Archive for the 'Home Buyer Information' Category
Do you have to attend the closing?
August 21st, 2010 categories: Home Buyer Information, Home Seller Information | views
In Spring Texas the closing on a real estate transaction is held at a title company. Since the closing is scheduled in advance, the majority of buyers and sellers are able to arrange their schedules and do attend the closing on their house.
Sometimes a buyer’s or seller’s schedule does not permit them to physcially attend the closing. In these circumstances, the closing can still occur on the scheduled closing date by the title company doing an advance “mail-out” or through the use of a POA (Power of Attorney).
Mail-out closings are common when the sellers have already moved from Spring Texas and are now living in another state making it unpractical for them to travel back to attend the closing. The title company will mail out the documents for the sellers signatures and the sellers will arrange to have the documents returned by the closing date.
POA’s are frequently utilized when there is more than one buyer or seller. The buyer or seller who is unable to attend the closing will give a POA to the other buyer or seller to sign the documents on his or her behalf.
Read also:
- Who decides the closing date?
- Who repairs the nail holes?
- What stays and what goes when you buy a Spring Texas home?
- What to expect on closing day?
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Is your Real Estate Agent pushy?
August 15th, 2010 categories: Home Buyer Information | views
Here’s a fun YouTube video on pushy real estate agents.
Rick and I are not pushy real estate agents. As buyers agents, we will show you any house on the Spring Texas real estate market you would like to view. We work hard to help you find and purchase the right house for your lifestyle and your finances.
A thank you goes out to Missy Caulk, a Ann Arbor Realtor. I discovered the YouTube video on her website of www.annarborrealestatetalk.com
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Will paying cash get you a discount on real estate?
August 13th, 2010 categories: Home Buyer Information, Home Seller Information | views
The majority of the time if you pay cash for Spring Texas real estate you will get a discount. The real question is not will you get a discount but how big of a discount. The answer depends on how big of an advantage cash is to the seller.
The biggest discounts for cash will be on properties that are not available to be financed. Properties unavailable for financing are typically foreclosure properties that are in terrible condition. The owners (banks) of these properties know they need to provide significant discounts to attract the cash buyers.
The discount will depend upon the overall condition of the property, how long the property has been on the bank’s books, and how motivated the bank is to dump the property. In the Spring Texas area, I have seen lenders sell cash only properties at 10% to 20% lower than market value.
The value of cash to a seller (bank or individual owner) is much less if the house can be financed. Why? From the seller’s perspective he wants to sell his home to whomever will pay him the most for it. Whether the money comes from the buyer directly or whether it comes from the buyer’s lender doesn’t matter to the seller. Its all cash to the seller.
A cash buyer does offer the seller some advantages including a quicker close, the elimination of potential appraisal issues, and an assurance the transaction will not fall through due to a buyer’s inability to secure financing. In situations where the seller has two buyers both offering him the same price for his Spring Texas house and one buyer has cash and other buyer requires financing, the seller will choose the cash buyer.
If the seller has only one offer and it is from a cash buyer, the seller is going to consider the advantages the cash buyer offers in conjunction with the market value of his house. Sellers will give a cash buyer a discount but the discount is usually in the 1% to 5% range.
Read also:
- If the house doesn’t appraise for the sales price, are you stuck buying the house?
- Are you overpaying if you pay the home’s list price?
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Accepting property in its present condition doesn’t mean you can’t ask for repairs
August 11th, 2010 categories: Home Buyer Information, Home Seller Information | views
In section 7 of our Spring Texas real estate contract the touchy subject of property condition is addressed. Buyers, sellers, and Realtors seem to generally understand the majority of the items in this section. That is until they reach 7.D. ACCEPTANCE OF PROPERTY CONDITION which is where confusion takes over.
In section 7.D., Spring Texas home buyers have to either check box (1) they are accepting the property in its present condition or box (2) they accept the property in its present condition, provided Seller, at Seller’s expense, shall complete the following repairs and treatments.
On the majority of offers I receive, the buyers have checked box (2) and have written in “all deficiences listed on the inspection report”. This causes my sellers immediate heartburn because it commits them to correct every single deficiency listed on the inspection report. If the sellers agreed to (2), they would be writing a blank check to cover every item identified on the report. Whether the repair could be handled with a $5 tube of caulk or the repair was to bring an item up to today’s building codes, it wouldn’t matter because the seller would have agreed to fix them all.
The true purpose of section 7.D. is to list any items the buyers are making their offer contingent upon the sellers repairing. As a buyer a specific repair you may want to make your offer contingent upon is the sellers installing a new roof or a water heater or replacing a broken window.
If you are not requiring the sellers to make any repairs at this time, you should check box (1). If you have purchased a termination option in Section 23 of the real estate contract which I highly recommend you do, you still have the right to inspect the house and request the sellers to make repairs. If the sellers agree to the repairs, the contract will be amended detailing the repairs to be made. If you and the sellers can not come to terms on the repairs, you still have the right to terminate the real estate contract during the option period.
As a buyer the main thing to remember is when you accept the property in its present condition, you are NOT forfeiting any of your rights to request the sellers to make repairs based upon your inspection of the house.
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Monthly payments on FHA loans increase on October 4th
August 7th, 2010 categories: Home Buyer Information | views
Earlier this year, the FHA increased the upfront mortgage insurance premium from 1.75% of the loan value to 2.25%. Now the FHA has decided to reduce the upfront mortgage insurance premium from 2.25% to 1% and increase the annual premium from 0.55% to 0.9% on loan to value (LTV) ratios greater than 95%.
What does all this jockeying around of rate structures mean to Spring Texas home buyers?
Short answer … your monthly payment will increase. If you already have an FHA loan these changes will not impact you as your monthly payments will remain the same. Only FHA loans originated October 4th, 2010 or later will be impacted.
How much will the FHA changes increase your monthly payment?
For illustrative purposes, I have used a sales price of $160,000 which will get you a nice house in Spring Texas. The maximum allowable you can borrow for an FHA loan is 96.5% of the sales price. You can roll in the upfront mortgage insurance premium and with today’s low interest rates it makes financial sense to do so.
On a monthly basis an increase of 34 dollars doesn’t sound like a lot. But on an annual basis the increase is $408. Now, we are starting to talk about real money.
If you are thinking about buying a Spring Texas home but haven’t gotten serious about it yet, act now to avoid an increase in your monthly payment.
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Do you know if your house is for sale?
July 24th, 2010 categories: Home Buyer Information, Home Seller Information | views
About 10 years ago it was easy to know if your house was for sale. And if you weren’t 100% sure all you had to do was take a quick look oute the window. If you saw a real estate “for sale” sign in your yard, your house was for sale. But fast forward to today and it’s possible that your Spring Texas house could be listed for sale on numerous websites without you knowing.
The reason it is listed for sale may be because you have been a victim of a real estate scam. But the more likely reason is because the status of the listing was not changed when either you purchased the home or you took the home off the Spring Texas real estate market.
Your house could be listed for sale on YouTube , Google, Craigslist.org, OLX, Facebook, Realtor.com, Trulia, Zillow, your real estate agent’s site, or numerous other real estate sites. The reason your house could be wrongly listed as for sale on a site when it’s NOT for sale is due to the site’s source of data for its listings.
If the real estate site uses our local Houston MLS (multiple listing service) as their date source, then the information is fairly accurate. I won’t say 100% accurate because a house could be sold but still be showing as for sale because the listing agent has not updated the listing in the Houston MLS.
Numerous Internet sites and real estate sites receive their listing data NOT from the Houston MLS but directly from individual real estate agents and from syndication sites. When a house is sold or taken off the Spring Texas real estate market, these sites are dependent upon their data source to update the data. The problem is the real estate agents and the syndication sites do not update the data. Resulting in houses being represented as for sale that are NOT for sale. The solution is for these sites to work out an agreement with the Houston MLS to receive a feed of its listing data. But that won’t happen because the feed agreements cost money.
If you want to find out if your Spring Texas house is listed for sale, google your address. If you discover its listed for sale and its NOT for sale, contact the listing agent and ask them to remove the listing.
- How accurate is the Zillow’s Zestimate for your home?
- Do all real estate websites have the same Spring Texas homes for sale?
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Home size declines; buyers demand for 1 story homes increase
July 10th, 2010 categories: Home Buyer Information, Home Seller Information | views
The National Association of Home Builders announced that builders are listening to buyers preferences and constructing smaller homes. After nearly 30 years of increases, the size of new single-family homes built experiences its first decrease.
The nationwide average of 2,438 sqft for homes built in 2009 is about a 100 feet smaller than the homes built in 2007. The homes built in 2008 were about the same square footage as 2007.
Several years ago, Spring Texas home buyers wanted the biggest house they could afford. This was especially true if the buyers were relocating to Spring Texasfrom out of state. It was around the time Hurricane Rita came through in 2005 and caused utility prices to increase that buyers became more concerned about the heating and cooling costs of the 4,000+ sqft McMansions. Buyers began to question whether they really needed a 4,000+ sqft home. The demand for the larger Spring Texas homes started to decrease while the demand for smaller homes began to increase.
According to the U.S. Census Bureau’s data, for years the percentage of 2-story homes being built has continually increased while the percentage of 1-story homes has decreased. But starting in 2006, the trend has been reversed as more buyers are demanding 1-story homes. We are experiencing the same trend of increase demand for 1-story homes in the Spring Texas real estate market. With the baby boomer population continuing to age, the demand for 1-story homes will continue to increase.
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Is now a good time to refinance?
June 30th, 2010 categories: Home Buyer Information | views
With the interest rates for 30-year home mortgages at 50 year lows, NOW may be not only a good time but a great time to refinance. What’s in store for mortgage interest rates? According to the Mortgage Bankers Association you should expect interest rates to steadily rise.
Bankrate.com provides a great free refinance calculator that calculates your payback period in months. Your lender can provide you with the current mortgage interest rates but if you wanted a rough estimate you could plug in 4.5% for the interest rate on a conventional 30-year loan or 4.25% for a FHA loan. At least this is what the mortgage interest rates were last week.
After you have determined the payback period, you need to ask yourself how long you plan on staying in your current Spring Texas home. If you plan on staying longer than the payback period, then call your lender because now is a good time for you to refinance your home.
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Stop! Don’t buy that fridge for your new house …. YET
June 21st, 2010 categories: Home Buyer Information | views
Okay, I admit the title for this post is a little bit dramatic. But I needed to get your attention to let you know of a change in the mortgage industry. As a Spring Texas Realtor, I do not even attempt to stay on top of the ever changing mortgage industry. Instead, I rely upon the expertise and knowledge of the loan officers at HomeTrust Mortgage .
The other day, I received the following email from Marilyn Causy of HomeTrust Mortgage outlining the latest change in the mortgage industry:
“ We are now required to pull a one bureau credit report three days prior to closing on every loan that is taken after June 1, 2010. Even though we always stress to our borrowers that they should not make any new purchases prior to closing their loan, we really need to stress this more. If we have a borrower that has marginal credit scores or tight debt-to-income ratios to begin with, any negative change could cause the loan not to close and it would be right before closing that this could happen.
You should be and will be excited about purchasing a Spring Texas house just don’t let it get the best of you. Do all the shopping you want but hold off on buying until after you close on your house. I know I may sound like your mother but … oh well. I would rather that than you being mad at me because I didn’t give you proper advice.
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Mortgage Rates to slowly increase
June 17th, 2010 categories: Home Buyer Information | views
The Mortgage Bankers Association (MBA) economists have revised their mortgage interest rates projections and are now predicting a slower than anticipated increase. The interest rate for 30-year mortgages are still projected to be in the high 6% range by fourth quarter of 2012. The revision is in how quickly the 30-year mortgage interest rates will rise from their current levels of high 4% range to the high 6% range.
In their June 11th forecast, the MBA economists predict the 30-year mortgage rates will gradually rise to 5.4% during the fourth quarter of this year, climb to 6% by fourth quarter of 2011, and reach 6.6% by fourth quarter of 2012.
If you are considering purchasing a Spring Texas home, a gradual increase in mortgage interest rates is good news. As it gives you time to find the right house without feeling you have to quickly make a decision before the interest rates skyrocket.
Mortgage interest rates have a significant impact on how much Spring Texas home you can afford and how much interest you will be paying over the long run. The table below identifies how much that 1% jump in mortgage interest rates will cost you.
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