17 May . 2019
Who’s who when you buy a new home
Once you decide to buy a new home, you’ll probably meet a lot of generally friendly and helpful folks, from the lender and title company, to the HOA and design center staff. Your builder sales consultant and real estate agent will likely run point with all of these players, but it’s still a good idea to know who’s who – starting with those two.
Builder. From the time you first walk into the model home and decide to buy, the builder sales consultant will be one of your main points of contact through the entire process, whether you choose a completed home or build from scratch. The sales consultant shepherds you through every step of the buying process, from showing you available homes and homesites, signing the contract, coordinating closing, and following up after closing. If you are building a home rather than purchasing one that’s already finished, the sales consultant will coordinate with the construction team, keeping you updated and scheduling meetings and walk-throughs at key intervals.
Real estate agent. Working with a real estate agent is highly recommended for all homebuyers. It doesn’t cost you anything, because the builder pays the agent’s commission. The agent will work with the builder sales consultant to help coordinate all of the activities described above. But before you even get to the point where you choose a builder, an experienced agent can help you understand how much you can afford to spend for a home, and can get you pre-approved by a lender. On an even more fundamental level, an agent can help you find the area of town and the community that’s best for you. They can also provide invaluable advice about choosing a builder and a floor plan.
Developer. Put simply, the developer creates streets, utilities and other infrastructure for a development that can range from just a few homesites, to thousands of them. Most communities include at least a few amenities, such as a park, playground and pool. Sometimes the builder may also be the developer. With a large planned community such as Rancho Sienna, the developer plays a vital role in envisioning an overall lifestyle; creating a vibrant mix of different home styles and price ranges; reserving sites for schools, shopping and other services; and establishing a homeowner’s association. Rancho Sienna devotes more than 100 acres parks, trails, natural open spaces, and Sienna House. Most homebuyers will interact with the developer, mainly through the HOA and the Lifestyle Director, after they close and move into their new home. More on that later. Developers such as Newland Communities love to talk with homebuyers, to share their vision for the community, answer questions and hear feedback.
Lender. Most people take out a mortgage in order to purchase their new home, so they interact with the lender. It’s a good idea to get pre-approved for a home loan before you start talking to homebuilders, to find out how much you can afford to spend, and to determine the monthly payment you are comfortable with. You’ll also have the opportunity to resolve any potential problems during the pre-approval process, so there won’t be any unpleasant surprises ahead. Your real estate agent or builder sales consultant can recommend a lender. Most builders have preferred lenders, and many have their own mortgage companies. Builders will often offer financial incentives for using their preferred or in-house lender, but you’re always free to select your own mortgage company.
Title company. The title company is an essential player in the home buying process, although most buyers don’t have a clear idea of what title companies do. Basically, the title company insures that the title of a piece of real estate is legitimate and then issues title insurance. This insurance protects the lender and/or owner against lawsuits or claims that might result from disputes over the title. This is important in the case of existing properties, where there may be the potential of disputed ownership or claims, and it is also essential when purchasing a new home. The title company maintains an escrow account, which includes funds needed for closing, such as the down payment, and prepaids such as taxes and insurance. The title company also conducts the formal closing of the home. This includes providing necessary documents, collecting and disbursing monies, and filing new titles, deeds and other documents with the appropriate entities. As a buyer, you are free to select your own title company, although most buyers are content let the lender or real estate agent make this selection.
Design center. For many buyers, one of the best things about building a new home is getting to select all the finishes, including flooring, wallpaper, countertops, cabinets, and hardware and plumbing fixtures. Some builders have design centers inside their model homes, but many have created centralized design centers in major cities where they build, to provide buyers with thousands of choices and the opportunity to consult with professional interior designers. Your builder sales consultant will coordinate one or more design center visits for you.
Inspector. For obvious reasons, lenders always require a professional third-party inspection when they are financing an existing home. In the case of a brand-new home, such an inspection is not typically required. The building process includes a final, pre-closing walk-through with the buyer and the construction superintendent. The sales consultant and real estate agent are also usually present for the walk-through, which is essentially a final inspection of the home. Websites such as Realtor.com strongly recommend also hiring your own private inspector, even though it will cost you a few hundred dollars out of pocket, and even though the builder provides their own warranty. As Realtor.com points out, a private inspection can help make sure that a new home is free of problems and built to code, among other important safeguards. They actually recommend two inspections – one before the walls are closed in, so that framing and systems can be checked; and a final inspection after the home is complete.
Insurance company. A lender will require the homebuyer to get an insurance policy covering fire and other hazards before they will complete the loan. Even if a buyer is paying cash for the home, insurance is essential to protecting their investment, and also for protecting against liability lawsuits in the case that anyone is injured on the property. As with so many of the other pieces of the home buying puzzle, the buyer can look to the real estate agent or builder sales consultant for a recommendation, and they are always free to select their own insurer.
HOA. After closing, the buyer will be contacted by HOA, or Homeowners Association, for important documents and materials, such as key fobs and codes that allow access to amenities. The HOA provides an essential role in maintaining the ongoing attractiveness, quality and property values within the community, by carefully managing any architectural modifications and ensuring that private yards, recreational amenities, community entrances, and other common areas are well maintained. HOA dues, paid yearly by residents, finance the HOA and its contributions to the community’s lifestyle and quality. Some large communities, such as Rancho Sienna, have onsite HOA offices, making it easy for residents to interact with the HOA. When a community has a Lifestyle Director, like Rancho Sienna does, that person is usually technically an HOA employee, and is an important part of creating a neighborly lifestyle through fun events and activities.
Get started on your own home buying journey by exploring Rancho Sienna’s new homes, priced from the $200,000s to $500,000s.
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