Archive for October, 2008

Single, Then Love & Marriage, And Both Can have REAL ESTATE

Friday, October 10th, 2008

Ladies First

Tips for First Time, Single Female Homebuyers

Single females continue to be a driving force in the housing market. In fact, according to the National Association of REALTORS®, single women purchased one out of every five homes in 2006. So, if you are ready to take the plunge into homeownership, the Coldwell Banker® organization recommends taking the following steps:

Get Your Finances In Order. First and foremost, check your credit history. Order a report from one of the three major agencies and take immediate steps to rectify any problems. Make sure you pay your bills on time and have established a savings plan.  You want to be on firm financial footing when you begin the home buying process especially since you will be funding the purchase on one income.

Buy Within Reason. Have a good idea of what you are, and are not, willing to do with a home. Determine ahead of time whether you want a house that is ready for living, or whether you want to break out the tools and begin the fixer-up process. If you want to take the do-it-yourself route, however, be sure to establish a separate budget for that process so that you can stay on top of both the mortgage and renovation budgets.

Work With a Reliable Real Estate Sales Associate. Buying a home is likely the largest transaction you will ever make, so when you are buying on your own be sure to surround yourself with a team of professionals who will help you navigate through the process. An established real estate sales associate can coordinate information from beginning to end and help identify the professionals you will need (inspectors, lawyers, contractors) to make the experience as smooth as possible. As a professional REALTOR®, I can be your resource.
Most importantly, have fun!

Love, Marriage and Real Estate
Living with your parents until you get married is a concept as quaint as apple pies cooling on windowsills and white picket fences.  With the average age of first marriages 26 for women and 27 for men, according to USA Today, more and more young adults are spreading their wings and enjoying life before choosing to settle down. And the savvier among the group have eschewed the pitfalls of monthly rent and taken advantage of the recent real estate bull market to purchase their own homes. As a result, it is not uncommon to see new marriages in which both the bride and the groom enter the union with a dowry that includes real estate!

So, what to do with the extra house? Perhaps the first temptation is to jettison one and use the proceeds to fix up the other house and set up a nest egg. A good idea, and one that will set you up with a nice down payment when it is time to purchase a larger house for a growing family.

But that is not the only option for newlyweds with two homes. According to the professionals at Coldwell Banker Real Estate Corporation, another good idea is to keep one house as a rental unit. The tax codes allow you to immediately depreciate the value of the building over 27 years, and any taxes, insurance, visits to your property and fix-ups are all write-offs. With this approach, both homes are investments and you build equity in each.

They also suggest selling one of the homes and buying a condominium to turn into a rental unit.  According to the National Association of REALTORS in the past 8 to 9 years condominium appreciation has beat that of single family houses.

No matter which option you choose, consult with a knowledgeable real estate sales associate before making any big decisions on what to do with the second house. A good realtor will know the market and be able to counsel you on the type of cash flow you can expect with a rental in the neighborhood, or whether a straight up sale is a better way to go. And if you choose to rent, make sure to get the advice of a good accountant to help you navigate the various tax advantages to being a landlord.

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HOUSE HUNTING? BE PREPARED WITH A PRE-APPOVED MORTGAGE LOAN

Wednesday, October 8th, 2008

Most homebuyers miss out on one of the most important steps in the home buying process. In this competitive real estate market, the experts at Coldwell Banker Real Estate Corporation strongly advise that homebuyers arm themselves with a pre-approved mortgage loan before the house hunting begins.

A pre-approved mortgage loan is a lender’s actual commitment to lend to the homebuyer, with specifications on the exact loan amount. To get pre-approved, homebuyers need to provide personal financial information, such as income, debts and assets, to an underwriter. After a homebuyer applies for the loan, the lender will most likely approve the application with certain caveats. As the lender is committing to the loan amount and interest rate up front, the homebuyer knows that they have their financing in place before they start shopping for a home.

Advantages of having a pre-approved mortgage loan include:

Establishing an advantage in a competitive market. A pre-approval letter gives the homebuyer an edge in a multi-offer situation. Sellers prefer working with potential buyers that are pre-approved. From the seller’s perspective, they do not want to take their home off the market only for the deal to fall through because the purchaser cannot get sufficient financing. An offer with a mortgage pre-approval letter carries far more weight than an offer with only a pre-qualification letter or no letter at all. In fact, sellers often accept offers of lower dollar amounts from pre-approved buyers over buyers who have not been pre-approved despite higher offers. With pre-approval, the home sellers have a higher confidence level that the deal won’t run into any problems.

Finding the best possible type of loan. Working with a mortgage agent before looking at houses gives the homebuyer plenty of time to decide what category of mortgage product works best for his or her financial goals. Once the buyer decides on the kind of loan he or she wants and has been pre-approved for it, the homebuyer can then focus on finding a dream home.

Establishing the price range. Getting pre-approved for a mortgage enables the homebuyer to determine, prior to house hunting, how much money he or she qualifies for, thereby establishing a price range. The real estate sales associate and homebuyer can then focus on looking at appropriate homes.

Seeking comfort with the loan amount: By taking the time to seek pre-approval, the homebuyer can select a comfortable loan amount.  In many cases, buyers can qualify for mortgages that are more expensive than what they feel comfortable committing to for the long-term.  Buyers often end up acquiring a more expensive home than they want merely because it works on paper. It’s important for a buyer to purchase a home that they can own – and not the other way around.

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