10/24/07
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Find more pictures of Madison by Patti at
www.MadisonVaRealEstate.com
Thursday, October 25, 2007
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Know The Score
You hear it everywhere: exotic loans, FICO scores, default risks, rising interest rates. Sounds like a lot of gloom and doom, doesn't it? While lenders are generating hot and heavy business, the truth is that it's still an excellent time to purchase a home. It's also time to educate your self about the economics behind securing a home loan.
The rate you are offered on a mortgage is largely based on your FICO score. What is FICO? It simply stands for Fair Isaac & Company, who developed our modern credit scoring models. The highest possible “score” is 850, and you'll need a rating of 620 or above to be considered for the best interest rates.
Higher income does not necessarily generate a higher score. Your payment history does have significant impact, however. If you have a higher credit score, you're probably in a position to accept a “prepayment penalty,” which is imposed when a loan is repaid early. But many borrowers who accept this “penalty” will end up paying a lower interest rate.
Be cautious out there - with so many types of loans available, you'll find some are a good fit for you and some are downright unwise. Real estate agents and mortgage specialists work together to determine the best avenue for you to follow, leading right up to the front door of your new home!
www.MadisonVaRealEstate.com
The rate you are offered on a mortgage is largely based on your FICO score. What is FICO? It simply stands for Fair Isaac & Company, who developed our modern credit scoring models. The highest possible “score” is 850, and you'll need a rating of 620 or above to be considered for the best interest rates.
Higher income does not necessarily generate a higher score. Your payment history does have significant impact, however. If you have a higher credit score, you're probably in a position to accept a “prepayment penalty,” which is imposed when a loan is repaid early. But many borrowers who accept this “penalty” will end up paying a lower interest rate.
Be cautious out there - with so many types of loans available, you'll find some are a good fit for you and some are downright unwise. Real estate agents and mortgage specialists work together to determine the best avenue for you to follow, leading right up to the front door of your new home!
www.MadisonVaRealEstate.com
Remodeling Dollars and Sense
REMODELING: DOLLARS & SENSE
Many homeowners remodel not just to improve the condition of their biggest asset, but also to improve the salability of said asset. Experience proves that some projects are better for improving your bottom line than others.
DO upgrade kitchens and bathrooms, as these rooms are most likely to get scrutinized by potential buyers. New countertops and appliances and sparkling fixtures will be a memorable aspect of your showings.
DO improve exterior features, too - first impressions count! Some of the most valuable work you can do is to add new siding, or to pressure clean or replace old dingy siding. Another outdoor biggie: decks. Most everyone loves relaxing outside, so adding or improving this amenity not only adds style to your lifestyle right now, but also increases your home's real and perceived value.
DO realize that the biggest return on your remodeling investment will come from more costly repairs, such as replacing windows or installing new air and heating units. If your home is in need of such improvements, it makes sense to do it now, before it costs more later.
Finally, DON'T turn your home into the neighborhood's priciest palace. You'll end up turning off potential buyers who will see other homes around the block offering more affordability. It's a delicate balance, but your home should offer the greatest value when compared with similar offerings.
www.MadisonVaRealEstate.com
Many homeowners remodel not just to improve the condition of their biggest asset, but also to improve the salability of said asset. Experience proves that some projects are better for improving your bottom line than others.
DO upgrade kitchens and bathrooms, as these rooms are most likely to get scrutinized by potential buyers. New countertops and appliances and sparkling fixtures will be a memorable aspect of your showings.
DO improve exterior features, too - first impressions count! Some of the most valuable work you can do is to add new siding, or to pressure clean or replace old dingy siding. Another outdoor biggie: decks. Most everyone loves relaxing outside, so adding or improving this amenity not only adds style to your lifestyle right now, but also increases your home's real and perceived value.
DO realize that the biggest return on your remodeling investment will come from more costly repairs, such as replacing windows or installing new air and heating units. If your home is in need of such improvements, it makes sense to do it now, before it costs more later.
Finally, DON'T turn your home into the neighborhood's priciest palace. You'll end up turning off potential buyers who will see other homes around the block offering more affordability. It's a delicate balance, but your home should offer the greatest value when compared with similar offerings.
www.MadisonVaRealEstate.com
Monday, July 9, 2007
Rubbing Elbows
At some point in your life you're likely to find yourself either buying or selling a home. When that time comes, you might want to ask yourself some questions.
Can I figure like an accountant? Can I measure like a surveyor? Do I understand "legalese" like an attorney? Can I spot defects like an inspector? Can I speak like an auctioneer? Do I understand zoning, building codes and taxes like a city or county employee? Do I understand human motivation like a psychologist?
Chances are you'll be hard pressed to answer all those questions with a "Yes," unless you're a real estate professional. Why, you ask, would an agent be different? It has to do with "rubbing elbows."
The daily routine of an active, highly committed real estate broker or agent is an exhausting one. During any 24 hour period, such a professional will likely have contact with loan officers, lawyers, tax collectors, land surveyors, insurance company representatives, mortgage lending officers, accountants, auctioneers, courthouse personnel, local businessmen and - most importantly - buyers and sellers.
Working at least six days a week, can you imagine how many individual contacts would be made in a year's time? Such an active individual can mean the difference between winning or losing at real estate. After all, it's who you know, and now you know the benefits of representation.
At some point in your life you're likely to find yourself either buying or selling a home. When that time comes, you might want to ask yourself some questions.
Can I figure like an accountant? Can I measure like a surveyor? Do I understand "legalese" like an attorney? Can I spot defects like an inspector? Can I speak like an auctioneer? Do I understand zoning, building codes and taxes like a city or county employee? Do I understand human motivation like a psychologist?
Chances are you'll be hard pressed to answer all those questions with a "Yes," unless you're a real estate professional. Why, you ask, would an agent be different? It has to do with "rubbing elbows."
The daily routine of an active, highly committed real estate broker or agent is an exhausting one. During any 24 hour period, such a professional will likely have contact with loan officers, lawyers, tax collectors, land surveyors, insurance company representatives, mortgage lending officers, accountants, auctioneers, courthouse personnel, local businessmen and - most importantly - buyers and sellers.
Working at least six days a week, can you imagine how many individual contacts would be made in a year's time? Such an active individual can mean the difference between winning or losing at real estate. After all, it's who you know, and now you know the benefits of representation.
AN OUNCE OF PREVENTION!
What does the phrase "title search" mean to you? Aside from an activity at the local library, its purpose is critical to the successful sale of a home. A title search is performed by an attorney in order to guarantee that there are no unknown liens on or claims to a property.
Because title searches are often ordered only after a purchase contract is on the table, problems can suddenly turn up at the eleventh hour, causing delays in the closing. That's why it may be advisable for the sellers to request a title search before even listing their property for sale.
What sort of problems might a title search unearth? There might be an "unreleased mortgage," which happens when a previous refinance is paid off, but the lender fails to file a release on the old mortgage. Property taxes may appear to be unpaid until filing errors are discovered. A divorce or death in the family may not be properly reflected in the ownership structure. Sometimes property records are fraudulently used to commit identity theft.
This is not to say that these errors are common, but they are increasingly prevalent among properties that have changed hands several times over these last few years of frenzied real estate activity. Speak with an agent before listing your home to determine whether a title search is appropriate.
What does the phrase "title search" mean to you? Aside from an activity at the local library, its purpose is critical to the successful sale of a home. A title search is performed by an attorney in order to guarantee that there are no unknown liens on or claims to a property.
Because title searches are often ordered only after a purchase contract is on the table, problems can suddenly turn up at the eleventh hour, causing delays in the closing. That's why it may be advisable for the sellers to request a title search before even listing their property for sale.
What sort of problems might a title search unearth? There might be an "unreleased mortgage," which happens when a previous refinance is paid off, but the lender fails to file a release on the old mortgage. Property taxes may appear to be unpaid until filing errors are discovered. A divorce or death in the family may not be properly reflected in the ownership structure. Sometimes property records are fraudulently used to commit identity theft.
This is not to say that these errors are common, but they are increasingly prevalent among properties that have changed hands several times over these last few years of frenzied real estate activity. Speak with an agent before listing your home to determine whether a title search is appropriate.
Wednesday, June 6, 2007
Monday, June 4, 2007
MAKING IT STICK!
The Multiple Listing Service is a convenient way to locate most homes for sale, and access to that data has created a buyer who expects a high level of service from real estate professionals.
Nearly 3 out of 4 buyers are searching the Internet for homes. Locating a suitable property has become easier, but the real estate agent shows the property and critiques its value. Their ability to negotiate an accepted Offer To Purchase becomes paramount, especially if the seller is entertaining other offers.
Once the offer is accepted, the agent organizes the steps needed to bring the transaction to a successful close, such as arranging inspections, guiding the mortgage process, tracking contingencies, arranging the closing, ect.
The Internet provides a wide access to real estate data and has improved the buyer’s knowledge, but they still benefit from the experience of a professional. An agent representing the buyer is usually paid from the commission paid by the seller, with no charge to the buyer.
The Multiple Listing Service is a convenient way to locate most homes for sale, and access to that data has created a buyer who expects a high level of service from real estate professionals.
Nearly 3 out of 4 buyers are searching the Internet for homes. Locating a suitable property has become easier, but the real estate agent shows the property and critiques its value. Their ability to negotiate an accepted Offer To Purchase becomes paramount, especially if the seller is entertaining other offers.
Once the offer is accepted, the agent organizes the steps needed to bring the transaction to a successful close, such as arranging inspections, guiding the mortgage process, tracking contingencies, arranging the closing, ect.
The Internet provides a wide access to real estate data and has improved the buyer’s knowledge, but they still benefit from the experience of a professional. An agent representing the buyer is usually paid from the commission paid by the seller, with no charge to the buyer.
IT’S MORE THAN A “SALE”
The label “For Sale By Owner” is a bit misleading. All homes are for sale by owner, since the homeowner holds the title. In most cases, real estate professionals are employed to facilitate the sale, but do much more than just “sell” the home. They represent the seller and market the property.
“ For Sale By Owner” really translates to Unrepresented Seller, and it’s not good to be unrepresented in a competitive industry. Most buyers seek the services of an agent for their expertise. The seller is at a definite disadvantage if not armed with the same representation.
Unrepresented sellers report that the most difficult aspects of going it alone are: pricing correctly: preparing the home effectively: marketing the property: and understanding the paperwork. Unrepresented sellers face more liability issues and lower sales prices than their represented counterparts. If you are considering selling your own home, consult a real estate agent first and let them explain how they can benefit you.
The label “For Sale By Owner” is a bit misleading. All homes are for sale by owner, since the homeowner holds the title. In most cases, real estate professionals are employed to facilitate the sale, but do much more than just “sell” the home. They represent the seller and market the property.
“ For Sale By Owner” really translates to Unrepresented Seller, and it’s not good to be unrepresented in a competitive industry. Most buyers seek the services of an agent for their expertise. The seller is at a definite disadvantage if not armed with the same representation.
Unrepresented sellers report that the most difficult aspects of going it alone are: pricing correctly: preparing the home effectively: marketing the property: and understanding the paperwork. Unrepresented sellers face more liability issues and lower sales prices than their represented counterparts. If you are considering selling your own home, consult a real estate agent first and let them explain how they can benefit you.
JUST DO IT!
Thinking of buying a home, but feel bewildered by conflicting reports about the real estate market? Whether or not real estate is up, down or sideways, most people make their purchase decisions based on lifestyle and need rather than market conditions.
A home is a “durable good,” similar to a washing machine. When you need a new washer, you search for a machine that offers good value and service. You don’t think about whether the price of washers will be going up or down in the coming months or years.
You can have greater peace of mind when your purchase is made out of necessity and not just out of a desire to turn a profit. You get the greatest value out of your home by simply living in it, and as long as you can continue to make mortgage payments, you run little risk of losing on your investment.
Thinking of buying a home, but feel bewildered by conflicting reports about the real estate market? Whether or not real estate is up, down or sideways, most people make their purchase decisions based on lifestyle and need rather than market conditions.
A home is a “durable good,” similar to a washing machine. When you need a new washer, you search for a machine that offers good value and service. You don’t think about whether the price of washers will be going up or down in the coming months or years.
You can have greater peace of mind when your purchase is made out of necessity and not just out of a desire to turn a profit. You get the greatest value out of your home by simply living in it, and as long as you can continue to make mortgage payments, you run little risk of losing on your investment.
Sunday, March 4, 2007
Saturday, February 17, 2007
Capitol Gains Tax
You can avoid capital gains taxes on the sale of your home if it was your primary residence for at least two of the five years prior to its sale. Individuals may qualify for a $250K tax exemption, and married couples up to $500K.
If you've moved into your "forever home," and suddenly get laid off from your job, or need to move unexpectedly, you will not completely lose your exemption even though you couldn't remain in your home for two years.
Even the IRS understands unforeseen circumstances. Under Internal Revenue Code 121, you can get a partial credit for the time you've lived in your home.
Your exemption is based on the number of months that you remained in your principal residence. If you have to sell after 18 months, you will qualify for 18-24ths, or 75% of the total exemption.
The rules may seem complicated, but with the assistance of your tax adviser and a real estate professional, you can maximize your savings and locate your next home with a minimum of aggravation.
If you've moved into your "forever home," and suddenly get laid off from your job, or need to move unexpectedly, you will not completely lose your exemption even though you couldn't remain in your home for two years.
Even the IRS understands unforeseen circumstances. Under Internal Revenue Code 121, you can get a partial credit for the time you've lived in your home.
Your exemption is based on the number of months that you remained in your principal residence. If you have to sell after 18 months, you will qualify for 18-24ths, or 75% of the total exemption.
The rules may seem complicated, but with the assistance of your tax adviser and a real estate professional, you can maximize your savings and locate your next home with a minimum of aggravation.
Sunday, January 28, 2007
Renting to Purchasing
Today's real estate market provides an excellent opportunity for renters to turn their monthly payments into equity. Interest rates are still lower than in the past ten to twenty years. Home prices in many areas are adjusting back down to reflect reasonable levels of appreciation.
Money paid for rent goes into the pocket of the landlord, but money paid for a mortgage goes toward equity in the home. You keep the money you pay for your home, as its investment value increases with every payment.
If you could put $10,000 down on a $210,000 home today and pay $1,100 per month, your equity would total $138,521 over a ten-year period. This calculation assumes a 30-year fixed rate loan at 6.5% and an annual appreciation of 4.5%. Of course your income and credit rating determine whether or not you qualify for a loan.
So do the math, and then contact a local real estate agent or a lender to discuss your eligibility for home ownership. It’s never too late to start building your future!
For more information about living in central Virginia please visit my website at
www.MadisonVARealEstate.com
Money paid for rent goes into the pocket of the landlord, but money paid for a mortgage goes toward equity in the home. You keep the money you pay for your home, as its investment value increases with every payment.
If you could put $10,000 down on a $210,000 home today and pay $1,100 per month, your equity would total $138,521 over a ten-year period. This calculation assumes a 30-year fixed rate loan at 6.5% and an annual appreciation of 4.5%. Of course your income and credit rating determine whether or not you qualify for a loan.
So do the math, and then contact a local real estate agent or a lender to discuss your eligibility for home ownership. It’s never too late to start building your future!
For more information about living in central Virginia please visit my website at
www.MadisonVARealEstate.com
Thursday, January 25, 2007
Sellers/Buyers Market
Are we currently in a “buyers market” or a “sellers market”?
The basic concept behind a "buyers market" is that there are more residential properties for sale in an area than there are qualified buyers. This creates increased competition among the sellers for those fewer buyers, putting the buyers in the “driver’s seat” when it comes to negotiation.
A "sellers market" occurs when there are more prospective buyers than there are homes for sale. Buyers then compete against each other for available properties, often to the benefit of the seller.
Many areas across the country have enjoyed a sellers market for the last few years. Mostly because interest rates have been so low that many more buyers qualified for financing. We are currently experiencing more of a “buyers” market, since interest rates are slowly creeping up and there are more houses for sale.
Regardless of which hat you’re wearing, consult a professional for advice on getting the most out of your real estate experience.
The basic concept behind a "buyers market" is that there are more residential properties for sale in an area than there are qualified buyers. This creates increased competition among the sellers for those fewer buyers, putting the buyers in the “driver’s seat” when it comes to negotiation.
A "sellers market" occurs when there are more prospective buyers than there are homes for sale. Buyers then compete against each other for available properties, often to the benefit of the seller.
Many areas across the country have enjoyed a sellers market for the last few years. Mostly because interest rates have been so low that many more buyers qualified for financing. We are currently experiencing more of a “buyers” market, since interest rates are slowly creeping up and there are more houses for sale.
Regardless of which hat you’re wearing, consult a professional for advice on getting the most out of your real estate experience.
Monday, January 22, 2007
Sunday, January 21, 2007
Pricing Your Home
As most markets experience an "adjustment" period, buyers are fewer and farther between. Sellers usually ask their listing agent for a Comparative Market Analysis (CMA) to properly gauge their asking price in these dynamic conditions.
But as a buyer, how can you be sure that your offer is a reasonable one? Some sellers simply ignore current market conditions, expecting to fetch the same prices as a year ago. You may need some assurance. Particularly, you need to know how many homes are on the market now vs. a year ago, and how the average sales times compare. Ask a real estate pro to provide you with the very same CMA that the sellers request!
Once you've located a home you're excited about, a CMA report will compare it with similar properties, and give you a very good indication of whether the asking price truly reflects its value. Such a report costs you nothing, yet gives you the peace of mind that your offer is a solid one, and you're not risking one penny more than you should!
But as a buyer, how can you be sure that your offer is a reasonable one? Some sellers simply ignore current market conditions, expecting to fetch the same prices as a year ago. You may need some assurance. Particularly, you need to know how many homes are on the market now vs. a year ago, and how the average sales times compare. Ask a real estate pro to provide you with the very same CMA that the sellers request!
Once you've located a home you're excited about, a CMA report will compare it with similar properties, and give you a very good indication of whether the asking price truly reflects its value. Such a report costs you nothing, yet gives you the peace of mind that your offer is a solid one, and you're not risking one penny more than you should!
Tax Incentives
Millions of people each year move from one state to another. The financial and personal impact of buying and/or selling a home can be enormous. You should fully understand the tax implications before moving. You should legally change your state of residence and determine how that affects taxes on income, property, and your estate.
Once you’re a legal resident of your new home state, you can apply for incentives like homestead exemptions (if available). Make sure you’ve updated the address on your credit report. Investigate how the enforcement of certain legal documents like wills and powers of attorney might be affected.
Making your move early in the year may minimize the impact. Tax returns can be confusing when you’re claiming part-time residency in two different states during the year you move. Trust a real estate professional to help with selling, buying and moving, and seek advice from a tax consultant about the financial implications.
Once you’re a legal resident of your new home state, you can apply for incentives like homestead exemptions (if available). Make sure you’ve updated the address on your credit report. Investigate how the enforcement of certain legal documents like wills and powers of attorney might be affected.
Making your move early in the year may minimize the impact. Tax returns can be confusing when you’re claiming part-time residency in two different states during the year you move. Trust a real estate professional to help with selling, buying and moving, and seek advice from a tax consultant about the financial implications.
Reverse Mortgages
Reverse mortgages have existed for years now, but are often misunderstood.
A reverse mortgage is still a loan, but is not paid back until the last owner/co-owner dies, or the home is sold or left unoccupied for one year. You may receive an equity line of credit, borrowing money as needed, or receive monthly checks for the rest of your life, like an annuity.
While the loan amount is based on your age(62 and over) and your home’s value, lenders don’t loan the full value of your home. A reverse mortgage provides a low-risk option that allows seniors to remain in their home for the rest of their lives, however, other investments should be depleted before giving it consideration. Your home’s equity should be tapped as a last resource.
When the loan becomes due, the home is sold and you (or your heirs) would receive any money left over. If the house sells for less than the loan amount, the lender eats the loss. Again, this is a great option for many, but not all qualified borrowers. Give it thorough investigation.
A reverse mortgage is still a loan, but is not paid back until the last owner/co-owner dies, or the home is sold or left unoccupied for one year. You may receive an equity line of credit, borrowing money as needed, or receive monthly checks for the rest of your life, like an annuity.
While the loan amount is based on your age(62 and over) and your home’s value, lenders don’t loan the full value of your home. A reverse mortgage provides a low-risk option that allows seniors to remain in their home for the rest of their lives, however, other investments should be depleted before giving it consideration. Your home’s equity should be tapped as a last resource.
When the loan becomes due, the home is sold and you (or your heirs) would receive any money left over. If the house sells for less than the loan amount, the lender eats the loss. Again, this is a great option for many, but not all qualified borrowers. Give it thorough investigation.
Information Overload
The growth of information technology in real estate has provided benefits to both agents and consumers. Buyers and sellers are better informed and real estate agents are able to offer a higher level of service. Access to all that information can not replace the need for representation in the sales transaction. In the real estate industry, the number of agents, the use of technology, and economic growth have all increased together over the years.
Now consumers can view listings online, research neighborhood demographics, and even find a lender after shopping around for the best rates. All of this creates a more educated homeowner or buyer, who understands the benefits of representation.
The consumer can experience “information overload”. A real estate agent’s roll is to translate all the input, as well as assist with complicated matters like title insurance, inspections, legal documents, and contract negotiations. Technology can never replace good customer service that an agent can provide.
Now consumers can view listings online, research neighborhood demographics, and even find a lender after shopping around for the best rates. All of this creates a more educated homeowner or buyer, who understands the benefits of representation.
The consumer can experience “information overload”. A real estate agent’s roll is to translate all the input, as well as assist with complicated matters like title insurance, inspections, legal documents, and contract negotiations. Technology can never replace good customer service that an agent can provide.
Make Your Home Stand Out
In today’s market where houses for sale are plentiful, there is a lot of competition for buyers. If you’re getting ready to sell your home, there are steps you can take to make it stand out from the others.
Make your home look more spacious by using neutral colors on the walls and carpeting. Far from appearing boring, the neutral scheme will actually allow buyers to better visualize their own decorating plans. Along those same lines, get organized and reduce the clutter around the home.
This also means rearranging furniture, or even putting some furniture into storage, if it will help your rooms “breathe.” After all, you want buyers to be able to picture their own furniture and belongings in your home. It will be easier for them to imagine moving in if you’ve already taken steps to clear the space a bit.
Details like door handles, cabinet hardware, and faucets can be inexpensively updated to show pride of ownership in your home. Now you’re ready to successfully compete for those buyers!
Make your home look more spacious by using neutral colors on the walls and carpeting. Far from appearing boring, the neutral scheme will actually allow buyers to better visualize their own decorating plans. Along those same lines, get organized and reduce the clutter around the home.
This also means rearranging furniture, or even putting some furniture into storage, if it will help your rooms “breathe.” After all, you want buyers to be able to picture their own furniture and belongings in your home. It will be easier for them to imagine moving in if you’ve already taken steps to clear the space a bit.
Details like door handles, cabinet hardware, and faucets can be inexpensively updated to show pride of ownership in your home. Now you’re ready to successfully compete for those buyers!
Wednesday, January 17, 2007
The Home Inspection
When buying or selling a home, you will probably encounter “the inspection”. Disclosure and awareness are the most important issues. A recent survey of the National Association of Home Inspectors suggest that sellers need to address any problems before listing their home. Buyers should be aware of the following survey results.
The four most common major problems are as follows: Improper drainage around the house can allow water to penetrate the foundation. Roofing can reflect damage in the form of worn materials or improper flashing.
In older homes, particular attention should be paid to the electrical system, which might have inadequate overload protection, “suspicious” wiring, or insufficient power. Also inspect the heating and air conditioning systems, especially if managed with an older thermostat or other controls.
Even though most homes will not have major problems, these are the most common. Trust your agent to prepare you for anything, whether selling or buying.
The four most common major problems are as follows: Improper drainage around the house can allow water to penetrate the foundation. Roofing can reflect damage in the form of worn materials or improper flashing.
In older homes, particular attention should be paid to the electrical system, which might have inadequate overload protection, “suspicious” wiring, or insufficient power. Also inspect the heating and air conditioning systems, especially if managed with an older thermostat or other controls.
Even though most homes will not have major problems, these are the most common. Trust your agent to prepare you for anything, whether selling or buying.
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