How can you tell if buyers are really committed?
Less than a week ago the "For Sale By Owner" ad for your home appeared for the first time in the newspaper. After several showings, a family has shown interest in buying your home. In fact, they just called you back to say they want the house. Hooray! They plan to see a mortgage lender right away, and have asked you to hold the house until a week from Thursday. They say they will be "in touch" soon. What do you do now? Agreements for the sale of real estate should be in writing to be enforceable. Such an agreement states the purchase price, tax information, details of financing, a closing date, the date of possession and identifies any personal property to be included in the sale, and other information. At the time an agreement is signed, it is also customary for the buyer to provide an earnest money deposit, a sum of money acceptable to the buyer as proof of the buyer's serious intent. Consider this. Sincere buyers, who truly intend to keep their end of the bargain, would have no qualms about signing a written agreement spelling out the specific terms agreed upon. If they hesitate to sign such an agreement or will not offer an earnest money deposit, you might ask yourself whether they are really serious buyers in the first place. The sale of your home is a serious business transaction. A REALTOR can represent your best interests by qualifying buyers and preparing an appropriate agreement of sale. Marketing your home at the best possible price and terms is important too. A REALTOR understands the local real estate market and is able to provide buyers qualified to purchase your home. Take no shortcuts. To sell your home, call a REALTOR!
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Do you have a friend "in real estate?"
Do you have a friend "in real estate"? The chances are good that you may have several such friends. That could create a dilemma when you decide to sell your present home. How would you decide which friend to represent you in the sale of your home? If you are like most sellers, you will no doubt want to sell your home at the best possible price. At the same time, it would be important to accomplish the sale in the least time and with a minimum of inconvenience to you and your family. To accomplish each of those three objectives, your home should be marketed effectively from the beginning. If you choose one of your real estate friends, it makes good sense to choose one who knows the real estate business from the inside - out, someone who devotes full-time to the business and has made a long-term commitment to be the best. Your friend should possess extensive knowledge about your neighborhood and, specifically, the type property you will be selling. The friend you choose should be "in-touch" with the local market, having daily contact with mortgage lenders, bankers, attorneys, and other real estate related individuals. Your friend should be a REALTOR, a member in good standing of the local Board of REALTORS, who subscribes to a Code of Ethics. This association provides many opportunities for its members, including continuing education and regular contact with other professionals, another measure of your friend's commitment to excellence. His or her activity level, the degree of involvement in day-to-day changes which occur in real estate locally, will very likely reflect an established record of successful real estate sales. Does it sound as though you should look for a professional real estate business person, rather than a friend? You really should, and if that professional also happens to be a friend, Bingo! - everyone's a winner.
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How can I help a family member become a home owner?
In movies and television shows depicting "by-gone" eras, families are portrayed as having strong ties between parents, children, aunts, uncles and grandparents. Relatives seem to join together in close-knit unity, sharing their prosperity and giving each other emotional and financial support when needed. Today, there are opportunities to return to the values shared in earlier times. Younger family members, just starting out, can be provided assistance with downpayments on a first home. Others, already established in home, might benefit by receiving funds to be used as purchase money, secured by a first mortgage, resulting in a lower interest rate. By making funds available to family members for downpayments and mortgages, parents, grandparents and other relatives can earn favorable interest rates on their savings. Secured by mortgages or other collateral, the use of "family money" could work to the benefit of both borrower and benefactor. The relative making the loan may receive more interest than what their current investment provides, and the one borrowing might benefit by a slightly lower rate than would be available from a conventional lender. Either way, the family benefits. Younger members of the family can begin building security through equity in a home, and those moving up may improve their financial position through interest savings. Home ownership has historically provided a long term increase in financial security. Properly secured loans from one family member to another for home buying purposes can provide financial growth, strength and security, not to mention emotional satisfaction. Whether you are planning to buy, or have money to invest, talk to a family member first. Put your family ties to work for the good of the family.
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What is a fair price for my home?
When selling or buying real estate, what price is a "fair" price? One land auctioneer used to begin his auction sales with the words "We're here to get as much as we can - you're here to buy it as cheap as you can what am I bid?" It was a down to earth way of saying that buyers and sellers have different viewpoints about price, but must finally agree if a sale is to take place. Mortgage lenders, appraisers and real estate brokers use the term "fair market value" to identify what they believe to be a "fair" price. Fair market value is defined as ``that price which a buyer is willing to pay and at which a seller is willing to sell, both parties being knowledgeable about the property and neither party being under any time pressure to sell". A Competitive' Market Analysis is one method for determining fair market value. It is a report which provides information about similar properties which are 1) "For Sale" at the present time, 2) already "Sold", and 3) "Expired". Homes which are currently "For Sale" indicate what the competition is asking. Although buyers have not yet agreed to those prices, they are one barometer of the maximum potential price. Homes which have already "Sold" provide historical information about prices sellers have been willing to accept and buyers have been willing to pay. The more recent the sale, the more reliable the information. Appraisers only use sales which have actually closed. Those listings which have expired without selling are an indicator of what buyers are not willing to pay. If a home was listed for sale and did not sell, the price was likely higher than buyers were willing to pay for comparable homes. Sellers may set their asking price, however buyers actually place the final value on them, as evidenced by their willingness to pay a particular price. For detailed information about fair market value in your area, call a REALTOR. As an active member of the local real estate community, a REALTOR is able to provide accurate, up-to-date information on the local housing market.
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What is an earnest money deposit?
In by-gone years, real estate buyers and sellers are said to have first "bargained" for the property in question. The process of serious negotiation was said to be bargaining in "good faith" or "in earnest". Each party sought the assurance of the other that they were sincere in their desire to buy or sell. In those days, there was little need to write down the details of the agreement since, as they said then, "A man's word is his bond". Probably no money changed hands either until the sale was consummated. Later, as agreements for the sale of real estate were required to be in writing, it became common practice for the buyer to offer a quantity of money (or other valuable) as "earnest money", also known as "good faith money". It's purpose was to offer a visible sign that the buyer intended to complete the sale. The amount was usually small, but it's significance was great. It, along with the written contract it accompanied, took the place of a handshake agreement. Today, an "earnest money" deposit placed in an escrow or trust account is commonplace. The purpose is the same, to assure the seller of the buyer's serious intent to complete the purchase. The amount of money placed as a deposit when purchasing real estate is negotiable between the buyer and seller. Most agree, however, that the larger the deposit, the more serious the buyer's intentions. The idea of a deposit is to insure that the buyer fulfills his or her obligations under the agreement of sale. If a buyer willfully defaults on those obligations, the deposit may be forfeited. Most sellers require a deposit large enough to insure that the buyer will not default. From that point-of-view, sellers may look with suspicion upon buyers who refuse to provide a deposit or insist on a very small one. After all, a genuine buyer, who sincerely intends to complete a sale, has no qualms about making a substantial deposit. When selling a home, ask your REALTOR for advice about the amount of deposit you should require from buyers. Remember, there is no set of rules to follow, just good common sense.
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I'm considering selling my home "By Owner" - do you have any suggestions?
Selling your home soon? Will you be able to find a buyer? More importantly, will buyers be able to find you? If you plan to sell your home alone, without the professional assistance of a REALTOR, staying at home should also be included in your plans. At first, when you begin running advertisements and place a "For Sale" sign in your yard, you may receive many phone calls from prospective purchasers. They may also come to your front door to ask questions - unannounced. That is good, however it places responsibility squarely on your shoulders to be there at all reasonable hours to graciously show the home at their convenience. You may say to yourself, "I'm home most of the time, and if I do happen to be gone, my telephone answering machine will take their call". Yes, some will leave a message or call back - the ones with plenty of time on their hands. You will probably encounter two types of buyers, the not-so-serious "time-wasters" and the sincere buyers, motivated to make a purchase. In the first case, if you are not home when they call or come-by, don't worry. They will call back. They like to look at homes and are in no hurry to buy. They like to call people selling "by owner" because they will not have to deal with a REALTOR who may ask them qualifying questions before showing the home. The second group of buyers, those motivated and prepared to make a purchase right away, will rarely call a second time or return if you are not home. They intend to buy - plain and simple. If you have your home "For Sale" and are not home, they will probably go to homes which can be seen with little notice, usually those listed with a local REALTOR. To purchase a home, buyers must first see the home. To be sure your home is exposed to the widest variety of potential buyers, at their convenience, seek the representation of a REALTOR. You benefit from the convenience, and your best interests are protected.
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I want a bargain on a home. Is there anything I should be aware of?
Have you ever shopped a "bargain basement" sale at a large department store? Merchandise from throughout the store which has not sold at full retail price is offered along with lower quality merchandise on the "basement" level of the store at real bargain prices. Many people are attracted to the "Bargain Basement Sale". They try on the merchandise, point out flaws to sales clerks, and bargain for an even better price. On the upper floors of the store, it is "business as usual". Serious shoppers looking for quality merchandise at fair prices quietly make their purchases from service-minded attendants. Real estate is sometimes sold and purchased in much the same way. At the bargain basement level, a few sellers attempt to sell "by owner". With a For Sale sign and a few newspaper ads, they attract the real estate bargain-hunters of the world, those who want to buy below the market by dealing directly with the owner. They expect to save the real estate commission and a few thousand extra for good measure. They may or may not buy, but they will certainly look, inspect, bargain, knit-pick, and otherwise take up the valuable time of the seller. Serious real estate buyers, on the other hand, are likely to choose a REALTOR to help them locate a suitable home. They understand that a REALTOR can show them a wide variety of available homes, priced fairly. Buyers are also likely to receive other services such as help with mortgage financing, advice on schools, shopping, churches, etc., and other community information. Services are generally offered to buyers at no cost because the REALTOR usually represents and receives a fee directly from the sellers. Are you willing to sacrifice the equity in your home to bargain hunters? Are you prepared to open your home to inspection by a variety of unqualified lookers? Wouldn't you prefer to sell your home to a qualified buyer with little inconvenience to you and your family? When selling your home, consider the importance of showcasing your home to the right clientele. A full fair price sale can be the result - the benefit of a wise decision.
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I'm a first time home buyer. What should I be aware of?
You have been planning to purchase a second car and have saved $7,000. It's Saturday morning and you have time to shop and make your purchase. You drive to a nearby dealer and find only two cars for sale. Both are the same year, make and model. Both have a price tag of $7,000. They are identical - until you begin to inspect them more closely. The first appears to be "good transportation" at best. The car's finish shows neglect, with nicks, scratches and "dings" abundantly displayed. The windows are smudged, the tires under-inflated, and the radio antenna is missing. Inside, key in the ignition, it grudgingly starts on the second try. Books and papers litter the back seat, the ashtray over-flows with an assortment of items, and the floor mats are missing. After an abbreviated inspection, you turn your attention to the second car. You notice that the morning sun reflects brightly off the spotless windows and gleaming finish. This car seems to promise satisfaction. The chrome and trim are flawless, and the tires have been scrubbed clean. It invites a closer inspection. Sitting at the wheel, the engine jumps to life, then settles down to an imperceptible idle. The interior sparkles. You feel good just sitting there at idle speed. You make your choice. This car wins hands down. Home buyers experience similar situations daily. With plans to purchase a home, buyers inspect a number of similar homes at similar prices. They begin making value judgements from the moment they drive up to each home. Their first impressions begin with the yard, the driveway, and the front door. Once inside an attractive, well- maintained home, buyers can sense the presence of "pride-of-ownership" - or its absence. It has been said that buyers make up their minds in the first five minutes, then spend the rest of the time rationalizing their decision. For those who plan to sell their home - a word of advice: place great emphasis on providing a home in impeccable, move-in condition. For more details on the best way to showcase your home, contact a REALTOR.
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Is there anything I should prepare for when buying a home?
Buying a home soon? Whether you plan to purchase your first home, move up to a larger one or buy a new one, what steps can be taken to insure a satisfying, successful home buying experience? The first step might be to evaluate your present situation. Do you currently own a home? If so, will it be necessary to sell before making another purchase? Are you renting? How much time is left on your lease? If you already own a home, start by asking a REALTOR to provide a "market analysis" of your home. It should include a suggested price range, terms, a list of needed improvements, probable selling time, and a "net" sheet showing the proceeds you may expect to receive when it sells. Once you know what to expect from the sale of your present home, you will be better prepared to make an informed decision about another home. If you are leasing or renting now, the expiration date of the lease will help you set a timetable for your purchase. Step two, ask a REALTOR for a list of mortgage lenders who perform "pre-qualification" interviews. This procedure allows the lender to determine the maximum mortgage for which you qualify. By obtaining this pre-purchase determination of available mortgage loans, you can begin your home search with the advance knowledge needed to purchase the home of your choice. You will also know the amount of your down-payment and other closing costs. Next, make a list of features you would like included in your next home. Write down desirable locations you would like to consider, an acceptable price range, number of bedrooms and baths, and any other amenities. Be specific. It is unlikely that you will find a home that offers every single feature you desire, however, without a list, it will be more difficult to recognize homes which meet your expectations. Finally, provide the information you have gathered to the REALTOR of your choice, and ask to be shown a selection of homes which match your criteria. By following a logical, step-by-step, purchase agenda, you can enjoy a worry-free home purchase.
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There are a lot of homes on the market now. How should I be searching for MY new home?
Have you ever seen an eye-catching advertisement in the local newspaper picturing an attractive dress or suit which interested you? Imagine your surprise and frustration as you respond to the ad and find only that one item in stock, in only one size? The store offers no wide selection of styles and no color choices. In fact, the price seems high for the advertised item, yet there is no other merchandise against which to compare the price. You leave the store in confusion. A ridiculous story? Of course. When buying merchandise, you will probably go first to a store that offers a wide range of clothing in many sizes, styles and at various price levels. A helpful attendant will ask about your interests in clothing, then show you the way to the right department. After comparing styles, quality and prices, you make your purchase. When you buy a home, you could really face the first situation. Each time you respond to a "by owner" advertisement, you are making a trip to a store with only one piece of inventory. You face a "take it or leave it" situation. The owner has only one home to sell, making price comparisons difficult. You must visit several "by owners" just to get a feel for price, quality, etc. You are literally "on your own", and each owner is biased toward the one home being offered for sale. Look at home buying as a process, not a single act. It requires knowledge of your buying power and your ability to secure mortgage financing. It requires a knowledge of the area, and of your needs and preferences as to size, style and features. Finally, you should be able to comparison shop, sizing up a number of fairly priced homes before making your decision. To accomplish all the steps in the home buying process, select a REALTOR to help you locate the right home. REALTORS are committed to a Code of Ethics, and to treating all parties fairly. They will lead you through the buying process, help with financing, and locate a variety of suitable homes at fair prices. Because they can show you virtually any home being offered for sale, you only need the services of one REALTOR.
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Should I take a vacation or buy a vacation home?
Each year families all over the country set a goal of going on vacation. It may be a road trip to a national park, a flight to the grandparents' house or a few days at a theme park. Anticipation, fun, excitement, and lots of goofy pictures to laugh about for years to come. Vacations mean all of these. However, there's a way to make your vacations even better: make them an investment by buying a vacation home. This might seem like an expensive luxury at first, but consider the expenses you incur for a vacation: travel, food, research, lodging, preparation time and energy, etc. Even though a vacation home also involves expense, these expenses build equity in a home. First, consider the types of activities you and your family enjoy. They will have a big impact on the location you choose to buy a second home. You should look for areas that both match your needs and show consistent property values. A location that suddenly becomes popular may just as easily become unpopular. Once you have chosen a location, it's vital to meet with a real estate professional to determine affordable financing options and the most desirable neighborhoods. Ensure you make the best investment by researching before you buy. Look carefully at issues like income and property taxes, insurance rates, property values, local real estate codes and regulations. Some vacation home owners can rent their second homes without a problem. On the other hand, relying on vacationers to help pay the mortgage may be a risky bet. If you're considering renting your second home, rent to friends, relatives and prospective renters you know or have screened. A vacation home may not be out of your reach. If your family enjoys getting away, buying a second home after careful research is a smart investment. Ask me anytime for help with mortgage possibilities and information about homes in the Ft. Wayne Area or any other location in North America. Today beautiful Southwest Florida provides some of the best real estate bargains in the nation. Contact us about how you can find your next "vacation".
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Is there anything I can do to help sell my home?
True or false? Once you have chosen a REALTOR to represent you in the sale of your home and have signed a listing, you should get out of the way and let the REALTOR find a buyer. False. Selling a home quickly and at the best possible price requires involvement by the owners as well as the REALTOR in the selling process. The sellers' responsibilities fall into two areas: l) providing a home that is fairly priced with attractive terms, and 2) providing a home in marketable condition. The REALTOR is responsible for preparing and implementing a marketing plan which will attract suitable buyers to the home resulting in an acceptable transaction for the sellers. Pricing is important because most buyers comparison shop before making their purchase decision. As a result, they eliminate homes which are priced above "fair market value". The REALTOR can provide details of recent sales in the local market, as well as pricing of similar homes currently for sale. This data can be used by the sellers to arrive at a price which reflects the value offered by their home. Providing an attractive home in marketable condition is critical to a successful sale too. No matter how effective the marketing plan, buyers expect to purchase a home in excellent condition. By performing an objective walk-through inspection of the home, the REALTOR can provide the sellers with a list of possible improvements. It is then up to the sellers to see that the home presents a positive first impression. With the sellers participation, the REALTOR will create an imaginative marketing plan. This plan will target groups of buyers most likely to purchase the home. Advertising and promotion will be placed to attract their attention. The home is thus positioned to appeal to the widest possible segment of purchasers. The next time you sell your home, plan to work in partnership with your REALTOR. The results can be an emotionally and financially satisfying home selling experience.
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What things should I prepare for now that I've bought a home or sold one?
Tips For a Smoother Move Rarely do people live in the same house throughout their lives anymore. Moving is a fact of life for most people sooner or later. When the time comes for you to pick up and move on, plan ahead and involve everyone in the family. Two Months. Contact movers at least two-months-in advance. Call a few companies and set up appointments with agents to see your belongings. Also call the Better Business Bureau and your state's agency that regulates movers to ensure that your choice has receive few or no complaints against them. At this point, determine how involved you and your family want to be in the moving process. Be sure that all bids are for the same work. Give identical details to each mover's agent: the number of levels in your new and current home, the items you will pack yourself, the exact date you need to be moved in, and any delicate items requiring extra care. One Month. Complete all your moving-related errands about one month before the big day. Look through all your recent receipts as a reminder to pick up dry cleaning and appliances at repair shops. Contact utility companies to give them your shut-off dates. Collect everyone's medical, dental and school records. Stop by the post office to complete a change-of-address form and then send your new address to any paper or magazine to which you Subscribe. Also, invite friends or family for get-togethers and a good-bye party. The Countdown Begins. Pack belongings you'll need during the move as the days preceding it arrive. Along with clothes, pack an essentials suitcase with everyday items such as toiletries, a plastic tableware set for snacks and non-perishable foods like tuna fish, crackers and granola bars. Try to eat all remaining perishable food and defrost the fridge to room temperature for your moving day. The computer, television and other electronics should also be cooled down. Don't forget to label and carry important papers with you.
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I'm thinking about remodeling my home. What things should I consider?
After a few years of home-owning experience, like many owners, you may realize that you're outgrowing your house. Seems like it's time for a new home, but should you take care of those remodeling jobs you planned! In general, remodelers find it's better to make minor, cosmetic improvements if you're planning to sell within a year. If you think your house could use some remodeling, you have many options. For the past few years, remodeling the kitchen and adding a bathroom have proved to be good financial choices to home sellers. You can start by using a home computer and working with a professional remodeler. If you have a home computer, you can purchase and install any number of home remodeling visualization programs (if your remodeler doesn't have one). You can then view new wall colors, different types of tile and other cosmetic changes on your computer screen. You can arrange various styles of furniture, design your own room, build walls, add cabinets and fixtures, see everything from all angles, even cast shadows from outside light, and then tally the approximate costs for your new creation. More complex programs will require some time for you to go through a tutorial, which will teach you what the program does and how it works. However, when you actually speak with your remodeler, you'll already have seen which layouts best meet your needs. You should be able to buy interior design computer programs at almost any good office supply or computer specialty store. Before you hire a remodeler, conduct a thorough interview including the company's: * References of past clients. * Samples of previous jobs. * Views about remodeling (and your comfort level talking with the remodeler). * Membership with local or national remodeling associations, such as a Certified Master Remodeler. * Experience in your area. * Record with the local Better Business Bureau.
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Wouldn't it be easy to sell my own home?
When preparing to sell a house, some homeowners are tempted to handle the marketing, negotiations, and many other details of the sale themselves. For those considering such a plan, here are some basic questions: Will you price your home too high and discourage prospective buyers, or too low and lose part of your equity? Do you have the information and the ability to ask hard questions about the financial qualifications of the buyer? Can you show other houses as comparables? Are you available to prospects on a full-time basis until the house is sold? Can you answer objections and criticism without getting emotionally involved? Can you call a prospect back without placing yourself in a poor bargaining position? Are you familiar with all the financing possibilities to guarantee the sale? Do you really have the time to handle all of the details? It is tough to sell a house by yourself. And, according to one survey, on the average, houses sold by real estate agents brought a 9.5 percent higher price than similar, owner-sold homes.
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Should I check my credit report before considering the purchase of a new home?
When was the last time you saw a copy of your personal credit report? If it hasn't been recently, then it may be time to get a copy, especially if you're considering a real estate purchase in the near future ... It is estimated that more than two out of five people have erroneous information on their consumer-credit reports. Incorrect information can cause long delays in the approval process and can even be the basis for denial of credit, including a mortgage. The time to check with credit reporting agencies is when you don't need the credit. It can take months straightening out a problem and you don't need that added stress during the home buying process. The major credit reporting companies are TRW, Equifax, and Trans Union. Since they operate independently, you might check your report at all three. If you have difficulty, you can ask for help from your mortgage or commercial banker. One of the most common misunderstandings homeowners have is that since there may not be a late fee due on the house payment until the 15th of the month, they think it isn't due until then. The house payment is due on the first of every month and will not only be considered late but reported as such if it is received after the first.
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