In today’s tumultuous economy, it’s no surprise that there are foreclosure properties to be found in just about every community across America—even ours. While a terrible hardship for homeowners to endure, foreclosures can present a unique opportunity for first-time home buyers and investors looking to purchase a “bargain-priced home” with the potential for building instant equity.
As an experienced real estate professional, I want to advise you to tread carefully when it comes to foreclosures—they might not be quite the bargain you expect. Here are some important facts you need to know before venturing out into the foreclosure market:
– Homeowners faced with foreclosure are understandably stressed and resentful, which can often lead to neglecting routine maintenance on a home. Sometimes, even deliberate damage is done. Assessing the home’s condition, therefore, is a must.
– Foreclosure properties have often been vacant for an extended period of time. Look for problems caused by damp conditions, such as mold.
– Get a thorough home inspection before bidding on the property. Once the damage/disrepair of the home is assessed, factor this in when bidding on the home.
– Contact a real estate professional—like me, a Member of the Top 5 in Real Estate Network®—who is well steeped in the community and can provide information about pre-foreclosure properties, that is, homes that have been scheduled for foreclosure but have not yet gone to auction or been sold off. These homes need to be sold quickly as owners are trying to avoid foreclosure and its impact on their credit.
– Last but not least, go to www.hud.gov for information on how to buy homes acquired by the U.S Department of Housing and Urban Development as a result of foreclosure action on an FHA-insured mortgage. The site also has information on special programs and opportunities for teachers, law enforcement officers and others.
While buying a foreclosure property takes patience and research, the results can be well worth your time and effort. For more information, please e-mail me, and please pass this on to anyone you know who might be interested in exploring a foreclosure purchase.
Condominium homes have always been, and will likely always be, an efficient and economical route to becoming a first-time homeowner. They can offer the comfort, prestige, and even luxury appointments that apartment living may lack, often at a cost that is not much different than rent. With the current first-time home buyer tax credit and the deadline for the move-up tax credit fast approaching, I advise you move fast on any condo purchase you may be considering.
With my experience as Member of the Top 5 in Real Estate Network®, I am well aware that not all condominiums are the same, however, so make sure you ask the following four questions before you buy:
What will you own? Read the bylaws and be sure you understand what you will be responsible for and what belongs to the condo association. Will you own the boat dock at the back of your unit? Can you elect to build a spa on your patio? Generally, unit owners own and are responsible for the interior of their condos, while costs for outside maintenance including common areas and sewer lines are the association’s responsibility.
Who lives there? Are the majority of residents owners or renters? Owners generally take more interest in proper maintenance and are more willing than renters to serve on the association board and enforce complex rules and regulations–including the regular collection of homeowner dues.
How effective is the homeowner’s association? Do they have legal counsel, reasonable funds and a capable, caring volunteer board? One way to judge is to check with residents about restrictions, oversight and timeliness of repairs and upgrades. Another is to take a hard look at the grounds and be wary of signs of neglect.
What about special assessments? The association should have the power to special assess for needed, one-time large expenditures. Otherwise, things that need to be done may never get done at all, leaving the complex vulnerable to disrepair and lowered property values.
Don’t miss this great opportunity to become a homeowner or to downsize by buying a condo (remember, the move-up tax credit does not require you to move to a larger or more expensive home). Please e-mail me for more tips on buying a condo and forward this information to any family and friends who may be in the market as well.
While one in seven Americans has at least 10 credit cards, the average is four, according to a report from Experian. Usage on credit cards has dropped dramatically in the last two years as financially constrained consumers have reduced spending and begun paying off debt. The national average interest rate on credit cards as of November 2009 is 12.64%, which has declined 0.45% from six months earlier.
As a member of the Top 5 in Real Estate Network®, I know that mortgage-seeking clients are always asking for advice on how they can improve their credit profile, such as the number of credit cards they should have. According to the credit experts at ApprovalGuard.com, however, it’s not just the number of credit cards you have, but how you use and manage those cards.
Here are some critical tips for managing your credit cards in order to maximize your credit profile:
1. Use your credit cards regularly, but in small amounts, never exceeding 30% of your entire credit line. For example, if your card limit is $4,000, set a self-imposed limit to keep your balance at $1,200.
2. Even if you pay your bills on time, coming close to your full balance each month affects your credit score negatively. Regularly maxing out your card limit is a bad habit in the eyes of credit-rating firms. It’s better to spread your credit charges out over two or three cards, keeping each balance at or below 30% of your total credit line.
3. Don’t get rid of old cards even if they have higher interest rates than ones you may get on newer cards. Credit rating firms like to see a well-established history, so utilize your old cards every so often for small purchases.
4. On the flip side, avoid getting new cards, if possible. When you add a new credit card, your credit score will likely suffer a temporary drop until you have established a payment history with that card.
Well-managed credit cards will assist you in establishing a stronger credit profile and better credit scores that can potentially lead to lower interest rates and terms when applying for home loans. For more information on shoring up your credit profile, please e-mail me. Feel free to pass this important article along to your friends, colleagues and family. All of us can use some guidance in managing our credit in today’s economic environment.
Believe it or not, even though selling and buying a home is one of the most stressful, most important financial and lifestyle investments you’ll ever make, most people spend very little time in selecting a real estate agent to work with. Even worse, most people tend to believe that all real estate agents are the same and possess the same skill sets and capabilities.
As a member of the Top 5 in Real Estate Network®, an elite group of real estate agents that requires members to meet a series of stringent criteria before joining, I know all too well how wrong the above perceptions are. When confronting any real estate decision, especially one that involves relocating to a different region or state, it is critical to select an agent with the necessary skills, experience and proven results.
Here are the top 5 reasons to use a professional real estate agent to handle your relocation:
1. The amount of homework involved. Moving to a new area means conducting a lot of research to learn about school systems, recreational activities, community services, etc. A seasoned, qualified agent will do most of this work for you and will suggest accurate resources for you to search out on your own.
2. The need for sounding boards. A relocation places a fair amount of stress not just on you, but on your entire family. There will be lots of concerns, questions and anxieties involved. A professional real estate agent has dealt with this situation hundreds or thousands of times and will know how to listen and respond with the right information to allay the fears of your entire family.
3. Settling into the new area. Successfully acclimating to the new area means quickly finding access to your favorite sports, hobbies, interests, etc. A professional real estate agent is well-steeped in his or her community and will help get you and your family involved in the things you love to do right away.
4. Gathering the right paper work. From school records to medical information, there is a lot of paperwork that needs to relocate with you. Your real estate agent should be able to provide you with a checklist of all the materials you will need to gather and transport well in advance.
5. A network of professionals. Successfully relocating to a new area requires not just working with a professional real estate agent, but many other credible professionals as well, such as builders, landscapers, handymen, child care providers…the list goes on. The right agent is well entrenched with many proven professionals in all of these fields and more, and can serve as a single hub for great referrals. Top 5 Members have access to a large network of other Top 5 Members across North America, ready to assist in your successful relocation.
Handled correctly, a relocation is a positive, exciting experience—a fresh start, not a painful mistake. If you’d like to learn more about ensuring a smooth and happy relocation, feel free to e-mail me and I’d be happy to share what I know. Please pass this e-mail along to family and friends who might also have a relocation in their future.
RISMEDIA, February 1, 2010—With the expanded Home Buyer Tax Credit still in place, and home prices and mortgage rates still at attractive lows, more renters are grappling with the question, “Do I buy now, or should I keep on renting?” and more homeowners are wondering, “Is now a good time to move up?”
The answer, say money experts, depends on the overall health of your finances, because you need to not only amass a pile of cash for the deposit and closing costs, but convince a lender to lend you 80% or more of the purchase price in the form of a long-term mortgage. Here are four elements to consider:
Having good credit is important, so they suggest going to Fair Isaacs’ myFICO.com and purchasing your current scores ($15.95 each for reports from Equifax and TransUnion, another $15 at Experian.com). Don’t be surprised if the scores differ somewhat, and check them carefully for errors. Remember that errors must be reported to and corrected by the agencies themselves, which could take weeks or months.
Know what you can afford. Aim for a home that costs about two-and-a-half times your gross income–less if you have significant financial debt. In all, your monthly home payments should not exceed 36% of your gross monthly income. Getting pre-approved by a lender should be your signal to start home shopping.
Check your cash situation. Whether you are aiming to amass 20% of the home’s price for a conventional loan, or 3% or more for a loan from Fannie Mae, Freddie Mac, FHA or the Department of Veteran’s Affairs, you will also need to cover fees and closing costs, which can run up to 5% of the mortgage amount.
First-time buyers may augment their cash by borrowing from an IRA or getting a cash gift from parents, but check with a financial advisor for amounts and tax consequences. Current homeowners may be able to use proceeds from the sale of their current home.
And speaking of tax consequences, remember that homeowners, unlike renters, must pay property taxes each year–and pay for any needed repairs or upgrades. Be sure to leave yourself a little financial wiggle room in order to meet these expected–and sometimes unexpected–expenses.
As a Member of the Top 5 in Real Estate Network®, and an experienced real estate professional, I can help you with these important real estate matters. Please e-mail me for more information.
