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Buying first Home

GoldieLockingsGoldieLockings
edited April 2017 in Seattle Real Estate
Hello, all,

Can someone point me in the right direction as to what are the steps of buying my first home?

I'm buying my parent's home, what do I need to do to make this a smooth transaction?

Thank you for for any information.

GL.

Comments

  • JasperJasper
    If you are buying your parents' home, I recommend that you and your parents sit down with a lawyer to make sure that your proposed purchase terms are in a form that won't confuse the legal system. There are several possibilities. You will also need to make sure that your proposed purchase amount and other terms do not accidentally trigger unnecessary taxes (gift taxes, estate taxes, income taxes, property taxes, et cetera).
  • JasperJasper
    At least two of the frequent commenters on the Seattle Bubble website are lawyers by training, who are now residential real estate brokers. They might be able to point you toward a good lawyer.
  • JasperJasper
    Oh, I forgot real estate transfer taxes.
  • JasperJasper
    Do your parents own their home free-and-clear? Do they have an assumable mortgage? Will you be borrowing a large amount from a financial institution, or will your parents "carry" the mortgage?
  • GoldieLockingsGoldieLockings
    Hello Jasper,

    My parents still owe an amount of the house. Not that much I don't think. I will not need to borrow any amount from any financial institution, I will buy the house from them at fair market value and pay in full. Will an attorney be able to finalize everything or do I need to involve others such as an escrow company?

    Thank you for your help.

    GL
  • JasperJasper
    An attorney should be able to answer your question about whether you need an escrow company. You might not need one. It is pretty easy to go into a bank to pay off a loan. (The bank will probably be happy to notarize the documents you need to file with the county, too.) It is also pretty easy to file documents with the county records office.

    If you (or your parents) feel more comfortable using an escrow service, I expect that it will be cheaper to use an escrow company for what the escrow company is good at, than to use a lawyer for those services. The last time I checked, good real estate lawyers ran $ 175 - $ 350 per hour, depending on how quickly they needed to respond to requests. Saving three hours of a lawyer's time can easily pay for what the escrow company does.

    The biggest gotcha with escrow services and loan payoffs is that most banks in the Seattle area do not understand the difference between a "cashier's check" and an "official check". A "cashier's check" is often needed in these transactions; a "wire transfer" will also do. An "official check" or an "ACH transfer" is often not acceptable.

    I also don't know if a title search would be of value to you. Most "title insurance" companies are really "title search" companies that back their research with a very large guarantee that they didn't miss something important in the records filed with the recorder's office. You can ask a title insurance company how much an "owner's title insurance policy" would cost for a property at your location, with the value your parents' property has. Most of the big title insurance companies with local offices have similar prices, in my experience.
  • JasperJasper
    The following comment on the blog talks about an attorney who offers services similar to what you might want:

    http://seattlebubble.com/blog/2017/05/09/sales-fall-off-cheap-king-county-neighborhoods/#comment-262625
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