Home Buyer FAQ

Have questions about buying a house in Portland, Oregon or surrounding areas? You’ve come to the right place.

What is my first step?

Talk with a bank, credit union, or mortgage broker to find out exactly what your budget for buying a house is, and secure lending. Nothing is more frustrating than finding the perfect home only to find out it is outside your price range. Get the financing taken care of first. When we go to make an offer on a house, we want to include a pre-approval letter to ensure the offer is taken seriously. A pre-approval letter shows the owner of the house that if they accept your offer you have the ability to buy it and have already taken steps to make the process quicker and easier. If you are interested in some recommendations for gaining financing we are happy to help you with an introduction to some of our partners.

What is my second step

Make sure everyone is on the same page. Take some time to think and talk about your individual priorities and then rank them. Is location the most important to reduce your commute? Do you have particular school district that you want to be in? Do you want a big yard for a dog or garden? Maybe you prefer to have as little maintenance as possible. What about the daily use of your house? Do you need a quite place for a home office? A large kitchen or dinning room for entertaining? Once everyone has made their list of priorities have a conversation where you compare and contrast what people care about most and how they envision using your new home. During this process some compromises might need to be made. If you have to pick between a 3 car garage and soaker tub which one is more important? What are you willing to be flexible on and what is your absolutely most important? This process will save you hours of looking at the wrong homes and many potential arguments or hurt feelings down the road.

What does writing an offer entail?

A lot of the strategy for writing an offer is dictated by the market. If it is a sellers market (more buyers are competing for scarce homes) then the room for negotiation might be limited or non existent. Often times in a sellers market there can be a multiple offer situations. This means multiple buyers will put in offers at the same time and the seller will be able to choose the best one of the bunch. If enough people are putting in offers you can become part of what is called a bidding war. Lets look at an example, say a home is listed for $200,000 and three buyers all write offers. One offers under the asking price for $195k, another offers the asking of $200k, while the third offers $210k. You can understand that the buyers who offered the most at $210k are most likely going to have their offer accepted and move into contract. In a sellers market you might need to offer more than the listed asking price. In the heat of the moment you might be tempted to offer more than you are comfortable with and end up with buyers remorse. To avoid this I recommend having a limit set beforehand and a price point at which you feel good at walking away from the deal.

What is earnest money?

Earnest money is a good faith down payment on the house that you put into escrow (kept in trust by a third party) when an offer is accepted. Once a seller accepts your offer they will take their property off the market and this money shows that you are “earnest” or serious in your desire to buy their property. At closing this money will be applied to the purchase of the home.

How long before I know if my offer is accepted?

Typically the sellers will be given 12-72 hours to either accept, reject, or counter your offer.

What is a counter offer?

A counter offer is basically a new offer presented by the seller that keeps part of the original offer but changes other aspects. Price is the most common reason for a counter offer but not the only one. Lets say for example that you offered $190,000 on a house that is listed for $200,000.  The seller responds with a counter offer of $195,000. You now have the option to either accept, reject, or counter their offer with a new proposal.

What is an inspection period after an offer is accepted?

An inspection period is typically 10 business days and provides the buyer time to do “due diligence.” This means you have 10 days to bring in professionals to inspect the home and become aware of any problems or repairs that might need to be taken care of. We recommend for a typical home in Portland setting aside $1,000 for inspections and considering the following four professional services.

1. Whole home inspection- $400-600 depending on the square footage. This is a generalist who is going to look from the foundation to the rafters for problems like; mold, broken appliances, a leaking roof or windows, cracks in the foundation, defects in the siding, plumbing, and electrical. They will point out problems for a specialist to take a look at or repairs you should plan for down the road.

2. Sewer scope- $125. This is money well spent. You want to make sure that your sewer pipes are properly installed, the right size, free of clogs, and that no tree roots have broken through. Overlooking this minor detail could end up as an expensive and unpleasant mess in your future.

3. Radon testing- $125. According to the City of Portland, “In Portland, the greatest source of radon exposure is from naturally occurring radon gas that enters homes and buildings through the foundation. Customers are encouraged to test their home for radon. The EPA, Surgeon General, and the Oregon Health Authority all recommend testing your home for radon gas.” If your home is sitting on a concentration of radon these experts will let you know and provide solutions for remediation.

4. Underground oil tank search- $125. Many of Portland’s older homes were once heated with oil. Even if these tanks are no longer in use, they can be underground and still holding oil. If they are not properly decommissioned then you could be responsible, as the new owner, for any environmental damage and remediation expenses from a tank that leaks oil into the soil or ground water. These professionals will find them and make sure they have been properly decommissioned to protect you from this liability.

If any major problems are found during the inspection period it gives the buyer a chance to gain quotes for repairs and an opportunity for negotiation with the seller to have them address the issues or lower the final price of the home as compensation.

How long before I get the keys?

A typical home transaction take 4-5 weeks to complete.

Weeks 1-2, 10 business days for inspections and time for any subsequent negotiations.

Weeks 2-3, The appraisal process for your lender and addressing any issues they might have.

Weeks 4-5, Final loan documentation, closing date, sign papers, then you get your keys.

How much can I expect to pay in closing costs?

Closing costs are an assortment of fees charged by professionals who help in the home buying process. You can expect to pay 2-5% of the purchase price in closing costs. These funds will go to the lender for the loan origination, the title company for recording the transfer of the deed, and prepaid taxes and insurance that will be held for you in an escrow account.

How much does it cost to work with a Realtor?

To work with a buyers agent typically doesn’t cost you any money at all. The selling agent has worked out a fee structure with the seller beforehand, this is usually between 4-6% of the selling price of the home. Within that percentage typically 2.5% is set aside for the buyers agent.

Why should I work with a Realtor?

With tools like Zillow the traditional role of a real estate agent as gatekeeper to the listings has disappeared, however that does not mean there is no longer a role for Realtors. With a buyers agent representing you, you gain a professional ally with a legal responsibility to act in your best interest. When we work with buyers we bring years of experience negotiating contracts. We have a long list of other specialists whom we have vetted to solve any problem related to home ownership. We save you time by organizing and granting access to homes quickly, as they come on the market, so you can be first in line. We help you navigate the tricky due diligence period and handle negations for repairs saving you money and unwanted surprises. The best part is working with us won’t cost you a dime.

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Contact Info

+1 (503) 360-3076

patrick@swiftnw.com