Buying a Home

The best way to start the home buying process is to take a realistic look at what you can expect from home ownership. There is increased responsibilities that come with home ownership as well as many benefits. A survey conducted by the National Association of Realtors listed pride and satisfaction as top home buying reasons, as well as the following: dislike of paying rent, ability to control and modify a home’s features, good investment, long-term appreciation, leveraged investment, source of savings, tax benefits, and others. Another consideration is the stability of the housing costs. Your 30-year fixed mortgage is set—who knows where rental rates will be?

When you are ready to buy a home, the first step is to get pre-qualified for a loan. You should seek a lender that not only offers competitive rates, but also offers a high level of service. Ask our Kauai realtors or your friends and associates for recommendations and use our Kauai mortgage calculator on any property listing page. Our Kauai real estate agents’ experiences in working closely with lenders during transactions enable them to effectively assist you in the buying process. Once you decide on a lender, find out how much they are willing to lend you and/or how much you would like to borrow. That amount, with the money you are willing to invest, will determine your budget. Besides the down payment for the home, other costs you will incur include:

• The loan application fee, which covers the appraisal and credit report
• The loan origination fee
• The loan points, which is typically around 2% of the loan amount
• The state mortgage recording fee
• The title insurance
• The first year prepaid homeowner’s insurance
• Prepaid Private Mortgage Insurance (PMI), if applicable
• Inspection fee, if applicable
• Interest from the date of closing till the end of the month
• Loan impound account funding for property tax and insurance
• Escrow fees

Your Kauai Realty realtor and lender can work with you to determine these figures and inform you of other possible charges and credits.

Once your budget is determined, it’s time to find a Kauai realtor. This is perhaps the most important step in finding the right house and having a smooth transaction. There are quite a few choices and this can be confusing. Remember, this is one of the largest investments you’ll make in your life, so it’s very important that you choose someone who is knowledgeable and you feel comfortable working with.

Kauai Realty’s award-winning, friendly agents are among the most trusted, respected and connected Kauai professionals, with unsurpassed knowledge in all real estate sectors, Hawai`i land use laws, regulatory and permitting processes, financing, and island life so we can ensure fast transactions and sound investments. We would love to help you find your dream home. Contact a Kauai Realty agent today for an initial consultation.

By the time you negotiate the purchase of your home, you should have a clear idea of the real estate financing you need or want. If not, it is now time to visit your lender.

Your initial consultation will begin with a discussion of your Kauai real estate needs. Our Kauai real estate agents will help you identify your preferences regarding price range, number of bedrooms, approximate square footage, location, and other items you desire in your new home. You’ll be asked to list your “must haves” and your “want to haves,” and based on your criteria, our Kauai real estate agents will search the island to identify available Kauai properties that meet your needs. Another resource to search for your perfect home is our online property search, which accesses the Kauai MLS (Multiple Listings Service). Our Kauai realtors will work with you to find, pre-screen and schedule visits to potential homes. Thereafter, you may decide which home is right for you.

Congratulations! You have found your dream home and are ready to make a purchase. Your Kauai Realty agent will prepare a comparable market analysis, which shows the homes that are currently for sale (the competition), homes that are currently being purchased (in escrow), and the most recent sales, to help you to determine a reasonable offer.

In addition to the price, there are a variety of terms to be addressed in structuring your transaction to best suit your interests, including developing provisions to allow for certain financing, incorporating any necessary contingencies, and setting reasonable time frames. We will guide you through this process.

These are the funds that you submit with the offer to let the Seller know you are negotiating in good faith. If a deal is successfully negotiated, this is deposited to the escrow account on your behalf.

A thorough inspection of the property is a key element in determining the condition of property that you are buying. This is generally done after you reach an agreement with the Seller. If any major issues with the structure or components of the structure are uncovered, they should be addressed early on in the process. Your Kauai Realty agent can provide you with suggestions on your options available in dealing with such issues.

Now that you have successfully negotiated the purchase of your home, an escrow account is opened to coordinate the processing of documentation needed to complete your purchase. Your Kauai Realty agent will have the Escrow Company provide a Title Report, which will show not only the ownership interest being conveyed, but also any encumbrances affecting the property. Our extensive experience in working with various escrow companies ensures your transaction will move along as timely and smoothly as possible.

Most lenders will require you to purchase homeowner’s insurance coverage for fire or storm damages, which protects you and the lender from loss in the event that the home experiences an unfortunate incident. Your Kauai Realty agent can point out property features that may result in lower insurance premiums.

In Hawaii, termites are an issue. Usually, lenders require a Termite Inspection Report showing the property to be without any live infestation before they will fund the mortgage loan. There are provisions in the standard purchase contract used by realtors addressing termite issues.

Most Kauai real estate buyers wish to have the property’s boundaries marked to verify their purchase. There are basically two levels of service available, staking or surveying. In staking, the survey crew will locate existing pins and verify their location or put in new pins if there is a discrepancy or if the pins cannot be located. In a survey, typically a boundary survey, the same verification or location of the pins is performed and any improvements near the boundaries are sketched on a plot plan to determine if there are any potential encroachments over boundary lines.

An opportunity for a final inspection of the property is provided to the Kauai real estate Buyer prior to closing to satisfy any concerns over the property’s condition and continued maintenance since the time the offer to purchase was made.

Once all the funds have been submitted and the paper work completed, the conveyance documents are sent to the State of Hawaii Bureau of Conveyance for recording. Thereafter, you officially become the property’s new owner.