Monthly Archives: May 2016

May 28

4 Things Buyers Should Look For.

By Antoinette Johnson | Uncategorized

As a Buyer you should always try and learn as much as you can about the potential property you are buying. Here is a simple list of 4 things that you should not forget to look for.

Home sellers sign a disclosure document that they’re being upfront about any problems with the home.

“However, it can be very tempting for some to tell white lies or conveniently forgets facts,” says Wendy Flynn, owner of Wendy Flynn Realty in College Station, Texas. “In fact, a very large number of real estate lawsuits stem from owners misrepresenting their property.”

Realtor.com® recently featured some of the most common cover-ups that real estate professionals say they and their clients eventually discover.

Water damage: Water stains could be signs of leaks. “Many sellers try to conceal water intrusion in the basement, for example, with a pile of cardboard boxes or suitcases,” says Frank Baldassarre, owner of Ace Home Inspections on Staten Island, N.Y. If the home has obvious red flags – such as an odd odor or visible wall cracks – you may want to request removing a large picture frame to take a look at what may be behind it, Baladassarre says. Also, some home owners may try to use a fresh coat of paint to conceal water damage. As such, home owners may want to ask when the house was last painted. “If it was a year ago, they’re probably not trying to hide water stains,” says Baldassarre.

Bad foundation: Look for any jagged cracks in the wall. Zigzag cracks may signal a foundation problem, says Flynn. A bad foundation also could prevent cabinets and doors from closing properly.

Neighbor nuisances: “Home owners have an obligation to disclose what are called ‘neighborhood nuisances,’ but if they don’t, buyers have to rely on their word,” says Carrie Benuska, a real estate professional at the John Aaroe Group in Pasadena, Calif. “I know people who have asked their neighbors to keep noisy dogs inside during showings or only open their homes during strategic times of the day.” Buyers will want to take a walk around the neighborhood at different times of day to assess the area for themselves.

Temperature changes: “If you walk into a room and there’s a subtle shift in the atmosphere—maybe the air feels dry or damp—ask the owner what the room feels like throughout the seasons,” says Benuska. “The culprit is usually poor insulation, sometimes as a result of the owner adding a second room or floor to the home.”

Source: “How to Spot the Top Problems Home Sellers Try to Hide,” realtor.com® (April 4, 2016)

May 21

Home Much Does Buying A Home Really Cost?

By Antoinette Johnson | Uncategorized

I always tell my buyer clients up front that there are a number of costs associated with Home Ownership that people should keep it mind when they are planning to buy a home. Potential Home buyers may take a look at their projected monthly mortgage payment and feel like it’s cheap — especially if they’re used to paying skyrocketing rental costs. But buyers need to be prepared that the budget for a home is much more than just a monthly mortgage payment.

 

I have made a list of these potential costs that you should definitely include in your budget before moving forward!

1. Property taxes: Property taxes average about 1 percent of the home’s value. It will vary considerably depending on location. For example, the median property tax in Alabama is $538, while in New Jersey, taxes are $7,335.

2. Insurance: The cost of homeowners insurance will depend on numerous factors, such as the size of the home and its age. Some lenders may require extra insurance, such as flood protection.

3. Maintenance and repairs: Home owners may want to budget an extra 1 percent of their home’s value per year for home maintenance projects.

4. Furniture: If they need to outfit a new home, home owners will want to budget for furniture.

5. Closing costs: Closing costs can range anywhere from 1 percent to 5 percent on the sale price of the home.

6. HOA fees: Some neighborhoods or condos require home owners to pay an HOA fee to cover the maintenance of common areas.

7. Mortgage insurance: When borrowers have less than a 20 percent down payment on a loan, lenders often require them to then buy mortgage insurance, which will be added to their monthly payment.

8. Landscaping and lawn care: Equipment and the cost to maintain a lawn or pay for landscaping services is another additional cost to figure in.

9. Pest control: Home owners may need to pay several hundred dollars per year for pest control.

10. Inspection and appraisal costs: A home inspection can be smart prior to closing to see if any hidden house problems lurk. The inspection may cost $500 or more, depending on the size and location of the home.

Source: “10 Hidden Costs of Homeownership,” The Motley Fool (April 3, 2016)

 

May 14

Buyer Cheat Sheet

By Antoinette Johnson | Uncategorized

Buyers! I have not forgotten about you and I have prepared an ultimate guide for you guys to get the house you want.  As usual one of my clients inspired me to write this post and I hope it helps you all out.

In a seller’s market, home buyers need to be willing and able to act fast to snag the home they want. This spring, areas across the country are facing a limited number of homes for sale. Realtor.com® offers up a cheat sheet for surviving a seller’s market.

  • Be on call. “If you’re only looking now and then when it’s convenient, you’re probably wasting your time,” says James Malmberg, a real estate professional in Sherman Oaks, Calif. He suggests treating house hunting like job hunting. If someone calls with a lead, follow up promptly to gauge whether it could be a good fit and don’t linger.
  • Bring the paperwork. To be taken seriously, buyers would be wise to get a mortgage pre-approval letter as well as a “proof of funds” form from their bank to show they have enough to cover a down payment. They’ll be able to act quicker when they do find the right house.
  • Limit the contingencies. In a seller’s market, buyers may need to drop some of the contingencies to score the house. Sellers prefer the fewest number of hurdles to closing as possible. If your buyers come in with several contingencies — such as “if” they secure financing — the sellers are more inclined to bypass their offer and take another with less hassle. Also, “don’t waste your time lowballing a seller,” advises Sean Kelley, a real estate professional with Howard Hannah in Pittsburgh, Pa. “Always put in an aggressive offer.”
  • Cast a wide net. Search for homes outside prime locations if faced with limited or high-priced choices. Buyers need to carefully consider what they’re willing to compromise on. “Sometimes properties sit, even in a seller’s market, because of a problem that is scaring other buyers away,” such as some renovation work that may need to be done, Malmberg says. Those “flaws,” however, might not be a big deal to your buyers. “Finding a house this way can also cut down on the amount of competition you will face,” Malmberg adds.

Source: “Surviving a Seller’s Market: The Ultimate Cheat Sheet,” realtor.com® (April 7, 2016)

May 06

Buying Guide: While You Have Debt

By Antoinette Johnson | Uncategorized

Thousands of people are graduating from college with student loan debt and are worried that they might not be able to buy a house.  I have some good news, this might not be the case!

With mortgage rates remaining near historic lows, many financial experts are making the case that student-loan debt doesn’t have to hold back millennials from buying a home. But the message isn’t getting across: Nearly 70 percent of millennials say they are delaying a real estate purchase because of their student debt load, according to a new survey by CommonBond.

Forbes.com recently highlighted whether a person with student-loan debt was ready to become a home owner with the following assessment:

  • Debt-to-income ratio isn’t everything. Yes, the proportion of your income that goes toward paying your debt is a central determinant of whether you’re ready to buy a home. Most lenders require a debt-to-income ratio of 36 percent or less to qualify for a mortgage. But a buyer with student-loan debt shouldn’t worry that their number will automatically disqualify them. The key is that they pay their bills on time and still have enough income left over to compensate for their debt.
  • You can still handle more debt. The best interest rates tend to go to those who can offer a 20 percent down payment, but loans are available that require as little as 3 percent down on a home. How much more debt can you take on? If you can handle your student-loan debt and a bit of a higher mortgage balance and still be comfortable, that’s one way to make it work. Or, if you can save up enough for a larger down payment while paying down student debt, that might be a better option. But potential home buyers need to take into account all the extra costs of home ownership beyond just the monthly mortgage payment. Check out: Help Buyers Add Up Extra Costs of Ownership
  • Make a budget. To save for the down payment, would-be buyers need a budget in place. Katie Brewer, a certified financial planner in Dallas, suggests budgeting with broad buckets: fixed expenses, variable expenses, and longer-term goals (e.g. paying down debt, buying a home, or saving for retirement). Brewer recommends keeping fixed expenses to 50 percent or less of your overall budget. There’s no one budget style that is more effective, however. The important part is to just pick a method and then start working toward the goal — saving for a down payment, in this case.

Source: “How to Save for a Home When You Have Student Debt,” Forbes.com (April 4, 2016)