by CRESTICO | Feb 9, 2009 | CRESTICO
Buyers often have a difficult time determining how to arrive at a price to make an offer. Often, avoiding an offer at full asking price, can save the buyer money. Other times, full asking price is the only price at which a seller would be willing to let go of a property. Read further to learn about some of the things that affect the price at which a buyer is willing to make an offer.
Condition. A property’s condition certainly plays a factor in determining the price a buyer wants to offer. A smart buyer will have a good idea of how the condition of the desired property compares to the general neighborhood; namely whether it fits in or stands out. Condition takes many things into account. For example, structural condition is probably the most important to consider. Walls, ceilings, floors, doors and windows and the paint, carpets, and floor coverings will provide indications as to the condition of the property. Whether they are new, slightly worn, very worn, or in utter disrepair will affect the price a smart buyer is willing to offer. Often, bathrooms and bedrooms will need to be checked and seen whether the plumbing and electricity work efficiently. An intelligent buyer will also pay attention to fixtures, such as light switches, doorknobs, and drawer handles. Your agent will be able to complement the information you gather, by providing you with information regarding the other neighborhood properties.
Improvements. Smart buyers will note whether previous owners have made any improvements on the property. However, only take into consideration improvements such as room additions, because superficial or cosmetic improvements should not result in an increase of the price the buyer is willing to pay. However, be careful when considering things like expensive floor tile or swimming pools. A pool that costs $20,000 to install does not normally add $20,000 in value to the home. Ask your agent to give you guidance in this area
The Market. A hot market is often called a "seller’s market." During a seller’s market, properties can sell within a few days of being listed and there are often multiple offers. Today, however, we are living in a largely "buyer’s market," which means properties are staying on the market for extended periods of time and there are fewer offers being made. As such, a buyer has flexibility and should offer a lower price for the home.
Finally, comparable sales information is some of the best information to help a buyer determine a base price range for a particular home. Taking into consideration various factors like property condition, improvements, and market conditions help determine whether a "fair" price would be at the upper limit of that range or the lower limit. The "fair" price should be approximately what you are willing to pay at the end of negotiations with the seller. Although your agent may provide advice and guidance, you are the one who makes the decision. The price you put in the offer is totally up to you.
by CRESTICO | Feb 5, 2009 | CRESTICO
Get The Best Deal on A Home
While buying a home can be a stressful process, it can also provide you great sense of achievement and satisfaction. Here is some helpful advice for you to consider when trying to get the best deal.
Vacant Properties are a great way to get good deals. Properties that are vacant do not have anyone living in them and are not making any money for the seller. Often, sellers are very willing to enter negotiations to get these properties off their books. This can be a great negotiation point for you, the buyer.
Do not underestimate the value of a fixer upper! While it may not be the most attractive house on the block today, it very well may be tomorrow. New carpets, a coat of paint and landscaping can turn a seemingly dilapidated old shack into a sparkling new home. Try not to get distracted by things that are easily fixed. If the home has no structural issues and matches your needs, consider the potential when making your decision. Often, homes that are not initially aesthetically pleasing, will turn out to be the customized home of your dreams!
Get an accurate idea of how many homes in the area you are considering, truly match your needs. Having a solid idea of this number will help you determine your negotiating power. The more homes there are that match your needs, the greater your ability to negotiate. Your agent can help you find this information.
Survey the area’s schools. Just because you do not have children now does not mean that you will not in the future or that you should not consider the schools. Schools can be a great negotiating tool, as well. Good schools are an indication of property value that is underlying and potentially long-lasting. Not-so-good schools in the area can give you another bargaining chip when entering negotiations with the seller.
Have a flexible touring schedule. Often, and especially in this market, sellers rent their properties while they are trying to sell them. This means that there may be tenants living in the property, or perhaps there is no lockbox and tours may be on an appointment basis only. While this may seem burdensome, consider this. A home that is not often viewed, is not often made an offer on. As a result, your offer may be taken more seriously. Minimally shown homes do not pull in offers the way open houses do, so the seller may be more willing to entertain and negotiate your terms.
A common point of contention between buyers and sellers is the closing date. Buyers are often eager and want to close as soon as possible to meet their own personal deadlines, be it the opening of school or beginning of summer or recently after a wedding. Sellers are often eager for many of the same reasons as well. However, it would be beneficial to the Buyer to determine the Seller’s deadline when making the offer. This way, the seller may be more likely to accept the offer.
Using this advice and help from the right agent, you’re sure to get the best deal possible!
by CRESTICO | Feb 3, 2009 | CRESTICO
Economic times seem troubling. But they don’t have to be, not for everyone! Mortgage rates are low and can be translated into super savings for borrowers who qualify. But there are some things you must know before you decide whether or not to refinance in the current market!
Before you even consider Refinancing, you have to think about what you are refinancing. Many Americans have lost all of their equity, Zillow estimates that 1 in 7 American homeowners have negative equity in their homes. Generally, you will need at least 3 percent equity in your home to refinance. If you do not have three percent, refinancing may not be an option for you.
It’s not as easy as you think. Most people’s applications will not be approved. The economy is in a state of turmoil and this trickles down and affects everyone. Many lenders are not making it easy to refinance.
Another consideration is your FICO score. You will most likely need a score of 740 and above to be able to secure some the best rates of the market. It may not be worth financing, even if you get approved and your FICO is less than 740 because you may be paying a higher rate.
Next, even though it seems that the rates are unbeatable, you will have to carefully think about your finances when you are considering refinancing. First, I suggest you take a look at your current rate. What is it? If your rate is about 6%, perhaps it may be a good time to refinance, since your rate is more than one whole point above the market’s current rates. Also, keep in mind rates for loans above the current FHA limit ($729,000) will have much higher rates than those within the FHA limit. Another thing you must consider are fees. The more you pay in fees, the less you are saving, even at a lower rate. Calculate how much you will be saving with the lower rate and if you can recover what you pay in fees in three years or less, then refinancing may be right for you.
The fees that you will have to pay vary, however you have options when it comes to paying these fees. You may want to pay cash for these fees, take a higher interest rate for lower fees, or simply add the fees into your mortgage. You will need to talk to your mortgage specialist and he/she will provide you with the best advice for your situation.
Shopping. The best way to get the best rate and the best deal is to go shopping. If one lender says "No" that does not mean that no lender will refinance you. The era of the mortgage lender who hunts you down is over. It is now time for you, the consumer, to seek out the best lender for you with the best deal for your situation.
You’re not alone. The economy may be slow, but the industry is not. Mortgage lenders are swamped! They are inundated with work and faced with downsizing and lay-offs, they often struggle. Keep that in mind when you submit your application. Be patient and realize that it may take upwards of 30 days to hear back from a lender.
Feel free to contact me with any questions you may have, we, at Crestico Realty are here to help!
by CRESTICO | Jan 31, 2009 | CRESTICO
What is an REO? REO means Real Estate Owned. Everyone is talking about REOs these days. But before you consider buying one, there are a few things you should know about REOs. These properties are generally owned by banks, credit unions, mortgage companies and sometimes private companies. It has become increasingly common for the news to report foreclosure issues and homeowners losing their houses and other effects of the mortgage crisis. As a result there have been dramatic increases in the marketing of REOs to the general public. It used to be that you could barely get your hands on lenders’ foreclosure lists. But these days, everyone is trying to sell REOs.
The people that are being marketed by these REO sellers are mainly first-time and minority potential homebuyers. Fannie Mae works with many companies to help these types of homebuyers realize the American Dream of owning your home using reasonable and affordable loans. There has been a shift in the industry from marketing REOs to those who “flip” houses to first-time homebuyers. The dramatic increase in foreclosures has left many lenders with high inventories of REOs, resulting in potentially advantageous opportunities for individuals who never has access before, to gain access to the real estate market. Additionally, the number of foreclosures is allowing simple real estate investors to diversify and expand their portfolios.
There are many laws regarding foreclosures and the process. Mainly, when the property is in the pre-foreclosure and auction stage, the bank (owner) is only legally entitled to its losses and expenses. This is to say that the bank (owner) is not entitled to gain a profit from the sale. This changes however, after the property has been foreclosed on it becomes an REO.
REOs are often considered to be fabulous starter homes because the sales prices for these properties is generally lower than that of a similar non-REO property. In today’s market however, this may not always be the case. This is mostly due to the fact of the number of such properties in the market. Even though a property is an REO, it does not mean that the owner will not make a profit off the sale. Remember, after the foreclosure process, the REO owner is now allowed to make a profit, which may affect the sale price. A buyer will generally be more likely to get a lower price when purchasing a home in the pre-foreclosure or auction stage.
Let’s say now you’ve decided you want an REO. You should know there are risks associated with this “great deal” you are getting. When considering your REO purchase, make sure you have access and contact information for various experts who will guide you in the inspection process.
You will need a Realtor, who can protect your interests and make sure you get the best deal possible. Your Realtor will be able to generate reports for you showing comparable sales prices which will enable you to assess whether the asking price for the REO you are considering is appropriate. There are some statistics that show the average price of an REO is 15 – 30 percent lower of comparable sales prices. However, there are REASONS for this.
REOs are sold AS-IS. This means that what you see is what you get. You will need a qualified home inspector to guide you with this step of your REO purchase process. Only a qualified inspector will be able to reveal latent flaws or issues that you will need to consider before you purchase the REO. You will need to factor in the costs of potentially repairing, replacing or rehabilitating the necessary sections of the property into the price you will be paying.
REOs take longer. When purchasing an REO, you are not dealing with Joe and Jane Smith homeowner, you are dealing with either a Bank or an Investment Company. The decision making and sale approval process in a business takes much longer than with individuals. It could take weeks to get an approval on your offer. Additionally, even though most banks will remove tax liens and occupants (if need be) from the property, in order to protect yourself, you should perform a title search. Now you may not personally be able to do this, which is why you will hire a company to perform such a search for you, and the results may take up to a week to review. Another potentially time-consuming process is getting an appraisal. As a buyer, you should not trust the seller’s appraisal blindly, get your own! Any time or money you spend beforehand may well be worth it in the long run. You want to know that you are getting what you are paying for!
With the right amount of patience and knowledge and the care of a Crestico Agent, buying an REO will seem like a breeze. We have agents that specialize in purchasing REOs. When you work with a Crestico Agent, he/she works for you to get all the experts you need! From inspectors, to title searches to appraisers, your Crestico Agent takes care of it all for you!! Call us today!
by CRESTICO | Jan 31, 2009 | CRESTICO
Real Estate Agents: Choosing a Broker That’s Right For You!
In an industry like real estate, where being an agent is an unsalaried position and the business experiences so much turnover, which broker you choose to hang your license with becomes an important consideration for your career.
A vital part of your success will depend on your broker and at Crestico we believe, as your broker, we have a responsibility to support your growth and profitability, so that you will do well. Choosing the right broker involves more than supplying leads, or offering the best commission splits and lowest desk fees!
We encourage you to speak to our agents and see that our environment enables you to make real money! Realizing you made the best decision gives you peace of mind. We at Crestico Realty understand that it’s comforting to know you’ll have support when you need it, in addition to technology, and a market presence with a broker that the public wants to do business with!
For new agents, the industry poses many challenges. Almost 85 percent of new real estate agents “drop out” after less than one year in the business, and 15 percent of the remaining don’t renew their licenses. We want to make sure you’re not one of these statistics. Successful real estate agents are self-starters and go-getters. The beginning of a real estate career often involves lots of rejection. But it’s only temporary. As a real estate agent, you are more than a person who shows properties, you become a trusted advisor and your clients look to you for your knowledge and expertise. Buying a home is the most expensive (for most people) transaction of their lives.
by CRESTICO | Jan 31, 2009 | CRESTICO
At Crestico Realty, we believe an informed client is a happy client, so we do our best to make sure you are informed, every step of the way! The first step we take in doing this, is to inform you before you become our client and give you a taste of our excellent customer service. Below, is information that many first time homebuyers seek from us every day.
You’ve decided to buy a home. It seems like the right and best thing to do, but why. Many first time home buyers ask us why it is better to own a home than to rent one. Renters face many challenges that homeowners do not. Primarily, if you get the right loan (which we can help you with), your mortgage should stay affordable every year and you will not be faced with one of renters’ biggest problems: rent increases. Next, why not let the place you live give you some tax benefits? Renters do not get to enjoy the same tax benefits that are associated with owning your home. If you have a family, or are thinking about having one; wouldn’t it be nice to have your kids born and raised in the same place? We all have fond memories of our childhood and our childhood homes. Kids love backyards and swimming pools and treehouses and slumber parties. These are things that may not be as accessible and as private as you would prefer them to be if you rent an apartment.
Also, when you rent, you are not making an investment, you are merely spending money. Money you spend on repairs, upgrades, decorations, renovations and rent loses its value once it leaves your checking account. But when you own a home, the money you spend on everything from landscaping to decorations becomes an investment, and you will see a return on that investment. You might say that everyone is talking about losing value and losing equity, but that’s only applicable to today’s market. If you look at the Real Estate market, over time, you will see that it is a cycle and any money you spend today will eventually regain its value tomorrow. And finally, above all owning a home means you OWN it and can do anything you like with it. You can decorate it and express yourself in a way you would not be as free to, if you were renting someone else’s property.
Next, first time home buyers find themselves faces with the question of location. We’ve all heard the saying “location, location, location!” That should give you a clue that location is very important. You will need to consider your lifestyle and your needs when determining a location for your home. Do you have children? Is the quality of the schools in the area an issue? Are you looking to join a community? Your Crestico agent can help you determine your needs and find the perfect location for you.
The next thing to consider is the money. The amount of money you will need to buy a home depends on many things including the cost of the home and the mortgage you get. Your Crestico agent will go over each and every step with you and introduce you to our preferred lender, American Guardian Home Loans and together they will explain the entire process to you. Generally, when you are purchasing a home, you will need to have cash on hand to pay a deposit when you submit your offer so that the seller will take your offer seriously. Also, you will need cash for the down payment and the closing costs (to cover the processing of the paperwork involved).
Most people purchasing a home do not do it entirely with cash. Most buyers needs loans. Choosing a first time home buyers loan can be a daunting task. It may seem overwhelming because there are so many different types of loans with different names and options associated with them. Not to worry, Crestico Realty has a dedicated representative at American Guardian Home Loans who is there only for our clients.
Finally, one more thing a first time home buyer should be aware of is insurance. Having the right homeowner’s insurance policy is an important part of being a homeowner. Homeowner’s insurance differs from renter's insurance in that it protects your home and its valuable contents from occurrences like theft, fire, floods and earthquakes (depending on your location and type of policy). There are other kinds of insurance, such as Private Mortgage Insurance (also known as PMI) which may be required, depending on your loan and mortgage terms. Your Crestico agent will work with you to get you the best value in insurance policies because Crestico Realty is your one stop shop for all your home buying needs. We are part of a network of professionals and have extensive relationships in the industry that we use every day to make sure you are getting the best the industry has to offer.
