Buyer
What is going on with the market ??
A lot of people are asking that question; What is going on with the market right now?
The current situation is not usual, many people are waiting to see what is going to happen to the economy, how the economy will recover. This is putting a lot of people on Hold for listing their properties and they may be right, why do I sell my property now if it may appreciate 50k more next month, buyers now driven by the lowest mortgage rates ever are flocking to the real estate market because they can afford way more than when those rates were higher by 1% not a long time ago.
With CARES Act Mortgage Forbearance in place, which limits the foreclosure possibility as well eviction for tenants that can’t pay their rent due to loss of income, the inventory is very tight. Many landlords cannot list their properties, and many homeowners are waiting to see what comes next.
The CARES Act forbearance was about to expire but with the new extension by the Federal Government to summer, my expectations are that the market will stay tight until that time.
Expectations are that sellers will have big leverage in pricing their properties and buyers will compete fiercely taking advantage of the lowest mortgage rates.
Feel free to contact me with your questions about your property value or any real estate advise
2021 Housing Market Expectations
The housing market has seen a record growth starting summer 2020 after a few months of slow growth during COVID-19 pandemic, despite the uncertainty in the other economic sectors, especially the jobs market.
This growth was driven by 3 key factors: Historic Low-interest rates, a low inventory of properties available for sale, and a surge in city residents looking out to relocate to the suburbs following the many cities unrest during the time of protests.
Home sales have been at the highest in the last 15 years since the last depression. This time of the year during the Holiday season historically is the slowest but so far, the real estate market has not shown any kind of weakness driven by the low-interest rates.
For the first time in so many years that we see a seller’s and buyer’s market. That may sound like a mistake but let me explain it.
It is a good time for sellers to sell because of the short inventory when they have leverage in dictating a lot of contract terms in their favor but it is also a good time for buyers to buy because they can afford more space with the low-interest rates.
The latest housing numbers are showing 16 consecutive weeks of double-digit price appreciation. When comparing this time of the year with the same time in 2019, home prices are approx. 12-14% higher.
The expectations are for a strong housing market in 2021 due to the fact that it is less likely that the mortgage interest rates will jump up all of sudden with the federal government is trying to stimulate the economy following the pandemic, as a result, buyers will keep trying to benefit from this opportunity before interest rates start going up again while sellers are closely watching the market and selling their properties for the highest price possible due to the low inventory.
Feel free to contact me with any questions you may have or if I can assist you with any real estate needs.
Selecting a Real Estate Agent
I’m going to touch base on one of the most important aspects in the process of real estate transaction; which is selecting a Real Estate Agent, whether you are buying or selling.
The market is full of Realtors from different backgrounds, with different skills, representing many brokers and brokerage firms, providing different levels of services, with different experience.
So the million dollar question will be: Which one to choose? The answer to this question will be whether you are buying or selling.
A- If you are selling your home, here are some of the characteristics sellers say they want in agent:
- Experience. With the local market is a key to succeed in selling your house.
- Education. Ask about degrees and certifications.
- Honesty. Trust your intuition. Your agent should speak from the heart.
- Networking. This is a people business. Some homes sell because agents have contacted other agents.
- Negotiation skills. You want an aggressive negotiator, not somebody out to make a quick sale at your expense.
- Good communicator. Sellers say communication and availability are key.
Two of the biggest mistakes home sellers make when choosing a listing agent are selecting an agent based on:
- Highest List Price for Your Home
- Lowest Commission
you may think that those are the 2 main keys to choose a realtor but those two criterion have very little to do with hiring a competent agent and, in many instances, are completely irrelevant. Let’s look at why.
The Highest Suggested List Price
Agents can’t tell you how much your home will sell for. That’s a not TRUE. A listing agent can show you comparable sales, pending sales and active sales. But YOU choose the sales price and a buyer will tell you if the price is right.
To get the listing, some agents distort the truth.
- Since agents can’t guarantee your sales price, the listing agent who suggests the highest price is probably untruthful. Ask the agent to show you numbers supporting that suggested list price. They probably won’t have them or the home sales will be located in a different neighborhood.
- Look for a listing agent who gives you a range.You always look for a price range. Many factors determine the range, among which are location, the market condition and improvements.
- Pricing is an art.The best time for an offer is within the first 30 days on market. If the home is priced right, you’ll get an offer. If it’s priced too high, you might not get any showings at all; buyers will shun your home and you’ll eventually end up reducing the price, leaving buyers wondering what’s wrong with your house.
Should You Choose an Agent Based on Commission?
Real estate agents are not equal; each is unique. Remember about 10% of the agents do 90% of the business. Each has their own marketing techniques and advertising budget. By choosing an agent with a large advertising budget and company dollars to match it, you will gain greater exposure to the largest number of buyers, which is ideal. Reaching greater numbers of buyers equals better chances of a good offer.
B- If you are buying a home, make sure to ask these questions:
1. Are you a member of the National Association of Realtors?
This organization requires certain standards from its members, and you don’t want to worry about having a shady agent.
2. Are you a member of MLS?
This is the Multiple Listing Service, which gives agents access to houses represented by all agencies — not just their own. For sellers, this means your home will be posted on the list as well, which means more people will see it.
3. Do you work on weekends?
Since this is when most open houses take place, the answer to this should be yes.
4. Can you outline how you would represent us?
The answer should include your housing inspections, following through with your mortgage approval process, and being present at your closing.
5. Will you show me houses listed by other companies?
Double-check that the agent isn’t partial to his or her own realty group.
6. Are you familiar with our area?
You’ll want the agent to know the ins and outs of your community.
8. What’s your business style?
Do you want a broker who calls you once a week or emails daily? Find out how the agent will keep you updated on prospects and inform them about your preferences.
Why hiring a Real Estate Agent when buying or selling a home.
1. Education & Experience.
2. Agents provide peace of mind.
3. Neighborhood Knowledge
4. Price Guidance
5. Market Conditions Information
Real estate agents can disclose market conditions, which will govern your selling or buying process. Many factors determine how you will proceed. Data such as similar homes, median and average sales prices, average days on market and ratios of list-to-sold prices.
6. Professional Networking
Real estate agents network with other professionals, many of whom provide services that you will need to buy or sell. Due to legal liability, many agents will hesitate to recommend a certain individual or company over another, but they do know which vendors have a reputation for efficiency, competency and competitive pricing.
7. Negotiation Skills & Confidentiality
Top producing agents negotiate well because, unlike most buyers and sellers, they can remove themselves from the emotional aspects of the transaction and because they are skilled. It’s part of their job. Good agents are not messengers, delivering buyer’s offers to sellers and vice versa. They are professionals who are trained to present their client’s case in the best light and agree to hold client information confidential from competing interests.
8. Handling Paperwork
One-page deposit receipts were enough to sell a house in the old days. Today’s contracts run so many pages with all forms and addendums and mandated disclosures. One tiny mistake or omission could land you in court or cost you thousands. In some states, lawyers handle the disclosures.
9. Develop Future Business Relationships
The basis for an agent’s success and continued career in real estate is referrals. This emphasis gives agents strong reasons to make you happy and satisfied. It also means that an agent who stays in the business will be there for you when you need to hire an agent again. Many will periodically mail market updates to you to keep you informed and to stay in touch.
Tips when buying a house
How to Buy a Home (in order)
1. Pick your your professionals. Stick with recommendations from Realtors. Your Realtor can help find the most trusted professionals who deals with the real estate transactions based on their experience with them. They can filter the good ones from the bad ones for you.
2. Hire a real estate attorney if your state law requires one for closing. Quiz them on their conflicts. A good real estate attorney can protect you throughout the process. Some state bar associations have a specialist certification for real estate attorneys.
3. When Searching Online to Find a Home. Ask your realtor about the most updated real estate website, some of them get updated once a week risking losing a good deal or property.
4 Shop and compare loan officers and narrow the selection down to three. The most important time to compare rates is when you lock in your rate. Most big real estate companies have in-office affiliated loan officers who can make the transaction goes smoothly.
5 Hire a buyer agent. Avoid dealing with listing agents that may lead you to a dual agent situation because they will be constantly running into conflicts of interests so severe that it will be illegal for them to assist you in key parts of the transaction and hence by law they have to protect the seller first. Try to find an Exclusive Buyer Agent who can represent you to your best interest in the deal. Base line, Never agree to dual agency and never allow your agent to collect incentives from the seller or other brokers or to pay referral fees to other brokers.
6 Hire an independent title company or attorney to close your transaction.
In states where attorneys are required to close transactions, make sure that your closing attorney is not the same one who has been helping you through the negotiation process. Use that negotiating attorney to help you negotiate the terms of the title insurance coverage that you receive from the closing attorney.
In states where title companies perform the closing, make sure that you are using a title company that is not affiliated with the seller. Make sure that the title company has attorneys on staff who supervise the title examination process.
Home Inspection Tips for Buyers
What is a Home Inspection?
Home inspection process is simply hiring a professional to inspect the property in all areas (structural, mechanical, electrical, plumbing) and prepare a comprehensive report to the the buyer of the house, new or old, in order to help the buyer make an informative decision before closing. The inspector should be certified and provide a report of the condition shortly after the conclusion of the inspection.
Reasons You Need a Home Inspection
It seems very important to get a home inspection, however many buyers opt out, especially when purchasing a new home or in tough seller’s market when the demand is high and the inventory is low to make their offers appealing to the seller. In short, you need to get a home inspection to insure you’re not walking into a financial disaster. You wouldn’t want to close on your home to later find out it has structural problems that are going to cost you thousands of dollars to fix.
How Much Does a Home Inspection Cost?
Cost of a home inspection depends on the size of the house and will differ by home inspector. Generally we are taking about a range of $300 – $500 which can save your thousands in the long run. There are some add – on services, so make sure you check with your inspector and get a quote before begging the process.
Include a Home Inspection Contingency in your Sales Contract
Make sure you have a contingency clause built into your sales agreement that states the sale of the home is contingent upon no major issues found in the home inspection. Your lawyer or real estate agent can help you with the wording, but you need some way to opt out of the contract based on the results of the inspection.
Who Pays for the Home Inspection?
The home inspection is the responsibility of the buyer. It’s well worth the money, especially if you’re buying an older home. However, you strongly should consider paying for a home inspection for a new home. Of course, you may love and trust your builder, but they make mistakes too. Keep in mind all new homes are generally insured for a year, but how do you know what to ask to be fixed without a home inspection?
How to Find a Home Inspector
Typically real estate agents are a good place to start to find a trustworthy inspector. Just ask your agent for their top three picks and you can do your research from there. You can also search on the web, but you may not be getting someone whom your agent is familiar with their work.
Makes Sure You Require Certification
It’s very important that your home inspector is certified. Otherwise, they may just be going on their own experience or judgment and not know the proper guidelines regulations to follow for their state. There are a lot of people with housing experience, but the state certified inspectors are required to look for certain things in the inspection and disclose them to you. Don’t take this issue lightly, Buying a home is a big, huge and long term investment that you don’t want to risk it to save few bucks.
Hire a Knowledgeable Inspector
While it’s important to hire an inspector who is certified, it also helps to find someone who has some home building, or related experience. Such inspectors are the brightest when it comes to finding issues as well as describing the problems to you in the report.
Watch Out for Conflicts of Interest
Under no circumstance should you hire a home inspector who also has a repair business looking to sale you services. While home inspectors may have remodeling and repair business on the side, the temptation is to find things that require their repair services.
Ask About the Inspection Report
A key to differentiate between home inspectors today is how they generate their report. Do you want a hand written report that is delivered in a few days? Or, would you rather have an electronic version with images you can via on the web the same day? Generally, it’s the latter, but it’s your preference. Some home inspectors, are using home inspection software to offer more conveniences to agents and customers.
Set Expectations in Regards to Timing
You should agree with your home inspector up-front in regards to when they will visit the home and when their report will be generated. This is a key in the home sales because those time frames are set in writing in the sales contract and missing those dates may cost you the right to opt out of the sale if there’s a major problem and Setting such an expectation up-front will insure you have the information you need timely during the already busy process of buying a house.
Use a Home Inspection Checklist
It’s always a good idea to understand what to look for and you can use a checklist from Closing.com as well as some other resources.
Preparing to buy your Next Home
Selecting a mortgage loan has become a challenging task in recent years. Sad News are :
Don’t expect it to change anytime soon.
Lending standards will remain tight in 2012, but that doesn’t mean you won’t be able to snag a mortgage with an attractive rate. Savvy borrowers who understand the rules and prepare in advance will improve their chances of success.
These tips will help you stay on top of your game as you try to secure a mortgage in 2012.
Most lenders require a minimum credit score of 680 to comply with Fannie Mae and Freddie Mac’s guidelines. Federal Housing Administration loans, which are guaranteed by the FHA, allow for lower scores, but most lenders want to stay away from scores lower than 620.
2- Prepare before you start
There are some basic documents every lender requires to process your mortgage application. Don’t wait for them to ask.
Have these documents ready when you walk into the lender’s office: your last two pay stubs, W-2s, income tax returns and bank statements.
Save these documents and any additional ones the lender requests in an electronic format, so you can easily resend them if anything gets lost in the process.
3- Know how much you can afford
Don’t rely on your lender to tell you how much mortgage you qualify for and then borrow the maximum amount. Plan your budget, and leave room for unexpected expenses. That’s especially the case when you are buying a house.
Bankrate’s calculators can help you determine how much house you can afford and estimate your monthly mortgage payments.
4- Shop around
Shopping around for a mortgage should go beyond comparing interest rates. Rates are important, but would-be borrowers must consider points, closing costs and different types of loans. Get estimates from three banks and three mortgage brokers before you decide which combination works for you.
5- Time is of the essenceOnce you submit your mortgage application to the lender, the clock starts ticking. Make sure you quickly send in any documents requested during the approval process.For buyers, a delay in closing the loan could kill the purchase and cost them their deposits. When refinancing, a delay could mean losing the interest rate the borrower originally locked in. Ask for an expected closing date, and follow up with the lender periodically until the loan closes. Keep in mind, some lenders close more quickly than others.6- Mortgage approved? Your credit must stay put until closing
After the lender pulls your credit and says you’ve been approved, don’t assume you’ve won the battle. Most lenders will pull your credit again before the loan closes.
It’s wise to avoid any moves that may affect your credit. Don’t apply for new credit cards or credit lines. Pay your bills on time
7- Consider a refi with no closing costsYou don’t always have to spend money to save money when refinancing. Many lenders offer mortgages with no closing costs. No, it’s not a free ride. Lenders usually make up for those costs by charging the borrower a slightly higher interest rate. Sometimes the slight increase translates into a few extra dollars in the monthly payment, and the borrower can save thousands in closing costs.8- Consider a shorter-term loan
Because interest rates are at or near rock bottom, short-term loans have become more affordable for many borrowers.
Those who currently have a 30-year mortgage with an interest rate of 6 percent or higher may be able to refinance into a 20-year or 15-year loan while keeping their monthly mortgage payments close to what they pay now. Consider this option even when the short-term loan means slightly higher monthly payments. This is your chance to pay off your mortgage more quickly.
Did your parents or in-laws give you a few thousand dollars as a gift to help out with the down payment? If so, congratulations — but make sure you can document and explain where you got the money.FHA loans allow borrowers to receive their down payment as a gift from a relative. For conventional loans, borrowers may receive gifts, but at least a 5 percent down payment must come from their own funds.Borrowers receiving a gift are required to present a gift letter signed by the donor, and they will need a paper trail of the money transfer. Be ready to present statements to show where the money came from when it was deposited into your account.Unless the money is being used for the down payment, avoid receiving large cash deposits in your bank account until your mortgage closes. Any large deposits other than your paycheck will have to be explained to comply with federal regulations.10- Be persistent
If one lender rejects your mortgage application, that doesn’t mean all lenders will. Most lenders follow Fannie Mae and Freddie Mac guidelines. In addition, they have their own internal underwriting guidelines, and some are stricter than others.
Ask exactly why your mortgage was denied. Depending on the reason, you may be able to take some quick steps to imp
11- Appraisal isn’t enough? Try againIf the home appraisal your lender received isn’t enough to back the mortgage loan and you think the appraiser is mistaken, try another lender.You can’t order a second appraisal or pick which appraiser the lender hires, but you can dispute the first appraisal or apply with a different lender.In a perfect world, the appraised value of a home shouldn’t vary drastically from one appraiser to another. But you may find that they do. If you believe the first appraiser is wrong, try a different lender and hope that lender’s appraiser does a better job.
12- Seek help
If you are behind on your mortgage or are struggling to keep up with your mortgage payments, seek counseling.
The U.S. Department of Housing and Urban Development has counseling agencies throughout the country. Homeowners can receive free foreclosure-prevention counseling from HUD-approved counselors. To find a housing counseling agency near you call (800) 569-4287 or visit the HUD website.
How Do I Choose a Title Company?
How Do I Choose A Title Company?
Most consum
ers don’t even realize what Title Insurance really is. Many consumers don’t know they even need a title company until they were told so by their bank or realtor. The fact you are actually conducting due diligence in your search for a title insurance company is an important step. First off you are on the right path to guarantee your transaction goes smoothly and you have the adequate 3rd party protection and security that you as a consumer deserve.
How Do I Choose A Title Company? Before exploring how to make such a choice lets first make sure you understand what a title company is or even does, let’s review.
So now, how do you choose the right title company? First off, you as the buyer or borrower have the right to choose your title insurance company. The decision is not up to the Seller, Realtor or Bank. Section 9 of the Real Estate Settlement and Procedures Act or RESPA “prohibits a seller from requiring the home buyer to use a particular title insurance company, either directly or indirectly, as a condition of sale. Buyers may sue a seller who violates this provision for an amount equal to three times all charges made for the title insurance.”
So there are most likely several title companies that come up as local agencies to your neighborhood. A lot to choose from right! But while most title insurance charges are state regulated and are the same across the board it’s important to know that not all title companies or individual title insurance offices are created the equal. Consider these key factors when deciding a title company to handle what is often the largest financial transaction in one’s life.
1) Company. There are many “in house” or “joint venture” title companies that possibly work exclusively with 1 real estate company, one lender or one home builder. While this obviously leads to higher efficiency within the parent company, it also creates the opportunity for price gauging. Often times a consumer will pay higher fees to such an entity and even more so get less in service.
2) Services. Closing in your home at a convenient time for you? E-Recording? The importance to these items is easy to explain. 1- Convenience to you; 2- Electronic Recording guarantees that your deed will be recorded right away as to avoid any potential discrepancies or potential fraud by past owners.
3) Fees. As mentioned previously, title insurance fees in most states are regulated by the States Department of Insurance. However, ancillary fees charged by title companies often times can create a significant difference from one company to the next. In addition to title and endorsement fees, there are recording, reconveyance, release tracking, courier, overnight delivery fees, wire fees, electronic document fees, mobile notary fees, document prep fees, etc. Additional work fees are also not uncommon. Shopping around can save you anywhere from 200-1,000 in ancillary fees depending on the County and State the transaction is in.
4) Experience: Has your escrow officer or title agent worked in the industry for 10 years or 10 days? Is the title agent an Attorney Title Company or a non-attorney title company? Some inexperienced title agents or non-attorney based firms may not be well versed in all forms of real estate transactions. Whether it’s a commercial deal, short sale, refinance, 1031 exchange, bank owned, REO, Seller Financed, Installment Sale, assumptions and wraps? Or do they have one specialty, more importantly; is it the specialty you are hiring them for?
5) Communication: Believe it or not, one of the biggest issues in the industry is lack of communication. In a business that requires communication many people are poor at communicating. How does your escrow officer or title agent communicate? Phone, email, face to face, text, fax, or all the above? It doesn’t really help to have an escrow officer that only communicates via phone if you prefer email or even text.
6) Financial Strength: Remember the title company is going to essentially place the transaction with an actual Insurer. The agent depending on the state your transaction is based in is probably just an “agent” for the Insurer. While many title companies have been around for over a hundred years, not all have. The purpose of a title company is to facilitate your escrow and provide title insurance for your most valuable asset. But will the underlying title insurer be around in a few years to pay a claim that an escrow officer with no experience and poor communication skills messed up? Ask the question, who is this being placed with? Then look up the companies rating http://www.demotech.com/01_pages/fsr/companies.aspx?t=1.
Choosing the right title insurance company is imperative to a successful closing. Many things can go wrong in a real estate transaction, it is vital that your title company be well versed in all aspects of the closing process. After all, the mark of a good company is how they respond when things go wrong.