Home Buyer Tips For Purchasing A Home 

 

Purchasing for home of the first time or even second can be exhausting. Many home buyers do not have the experience, time or legal knowledge to purchase a home on their own. Home buyers benefit greatly from services of Realtors when purchasing a home. Below are some great articles to help you get familiar with what is need.

Are You Ready For Home Ownership?

 

Owning a home may be your dream, but in order for the purchase to be the happy and satisfying experience it was meant to be, you need to ensure that you are financially and mentally prepared for the responsibilities that come with it.

Some people have a notion that home ownership is like renting, but with the power to have pets and paint the walls whatever color you like. However, while these privileges are available to homeowners in most municipalities, they come with the responsibilities of a mortgage, taxes and home maintenance. Preparing for home ownership requires you to take critical stock of your finances and your expectations.

Search now for homes in the area.

 

Questions for Prospective Homeowners:

 

Are you ready to buy?
Owning your own home is about more than just being able to decorate any way you like; it’s about being prepared to maintain your home over the years, realizing that part of your income and time will go towards repairs and maintenance. It’s about being willing to take the risks of home ownership with a realistic expectation of the rewards.

 

How much can you afford?
It can be discouraging to find that your salary won’t stretch as far as the home you want to own. However, sacrificing a huge part of your income just to pay the mortgage can very quickly make home ownership a burden rather than a point of pride. It’s better to buy a modest home now and look at purchasing your “dream home” in a few years.

 

What is your debt-to-income ratio?
This is something that lenders take very seriously. Your overall debt should not be more than 40% of your income, and your housing debt should not be more than 32%. What 32% of your income will buy depends on where you want to live. In rural or downtrodden areas for example, it can buy a very comfortable residence and ample acreage. In highly sought-after urban areas however, it may not even buy a 400 square foot bachelor suite.

 

What do you want?
Do you like the idea of cleaning your own gutters? Do you shudder at the thought of lawn care? Would you rather just pay a fee every month and have everything done for you? Would obeying rules about when you can have your garbage cans out bother you, or do you want to live in a neighborhood where everything is ‘just so’? The answers to these questions can help you narrow down the search for the right type of property for you.

 

We Can Help!!

You need a good agent who will work hard for you. We are dedicated to helping you find the right home, at the best price. We want you to find the home that will make you happy and successful in real estate ownership.

When you hire us to help you buy your first home, we want to know what you want and how much you can afford. Then we’ll find a way to merge these two priorities and find a residence that you’ll enjoy owning.

Keep your objectives in mind when visiting a home. Sometimes the idea of owning a home can overwhelm your practical sense, so keep your feelings in check. Keep a list handy of the features that you need and want in a home, and judge each home by the list instead of by details that could distract you from your goal. When you’re alone with your agent, you can go over the pros and cons of each home. We can help you stay on track while still keeping our eyes out for a great property.

Engage the services of a good real estate lawyer. We can recommend several lawyers in the area who might be a good fit for you. Interview them to ensure that you get someone you can work with. The legalities of transferring land ownership can be dodgy, and a lawyer can be your best defense against future legal troubles. A good lawyer can charge several hundred to over a thousand dollars for their services, but the thousands of dollars saved in legal fees later on makes this a good expense.

Make the offer. This can be a maze of “buyer”, “seller”, “chattels”, “deposit”, and “completion”. We’ll be happy to prepare the paperwork and go through it with you before submitting it. Remember, the seller may reject or counter your offer, so even at this late date, avoid setting your heart on the home you hope to own. You’ll probably have to write a deposit check to the seller’s broker that proves the seriousness of your offer.

Get all necessary inspections done. A home inspector will check for signs of harmful materials like asbestos, lead paint and mold. They’ll also check for evidence of pests, faulty wiring and leaks. This is a crucial part of the home purchase. Not getting an inspection done means that you could be stuck in a home with a bad case of black mold and no recourse other than to pay for its removal. Inspections will cost a few hundred dollars, but again, this is more than worth it in the end. There are several inspectors in the area that we’d be happy to recommend.

Do a final walkthrough before closing the deal. We’d be happy to do this with you to make sure that everything agreed upon is completed prior to the final signing.

From the first interview that determines your requirements to the moment that you receive the keys, I can help you with the complicated process of buying a home. Don’t hesitate to contact me to find out more about how I can make the home buying process easier!

Contact us for more information about first time home purchasing.

10 Things To Know Before You Buy A Bank Foreclosure

 

1.) In order to make an offer on a Bank Owned Property, you must have the following ready:

•Pre-approval letter stating that the income, assets, and employment have been verified.

•Proof Of Funds (statement showing account balance)

•Cleared Deposit check of at least $1,000 or sometimes up to 3% of the purchase price (fully refundable prior to end of review period)

•Fully Signed and completed Contract for Purchase and Sale with no financing contingency (cash offer)

 

2.) Can I use my own title company?

Typically, the bank will require you to use their title company to do the closing. They have already researched the chain of title, and are familiar with the bank regulations, however, they will pay for the title insurance which saves you approx .5% of the purchase price.

 

3.) What if my lender cannot close on time?

You may be charged late fees for any extensions. This is why it is imperative that you are pre-approved.

 

4.) How did the Bank arrive at the asking price and is it a good deal?

The Bank will consult with their real estate agent and set the price at full market value. The list price has nothing to do with the price the bank will accept. We will research prior mortgages on the property so that you can estimate the minimum the bank might be willing to accept.

 

5.) If there are multiple offers, how can our offer stand out?

Having a larger deposit, waiving the financing contingency and showing proof of funds will get the Bank to want to work with you, even if your offer is less.

 

6.) Choose the right experience real estate agent

Make sure that the agent you choose to work with is

•experienced in working with banks,

•represents you as a single agent,

•knows how to structure deals to make sure you areprotected,

•has purchased foreclosures themselves.

 

7.) What if the property needs work?

The Bank WILL NOT make any repairs. They sell the property AS-IS. For this reason you have a review period to make sure the property is suitable. Some are perfect condition, some are terrible condition. Either way, you should do a home inspection after your offer is accepted.

 

8.) Can’t I see the property before making an offer? (This pertains to investment properties when flipping homes only)

It is recommended that you make the offer first in order to see if you even have a chance of getting a good deal. If the Bank responds and states that they will not sell less than market value, then there in no point seeing it. You will save countless hours of driving around looking at properties that you do not have a chance of getting for a bargain.

By making the offer first, you see if it is worth even seeing. If the Bank accepts your low offer, then you know that it is worth seeing, and you still have time to cancel for any reason if you feel it needs to much work or is not suitable (Inspection Period).

 

9.) What if I don’t like the property?

You typically have 7 days to review the property, perform any inspections necessary and decide if you like the property. Your deposit is fully refundable within the review period.

 

10.) How much will the bank take?

Typically the bank looks for a price that is within 5% of the asking price. If the bank is asking $350,000, and you offer $280,000, it is almost certain that the bank will reject your offer or give you a counter close to list price. The rule of thumb is that if the bank would accept $280,000, then they would ask close to $280,000. If they don’t get their price, then they will lower it every few weeks until they get close to list price.

Getting A Home Mortgage

 

There are a number of steps to the loan process. The more you know about it, the more you’ll understand everything that is required. Then you can be prepared, so the process goes as smoothly as possible. Knowledge is power, and can help you feel like you have some control of everything that’s taking place.

 

1. Make Sure You Have All Your Documents Organized

When you’re applying for a mortgage, the lender will need a lot of documentation to ensure you can repay your loan. That can include proof that you’re employed, your tax returns, paystubs, your credit history, bank statements, child support and alimony statements, and other verifiable information as to how much money you make and how consistent your income is. The level of debt you have and whether your credit report shows that you repay your obligations is also important.

 

2. Then It’s Time to Qualify

You have two options when you first try to establish what you can borrow. You can pre-qualify, or you can be pre-approved. Pre-qualification is a quick process that only takes your basic information and generates information on the price of the home you may be able to purchase. Pre-approval takes longer, but it gives you a lot of leverage. It shows that you can buy the home, and you’ll also know what your true price range is. That keeps you from wasting time looking at something you really can’t afford. Closing can take place faster and easier when you have pre-approval, making the entire process less stressful.

 

3. You Need the Right Loan for Your Needs

There are a number of things you’ll need to consider when you’re looking for the best loan for your needs. How long you plan to keep it is one of the things you should look at, along with the rates, origination fees, closing costs, points, and other factors that can vary from lender to lender. The process is often tedious and it can be time-consuming and difficult. With a qualified loan officer working with you and your Realtor, though, you can make the right decision.

 

4. Get Approval for Your Loan

To get a loan approval, the loan officer will review your application and verify things like your employment history, credit history, assets, and property value. To improve your approval chances, provide any requested documents in a timely manner, and don’t make major purchases until the loan closes. Find out when the closing date and time is, and make sure you can be there for it.

 

5. Your Loan Closing

After loan approval, you can go to closing. The final loan documents will be signed at that time, and you generally do that in front of a notary at a title company. Before you sign, make sure the amount of the loan is correct, along with the interest rate and any other terms. Your name and address should also be correct, and it’s important to catch any mistakes before you sign. You’ll need a cashier’s check for your closing costs and down payment; so don’t forget to bring that with you in order to have a smooth transaction.

How to Buy an Investment Property

 

If you have decided that buying a rental property will help you improve your financial future, then you have already considered the pros and cons of becoming a landlord. But are you adequately prepared to purchase your first investment property? Do you know what to look for in an investment property? And do you know what features make an investment property as profitable as possible? If not, don’t be alarmed. Many first-time investors find themselves asking the very same questions. Fortunately, with a little thought and a lot of research, you can make a good decision and find the perfect investment opportunity. Being prepared is your best asset when it comes to purchasing any investment property.

 

How Long Will You Own the Property?

One of the first things you need to think about is how long you intend to hold onto the property. Many investors plan to keep a property for only a few years, while others intend to pass the property on to their heirs. Your expected timeline will most likely fall somewhere in between. The length of time that you own a property will determine how much you will eventually pay in taxes, insurance, and maintenance, as well as mortgage payments that continue until the loan is paid in full.

Deciding how long you will hold onto an investment property will help you decide whether or not you will make updates and upgrades, or simply maintain it. If you purchase an investment property that you plan to keep for only seven years, chances are that you will still owe on the mortgage at the time of sale. The value may appreciate slightly over those seven years, leaving you with some measurable profit once the loan is settled. If you make updates in an amount equal to that expected profit, then you are simply breaking even on the property. On the other hand, if you plan to keep the property for twenty years with a fifteen-year mortgage, the value will most likely appreciate significantly and the loan will be paid in full before the sale. In this case, the cost of updates and upgrades will be less than your eventual resale profit, leaving you with a positive cash flow at the time of the sale.

For this reason, many first-time investors purchase a property with the intention of long-term ownership. The benefit of added income far outweighs the benefit of a small profit for someone who owns just one investment property. This is a good way to start preparing to purchase other investment properties.

 

Who’s Who in Real Estate?

When you want to become a real estate investor, get involved in the community to become acquainted with other local investors. This is important for several reasons. First and foremost, by getting involved in the community and becoming friendly with other local investment property owners, you will have a good chance of getting help and advice when you need it. Also, investors will offer you their referrals for specific realtors, agents, brokers, lenders, contractors, and maintenance providers. Anyone who would like to become a real estate investor can benefit from this sense of community and the networking that evolves over time.

 

Are You Financially Prepared?

Whenever you are planning to purchase property, you need to be prepared financially for the upfront costs, monthly mortgage payments, and all other expenses. Part of that preparation is having access to liquid assets. But, more importantly, you need to ensure that your credit report and credit score show lenders that you are financially stable and responsible. Commercial loans, used to purchase large investment properties, have much stricter lender requirements than do loans used to purchase single-family homes or small investment properties. Therefore, you need to know exactly what type of financing you need to purchase the property that you are considering, as well as the lender’s requirements for that type of loan. One advantage of purchasing an investment property is the rental income that will be generated. Lenders generally calculate 75% of the potential rental income as a part of your income.

 

Being financially prepared to buy an investment property also means knowing how to handle your accounting and tax reporting. Sometimes it is easier to hire an accountant to maintain your records, but many first-time investors prefer to save money by handling the bookkeeping on their own. Either way, a class or a book on real estate management will be helpful, because you will need to learn about tax-deductible expenses, allowable costs, and more.

 

Are You Familiar with the Local Rental Property Market?

To avoid paying too much for your investment property, you must have a clear idea about the real estate market in which you want to buy. You need to determine whether a specific property will draw enough rental income to at least break even each month, and preferably generate a profit from the first day of ownership. Real estate investors often explain that they generate their profit through the purchase of a property and not so much from the sale. This is a common statement among investors, because investment property does not appreciate on the same timeframe as do single family homes. In addition, many more things can go wrong with investment properties. The risk is significant. Therefore, knowing the area well is critical to ensuring that you are buying a property with the right price for the amount of income you intend to generate.

For example, a low-priced investment property in a dangerous and inaccessible area may seem like a bargain, but if you cannot get tenants to move in, the profit margin will be minimal or even nonexistent.

Talk to other local investors and work with a realtor who is familiar with investment properties in your area. Become intimately familiar with the local rental market before determining whether a property meets your needs.

 

Conclusion

By doing your research ahead of time and making sure that you are financially able to manage an investment property successfully, you are paving the way to your future financial success. There is no reason that a well prepared buyer cannot become a successful real estate investor. Pay close attention to each of the items mentioned above and answer the questions honestly. Then you can determine whether or not purchasing an investment property is the right move for you at this point in your life.

How to Find Your Next Home

 

Whether you are a first-time homebuyer or a seasoned expert, buying a home is a huge commitment in terms of time and money. But, much more than that, the process of finding a home that perfectly fits your lifestyle should be fun.

Realtors know that buyers who get excited while looking for a home are more successful at finding the right home for their lifestyle and tend to enjoy the process almost as much as the realtors do.

Simplify the process of finding your next home by heeding these tips that will help you better enjoy the process of looking for a home and worry less about the nagging details that can derail the entire process.

 

Before You Start Looking…

Sometimes potential buyers will decide that it is time to buy a new home when they drive past a for-sale sign in the lawn of a sparkling home in their neighborhood. Perhaps this is the home of their dreams, but more likely it just makes them long for a change.

If and when this happens to you, take some time to consider what exactly you would include in your dream home if your choices and financial resources were unlimited. Once you have put together this dream list, scratch off the items that you know are unrealistic. Then make another list from the items that remain, grouping them into must-haves, would-likes and things it would be okay to have included.

Realtors’ experience shows that when such a list is created before beginning the actual home search, buyers do not have the opportunity to become enamored with a specific home that might not have everything that they are truly seeking.

 

Got Cash?

Unless you can answer with a loud, confident “yes,” you need to research mortgage lenders, programs and interest rates well before beginning your home search. Buyers who have determined ahead of time how much they are willing to spend, and how much they can borrow, are the most successful homebuyers.

Once you know how much money you can comfortably afford to put toward your mortgage payment each month, contact a lender to discuss the process of obtaining a pre-approval and loan commitment statement.

Once you complete the application process and receive your pre-approval, ask the lender to make a loan commitment that will lock in your interest rate (usually as long as you purchase within 90 days) and provide proof of funding to a potential seller.

 

 

Share the Wealth…

…the wealth of information, that is. By sharing your prioritized dream list with your realtor, you gain gaining access to all of his or her resources for matching you with potential homes. Your realtor will be able to research many homes through a variety of different methods with the goal of finding one that suits your lifestyle perfectly.

 

Jump on the Highways…

Yes, highways – and streets, roads, lanes, avenues, and boulevards, too! You should drive through the area in which you would like to move in order to scope out potential homes for sale. Getting a feel for the location, neighborhood, proximity to schools, and other factors will help you see first-hand what living in the area would mean to you.

And speaking of highways, now you can hop onto the information superhighway! The internet is a fantastic tool that can help you find homes that meet your requirements from the comfort of your own home office. You can access thousands of websites that list homes for sale, and you can also learn more about the area to which you plan to relocate.

 

Be Realistic…

With housing costs are on the rise, some buyers choose to purchase homes in areas with appreciating property values in the hopes that within a few years they will be able to sell their home and generate a profit.

Realtors know that in most cases you will be unable to profit from your home significantly unless you are willing to make investments in it. If you are purchasing a fixer-upper with the intention of making necessary repairs and upgrades and then selling the home for a much higher price, then you may indeed be able to make a profit. However, if you do not intend to invest the necessary time and money in upgrading or renovating your new home, you should not expect a significant short-term increase in its value.

If you want to purchase a larger home than you might otherwise be able to afford through traditional lending, consider using a balloon or interest-only mortgage, but be aware that this is a risky proposition for buyers who are not prepared to make long-term sacrifices in order to satisfy their loan requirements. Some buyers opt for this alternative financing in order to afford a home that is really beyond their grasp. If this sounds like you, proceed with caution. Your realtor should provide the same advice. Even though your realtor earns income through commissions based on homes’ selling prices, it is his or her responsibility to look out for the client’s best interests. You are no exception!

 

Consider the Value of Contingencies…

When you are looking at homes that are attractive to you, realize that several other buyers may also be very interested in making an offer. Therefore, you need to know ahead of time what you are willing to give up in terms of contractual agreements and obligations in order to make your offer as attractive as possible to the seller.

Your realtor can ask the listing agent whether the seller has obtained a pre-sale home inspection. If so, then you and your realtor can evaluate the legitimacy of the inspection report by researching the home inspector. If the inspection seems accurate and the inspector is properly certified, then you might opt to waive the right to a home inspection. You might also agree to allow the seller to remain in the home rent-free for a specific period of time after the closing. This is particularly useful when the seller is building a home or the closing is pending on his or her next home.

If you would like additional information about ways to improve your offer’s attractiveness to the seller, your realtor should be more than happy to share his or her knowledge and expertise with you. Call to schedule a time to chat before you are ready to make an offer.

Good realtors pride themselves on being able to assist people like you in the process of buying and selling their home. Years of experience have allowed them to understand what sells buyers on homes, and sellers on buyers. Working together, your combined efforts should be enough to get you into the home of your dreams.

Most importantly, remember that the process of looking for your next home should be a fun and exciting time! Being pre-approved for your mortgage and knowing exactly what you are looking for in a home make the process much smoother once you actually begin viewing homes. Have fun and always remember that you can contact your realtor with any questions or concerns that you might have related to any of the information presented in this article.

Area Moving Checklist

 

Moving can be a very stressful event, but there are ways to make it less painful. One of those is to have the right moving checklist, so you don’t forget to do something important and so you can make sure that you’re doing everything you can to address any problems that could come up. We want to help, and we’ve compiled a moving checklist below that you can use in order to help make your move a little bit easier.

 

Before the Move

Before you make your move, notify: the post office, your credit card providers, any charge account providers you have, utility companies, your past employer (so you can get your tax documents), subscription services, and your family and friends of your change in address. Once you’ve done that, it’s time to:

  • Change your bank account to one that’s closer to your new home, if you don’t have a branch of your current back there.
  • Make sure you let your insurance company know, so your coverage can follow you and you won’t be putting yourself at risk.
  • Get an legal or school records and other important documents from your current area before you head out to the new one.
  • Transfer your prescriptions, line up a doctor and dentist through referrals, and get your medical history and records to take with you.
  • Use up the perishable food you have, so you can clean out your refrigerator and defrost your freezer properly.
  • If you have large rugs and/or appliances that are going with you, get them ready for moving.
  • Have your utilities disconnected and get any refunds for deposits you’ve made.
  • Remove your children from school and get them registered in the new one.
  • Get a relocation package from the Chamber of Commerce in your new city, or from your Realtor.
The Day of the Move
  • Double check to make sure you didn’t leave anything behind.
  • Give your children games and books so they can stay entertained while you’re traveling.
  • Make sure your pets are ready to go, especially if they need to be crated.
  • Keep your important documents and your jewelry on your person, not in a box or suitcase somewhere.
  • Leave your keys with your Realtor, for the next owner or tenant.
When You Get to the New Place
  • Get your utilities started.
  • Register your car and change your driver’s license.
  • Get your children registered for school if that hasn’t already been done.
  • Set up any needed appointments with doctors and dentists.
  • Enjoy your new neighborhood and explore all it has to offer!

 

 

Following a checklist can really help you get through the difficult times that moving can produce. The more prepared you are for the move, the better off you’ll be when it comes to getting everything transferred from one place to another. Whether you’re moving down the block or across the country, being ready for the move is the best way to get through it. Once you get settled into your new place and the move is behind you, you’ll feel a lot happier.