RisMedia Buying 101

Syndicate content
Updated: 22 hours 41 min ago

5 Home Inspection Mistakes Buyers and Sellers Make

April 22, 2018 - 1:01pm

(TNS)— A home inspection is an assessment of a home’s condition. Home inspectors not only identify problems with houses; they can give buyers information that will help them with the upkeep.

“We want to teach them how to maintain the property because it’s the biggest investment they’ll ever make,” says Alden E. Gibson, a past president of the American Society of Home Inspectors.

If you’re getting a home inspection, here are five mistakes to avoid.

Not Researching the Inspector
Too many buyers and sellers hire whoever is recommended to them without doing any research. The inspection is only as good as the inspector doing it, says Troy Bloxom, owner of Home Inspections Plus near Anchorage, Alaska, and past president of the National Association of Home Inspectors.

A few questions to ask:
·      How long have you been inspecting homes?
·      How many inspections have you done?
·      What are your qualifications, certifications and training?
·      What was your job before you were a home inspector? (Ideally, your pro was in contracting or building.)

You want a certified professional who stays current.

“There’s a lot of stuff you have to know, and you want someone who’s keeping up with ongoing education,” says Kurt Mitenbuler, who is certified by the American Society of Home Inspectors (ASHI) and owns an inspection company in Evanston, Ill.

You’re looking for an inspector who can analyze the home’s strengths and weaknesses, then explain them.

Not Attending the Inspection
Being present for the inspection may not be mandatory, but it’s a smart idea. Simply reading the inspection report isn’t enough to give most homeowners the full picture, Gibson says: “If they don’t see it, they don’t understand it.”

Gibson says he turns down dozens of inspections a year “because people can’t be there or don’t want to be there.”

The inspection might take an entire morning or afternoon, so set aside enough time. Some inspectors will sit with you afterward to explain things and answer questions.

“Any home inspector who doesn’t let you follow him around? That’s weird. Ask me any question you want,” Mitenbuler says.

A good inspector can give you an estimate of how much you’ll need to spend on repairs and upgrades, which is very valuable information as you consider your budget.

Not Reading the Inspection Report
Too many buyers and sellers just glance at the inspection report. You need someone who uses “clear, concise” language in person and in written reports, Mitenbuler says. He recommends scanning a few reports by checking the inspector’s website or asking for a sample report.

A knowledgeable pro will state simply what’s wrong with the house and what it will take to fix, Mitenbuler says.

Not Getting a Presale Inspection
Many sellers decide to leave the presale inspection to the buyers, Bloxom says. That’s a mistake.

When the buyers get an inspection (and if they’re smart, they will), the sellers may have little time to complete repairs and keep the sale on track, Bloxom says.

But if the seller has the home inspected before putting it on the market, he has more time to do repairs and to shop around and control his costs for the work, Bloxom says.

Both buyers and sellers often wait too long to engage an inspector, Gibson says. You should find an inspector long before you have (or make) an offer on a home. “Any good inspector will be booked out,” he says.

Not Prepping the Home
Inspectors get annoyed when homeowners don’t prepare their houses for inspection.

“Don’t force the home inspector to empty the closet to get into the attic,” Mitenbuler says. If you have a crawl-space hatch, move anything sitting on top of it.

Got a lock on a utility closet, basement or shed? The inspector needs access, so open it or provide keys.

For a seller, the best tack is to be at home to meet the inspector, introduce yourself, provide your mobile number, and then you can take off, Mitenbuler says.

To reduce the need for repeat inspections, hire professionals to do repairs, Bloxom says. Too many sellers will try DIY or get them done on the cheap, but poor workmanship will show up during the follow-up inspection, Bloxom says, and could result in more repairs—and another inspection.

©2018 Bankrate.com
Distributed by Tribune Content Agency, LLC

For the latest real estate news and trends, bookmark RISMedia.com.

The post 5 Home Inspection Mistakes Buyers and Sellers Make appeared first on RISMedia.

Categories: Real Estate

Keys to Buying a Second Home

April 1, 2018 - 1:00pm

(TNS)—If you’ve been thinking about buying a second home, now is a good time to take the leap. Mortgage rates are still historically low.

But there are some vital things to do before you start shopping. Follow these steps to make buying a second home a smooth process:

The best way to start the search for a second home is to find a real estate agent who is familiar with your desired location. This person could provide you information about neighborhoods, market prices and the pros and cons of particular properties.

With an eye toward the long-term value of a property, the agent could fill you in on price histories and how comparable sales have fared, and resale prospects. Factors that tend to help properties hold or increase in value are proximity to a major metropolitan area, ease of access and the availability of year-round amenities.

Factor in additional costs. Today’s second-homebuyers are more interested in enjoying their properties rather than getting a quick return on their investment.

Still, you should consider that you will be away from the property a lot of the time, which usually entails additional costs, such as having a management company check the place in your absence for water leaks, frozen pipes and other problems.

Getting insurance for a second home may be more challenging than it is for a primary residence. If you are considering a second home on the beach, for example, you’ll need flood insurance in addition to regular home insurance. It has become more difficult to get flood insurance in coastal communities, and the cost has increased greatly in some markets.

Be sure you can afford two mortgages. You have to qualify for a second-home mortgage, which is on top of any mortgage debt on your primary home.

Typically, you will need to make a down payment of at least 10 percent, meet credit standards and debt-to-income requirements, and provide documents for income and asset verification.

If you have a good relationship with the mortgage lender on your primary residence, that might be a good place to start your quest for a second-home mortgage.

Take into account the tax implications of your purchase. If you use your home as a true second home, you could get a deduction for mortgage interest and property taxes, just as you do with your first-home mortgage.

Be aware that under the new federal tax law, the cap to the mortgage interest deduction will be lowered from $1 million to $750,000. So if you already have a $750,000 mortgage and get a loan for a vacation home, you won’t be able to deduct the interest on the second mortgage.

If you rent out your second home, you will have to consider additional tax ramifications, particularly if the rental period extends beyond 14 days a year.

©2018 Bankrate.com
Distributed by Tribune Content Agency, LLC

For the latest real estate news and trends, bookmark RISMedia.com.

The post Keys to Buying a Second Home appeared first on RISMedia.

Categories: Real Estate

Ask the Expert: Can a Home Inspection Help the Mortgage Process Along?

March 27, 2018 - 4:43pm

Today’s Ask the Expert column features Dan Steward, president of Pillar To Post Home Inspectors.

Q: Should sellers get a home inspection to help the mortgage process along?

A: If you’re a seller, it behooves you to get your own home inspection prior to putting your house on the market. But why spend money on one when the buyer will surely get their own?

Buyers that see a recent home inspection along with the listing sheet already realize that the asking price of the home is likely justified. They can rest assured that there are no scary surprises waiting for them upon closing. And you can hasten an offer by having that report right in front of serious buyers when they’re considering putting in an offer.

This also establishes a sense of trust between the buyer and the seller from the start. It shows the buyer that you care enough to get details and minor problems with the house detected and fixed before they even put in an offer.

If your home inspector shows you minor items that may come up in the buyer’s home inspection, you can have the issues looked at and repaired before the buyer even has their report done. You will have time for bids on a job instead of rushing to pay a higher price for the work, or, worse, having to deduct from the agreed upon price. In fact, you can show the report and a receipt proving the problem was already addressed by a licensed professional.

Having a good report readily available also shows the buyer that you’ve most likely been maintaining the property all along, which is another terrific plus when selling.

Mitigating risk is key when selling a home. Since laws regarding disclosures vary from state to state, for the most part, you as the seller are responsible even after a closing if something has been hidden or unreported to the buyer. Taking the time to have your own inspection will allow you to have repairs made for a cost that suits your budget, instead of having to deal with credits the buyer may ask for as the result of their home inspection. By getting a pre-inspection, you have proof that home maintenance issues, to the best of your knowledge, didn’t exist at the time of sale.

The only instance when it may not pay for a seller to proceed with a pre-inspection is when they’re selling a fixer-upper. In this case, the buyer already knows what to expect, and they should have a thorough home inspection completed before signing on the dotted line.

For more information, please visit www.pillartopost.com.

For the latest real estate news and trends, bookmark RISMedia.com.

The post Ask the Expert: Can a Home Inspection Help the Mortgage Process Along? appeared first on RISMedia.

Categories: Real Estate

6 Things You Must Do Before Buying a Home

March 27, 2018 - 4:37pm

(TNS)—Buying a home is a huge investment—probably the most significant purchase of your life. It’s not something you should do without preparation.

Before you start on the road to homeownership, make sure you are ready.

Improve your credit score.
A high credit score snags you the best deals. “Below 660 or 680, you’re either going to have to pay sizable fees or a higher down payment,” says Barry Zigas, director of Housing Policy for the Consumer Federation of America.

A score of 700 to 720 can get you a good deal, and 750 and above can garner the best rates on the market.

Pull your credit reports and make sure you’re not penalized for old, paid or settled debts.

Stop applying for new credit a year before you apply for a mortgage. Keep the moratorium in place until after you close on your home.

Figure out what you can afford.
There are various ways to determine how much house you can afford. If you’re using an FHA loan, your monthly payment can’t exceed 31 percent of your monthly income. The FHA will let you go higher under some circumstances.

For conventional loans, home expenses should not exceed 28 percent of your gross monthly income, says Susan Tiffany, retired director of Personal Finance Publications for adults for the Credit Union National Association, or CUNA.

Use Bankrate’s calculator to figure out how much house you can afford. Add to that other housing expenses, such as taxes, insurance and utilities. Then, bank the difference between that total and what you’re paying now.

Save for a down payment and closing costs.
You’ll need to save between 3 percent and 20 percent of the house price for a down payment. Your credit history and loan terms help determine how much you’ll need to come up with.

For example, with an FHA loan, the down payment requirement can be as low as 3.5 percent. You’ll need a credit score of at least 580. Home loans backed by the Department of Veterans Affairs, or VA, require no down payment.

Another cash expense will be closing costs. The national average for closing costs for a $200,000 mortgage is $2,084, according to Bankrate’s latest survey.

If a big down payment is a hardship, look for down payment assistance. Search online using the city name, the county name and key word combinations such as “down payment assistance,” “first-time homebuyers” or “homebuyer’s assistance.”

Down payment assistance often is based on location or reserved for particular buyers, such as first-time buyers. In a buyer’s market, you can negotiate to have the seller pay a portion of the closing costs.

Build a healthy savings account.
Building up your savings—not just for a home—is very important. Your lender wants to know that you’re not living paycheck to paycheck. If you have three to five months’ worth of mortgage payments set aside, you’re a much better loan candidate. Some lenders and backers, like the FHA, will give you more latitude on other criteria if they see that you have a cash cushion.

That money will also help pay for maintenance and repairs of the home. Most repairs are sporadic, but big-ticket fixes such as a new roof or water heater can come up suddenly and drain your budget.

A good rule of thumb is to assume that you’ll spend 2.5 to 3 percent of your home’s value each year on upkeep and repairs. If you buy a $250,000 home, aim to save $520 to $625 per month.

Get preapproved for a mortgage.
Before you start house shopping, you should get your financing in place.

“The No. 1 thing is (homebuyers) better have everything in order,” says Dick Gaylord, of RE/MAX Real Estate Specialists in Long Beach, Calif., and a former president of the National Association of REALTORS®.

Gaylord says you should get a mortgage preapproval “before you walk through the first house.” Otherwise, “How do you know how much you can afford?”

Buy a house you like.
Short-term homeownership can be expensive, depending on how much you put down and what it cost you to sell your old house and move.

To get a home that will make you happy, don’t count on a quick purchase. Step back and make certain the house you’re considering is one that will fit the needs of you and your family.

©2018 Bankrate.com
Distributed by Tribune Content Agency, LLC

For the latest real estate news and trends, bookmark RISMedia.com.

The post 6 Things You Must Do Before Buying a Home appeared first on RISMedia.

Categories: Real Estate

What to Consider When Selling Your Home in a Rising Rate Environment

March 13, 2018 - 4:23pm

There are many economic variables to consider when selling your home when interest rates are rising. If that’s the only changing economic variable, you’re generally going to see a negative impact on both home sales and home prices. This means as interest rates rise, the buyer pool for your home is going to shrink.

In 2008, the Federal Reserve set rates at 0.25 percent because of the recession and the lack of buyer confidence or demand. Since then, buyer confidence and buyer demand have risen. In December 2015, rates climbed to 0.5 percent and continued to rise to where they are today at 1.5 percent. The Fed has noted rates will rise to 2 percent in 2018 and then 3 percent by 2020.

What Happens to the Ability to Sell Your Home With These Rises in Interest Rates?
If interest rates rise 1 percent and all other economic factors remain the same, purchasing power for homebuyers will decrease by just over 11 percent; therefore, every quarter-percent (0.25 percent) rise of interest rates reduces homebuyer purchasing power by 3 percent.

That means for a home purchase of $300,000, a 1 percent interest rate rise reduces buying power to just under $267,000. So, someone who potentially may have been able to purchase your home may no longer have the buying power to do so. This creates a smaller buyer pool and less demand for your home. It’s also likely to increase supply as fewer people are able to purchase homes.

If mortgage rates rise, it becomes more probable for indecisive buyers to rush into the market, and the short term will likely see a decent boost; however, it could add extra pressure if rates continue to rise without leveling out.

While interest rates play a role in the housing market, there are a variety of personal and economic factors to consider, as well.

What Other Economic Factors Play a Role?
Supply and demand play crucial roles in determining the movement of home prices. If supply goes up, home prices go down. If supply goes down, home prices will probably go up. If demand increases, home prices mostly likely will as well; however, if fewer people are looking to buy homes, then prices will most likely decrease. As a seller, these are important factors to consider when putting your home on the market.

The sale of new homes is another factor to consider alongside rising interest rates because supply and demand will always play a factor in the home-buying process. Supply increases when new homes are created. Assuming that interest rates don’t rise too rapidly, paying attention to new-home inventory levels will give you an indication of what to expect as a seller.

Monthly income, as it relates to monthly mortgage payments, is a more important variable to gauge than interest rates alone. Your debt-to-income ratio plays a larger factor in your ability to qualify for a mortgage than interest rates alone. When monthly income rises, your ability to absorb higher interest rates does, as well. This means that as long as people are making more money, they’ll also be able to pay off any increase in debts.

When the real estate market crashed in 2007-2008, monthly payments of principal and interest were nearing 25 percent of the U.S. median family monthly income. Even with a rise in interest rates, Americans are currently seeing the highest monthly median income in the last 35 years. Because of this, the percentage of monthly income going toward monthly payments is still well below levels that analysts consider dangerous.

Overall, we seem much more hesitant to take out mortgages than we have been in the past.

One of the largest surprises is the percentage of all-cash transactions for home purchases. Even with interest rates at historic lows, the percentage of all-cash transactions is higher than normal because we’re more cautious about taking on debt than we have been in recent decades.

High stock market valuations allow people to diversify their percentage of assets, cash out and reinvest in real estate to keep their portfolio balanced.

The number of distressed properties is a result of a strong job environment. This allows folks to pay their mortgages without defaulting, while also helping to keep prices up even with a rise in interest rates.

While interest rates play a large factor in selling your home for top dollar, they’re in no way the only deciding factor. All of the factors mentioned above should be taken into consideration before you rush into selling your home because of high interest rates.

Ryan Fitzgerald is the founder of Raleigh Realty, a local real estate firm in Raleigh, N.C., that specializes in helping people find great homes for sale online.

This appeared first on ZING! by Quicken Loans. For more information, please visit realestate.quickenloans.com/.

For the latest real estate news and trends, bookmark RISMedia.com.

The post What to Consider When Selling Your Home in a Rising Rate Environment appeared first on RISMedia.

Categories: Real Estate

4 Ways to Prepare for a Competitive Spring Home-Buying Season

March 4, 2018 - 2:05pm

(TNS)—With housing inventory far lower than demand and mortgage rates poised to rise, it’s going to be a competitive market for homebuyers this spring.

If you’re looking to buy a home this season, here’s how to prepare yourself to enter the fray. 

Get your financial house in order.
Unless you plan on paying for the house in cash, you’ll need to apply for a mortgage. No matter how streamlined the process is, you’ll still need to gather a significant amount of documentation to give an accurate financial picture to the lender.

Before you even begin house shopping, look at your credit report to make sure there are no errors that could affect your score. Also, pay off any delinquent bills and reduce any other debts you owe so that your debt-to-income ratio (DTI) is favorable. Use a calculator to figure out your DTI and see if you need to make changes. Your goal is to look as attractive to lenders as possible so that you are you approved and can get the best rate on a loan.

Make sure you’ll qualify for a mortgage.
In order to get a mortgage, lenders want to know you’ll be able to meet your monthly obligations no matter what. This means they’ll ask to see your entire financial situation including employment history, salary, savings, investments, debts and anything else that makes up your net worth. Use a prequalifying mortgage calculator to get an idea of what size loan is right for your needs.

Even if you think you’re a strong candidate, never assume you’ll automatically qualify with the first lender you contact. Lenders’ guidelines have become stricter since the housing crisis of 2008, and you could lose out on the house you want if you can’t close on a loan. “Sometimes one deficiency can be offset by another strength. For example, if you have a higher DTI ratio, saving up enough to put a bigger down payment can help,” says Bill Banfield, executive vice president of Capital Markets for Quicken Loans. 

Choose the right REALTOR®.
Unless you’re a seasoned pro, having a REALTOR® on your side can make a big difference.

“An experienced agent will know what could happen that might make a deal fall apart and how to keep that from happening,” says Dori Summer, a real estate agent with Keller Williams Realty in Coral Springs, Fla.

Making an offer on a house in a competitive market can require more than just a willingness to pay the price. If a seller has to choose between multiple buyers, they’re likely to choose the one that’s coming to them with the best overall package. A good agent will present your offer along with other information, including your ability to get a loan, how much you’re able to put down and anything else that might make you more appealing than someone else vying for the same property.

Be prepared to pay the price.
Home prices in close to two-thirds of the housing market are at an all-time high, according to a February 2018 report by the National Association of REALTORS®.

“Sellers in this current market get at least 95 percent of their asking price,” says Samona Rosenberg, a licensed real estate agent with Stein Posner Real Estate Services in Boca Raton, Fla.

If you see the house you want and you know it’s in your budget, it may not make sense to hold out to see if the price will drop.

“The best properties all have multiple offers,” says Erik Williams, a REALTOR® with Keller Williams Realty in Cambridge, Mass. “If it’s a desirable property, it’s desirable to buyers. The people that I see get places under agreement are the most prepared people and the most aggressive.”

©2018 Bankrate.com
Distributed by Tribune Content Agency, LLC

For the latest real estate news and trends, bookmark RISMedia.com.

The post 4 Ways to Prepare for a Competitive Spring Home-Buying Season appeared first on RISMedia.

Categories: Real Estate

Ask the Expert: What Can Sellers Do to Prepare for a Home Inspection?

January 18, 2018 - 5:28pm

Today’s Ask the Expert column features Buddy Stark, director of Operations for HomeTeam Inspection Service.

Q: What can sellers do to prepare for a home inspection?

A: Completing these quick and easy tasks before beginning the selling process will help reduce stress and save your clients valuable time during the home-selling process.

Clean the House
An important part of selling a home is keeping it clean in anticipation of a showing. Cleaning the home will convey that it’s been well cared for and that the house is less susceptible to any issues caused by neglect.

Check All Windows
Have your client take a quick inventory of the windows to make sure they’re in good working order. Replace windows that are cracked or broken before the inspection to save time during the selling process.

Finish the Honey-Do List
Some areas of the home, although not typically thought of as areas that would affect a home’s appeal, may be displayed as safety concerns on a home inspection report. Your client can help themselves by replacing burnt-out lightbulbs, testing smoke detectors, replacing air filters and unclogging drains. These little things are easy to forget in day-to-day life, but taking care of them is a relatively easy task that will help potential buyers focus on the important systems of the home.

Check All Outlets
A sampling of electrical outlets will be tested as part of the home inspection to make sure they’re in good working order. Encourage your clients to take note of which outlets are not functioning in the home and replace them. Or, they may want to consider hiring an electrician to make sure both outlets and the electrical box are updated and in proper working condition.

Clear Areas for Easy Access
Home inspectors will be looking at the major parts of the home, including the foundation, HVAC systems, electrical systems, plumbing and even the water heater. Making sure home inspectors can easily access these areas, including the basement and attic, will save time during the inspection process.

Consider a Pre-Listing Inspection
Hiring experienced and professional home inspectors can save a lot of headaches during the selling process. They will thoroughly go through the home and notify clients of any potential issues ahead of listing the property.

For more information, please visit www.hometeam.com.

For the latest real estate news and trends, bookmark RISMedia.com.

The post Ask the Expert: What Can Sellers Do to Prepare for a Home Inspection? appeared first on RISMedia.

Categories: Real Estate

Suburban Realty Professionals  ♦  Princeton Office  ♦  96 Wall Street  ♦  Princeton, NJ 08540  ♦  877-221-8787