Process of Buying a Home

We can look at the process of buying a home as series of steps. All these steps must be examined in detail; here I will just outline them.

First step is to make sure that you have the necessary motivation and finances to buy a home. You should ask yourself; why do you want to buy? do you have the money?

Second get the help of a real estate agent and seek advice. You should learn about the market, the prices etc. It always helps to have professional input every step of the way.

Then you can get your loans pre approved. This will expedite the process and help you get the best rates and terms.

Once you are knowledgeable about the conditions of the market and finances, search and inspect homes. You should have clear goals when inspecting homes, so that you do not waste your time.

Next step is to select a home based on your desires and your capacity. Once satisfied with the selection, make an offer and engage in negotiations with the seller. Preparation will pay dividends here. Knowledge and research you have acquired in previous steps should be put to use.

Get the financing required. Again if you prepared and got pre approval this would be easier. Try to get the best terms possible.

You should also get the various types of insurances required

Close the deal and complete the settlement and necessary paper work. You should get competent professional help for this.

That is not all. You may want to look in to utility agreements, tax deductions, etc. to maximize the benefits.

Finally Move in!

Refinancing the Mortgage

When refinancing a mortgage, you essentially pay off one mortgage and take out another. Why do that? There are several possible reasons. While most of these may end up benefiting, you have to weigh the costs as well. Generally refinancing will cost about 5% of the mortgage value.

By refinancing you may be able to get a lower interest rate than the previous mortgage thus lowering your monthly mortgage payment. This is usually recommended if the interest rate goes down by 2 percent or more. In other cases you should weigh the numbers to see whether there will be any real benefit.

You may also want to change the time period of the mortgage to one better suited to your present circumstances and present economic conditions. For instance if there is a lower interest rate you can shorten the period with hardly any change in monthly payment.

Exchanging the mortgage from an adjustable rate or ARM mortgage to a fixed rate mortgage, or to do the converse, may also be a motive for refinancing. Benefits will depend on whether interest rates are expected to go up or go down.

Other motives can include getting full access to the equity of the real estate or to consolidation of debts. If you want to finance a big expense it may be beneficial for you to tap the equity by refinancing. Mortgage payments are also tax deductible thus increasing the attractiveness of this method of financing. However be careful, you are basically using debt backed by your home. So make sure that the purchase or expense is really worthwhile.

If your motive is consolidation of debt, basically paying off high interest rate debt such as credit card debt by using lower interest mortgage loan, then make sure that you do not accumulate credit card debt again. Otherwise the point of the whole exercise will be lost.

To conclude, you should have a clear idea about your motives, and cost and benefits, before refining your mortgage.

Role of the Real Estate Broker

Basically a real estate broker or agent is the intermediary between the buyer and the seller in a real estate deal. Under law a real estate broker has what is called a fiduciary relationship with clients. This obliges the broker to act in his or her clients’ best interest.

From seller’s side, a real estate broker helps to market the property using various methods in order to get the best possible price. Services offered by a real estate broker may include, giving an analysis of the current state of market, appraising the property, general marketing of property, guiding clients during the process of selling, preparing the necessary documentation and contracts, and auctioning of property if that is the requirement, among others.

While buyers can enter into a signed agreement with a real estate broker (thus obliging buyers to pay commission on conclusion of the deal) to search for a property at best possible price for them, that is not necessary. Buyers can deal with seller’s real estate broker or with others under a verbal agreement.

Brokers who assist in the deal without representing either the buyer or seller are known as transaction brokers and are not bound by the fiduciary relationship.

Real estate brokers are compensated depending on the role they played, by a commission based on a percentage of the gross transaction price of the deal, or through an hourly consulting fee.

Generally real estate brokers are required to have a license. In fact in some States of US unlicensed brokers are not entitled to receive commission and their activity is illegal. In some other states lawyers are allowed to deal with real estate matters in the same way as licensed real estate brokers. Buyers and sellers can also come to a deal without brokers.

Residential Real Estate Classification

When we talk about real estate transactions it is important to use right terminology. Here we will examine and explain few basic terms used is residential housing.

Occupation types
Housing tenure or occupation of a house can result from several legal arrangements. These include owner occupation, condominium housing, rented housing, pubic housing, and cooperative housing, among others. The type of occupancy does not depend on the type of house.

House Types
Residential real estate can be classified according to the physical appearance to neighboring real estate.

The term single family detached house is used to describe exactly that, a physically separated house occupied by a family. Duplex is a semi detached house with two homes usually separated by a single connecting wall.

There are several types of houses which are connected to their neighbors. A flat or an apartment is a single unit in a building with multiple housing units usually called an apartment building. When a multiple story building has separate houses in each floor, it is called a multi-family house. A row-house or a townhouse, also called a terrace house, has a row of houses with just the connecting wall to separate them. Condominiums, though some times used to describe apartments, is a legal arrangement whereby the housing units in a apartment building or terrace house are owned separately and other common parts of the building and attached property are held collectively.

In addition to the already described permanent homes people also occupy potentially portable homes such as, mobile homes or trailers, house boats, and tents.

Size of a house is measured in several ways. When it is measured in square feet, the size of the living area, without garage and other such areas, are given in USA. In contrast, in Europe the measure includes the whole area enclosed by the walls. Houses are also measured according to the number of bedrooms.

Buying a Home – Preparation

In order to successfully carry out a Home purchase you need to be prepared and have a plan. By planning carefully, you will foresee the requests of bankers, lawyers, and others, involved in the process. In addition by preparing you will also be able to uncover less difficult and smother methods to complete the process.

What You Need

First step in planning a Home purchase is to know your own desires. Why are you buying? Is it essential, or just a preference? Is it an investment or are you buying to live in the house? Is there are a deadline? What are you looking for in a new home? You should ask yourself these and similar questions.

Of course answers to these questions will be different for each purchaser. Point is that by having a clearly defined idea about what you need from the beginning you will be able to make effective decisions.

Where You Stand

In addition to knowing what you need, you should also know what you can afford.

You should have a clear idea about the amount of money you can pay as the down payment or the price you will pay upfront. In addition you should know your financing options and the amount of money you can get through a mortgage and can afford to pay off in monthly installments. Closing costs of the sale should also be taken in to account.

Planning will help you to improve your financing possibilities; for instance, by paying of your short term debts such as credit card balances.

To conclude knowing what you need and where you stand will definitely help you.

We will save you thousands $$$ We absolutely guarantee it.

We guarantee, in writing, to save you at least $2,000 from either the list price of the home, or from future moving, closing, or renovation costs.

Once we sign the buyer agency form, we can provide you with a written guarantee that we will save you at least $2,000 on the purchase of your next property or I will refund this amount to you out of my commission earned, up to a maximum of the commission earned.

We want our relationship to benefit you. Usually this savings will be earned by getting the home for at least $2,000 than the purchase price, however we can also save you in other ways such as reduced legal fees, reduced moving costs, reduced renovation costs, or reduced mortgage interest rates.

We know that there are lots of Realtor’s to choose from, so why not chose a team that will put money or value into your pocket.

Home Loan Modification Scams

With the government and major lenders stepping up their loan modification efforts, a new industry is building up—home loan modification scams. Often posing as third-party firms offering mortgage aid, these companies prey on desperate borrowers and charge them for poor or nonexistent services. State laws have been put in place to protect borrowers from home loan modification scams, but part of the responsibility also rests on the homeowner. To help you keep safe, here are some ways you can pick out home loan modification scams from legitimate companies.

Upfront fees

Most home loan modification scams work by charging you a sizable fee, then doing substandard work or even just letting your case go. Governments have addressed this by banning upfront fees from all loan modification transactions. If a company asks you to pay before they do anything, it’s most likely a home loan modification scam.

Guaranteed results

One thing you should know about loan modification is that there are no guaranteed results. Companies that promise to save your home without even knowing your name are probably home loan modification scams. A legitimate loan modification firm will ask for documents and analyze your situation before making any promises.

Unusual requests

A number of home loan modification scams have been known to get borrowers to sign their homes over, stop paying their mortgage, or sign forms without filling them out. Some even tell their victims to avoid all contact with their lenders. Every time a firm asks you to do something you’re not sure about, don’t be afraid to ask why.

High-pressure tactics

Companies who are after your money will most likely use strong words to scare you into working with them. They may use the word “foreclosure” or mention living on the street more often than necessary. Have a clear idea of where you stand and don’t let them make it seem worse than it actually is.

Limited contact information

The first thing you want in a loan modification company is that they be available when you need them. Most home loan modification scams will do the opposite—they’ll be out of touch as soon as they have your money or your signature. Make sure they have a real office and phone number, or better yet, look them up at the Better Business Bureau (BBB) website to see if they’re legitimate.

Home Loan Modification Laws

Knowing your home loan modification laws is vital to ensuring success in your mortgage modification. Beyond the rules and qualifications, one must know how the government and lenders work together in implementing the rules, how the guidelines are set, and what various home loan modification laws can mean for them. Of course, the laws vary from state to state, so it’s important to find local resources to help you stay informed. Here’s a quick guide to help you get familiar with federal home loan modification laws.

 

State laws

In many states, lenders are required to send foreclosure or default notices at least a month or so prior to the foreclosure date. Often, this is when most homeowners take steps to get a loan modification. However, some states, such as California, have passed new home loan modification laws that require lenders to call the borrower and discuss loan workout options before going into foreclosure. If you’re having trouble keeping up, look up relevant laws in your state so you can take action before your lender does.

 

Eligibility requirements

Qualifications for the government’s loan modification program, the Home Affordable Modification Plan (HAMP), are the same in every state. However, each lender and state can set its own guidelines. If your mortgage was originated in a state different from where you live, home loan modification laws usually apply from the state where your loan is. Lenders are usually allowed to set requirements regarding your income, balance, and financial hardship.

 

Working with third parties

Most people hire a loan modification agent or attorney to help them negotiate with their banks. This is certainly useful and is even strongly recommended by experts, but as the borrower, you must understand the home loan modification laws that govern your relationship with any third party. For one thing, in most states, you are given a three-day period to go over your contract and cancel it if necessary. There are also protective laws that help you avoid loan modification scams, such as the ban on upfront fees. Before agreeing to any third-party service, read the contract and check them against home loan modification laws to make sure you’re dealing with legitimate agents.

Realtor Selling Homes

Sellers

Selling your home can be overwhelming and challenging in today’s market. As your Realtor®, I am your consultant here to guide you along the way.

I will reduce your stress by making suggestions for home preparations before the listing, home staging to maximize profits, choosing the listing price right the first time, understanding the housing market, analyzing offers, dealing with issues and paperwork, handling the closing, and other final issues.

My goal is to get your home sold the best price possible in the current market helping you and your family move forward in life as quickly as possible.

Pricing your home in today’s market requires in-depth analysis. Don’t be afraid of selling too low. During my competitive market analysis I will research recent sold properties, active properties, expired properties, pending properties,  taxes and assessments, price per square foot, appraisal, FHFA, condition of your home, motivation level, and much more to give you the most accurate price range of where you can expect to sell your home. I will adjust your range to include a maximum list price. When your home is priced right from the start, kept in top showing condition, and is made available for viewing agents and buyers, you will get offers.

As your listing agent, I know how to deal with buyers and other agents on your behalf. I am an expert negotiator and won’t let you sign anything without a full discussion and my professional advice. In addition to proper pricing, proper marketing is essential to sell your home. I will aggressively market your home to get it sold as fast as possible using the most up-to-date tools that buyers use to search for homes such as print advertisements, virtual tours, voice messaging, text messaging, social media, and more.

I do recommend a pre-listing inspection to avoid last-minute surprises. The inspection will reveal anything major and will allow you to complete minor repairs. I also suggest that you offer the buyer a home warranty so you can rest assured that the basics will be covered if something should happen after closing and the buyer won’t come back to you for repair costs.

Real Estate

I was going to write a piece on staging your home, but that seems irrelevant this week. I feel obliged to write on the economic news and its impact on the local housing market. But, truth be told, I don’t know what the local impact will be. I am not sure anyone does yet.

That being said, I can suggest the following preliminary comments. Regardless of the government rescue plan, loans will be much harder to obtain. I am hearing talk of 15-20% minimum down payments. If this is the case, fewer buyers will qualify for loans, hence the number of buyers in the already diminished buyer pool will grow smaller. This is obviously bad for sellers. Fewer buyers means fewer opportunities to sell, higher inventory, and more downward pressure on pricing.

What if I just bought a home? Am I going to lose value? Those are reasonable questions, but reasonable answers to them require some sense of context, i.e., where is your home and what kind of price did you pay? The local real estate markets in California have been relatively stable with regard to pricing. This stability has been largely defined by a lack of appreciation or low appreciation over the last couple years, but we haven’t seen plummeting values except in a few cases where buyers overpaid in the ‘05 boom. Also, if you paid list or close to list, you probably paid too much (unless the home was priced exceptionally well, which does happen; check the comps). Homes in California are selling at an average of 93-96% on the real estate market.

I do not know what the next couple years will bring; however, I can tell you this. My husband and I bought a home last year and we don’t regret it. We needed a place to live, and we wanted a nice place to live with good schools and nice neighbors. Our home is worth about the same today as what we paid for it last year, but we are happy with our decision. We don’t plan on moving for 5+ years, and so the “value” of our home today is not important to us. Current value is meaningful only if you’re intending to sell in the current market.

Also, we did get a good deal on our home, and we bought after the boom years. People who paid too much in 2004 and ‘05 and need to move now due to a job loss, a job transfer, or a bad mortgage are the ones who are truly faced with lost value.