or two11. When sharing a wall, make sure it’s

thick12. Ignore the appliances and carpets13. Check the closets14. Get the disclosure packet15. Compare the property’s tax records to

the listing details

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Selling Your Home with Redfin

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● We’re on your side► Agents paid on your satisfaction

● Double your exposure ► Premium placement on Redfin► Zillow, Trulia, Craigslist and Realtor

● 1.5% listing fee► Professional photos► Beautiful flyers

Better Service, Lower Fees

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Thank You for Coming!