The customary or usual way people buy and sell homes in California may be different from your home state or country.  Those moving to California from other states may notice differences in the way real estate transactions are handled, particularly with the use of escrows, and the absence of attorneys, and having to be present at final closing meetings. The customary procedures for the typical transaction are described below. Remember that no two homes, and therefore no two real estate transactions are exactly alike; any particular transaction may vary in the details.  

In California anyone who offers to buy, sell, or lease real property for compensation must be licensed. Real Estate Brokers and Salespersons are licensed by the State of California. Individuals who wish to become a real estate agent must first take certain specified courses, and pass an examination. Those licensed as Real Estate Salespersons may then sell real estate under the supervision of a Broker. To become a Real Estate Broker, an individual must take additional courses and pass a more rigorous examination. A Broker can either work independently, or can work for a firm managed by another Broker. Salespersons and Brokers are collectively referred to as real estate agents. Selecting your agent for either buying or selling is an important first step, and should not be taken lightly. You are the client, and you must be satisfied. The ideal agent is experienced, is knowledgeable about the locality in which you are interested, is ethical, and is a good negotiator. Susan Laxson has all those qualities and more.  Susan has been a California Licensed Real Estate Agent for 18 years in San Diego, is professional, knowledgeable, successful and is a skilled negotiator.  Susan would be honored to represent you whether buying or selling your San Diego property.

California requires that a real estate broker disclose in writing the duties which arise from certain agency relationships and then disclose the broker's status as agent of the seller, agent of the buyer, or agent of both the buyer and seller (dual agent). This requirement applies to the sale, exchange, or lease for more than a year of real property improved with one or four dwelling units, or the sale of a mobile home.   

BUYER´S AGENT

A selling agent can, with a Buyer´s consent, agree to act as agent for the Buyer only. In these situations, the agent is not the Seller´s agent, even if by agreement the agent may receive compensation for services rendered, either in full or in part from the Seller. An agent acting only for a Buyer has the following affirmative obligations:

To the Buyer:

(a) A fiduciary duty of utmost care, integrity, honesty, and loyalty in dealings with the Buyer.

To the Buyer and the Seller:

(a) Diligent exercise of reasonable skill and care in performance of the agent´s duties.

(b) A duty of honest and fair dealing and good faith.

(c) A duty to disclose all facts known to the agent materially affecting the value or desirability of the property that are not known to, or within the diligent attention and observation of, the parties. An agent is not obligated to reveal to either party any confidential information obtained from the other party which does not involve the affirmative duties set forth above.

Throughout your real property transaction you may receive more than one disclosure form, depending upon the number of agents assisting in the transaction. The law requires each agent with whom you have more than a casual relationship to present you with this disclosure form.

A potential buyer will describe to Susan their preferences as to location, type of home, price range, number of bedrooms and baths, and any special features their likes or dislikes. Susan uses her experience, plus the information on current listings provided by the MLS data base, to construct a list of prospective homes. Susan will then make appointments to see the homes which are of interest to the buyer, and personally accompany the buyer on the tour of these homes. As the process continues, the focus narrows, until a home is selected as the buyer's number one choice. At this point Susan will research the prices at which similar homes have sold in the neighborhood, as a guideline in setting the offer price. 

Susan will assist the buyer in preparing a written offer on a deposit receipt form. All the details of the offer are entered on the form, including the description of the property, the price offered, the amount of the deposit paid (usually 3% of the purchase price), financing terms, duration of the offer, rights of the buyer to inspect the property, which party will pay which fees, etc.

The buyer may offer less than the asking price. In addition, there may be other terms of the offer which are not acceptable to the seller. The seller will usually make a written "counter-offer," which says in effect, "I agree with your offer except as follows..."  The buyer can respond with a written "counter-counter-offer," and the offers can go back and forth until finally there is agreement, or until one of the parties will no longer respond.

The purpose of an escrow is to enable a buyer and seller to deal with each other without risk. Before title to the property can be transferred to the new buyer, the seller must be paid, the seller's old mortgage paid off, a new loan must be obtained by the buyer, and any other liens on the property must be paid off. All responsibility for handling funds and documents is delegated to the escrow holder, a neutral third party, which is usually a title insurance company or escrow company. Your title insurance officer can answer many of the frequently asked questions about title insurance and preliminary reports. In a simple transaction, the buyer delivers the agreed upon funds to the escrow holder. The buyer also instructs the escrow holder to deliver to the seller the stated sum only after all conditions have been met, and title is vested in the buyer. Concurrently, the seller deposits his deed and other documents with the escrow holder, authorizing their delivery when the buyer has deposited the agreed purchase price. The contracting parties deposit funds or documents with the escrow holder, for delivery to the respective parties upon performance of all conditions of the agreement. 

Most contracts provide that the buyer may, at their own expense, have the house inspected by professionals of their choice. Typical inspections include pest (termite) inspection, contractor inspection (includes electrical, plumbing, heating systems), roof inspection, swimming pool inspection, environmental and earthquake hazards, and geological/soil inspection. These inspections may reveal defects which were not evident to the buyer, and which were not disclosed in the seller's disclosure statement. Depending upon the terms of the Deposit Receipt, the buyer may request the seller to either fix the defect, or provide funds so that the buyer can correct the defect after close of escrow.   Susan accompanies the physical/contractor inspectors to the home and encourages her buyers to be there also.

In California the title of the property is searched by a title company and a preliminary report is issued on the condition of the title, for the buyer's approval. The report would include such information as present ownership, legal description of the property, any existing liens or unpaid taxes, any easements, and other covenants, conditions, or restrictions. A policy of title insurance will usually be issued at close of escrow. A title insurance policy insures the buyer's interest in their purchase, and the priority and validity of any loan. It is a contract to indemnify against loss through defects in the title.  

The buyer is responsible for applying for their loan. When the buyer's loan is approved and documents are ready for signature, the lender delivers the documents to the escrow holder, usually a week or more before the closing date. The buyer signs all loan documents ahead of the closing date, and the seller signs the deed a few days before closing. One or two days before closing the buyer delivers the remainder of the down payment to the escrow holder. To avoid delaying the closing, the buyer should transfer their down payment funds to a local bank well ahead of close of escrow.

After both the buyer and seller have complied with all agreed-upon terms, the escrow is "closed," and the deed is recorded with the County Recorder. The escrow company notifies the real estate agents that the title is recorded and on that day the property belongs to the buyer. There is no need for a final meeting of the parties and their attorneys, since all documents had been signed prior to the close of escrow, and had been delivered to the escrow holder. Sometimes the seller needs to remain in the property after the close of escrow; this holding over is handled by a separate agreement between buyer and seller. After the close of escrow the parties will be given a final settlement statement, showing the charges (costs of the loan, escrow, title etc.) and credits (tax prorations, loans etc.) for each party. 

Upon confirmation that the Grant Deed has recorded and the funds transferred, Susan will arrange for the keys to be delivered to you for your move in.  Please call Susan Laxson for information on making your move the easiest and most enjoyable of your lifetime.
 
Now is the time to enjoy your dream home in Carmel Valley - San Diego, California! 

The above description covers the customary steps in buying and selling a home in San Diego, California and buyers and sellers are reminded that each real estate transaction has its own unique characteristics.  The information in this web site is provided for educational purposes only and while the above material is summarized from sources deemed reliable, it is not guaranteed to apply to all transactions, as other conditions may apply.  Buyers and sellers who have legal or tax questions are urged to obtain advice from their attorney or tax professional.