There are lots of reasons to buy a property in the Poconos. Whether you want your own palace of solitude or a property that earns you money as a vacation rental, the process for buying a property in the Poconos can be broken down into a few keys phases. Below I’ll outline the basics for you, though it is important to remember that every transaction is unique and has its own quirks, perks, and hiccups.
The exploratory phase is the first step in buying a property in the Poconos. This is where you do some homework on the area and all of the private communities available to you to choose from. Most of your homework can be done online. In fact, you may have started this process without consciously thinking of it by “window shopping” on third party sites like Zillow – fantastic! Gotta start somewhere (you can start here for the most current information on the market by the way)!
Once you understand what you are looking for and where you would like to find it, it is time to interview the local Realtors who service that area. Make sure you find someone you feel comfortable with who has a solid working knowledge of the area, the market, and quirks of homes thereabouts.
The final leg of the exploratory phase is getting your prequalification or proof of funds document – a document from either a mortgage lender or your bank that states you have been pre-approved or currently have the funds to make a purchase in the price range within which you are seeking a property. If you aren’t working with a lender, your Realtor can recommend a few solid options (in most cases) but if not, shop around. Do your homework the same as you did for what house you want. There are lots of different choices for lenders and varying loan packages out there – go find one you like! Don’t be shy about putting your lender in contact with your Realtor – communication is key once we get under contract so introducing everyone ahead of time is an excellent idea.
Now for the fun part – touring properties. You and your agent will both scour the market for what is available that may be of interest to you (you probably already have a few in mind from back when you were window shopping) – now you can set up showing appointments and go tour those properties!
When you tour properties, it is important to take notes how ever you best remember things – whether taking pictures or videos on your cell phone or just carrying a notebook and making notes. This helps you recall problems, pluses, minuses, etc. – really anything of note (haha) about the property that came up during your tour. If the information is readily available your Realtor can find it for you (the good ones always do).
Purchase Offer Phase
At some point you will find that special place and it will be time to craft an offer. This is where you will be leaning on your Realtor a bit to take in the market conditions and your best interests to help you open a negotiation with the sellers. You will discuss things like price, contingencies, closing dates, seller concession, home inspection – each transaction is different, remember, so communicate with your Realtor and your Lender (where applicable) about the specifics for the property for which you are making a purchase offer.
Now you may get an acceptance right away (yay!) or you might get a counter-offer. Your Realtor will discuss all of these details with you and proceed with your decision in your best interest. Sometimes the parties involved can’t reach acceptable terms and so then the search continues, but eventually you will find a property and agree to terms with the seller and that is when you are considered to be “under contract.”
Under Contract Phase
Eventually you will agree to terms on a property and you will have an Agreement of Sale and sometimes other documents that are signed by all parties; now you are considered to be “under contract” – this is the status of the sale between agreement to terms to settlement.
In Pennsylvania, there are specific deadlines outlined in the Standard Agreement of Sale for every contingency and these dates are important to meet. Work with your Realtor, your Lender, your Title Company/Lawyer or both – all pertinent parties. Prompt communication is key to avoiding mishaps during this phase of the process.
Common contingencies often include different types of Home Inspections, Mortgage Approval, and Appraisal. In primary markets you may see sales contingent on the sale of another property. Each deal is unique and if at any point you want something specific explained in further detail don’t hesitate to speak up and ask questions.
Once you’ve hurdled all the obstacles in the Agreement of Sale you will realize – well, gee, closing is next week! There is some paperwork involved where you will go over all the costs for a final time and make sure everything is set up to be disbursed correctly.
At some point before closing/settlement you will want to contact any pertinent service providers for the property and make them aware that you are the new property owner as of your closing date so that you can prepare to have full capability as soon as you can after closing/settlement. PPL Electric Utilities will take 24 hours to transfer accounts so make sure you are squared away ahead of time with them.
The day of your settlement you will meet with your Realtor and do a final walk through inspection of the property before proceeding to the actual settlement and signing all the documents required for the transaction to finalize. After that you get the keys and the place is yours! Woo-hoo! Congratulations! Now call me to find out how much money you can make renting it out when you aren’t using it!