CENTURY 21 AAA North
DON'T DO THESE 6 THINGS WHEN BUYING A HOME
DON'T SHOP FOR HOMES WITHOUT AN AGENT
You can get started online -- everyone does, but when it's time to get serious, you're going to need a professional to guide you through the process. Trust us, you're going to want someone by your side finding you the right property, writing you the winning offer, and negotiating on your behalf the whole time.
DON'T START LOOKING WITHOUT A PRE-APPROVAL
Let's face it -- In today's market, buyers can't compete without a pre-approval. End of story. Get pre-approved by our in-house mortgage lenders Cross Country Mortgage. They are the absolute best in the business and they will make sure you have the most accurate idea of what you can afford.
DON'T UNDERSTATE YOUR BUDGET
Many home buyers choose to hide their true budget from their Realtor®. They fear that if they are totally honest, their Realtor® will get them into a stressful situation at the top of their price range. But if you're not honest from the get-go, you could miss out on a really great house that you can afford comfortably!
DON'T HOLD OUT FOR THE "PERFECT HOUSE"
Everywhere you go, you hear talk of getting into your "dream house" and settling for nothing less. But the truth of it is, there's no such thing as the perfect house. Instead, make a list of "musts" and "wants" to really focus on getting yourself into the "right" house. Narrowing your focus is more productive than "dreaming."
DON'T MAKE LOWBALL OFFERS
This rings especially true in today's hot seller's market, but could apply under any market conditions. Yes, you want to save money, but lowballing could really backfire, especially if the seller feels like you're insulting them. They may not even make you a counteroffer!
DON'T MAKE ANY BIG PURCHASES
When you have found the right house and the seller has accepted your offer, your loan still has to go through underwriting. Underwriters look to see if your credit score has changed since your pre-approval. Therefore, do everything you can to maintain your credit score -- don't take on more debt!
6 Smart Ways to Build Equity
1. Let Your Home Appreciate
Your equity can be calculated by subtracting your current loan amount by your home's current value, then dividing that by the home's current value. The smaller portion of the appreciation is usually the amount you've paid off on your mortgage, while the larger factor is often home appreciation. Many times, buying a house now with a smaller down payment means more equity for you in the long run as a result of a good market, as opposed to "waiting and saving money."
2. Make a Larger Down Payment
Putting down a larger amount on the sale of your house is the most instant way to build equity. A combination of home appreciation and making a larger down payment will mean a lot of equity in just a short amount of time.
3. Utilize Financial Windfalls
Work bonuses, side money, family gifts, inheritances -- If you pay down in lump sums, you can have your mortgage recalculated to reflect your newer balance.
4. Make Biweekly Payments
If you make your mortgage payments every other week as opposed to every month, you will actually make 13 payments on the year. You build equity faster and knock off 5 to 6 years on a 30-year mortgage, but make sure your lender isn't charging extra for processing semimonthly payments.
5. Cut Down Your Loan Term
If you take out a 15-year mortgage instead of a 30-year, you'll build equity twice as fast! This is the option for those who can afford the 2x they'll be paying each month (qualifying could prove to be difficult as well).
6. Home Improvements
And we're talking mostly BIG improvements -- new kitchens, additional bathrooms, or other rooms. These are the things that really build value. Make sure the added value outweights the costs.
How to Properly Win A Bidding War
Try to see the homes you like the first day they're on the market.
Be the first to write an offer.
Be prepared to offer at or significantly over asking price when competing with multiple offers.
Keep your contingencies to a bare minimum. Don't ask for seller concessions or small repairs. Offer free occupancy for the seller.
Make sure you have a solid mortgage pre-approval in hand or offer cash if you can.
Write a love letter to the seller that shows how much you adore the home and how much you'd love to call it your own.
Real Estate: Old and New Ways of Doing Business
In the past, buyers would look in the real estate section in the newspaper and either go to an open house or call their agent to make an appointment to see the house.
In the old days, real estate agents carried around multiple folders filled with paper contracts. What was their biggest concern? Losing documents!
Door-to-door visits, cold calls, post cards, open houses every weekend. These were the ways we did business back then. We still implement some of these strategies.
Back in the day, agents only represented the seller. Even agents who showed the buyer homes and wrote offers for the buyer ultimately represented the seller throughout the transaction.
Today, about 90% of buyers look online as well as receive daily updates from agents. Excellent photography, video clips, and google maps make home searches easier.
Now, most agents have scanned copies of documents stored on their computers. We know they are safe; we know we can access them from anywhere. And so can you!
Real estate websites, online advertising, social media -- these are the things that dominate the game today, along with some of the old school methods.
Nowadays, we have buyer agency to represent buyers. A real estate agent/broker agrees and contracts to represent the buyer, so they become that buyer's agent.
C21 Myth Bust
Today, we are going to debunk some myths about real estate agents.
Real estate agents get a salary
This is false. The agent's time and expenses are 100% on them. There is no reimbursement for hours of research, 500-plus messages, troubleshooting, driving to and from, etc. -- only commission.
Real estate agents are always late for appointments
This myth isn't fair. If this is the reputation real estate agents get, what about doctors, lawyers, or almost any specialized profession? Simply put, there is no excuse for habitual tardiness for any professional.
The agent keeps all the commission
Actually, the commission gets paid to the agent's broker, who then gives the agent his or her portion.
Don't trust the agent
Commission + negotiating money = untrustworthy. This is a misunderstanding. The difference between $300k and $310k is only $150 in commission to the agent. Agents aren't paying attention to this, they just want to get you into your dream home!
Commission is 6%
The truth is, all commissions are negotiable and vary according to a variety of factors, including type of property, price, and the market.
6 Mortgage Questions for a First-Time Home Buyer
Q: What is required to get a mortgage?
A: To qualify for a mortgage, you need a decent credit score, employment, tax returns, and in a perfect world, not a lot of debt. A good way to build credit is to apply for a credit card and pay it back carefully. Paying back other loans, like car and college, are useful as well. You want to show that you are responsible with money. Don't buy big ticket items like boats or cars before buying a home.
Q: If you have bad credit, how do you improve it?
A: Many times, if you think your credit is bad, you're actually doing better than you think. Here's a tip: check your credit report. There are a few free services to do this, or you can download an official copy once a year. If your credit is bad, many times, there's an old bill or collection bringing you down. These errors can be easily fixed. If they are not errors, start correcting your habits and your score will improve gradually.
Q: What's the difference between a mortgage pre-approval and a pre-qualification?
A: Simply put, a pre-qualification is not going to hold the same weight as a pre-approval. You can go online and have someone print you a pre-qual letter. But with a pre-approval, lenders like Cross Country actually check your finances in a verifiable way, which requires time and effort, which is precisely why it carries more weight. If you're serious, getting pre-approved translates to "I mean business."
Q: How much down payment do you need for a mortgage?
A: The days of needing to save up for a 20% down payment are over. There are plenty of great mortgage options to fit every budget. One common type of loan, called an FHA loan, allows the borrower to purchase a home with 3% down. You will pay a small amount of Mortgage Insurance, but once you gain a bit of equity, you'll be in the clear and no longer required to pay it. Active, retired, and former military persons may be eligible for a VA loan, which requires $0 down payment. If you live outside the big city, ask about a Rural Development loan, which also qualifies for $0 down payment. Talk to our lenders to find out more!
Q: What kind of down payment assistance is available?
A: If you're looking for help to make a down payment, many experts say that the "Bank of Mom & Dad" isn't a bad place to start, if your parents have the means to pitch in. Gifted money helps many people qualify for a loan as well, although it is imperative that you disclose to your lender that it was a gift. Not doing so will send up red flags. If private assistance is not an option, or it isn't enough, have no fear -- there are over 2,000 down payment assistance programs across the country that can help, as long as you meet their requirements for income and credit.
Q: What types of home loans are available?
A: There are mainly two types of loans. First, there are loans with an adjustable rate, meaning the rate could change over a period of time. Second, there are loans that are "fixed" or "term," meaning the rate will stay the same for the length of the borrowing period. Generally, term or fixed-rate loans are more common and considered the safer option, but really, this depends on your circumstances, including how long you plan to stay in the home.
The 6 Most Important Tips For Homebuyers
#1 Before you begin house hunting, get pre-approved for a mortgage
#2 Come up with a realistic idea of what you want in terms of house size, neighborhood, amenities, etc.
#3 Let your real estate agent handle all communication with sellers.
#4 Include important contingencies, especially financing and property inspections, with your offer.
#5 Ask the seller to put every component of the deal and any verbal agreement into writing.
#6 Evaluate the safety and overall condition of your new home with a home inspection.
What We Learned in 2017 and What It Means For 2018
Buy: Be Prepared to Compete
The market is still hot for sellers, so get ready to compete with other buyers for the home. Put in your best offer from the get-go, even if that means going over asking price. Keep your contingencies to a minimum, make sure you have a home inspection, but don't haggle over small repairs. Make yourself the best buyer of all the buyers.
Sell: Price It Right the First Time
Get a comparative market analysis (CMA) done by one of our CENTURY 21 AAA North Realtors®. Heed their advice. If you price your home too high, it will sit on the market and become stale, even when the market is hot. If you price it too low, you will lose profits.
Buy: Get Pre-Approved
The first step in buying a house is getting pre-approved for a mortgage. Gone are the days of looking for homes without one. In fact, many sellers require one to even see their home! Our mortgage reps at Cross Country Mortgage are top notch and will help you throughout the entire process.
Sell: Why Are You Selling This Home?
This question is tricky. It's almost like being asked "What is your greatest weakness" in a job interview with 99 out of 100 answers being the wrong one. You don't want to answer it the wrong way because buyers and their agents can and will use anything you say to negotiate against you. Letting the buyer know your situation and why you're moving could cost you thousands.
Sell: Appeal Designs to Buyers
A lot of times, buyers are looking for a certain type of design within the home. Some styles of interior design are more appealing to buyers than others. Go for clean and elegant, and if possible, update your kitchen and bath. Make your home attractive to the majority of buyers if you want to sell quickly and for top dollar!
Buy: Be Prepared to Compromise
In this market, you may have to make some compromises. You may not get the basement or the third bedroom you're looking for, but you will be a homeowner building equity from the day you close. There's nothing better than your home making you money while you live in it!
Sell: Maintenance & Curb Appeal
Buyers love a home that's maintenance-free and looks great inside and out. Get the furnace, electrical system, plumbing, and roof checked out prior to listing. It will help you avoid any surprises during the buyer's inspection. Keep that lawn and exterior neat and tidy! First impressions are everything!
Buy: Hold Your Tongue
The deal is not over until the deal is over. Keep any negative comments to yourself until you have signed on the dotted line. You want the seller to want you to buy the home. Don't give them any reason not to negotiate with you. And be careful about video surveillance. Many sellers have internet cameras installed, allowing them to hear everything you say.
Home-Buying Questions for Pet Owners
What are the local pet laws?
Even if you own the property, there may be laws regarding pets. Number of pets and breed types can have an impact. Check with the homeowner's association (HOA) or condo development.
Yard & fencing?
If your new home does not have a fence, it is likely that you'll have to build one. Again, check with the HOA or condo development to get a better idea.
Is the neighborhood good for pets?
With dogs, you want to be able to go on walks. Consider areas close to parks, dog runs, trails or other green spaces, or make sure your home is in an area of the neighborhood with sidewalks.
Solid hardwood floors are good for pets because they can be refinished if they get scratched or dirty. Wall-to-wall carpet is not so great, as cats will claw it and dogs track in mud and dirt.
Pet-friendly floor plan?
Size and layout are things to be considered if you have a dog (or several dogs)! A funny thing to think about: do you want to be tripping over your dogs all the time? If not, then consider a roomier floor plan!
Consider the stairs
As dogs age, they begin to have joint problems and the stairs can become a dilemma. Consider getting a place that has a carpet runner on the stairs, or be ready to install one.
Dancing for Treats
Trick-or-treating as we know it today originated in the Middle Ages when men and boys would dress up and dance and sing at their neighbors' doors, begging for coins and food. The practice was known as "mumming."
Irish in Origin
Halloween's origins come from a Celtic festival for the dead called "Samhain." People believed that ghosts of the dead roamed the earth on the holiday, so they dressed in costumes and left out treats to appease the spirits.
They come from an old Irish tale about Stingy Jack, who died and was not allowed into Heaven. Instead, he was sent off to roam the Earth with only a burning coal for a light. He put the light into a turnip (not a pumpkin) as a lantern and became the "Jack of Lanterns."
The black cat superstition began with the Puritans, who lived a Protestant way of life. Legend has it that witches, who were believed to worship the devil, would protect their identities by turning themselves into black cats. Thus, black cats gained the reputation of actually being witches.
The old tradition of wearing animal heads and skins to commune with the dead continued into Samhain, the festival that inspired what we know as Halloween today.
Top 5 Tips for Prepping Your Home to Sell
Google Your Address
Find out everything the internet is revealing about your property, including tax records. Make sure that what the internet says about square footage, number of beds and baths, etc. is correct.
Gather all your home improvement and repairs records you have made over the years. You'll be asked to disclose everything about your home when you put it up for sale anyway, so make sure you're on top of it.
Vet the real estate agents you're talking to. Ask for concrete examples of how they're marketing their current properties, and don't be afraid to ask for referrals.
Deep Clean Everything
And we mean everything. Leave no square inch untouched. We're talking about getting down and dirty in the bathroom, cleaning every crevice in the kitchen, and even getting the carpets cleaned.
People always judge a book by its cover, but prepping the exterior of your home doesn't have to be a chore. Pulling the weeds, planting flowers, mowing the lawn, and power washing if needed will make the hard work worth it when your doorbell starts getting some action!
5 Things Keeping Millennials From Buying a Home
1. Student Loan Debt
Perhaps refinancing federal loans into a private loan could help.
2. Bad Credit
Most likely at the hands of someone else, i.e. parents.
3. Rising Rent
Which means less money for a down payment.
4. "Cash" Competition
Putting down 20% when investors in the same area are putting down 100%.
5. "Avocado Toast"
And $4 coffees at that.
Selling with a Realtor® versus FSBO'ing
WHY YOU SHOULDN'T SELL WITHOUT A REALTOR®
1. Real estate is complicated. A Realtor®'s knowledge is priceless, and Realtors® have insight that the internet doesn't have.
2. Spend your time enjoying life and let your Realtor® handle the buyers' questions, showings, and all the other time-consuming business.
3. Image is everything. You only get one chance to make a first impression. With a Realtor®, you get top notch presentation of your home.
4. A Realtor® knows about predictive analytics, buyer demographics and marketing. Trust one today with selling your home!
1. If you list the house, it's just you. With a Realtor®, you're also getting the brokerage, their resources, and so much more.
2. Realtors time to devote to you and your home. Remember, you have to show the house and handle buyers and their demands.
3. If you plan on selling your home on your own, simply ask yourself this: "Do I know how to properly prepare and market it?"
4. What is your plan for marketing your home, keeping an eye on market trends, strategic promotion, which agents are most likely to have buyers for the home, and so on? Come on, put your home in good hands -- hire a Realtor® today!