Showing posts with label Home Buyers. Show all posts
Showing posts with label Home Buyers. Show all posts
Monday, March 5, 2012
Wednesday, December 28, 2011
6 tips for timing a real estate purchase
How fence-sitters can get a jump on the competition
By Dian Hymer / Inman News®
In mid-June, interest rates on home loans were lower than they were a year ago. However, this failed to ignite the housing market. Many buyers and homeowners would like to make a move, but some find it impossible to make a decision. They are commonly referred to as fence-sitters, poised to make a move when the time seems right.December 28, 2011
The housing market is unlikely to turn around soon, but this doesn't mean that now is not a good time to buy or sell. It depends on your personal situation and market conditions in the area where you plan to buy or sell.
Become an expert on your local market. Knowing a good deal when you see it or what price to ask if you decide to sell depends on having a good understanding of how much properties are selling for in your neighborhood.
While you're trying to decide what to do, line up a team that can help you accomplish your goal when you decide to move ahead. You can do this by researching online, attending open houses in the area and asking a real estate agent to keep you on top of market fluctuations.
Your decision to buy should be based on your personal financial situation, not on the national or global economy. For example, if you bought during the bubble market and are now getting divorced, you'll probably sell for less than you paid.
But, if the house is too expensive for one to support, it may be cheaper in the long run to cut your losses and sell now. No one knows how long the housing downturn will last. Prices could move lower before rebounding. This is not an ordinary recession.
HOUSE-HUNTING TIP: Don't get caught up following the herd. Just because most people in your area aren't buying or are having difficulty selling doesn't mean that you shouldn't make a move. Just make sure if you're a buyer that you have job security, a relatively healthy economy in your local area and a plan to stay put for at least 10 years.
The housing market will be volatile going forward. Good economic news will help fence-sitters make the decision to get serious about moving. Bad news of any sort can cause the market to stall. To take advantage of the upticks in the market, you need to be prepared in advance.
Find a good local real estate agent to work with who understands your needs, and wait to buy or sell until the time is right for you. It could take you a year or so to make the final decision. Some agents don't have the patience to stick it out.
Select an agent who will educate you about the market and the idiosyncrasies of the home-sale business in your area. Ask to be kept informed about sales in the area. Many agents are set up to do this electronically, which is an easy way to keep you informed without taking up a lot of the agent's time.
One of the most difficult aspects of the current home-sale business is financing the transaction. Find a loan agent or mortgage broker who is a real professional, has been in the business for years and who understands what current underwriters will require from you to process your loan.
Assemble all the financial documents you'll need for loan approval even before you start looking. Ask your agent or broker to have your loan package previewed by an underwriter so that you know beforehand if there are any problems.
THE CLOSING: Remedy these in advance so that they don't cause last-minute delays in closing.
Dian Hymer, a real estate broker with more than 30 years' experience, is a nationally syndicated real estate columnist and author of "House Hunting: The Take-Along Workbook for Home Buyers" and "Starting Out, The Complete Home Buyer's Guide."
Become an expert on your local market. Knowing a good deal when you see it or what price to ask if you decide to sell depends on having a good understanding of how much properties are selling for in your neighborhood.
While you're trying to decide what to do, line up a team that can help you accomplish your goal when you decide to move ahead. You can do this by researching online, attending open houses in the area and asking a real estate agent to keep you on top of market fluctuations.
Your decision to buy should be based on your personal financial situation, not on the national or global economy. For example, if you bought during the bubble market and are now getting divorced, you'll probably sell for less than you paid.
But, if the house is too expensive for one to support, it may be cheaper in the long run to cut your losses and sell now. No one knows how long the housing downturn will last. Prices could move lower before rebounding. This is not an ordinary recession.
HOUSE-HUNTING TIP: Don't get caught up following the herd. Just because most people in your area aren't buying or are having difficulty selling doesn't mean that you shouldn't make a move. Just make sure if you're a buyer that you have job security, a relatively healthy economy in your local area and a plan to stay put for at least 10 years.
The housing market will be volatile going forward. Good economic news will help fence-sitters make the decision to get serious about moving. Bad news of any sort can cause the market to stall. To take advantage of the upticks in the market, you need to be prepared in advance.
Find a good local real estate agent to work with who understands your needs, and wait to buy or sell until the time is right for you. It could take you a year or so to make the final decision. Some agents don't have the patience to stick it out.
Select an agent who will educate you about the market and the idiosyncrasies of the home-sale business in your area. Ask to be kept informed about sales in the area. Many agents are set up to do this electronically, which is an easy way to keep you informed without taking up a lot of the agent's time.
One of the most difficult aspects of the current home-sale business is financing the transaction. Find a loan agent or mortgage broker who is a real professional, has been in the business for years and who understands what current underwriters will require from you to process your loan.
Assemble all the financial documents you'll need for loan approval even before you start looking. Ask your agent or broker to have your loan package previewed by an underwriter so that you know beforehand if there are any problems.
THE CLOSING: Remedy these in advance so that they don't cause last-minute delays in closing.
Dian Hymer, a real estate broker with more than 30 years' experience, is a nationally syndicated real estate columnist and author of "House Hunting: The Take-Along Workbook for Home Buyers" and "Starting Out, The Complete Home Buyer's Guide."
Wednesday, July 27, 2011
6 tips for a better outdoor deck
By Paul Bianchina
Inman News™
Inman News™
July 27, 2011
Few projects are as enjoyable as building a new outdoor deck. They're fun to design and build; they look great; and they enhance both the enjoyment of your home and its resale value. Decks are also a great do-it-yourself project, and there are lots of products on the market that can help you get the job done faster, safer and with better results.
Wander the aisles of your local home center or hardware store or do an online search, and you'll find more than enough inspiration to get you itching to grab a hammer!
Deck design:
Let's start at the beginning -- with a great design. If you have something in your head in the way of a perfect deck but you're not sure how to turn it into reality, start with a simple computerized drawing program. You can pick them up inexpensively at a number of retailers, and they're pretty intuitive to learn. Most not only help you design the deck in 2-D, but also do 3-D modeling, structural details, and even material lists.
If you'd prefer to have someone else tap the mouse, check with your local lumberyard. Many of them offer computerized deck design services that can save you hours of planning. The design consultant will walk you through several basic designs, and help you customize them to your exact size and layout requirements.
Structural hardware:
When it comes time to do the actual framing, companies like Simpson Strong-Tie offer an incredible selection of steel framing hardware that greatly simplifies all those connections. For example, there are simple joist hangers that support and connect the joists where they attach to the ledger or rim joist, and inside angle connectors to strengthen a variety of framing joints.
Where a beam sits on top of a post, there are post cap connectors, as well as post base anchors to connect the post to the patio or pier block. There are even specialty connectors specifically designed for attaching deck railing posts to deck framing quickly and with much greater strength than simply nailing or bolting alone. Simpson's decking site is worth a visit:www.strongtie.com/deckcenter.
Duo-Fast DF150S-TC TICO Nailer:
All that helpful structural hardware also means driving a whole lot of nails to make the connections work properly. So if you've got a big deck project in the works, or you're a pro who does a lot of decks, you might want to consider a pneumatic nailer to help you out.
Duo-Fast's TICO Nailer is designed specifically to drive the 1 1/2-inch, .148-shank nails required by most building codes for use with structural hangers. It's compact to get into tight spots, has a convenient rafter hook, and has an adjustable exhaust to keep the air out of your face.
Best of all is the unique "probing tip," which accurately locates the hole in the hanger before you shoot the nail. Check it out at www.duo-fastconstruction.com.
Bench brackets:
Want to add a bench to your deck? Bench brackets make it easy. Made of steel or a durable resin, they bolt to both the decking and the deck framing for stability, then you add your own decking material to the top and back to form a seat and backrest.
The brackets are angled to form a comfortable backrest while eliminating all those difficult angle calculations. You can see a couple of different styles at www.rockler.com.
Precut stair stringers:
If your deck design calls for steps, don't despair over how to cut the stringers. Many lumberyards and home centers carry or can order precut stringers in different lengths. They're made of pressure-treated lumber so they're safe for ground contact, and all the hard layout and cutting has been done for you.
Just select the number of steps you need based on how high the deck is, secure them to the deck and to the ground using the appropriate hardware connectors, and you're all set. Finish off the installation with treads that match your decking boards.
Railings:
A deck railing adds a lot of visual interest to a deck, and it's also a code requirement if the deck will be more than 30 inches above the ground. Thanks to the tremendous interest in decks and the number of do-it-yourself deck builders, there are lots of different railing ideas that you can choose from, as well as the parts to build them with.
You can go with simple wooden pickets, which your local lumberyard will have in stock. Or you can step it up a bit with metal pickets, which are available in different colors and styles at places like www.stair-parts.com or www.deckdepot.com, or from many local welding shops. For a more open look, consider steel cables instead -- you can check out some examples at www.cablerail.com.
Remember that your new deck and railing will almost certainly require a building permit, and that certain construction standards must be adhered to for safety. Check with your local building department before you get going on any deck design or construction project.
Remodeling and repair questions? Email Paul at paulbianchina@inman.com. All product reviews are based on the author's actual testing of free review samples provided by the manufacturers.
Wander the aisles of your local home center or hardware store or do an online search, and you'll find more than enough inspiration to get you itching to grab a hammer!
Deck design:
Let's start at the beginning -- with a great design. If you have something in your head in the way of a perfect deck but you're not sure how to turn it into reality, start with a simple computerized drawing program. You can pick them up inexpensively at a number of retailers, and they're pretty intuitive to learn. Most not only help you design the deck in 2-D, but also do 3-D modeling, structural details, and even material lists.
If you'd prefer to have someone else tap the mouse, check with your local lumberyard. Many of them offer computerized deck design services that can save you hours of planning. The design consultant will walk you through several basic designs, and help you customize them to your exact size and layout requirements.
Structural hardware:
When it comes time to do the actual framing, companies like Simpson Strong-Tie offer an incredible selection of steel framing hardware that greatly simplifies all those connections. For example, there are simple joist hangers that support and connect the joists where they attach to the ledger or rim joist, and inside angle connectors to strengthen a variety of framing joints.
Where a beam sits on top of a post, there are post cap connectors, as well as post base anchors to connect the post to the patio or pier block. There are even specialty connectors specifically designed for attaching deck railing posts to deck framing quickly and with much greater strength than simply nailing or bolting alone. Simpson's decking site is worth a visit:www.strongtie.com/deckcenter.
Duo-Fast DF150S-TC TICO Nailer:
All that helpful structural hardware also means driving a whole lot of nails to make the connections work properly. So if you've got a big deck project in the works, or you're a pro who does a lot of decks, you might want to consider a pneumatic nailer to help you out.
Duo-Fast's TICO Nailer is designed specifically to drive the 1 1/2-inch, .148-shank nails required by most building codes for use with structural hangers. It's compact to get into tight spots, has a convenient rafter hook, and has an adjustable exhaust to keep the air out of your face.
Best of all is the unique "probing tip," which accurately locates the hole in the hanger before you shoot the nail. Check it out at www.duo-fastconstruction.com.
Bench brackets:
Want to add a bench to your deck? Bench brackets make it easy. Made of steel or a durable resin, they bolt to both the decking and the deck framing for stability, then you add your own decking material to the top and back to form a seat and backrest.
The brackets are angled to form a comfortable backrest while eliminating all those difficult angle calculations. You can see a couple of different styles at www.rockler.com.
Precut stair stringers:
If your deck design calls for steps, don't despair over how to cut the stringers. Many lumberyards and home centers carry or can order precut stringers in different lengths. They're made of pressure-treated lumber so they're safe for ground contact, and all the hard layout and cutting has been done for you.
Just select the number of steps you need based on how high the deck is, secure them to the deck and to the ground using the appropriate hardware connectors, and you're all set. Finish off the installation with treads that match your decking boards.
Railings:
A deck railing adds a lot of visual interest to a deck, and it's also a code requirement if the deck will be more than 30 inches above the ground. Thanks to the tremendous interest in decks and the number of do-it-yourself deck builders, there are lots of different railing ideas that you can choose from, as well as the parts to build them with.
You can go with simple wooden pickets, which your local lumberyard will have in stock. Or you can step it up a bit with metal pickets, which are available in different colors and styles at places like www.stair-parts.com or www.deckdepot.com, or from many local welding shops. For a more open look, consider steel cables instead -- you can check out some examples at www.cablerail.com.
Remember that your new deck and railing will almost certainly require a building permit, and that certain construction standards must be adhered to for safety. Check with your local building department before you get going on any deck design or construction project.
Remodeling and repair questions? Email Paul at paulbianchina@inman.com. All product reviews are based on the author's actual testing of free review samples provided by the manufacturers.
An economical kitchen, bath remodel
By Bill and Kevin Burnett
Inman News™
Inman News™
July 27, 2011
Editor's note: This is the second of two parts.
Last week we answered a question from an empty-nest couple who had just paid off the mortgage on their 1980s-era rancher in Pleasanton, Calif. Rather than sell and downsize, they decided to stay put. Trouble was, they were getting tired of their home's tired look. How, they wanted to know, should they go about updating?
We tackled walls, floors, doors and trim, suggesting new paint, some hardwood flooring, new molding and baseboard, and new interior doors. Today we'll discuss the "wet" rooms -- kitchen and baths.
Kitchens
Any way you crunch the numbers, a kitchen update is going to be expensive. But, assuming you don't have to open too many walls, reroute plumbing or add electrical circuits, it won't break the bank. If you have a workable footprint, cabinets, countertops and appliances are all you need to transform a 1980s kitchen into a 2011 model.
Whether custom-made or modular, new high-quality cabinets will cost thousands of dollars -- sometimes tens of thousands. For that you get silky-smooth sliding drawers, Lazy Susans and other fancy accoutrements that will never be seen from the outside.
If you can continue to live with the existing interiors, you can save fully 75 percent of the cost of new cabinets by refacing the fronts and adding new, custom-made doors and drawer fronts. You'll save even more if you use a paint finish, rather than stain and polyurethane, because you won't have to replace the cabinet faces.
Choose some nice, modern knobs and pulls, or go with a minimalist look and have your door and drawer maker include a routed finger pull.
Chances are your 1980s countertops are either a laminate such as Formica or Wilsonart, or tile and grout. You're going to want to ditch this for something more modern. While granite is still the darling, you have a bunch of other good choices, including marble, soapstone, crushed quartz or concrete. We've even seen countertops jacketed in pewter.
For a good primer on countertop choices, including pros and cons, check out http://interiordec.about.com/od/kitchencounters/tp/tp_countertops.htm.
Bottom line: It's up to you and your budget, but figure on spending at the minimum $150 per linear foot.
Appliances are also a personal choice between you and your budget. Figure on spending at least $6,000 -- and easily double or triple that -- for a classy refrigerator, oven, range and dishwasher. Bill loves his Electrolux induction range and Fisher & Paykel drawer dishwasher. Kevin wouldn't trade the Garland commercial range and oven he's been using for years.
Finish with a good sink and faucet. For the sink, deeper is better, and we like 16-gauge stainless steel. For your faucet, do your shopping on the Web and then buy at a plumbing supply house. Or do what Bill did -- buy $7,000 worth of appliances at a discount store and get them to throw in a $600 faucet for free.
Finally, consider adding some under-counter lighting. Kitchen designers call it "task" lighting, but if your kitchen is open to other rooms, add a dimmer switch and make it mood lighting as well.
Bathrooms
The standard 1980s bathroom has a tile shower or tub surround, vinyl floors, wood vanity, and an onyx or faux marble countertop.
Because tearing out tile and replacing it is a big, expensive job, we recommend that you keep the tile and spruce it up with a new grout job.
If your vanity has seen better days, we recommend that you replace it. There's a whole aisle of styles at the big-box home improvement stores. Find one that you like but forgo the faux stone countertops with the recessed sink.
Find a good stone dealer and have the real thing made to order. Bill went that route, choosing Jerusalem Gold limestone. The fabrication and installation set him back about $800, but every time he looks at it he thinks it's money well spent. For a more rustic look, consider a soapstone counter with matching sink.
Your flooring choices include tile, wood and vinyl. We would steer clear of tile, as it can be cold and hard underfoot. And, although we love wood everywhere else, we think it just doesn't look that good in the bathroom. Also, you're one leaky toilet away from costly repairs.
That leaves vinyl. We strongly recommend single sheets (no seams) of top-quality linoleum. We're especially partial to a product called Marmoleum.
Finish off your bathroom rejuvenation with a new shower door, faucet, towel racks, mirrors and light fixtures.
Copyright 2011 Bill and Kevin BurnettLast week we answered a question from an empty-nest couple who had just paid off the mortgage on their 1980s-era rancher in Pleasanton, Calif. Rather than sell and downsize, they decided to stay put. Trouble was, they were getting tired of their home's tired look. How, they wanted to know, should they go about updating?
We tackled walls, floors, doors and trim, suggesting new paint, some hardwood flooring, new molding and baseboard, and new interior doors. Today we'll discuss the "wet" rooms -- kitchen and baths.
Kitchens
Any way you crunch the numbers, a kitchen update is going to be expensive. But, assuming you don't have to open too many walls, reroute plumbing or add electrical circuits, it won't break the bank. If you have a workable footprint, cabinets, countertops and appliances are all you need to transform a 1980s kitchen into a 2011 model.
Whether custom-made or modular, new high-quality cabinets will cost thousands of dollars -- sometimes tens of thousands. For that you get silky-smooth sliding drawers, Lazy Susans and other fancy accoutrements that will never be seen from the outside.
If you can continue to live with the existing interiors, you can save fully 75 percent of the cost of new cabinets by refacing the fronts and adding new, custom-made doors and drawer fronts. You'll save even more if you use a paint finish, rather than stain and polyurethane, because you won't have to replace the cabinet faces.
Choose some nice, modern knobs and pulls, or go with a minimalist look and have your door and drawer maker include a routed finger pull.
Chances are your 1980s countertops are either a laminate such as Formica or Wilsonart, or tile and grout. You're going to want to ditch this for something more modern. While granite is still the darling, you have a bunch of other good choices, including marble, soapstone, crushed quartz or concrete. We've even seen countertops jacketed in pewter.
For a good primer on countertop choices, including pros and cons, check out http://interiordec.about.com/od/kitchencounters/tp/tp_countertops.htm.
Bottom line: It's up to you and your budget, but figure on spending at the minimum $150 per linear foot.
Appliances are also a personal choice between you and your budget. Figure on spending at least $6,000 -- and easily double or triple that -- for a classy refrigerator, oven, range and dishwasher. Bill loves his Electrolux induction range and Fisher & Paykel drawer dishwasher. Kevin wouldn't trade the Garland commercial range and oven he's been using for years.
Finish with a good sink and faucet. For the sink, deeper is better, and we like 16-gauge stainless steel. For your faucet, do your shopping on the Web and then buy at a plumbing supply house. Or do what Bill did -- buy $7,000 worth of appliances at a discount store and get them to throw in a $600 faucet for free.
Finally, consider adding some under-counter lighting. Kitchen designers call it "task" lighting, but if your kitchen is open to other rooms, add a dimmer switch and make it mood lighting as well.
Bathrooms
The standard 1980s bathroom has a tile shower or tub surround, vinyl floors, wood vanity, and an onyx or faux marble countertop.
Because tearing out tile and replacing it is a big, expensive job, we recommend that you keep the tile and spruce it up with a new grout job.
If your vanity has seen better days, we recommend that you replace it. There's a whole aisle of styles at the big-box home improvement stores. Find one that you like but forgo the faux stone countertops with the recessed sink.
Find a good stone dealer and have the real thing made to order. Bill went that route, choosing Jerusalem Gold limestone. The fabrication and installation set him back about $800, but every time he looks at it he thinks it's money well spent. For a more rustic look, consider a soapstone counter with matching sink.
Your flooring choices include tile, wood and vinyl. We would steer clear of tile, as it can be cold and hard underfoot. And, although we love wood everywhere else, we think it just doesn't look that good in the bathroom. Also, you're one leaky toilet away from costly repairs.
That leaves vinyl. We strongly recommend single sheets (no seams) of top-quality linoleum. We're especially partial to a product called Marmoleum.
Finish off your bathroom rejuvenation with a new shower door, faucet, towel racks, mirrors and light fixtures.
Saturday, March 26, 2011
The tax benefits of homeownership
Inman News™, February 04, 2011
By STEPHEN FISHMAN
By STEPHEN FISHMAN
The tax benefits of buying a home include:
Home mortgage interest deduction: The interest paid on a mortgage or mortgages of up to $1 million for a principal residence and/or second home is deductible as an itemized deduction. In the early years of a home loan most of the payments consist of interest, so this deduction is particularly substantial during the first years of homeownership.
Depending on the state a buyer lives in and his or her tax bracket, this deduction can reduce the cost of borrowing by one-third or more.
Home equity loan deduction: Homeowners can borrow up to $100,000 against the equity in their home and deduct the interest as an itemized deduction. The money can be used for any purpose, such as paying off high-interest credit card debt. In contract, the interest on credit card debt is not deductible.
Property tax deduction: Homeowners also get to deduct from their federal income taxes the state and local property taxes they pay on their home. This is another itemized deduction that renters don't get.
Deductible homebuying expenses: Various closing costs ordinarily involved in a home purchase are also deductible as itemized deductions, including loan origination fees (points), prorated interest on a new loan, and prorated property taxes paid at settlement.
$250,000/$500,000 home-sale exclusion: Perhaps the greatest tax benefit of owning a home comes when a person sells it at a profit. Homeowners who lived in their home for two of the prior five years prior to its sale need pay no income tax on a substantial amount of their profit -- $250,000 for single homeowners and $500,000 for married homeowners who file jointly. This exclusion can be used once every 24 months.
14 days of free rental income: Another little known tax benefit of owning a home is that the owner can rent it out for up to 14 days during the year and pay no tax at all on the rental income. In contrast, a renter who sublets his or her rental must pay income tax on all the rental income he or she earns.
Tax benefits of renting:
The only tax benefit that a renter can qualify for by virtue of being a renter is the home office deduction. This is a business deduction available to renters who own a business and have a home office they use regularly and exclusively for business purposes.
Some employees can qualify for this deduction as well. The deduction is limited to the amount of profit earned from the business each year. If a renter pays a lot of rent, this deduction can be substantial. Homeowners who are in business and have a home office can also qualify for the deduction.
Of course, the value of the tax benefits of buying a home depends on the state the buyer lives in and his or her tax bracket. Buyers who live in high tax states like New York or California get the most benefit.
This is why the blanket statement "it's always better to buy than rent" is not always true. It all depends on the buyer's individual circumstances.
You should encourage prospective buyers to run the numbers. There are some excellent websites you can refer clients to that have online calculators they can use to compare the costs of renting vs. buying a home.
7 Steps To A Stress-Free Home Closing
Published 2010-02-10 09:27:33
By doing homework in advance, you’ll understand what you’re asked to sign when you close the sale of your home.
You’ve already cleared several hurdles by finding the right home, negotiating the best price, and securing favorable financing. The last obstacle on your homebuying track is the closing, which can be both tedious and tense. By knowing what to expect and doing some legwork, you can put your closing behind you. These seven steps will guide you through a smooth closing.
1. Set a closing date
Your real estate agent will work with the seller’s agent and title company to schedule your closing date. Be sure it meshes with the end of your lease or the sale of your existing home and a time when you’ll able to play hooky from work. If you’re tight on cash, schedule your closing for the end of the month because that’s when you’ll have to pay the least amount of interest at the closing table.
2. Gather your funds
You may be required to bring funds to the closing. If they’re not easily accessible, arrange early to transfer them to a liquid account to avoid last-minute problems. If the title company requires the funds in the form of a cashier’s check, also leave time to stop by the bank and pick one up.
3. Purchase title insurance
Title insurance protects the policyholder against trouble with a home’s title. Your lender will insist that you purchase a policy to protect it. You should also consider purchasing what’s called an owner’s title policy from the same insurer, which protects you from fraudulent claims against your ownership and errors in earlier sales. In some areas, sellers traditionally pay for the buyer’s title policy. Shop online at Closing.com, EasyTitleQuote.com, and FreeTitleQuote.com. If your home has been sold within the past few years, ask the prior owner’s insurance company for a reissue discount.
4. Line up homeowners insurance
Get quotes and compare policies to be sure coverage will be in effect by your closing date. An annual policy should run $500-$1,000, depending on your home’s size, age, and amenities. If you live in an area where natural disasters occur, like earthquakes, floods, or hurricanes, you’ll need separate insurance to protect your home.
5. Review your good-faith estimate and HUD-1 settlement sheet
Your lender must provide a good-faith estimate of your closing fees. Some of those fees can’t change, and others can rise by 10%. Before you go to the closing, read your good-faith estimate, compare it with your HUD-1 settlement statement, and question any fees that increased.
6. Do a walk-through
Schedule an appointment to walk through the home one last time just before your closing. Make sure repairs you requested have been made, no major changes have occurred since you last viewed the property, and that the sellers left anything they agreed to leave and took all their belongings.
Also test electronics and appliances, such as the doorbell, dishwasher, washer and dryer, and oven, to ensure they’re functioning properly. Do the same with the hot water heater and heating and air conditioning systems. Walk the yard to be sure no plants or shrubs have been removed.
7. Resolve issues identified in your walk-through
If your walk-through uncovers problems, in some states you can delay the closing until the seller corrects them. But that’s often not feasible because your lease is probably over and you’ve already scheduled movers. Another option is to negotiate a discount to your sales price to cover the cost of the work needed. If the air conditioning is on the fritz and a contractor says the repair will cost $500, ask that the sales price be reduced by that amount. If you make that request at closing, however, be ready for a delay while the title company redoes the paperwork.
A third option: Have the title company hold a portion of the seller’s proceeds in escrow until the dispute is resolved. Once that happens, the funds will be released to you or the seller, depending on the outcome.
More from HouseLogic
Do you have the right amount of homeowners insurance?
Shop for an umbrella policy when you shop for homeowners insurance
G.M. Filisko is an attorney and award-winning writer who has endured several property closings, but the easiest was done through the mail. A frequent contributor to many national publications including Bankrate.com, REALTOR® Magazine, and the American Bar Association Journal, she specializes in real estate, business, personal finance, and legal topics.
Shop for an umbrella policy when you shop for homeowners insurance
G.M. Filisko is an attorney and award-winning writer who has endured several property closings, but the easiest was done through the mail. A frequent contributor to many national publications including Bankrate.com, REALTOR® Magazine, and the American Bar Association Journal, she specializes in real estate, business, personal finance, and legal topics.
Read more: http://buyandsell.houselogic.com/articles/7-steps-stress-free-home-closing/#ixzz1HkZIjs6z
HOAs: What You Need To Know About "Home Owners Association" Rules
Published: September 8, 2009
Lobbying for change in your homeowners association’s rules requires procedure, compromise, and perhaps joining the board.
Homeowners associations have broad legal powers to collect fines and fees and regulate activities.
If you live in a newer suburban community or planned unit development, you—like some 59.5 million other Americans, according to the Community Associations Institute—are probably a member of a homeowners association. It’s also a good bet that you haven’t given your HOA much thought until you have a problem. Since HOAs make and enforce the community rules, it’s smart to understand what you can do if you can’t or don’t want to follow them.
HOA facts
Each HOA, a volunteer group of neighbors who manage common areas of a subdivision, creates its own covenants, conditions, and restrictions. These CC&Rs cover resident behavior (no glass containers around the pool), property management (no fences higher than 8 feet) and common responsibilities (fee schedules and fines for non-compliance).
Average annual dues for a homeowners association is $420, according to the U.S. Census Bureau. And there’s value in the fee. A 2005 study, which appeared in the Cato Institute’s Regulation magazine, compared a group of Washington, D.C., area HOA properties with similar homes without community benefits—a total of about 12,000 homes. The HOA house values were found to be 5.4% higher. That’s $1,067 on the average U.S. home value of $197,600.
When you don’t like the rules
Some boards can impose what some homeowners believe are invasive, silly, or elitist rules. In 2008, some news outlets reported on a homeowner in an upscale gated community in Frisco, Texas, who was threatened with fines for parking his new Ford F-150 series truck in his driveway overnight. The board made exceptions for several luxury brands, but his mid-range truck was ruled “not classy enough.”
Even if you disagree with the rules, keep paying your dues. HOAs have broad legal powers to collect fines and fees and regulate activities. If you don’t respond to letters from the board, property manager, or a collection agency, the HOA can and will turn to small claims court or file a lien against your property.
You can handle some issues, if they don’t affect the CC&Rs, with a phone call. For example, adding recycling to the garbage collection route is a budget, not a rules, issue. Call the board member who oversees trash collection to find out if there’s leeway in the budget. Also, the board might find a way to add a service by cutting back on something else.
If you want to do something that’s against the rules—like flying the American flag in your yard—start by making a written request for variance, using the appropriate HOA form in your CC&R documents. A variance gives you permission to be the exception to the rule. Submit your request to the board and property management company.
Help your cause by seeking a compromise: That you’d like to fly the American flag, but only on national holidays.
Don’t expect a quick solution
Some HOA boards meet as little as twice a year. If the board decides the issue is worth pursuing, it may require a community vote. If it passes a majority, the board will adopt it. Board members also may consult the HOA attorney to see if there’s a legal liability if they rule against you.
If you don’t get a timely response, request a hearing and resubmit your request for variance with as much support for your cause as possible.
If the board rules against you without a community vote, you can appeal the ruling with a petition signed by a majority of other homeowners.
But if you fly your flag without permission, expect to get fined. Fines can range from a nominal $25 to a painful $100 or more depending on the issue. Your CC&Rs will indicate the fine schedule—per day, per incident, etc. Interest for nonpayment can accrue, and the HOA can sue you in small claims court.
If you feel the ruling or the fines are unjust, the last resort is to hire an attorney and sue the HOA, as a flag-flying couple did in 1999. They battled their HOA in court for nine years before the case was settled in their favor.
Become the rule-maker
If you don’t like the rules, the best way to change them is to become part of the process.
1. Know your CC&Rs, annual budget, and employee contracts. Do you see areas where expenses can be cut? Are service providers doing their jobs?
2. Volunteer for a committee or task. If the board needs to enforce parking rules, for instance, you can volunteer to gather license plate numbers of residents’ vehicles. In addition, put your professional expertise to work: Assist the board with data entry, accounting, or website design.
3. Stand for election to the board. When a position becomes open, the board notifies the members, and you can put your name forward. New board members are elected at the annual meeting by member majority vote. Many boards are three to nine members large, with terms of one to two years.
Involvement drawbacks
As a board member, be prepared to spend two to four hours a month reviewing property management reports, monitoring budgets, or talking to other board members and residents. Most boards meet quarterly; small boards only meet twice a year, for a couple of hours.
Accept that you might become less popular if homeowners don’t like your decisions. In the worst case, you could be sued, along with the rest of the association.
Involvement benefits
But their are rewards. You’ll feel more in control of your community’s fate. You may find that some rules you didn’t support have merit after all. But most of all, you’ll know you’re doing all you can to protect your quality of life and your home’s value.
Blanche Evans is an award-winning journalist with more than 15 years’ experience in real estate consumer advocacy. She is the author of five books including Bubbles, Booms, and Busts: Make Money in Any Real Estate Market. Blanche owns a townhome in Dallas and is treasurer of her homeowners association.
Read more: http://www.houselogic.com/articles/hoas-what-you-need-to-know-about-rules/#ixzz1HkVMGWIs
4 Tips to Determine How Much Mortgage You Can Afford
Published: March 11, 2010
By knowing how much mortgage you can handle, you can ensure that home ownership will fit in your budget.
1. The general rule of mortgage affordability
As a rule of thumb, you can typically afford a home priced two to three times your gross income. If you earn $100,000, you can typically afford a home between $200,000 and $300,000.
To understand how that rule applies to your particular financial situation, prepare a family budget and list all the costs of homeownership, like property taxes, insurance, maintenance, utilities, and community association fees, if applicable, as well as costs specific to your family, such as day care costs.
To understand how that rule applies to your particular financial situation, prepare a family budget and list all the costs of homeownership, like property taxes, insurance, maintenance, utilities, and community association fees, if applicable, as well as costs specific to your family, such as day care costs.
2. Factor in your downpayment
How much money do you have for a downpayment? The higher your downpayment, the lower your monthly payments will be. If you put down at least 20% of the home's cost, you may not have to get private mortgage insurance, which costs hundreds each month. That leaves more money for your mortgage payment.
The lower your downpayment, the higher the loan amount you’ll need to qualify for and the higher your monthly mortgage payment.
3. Consider your overall debt
Lenders generally follow the 28/41 rule. Your monthly mortgage payments covering your home loan principal, interest, taxes, and insurance shouldn’t total more than 28% of your gross annual income. Your overall monthly payments for your mortgage plus all your other bills, like car loans, utilities, and credit cards, shouldn’t exceed 41% of your gross annual income.
Here’s how that works. If your gross annual income is $100,000, multiply by 28% and then divide by 12 months to arrive at a monthly mortgage payment of $2,333 or less. Next, check the total of all your monthly bills including your potential mortgage and make sure they don’t top 41%, or $3,416 in our example.
Here’s how that works. If your gross annual income is $100,000, multiply by 28% and then divide by 12 months to arrive at a monthly mortgage payment of $2,333 or less. Next, check the total of all your monthly bills including your potential mortgage and make sure they don’t top 41%, or $3,416 in our example.
4. Use your rent as a mortgage guide
The tax benefits of homeownership generally allow you to afford a mortgage payment—including taxes and insurance—of about one-third more than your current rent payment without changing your lifestyle. So you can multiply your current rent by 1.33 to arrive at a rough estimate of a mortgage payment.
Here’s an example. If you currently pay $1,500 per month in rent, you should be able to comfortably afford a $2,000 monthly mortgage payment after factoring in the tax benefits of homeownership.
However, if you’re struggling to keep up with your rent, consider what amount would be comfortable and use that for the calcuation instead.
Also consider whether or not you’ll itemize your deductions. If you take the standard deduction, you can’t also deduct mortgage interest payments. Talking to a tax adviser, or using a tax software program to do a “what if” tax return, can help you see your tax situation more clearly.
Here’s an example. If you currently pay $1,500 per month in rent, you should be able to comfortably afford a $2,000 monthly mortgage payment after factoring in the tax benefits of homeownership.
However, if you’re struggling to keep up with your rent, consider what amount would be comfortable and use that for the calcuation instead.
Also consider whether or not you’ll itemize your deductions. If you take the standard deduction, you can’t also deduct mortgage interest payments. Talking to a tax adviser, or using a tax software program to do a “what if” tax return, can help you see your tax situation more clearly.
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G.M. Filisko is an attorney and award-winning writer who’s owned her own home for more than 20 years. A frequent contributor to many national publications including Bankrate.com, REALTOR® Magazine, and the American Bar Association Journal, she specializes in real estate, business, personal finance, and legal topics.
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