Are you ready to buy?
This seems like a very simple question but a lot needs to be considered before buying. We normally call this process the discovery process. The discovery process should be made up of the following stages.
- Reality Check Stage
- Location and Activity Stage
- Touring Stage
- Offer and Closing Stage
The first stage is what I call the reality check stage. The reality check stage is made up of figuring out what you’re capable of buying, the costs involved, and your possible time frame. This can be determined by simply analyzing your current and future financial situation, years to retirement, the amount of credit that you can acquire the time frame when you actually see yourself moving or using your retirement or vacation home. As you can see the initial stage of the discovery is one that is not very romantic or fun but it is a stage that is highly recommended in order to make the best use of your time and obviously your agents time. This stage of the discovery process is very personal and you may want to talk to your financial advisor, banker or a lender in order to be as realistic about your purchase. We have established relationships with lenders and mortgage brokers in order to be able to help you through this process. In regards to the costs, it is important to mention the costs involved related to escrow, foreign ownership trust, and closing costs (approximately between 5 and 7% of the purchase price).
The next stage that we can explore once we determine budget, costs and time frame, is the location and activity stage. This stage is where we start to explore the activities or interests that you have and try to match them up with the appropriate geographical location that offers those activities and interests. There are many different locations in Puerto Vallarta proper as well as around the Bay of Banderas. We as real estate experts are well aware of what each area has to offer and start matching your activities and interests with those specific areas. You may want the vibrant downtown area, where walking is the norm and where there is an abundance of restaurants, galleries and boutiques, or you may want the calm and soothing south shore. There is a myriad of activities and interests that can be addressed and catered to in Puerto Vallarta and the Bay of Banderas, this stage is really about you and projecting what you see yourself doing in PV. After this stage we have now determined your lifestyle and location or locations that may fit that lifestyle.
This is when we get to the fun part, we start matching your budget lifestyle and location together to find the best fit. This is what I call the touring stage; we begin by looking at different profiles of property that we found interesting for you. We talk about furnished vs. non furnished, turnkey vs. fixer upper, high density condo vs. low density condo or stand alone home. Once we look through the profiles we pick the three or four properties that you liked the most and set up the tour for the following days making sure that the properties to be seen are ready and coordinated in order to make the process as smooth as possible. This is sometimes difficult to coordinate or to meet the itinerary simply because you may want to spend more time at one property tan another and there must be some flexibility on the part of the showing agent and a lot of communication by the buyer representing agent in order to make it a pleasant experience. If the properties on the tour did not please you, it is very important to review the properties and locations seen to start to further determine what you really want. So we look at other profiles and maybe even pother locations based on your findings and stay in the touring stage.
Once we determine the proper location and exact property we are ready to move to the offer / closing stage. The offer stage involves determining the price that we want to offer, which we help you determine based on our expertise and information network. This stage also involves determining dates for financing and closing, protective clauses for both buyer and seller and any contingencies that may be involved in the buying or closing process. Some common contingencies are; contingent on financing, on a thorough inspection, acquiring no liens certificates, property tax up to date and many others depending on the particularities of the property. The offer / closing stage is coordinated completely by our closing agent and broker who work hand in hand with the appropriate lawyers and notaries to make the closing process as smooth as possible and as closet o the time frame as possible. It is very important to understand that we as agents depend on the collaboration and coordination of many parties involved. Some of the people involved are lawyers, lenders, banks, fiduciaries, appraisers, inspectors, notaries, sellers, seller’s agents, public registry, condo administrators, electric company, telephone company, gas companies etc… As you can see there are many people involved in the closing process which makes it very hard to determine a specific or exact closing date, for that purpose we will need to have some flexibility and patience during the process which is basically noted and specified in the purchase sale agreement. I think that by following these steps and having honest and experienced representation your buying experience will be very fruitful and pleasant. In our seven years of experience we have used this process to assist buyers in their purchasing quest and have had many successes and many happy customers that are now enjoying their retirement or vacation home. I hope that this article is useful in helping you determine whether you are ready or not to purchase a property in Puerto Vallarta or surrounding Bay of Banderas area and if you are what you need to consider in order to make it a happy and stressless purchase.
What is an Escrow account?
The escrow account is a very common tool in the real estate industry which helps all the parties involved by having third party impartial professional custody of accounts (funds) in real estate transactions. This escrow account and the money held within is subject to the purchase sale agreement and its content as well as the escrow contract which both outline the terms of the transaction. The escrow account maintains transparency and commitment throughout the term of the contracts and allows for an even playing field. The escrow contract includes the escrow officer and the buyer and seller and is specifically used for transferring funds and property on a very secure and efficient level. The cost varies from firm to firm but ranges anywhere from $550 to $650 usd, a very small price to pay for security of funds and a solid deal. The escrow account in our opinion binds all the parties to a fruitful and transparent transaction where everyone involved has to meet their obligations to sell and purchase. At closing the two parties involved sign what is called a disbursement agreement where they both agree that the conditions have been met and that the funds will go to each party involved, seller, notaries, and agencies involved, disbursed on one sheet confirmed, validated and signed off by both parties.