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Buyer Information |
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| Buying Tips |
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Buyer's Blues |
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The Realtor calls with great news! Your offer has just been accepted.
Congratulations--you are about to become a homeowner! Your initial euphoria may
be short-lived, however, as you begin to have second thoughts about the
purchase. First, it's the mortgage. It seems like so much money, and it will
take thirty years to pay for it. You look over the cash you will need for the
closing and feel like you will never be able to afford to dine out again!
Finally, you stare at the inspector's report and convince yourself that the
roof will blow off and every major system will fail the day after you move in.
You're in a frenzy. You ask yourself, "What have I gotten into?"The best thing
to do if you begin having "second" thoughts is just relax! These feelings are
so common that they have even been given a name--"Buyer's Remorse." "Buyer's
Remorse" is almost always a temporary malady, but call your Realtor if you are
having an extreme attack. We have experience in helping our clients through the
home-buying jitters. |
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Buyer's Remorse |
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When you sign a purchase agreement on a new home, you will almost certainly
feel an incredibly intense attack of panic and anxiety. Did I pay too much? Is
it really the right one? How can I ever pay the enormous mortgage payments? How
can I get out of it? This response--referred to as "Buyer Remorse"--is
completely normal! When you feel such anxiety coming on, call your friends who
have owned a home for a few years. Are they bothered by rapidly escalating
prices? Not at all! That means the value of their home is going up, too. While
their mortgage payments seemed high at first, they are now probably less than
renting a smaller home. There is also the pride of ownership as improvements
are made to the property. Did they feel anxious when they first signed the
agreement? They felt just as anxious as you feel, but they are really glad that
they went through with it. When you experience "buyer's panic"--hang in
there--you will be glad you did! |
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First Time Buyers |
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Most first-time buyers can qualify for a mortgage loan, but they may need
help from parents to make the down payment or closing costs on their home.
There are loan programs that minimize the down payment and closing costs for
first-time buyers. These programs usually require that 3 to 5 percent of the
purchase price come from the buyers funds, not from a loan or gift. Most
lenders ask for the last three months' bank records, and the borrower will be
asked to reveal the origin of any large deposits. If the money comes from the
parents, the lender may not consider those funds when qualifying the buyers. If
you are planning to help your children finance a home, you should transfer any
funds several months before they begin their house-hunting. If it is a loan,
you should draw up a formal re-payment agreement with your children to
eliminate potential misunderstandings between you, your children, and any
siblings. |
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First-Time Buyers |
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People who are selling their homes should know something about the market
group from which their buyers are likely to appear. Many homes are perfect for
a first-time buyer. First-time home buyers are usually younger (usually between
25 and 34 years of age) and have distinct buying patterns. First-timers often
have to settle for homes that are smaller, and perhaps older, than repeat
buyers. The median home size for first-timers is about 1450 square feet, for
repeat buyers around 1900 square feet. Approximately four in ten first-timers
will buy homes built before 1960, compared to two in ten repeat buyers.
First-time buyers haven't developed a strong a sense of what they want in a
house, and they may not have enough money to get exactly what they want at
first. Seventy-four percent say they like their new home better than their
previous residence. Two-thirds (67%) of repeat buyers say they their like their
new home better, probably because they are upgrading.
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Smart House Hunting |
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Serious house hunting can leave you worn out and confused at the end of the
day. It is hard to remember which house had the great back yard and kitchen and
which one you ruled out because of inadequate storage space. Some of the houses
you visited looked familiar--like maybe you had seen them before. How can you
conserve energy and keep it all straight?
The first step is to find a Realtor who knows the area well and will only show
you homes that meet your criteria. Next you should invest in a small note pad
in order to keep a record of the homes you visit. Note the address, style and
exterior color, as well as something distinctive about the house that will
trigger your memory. Make a special note if a house has real possibilities. Jot
down important pluses and minuses of each property and share this information
with your Realtor. This will help you to narrow down the houses so that you can
focus on your favorites.
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Buying New-Buying Old |
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New homes typically have a higher sales price than comparable existing homes,
and buyers are usually willing to spend more on a new home because of lower
maintenance costs. Builders' warranties on new homes, along with a new roof,
appliances, and major systems, usually make major repairs unnecessary and help
to counter a slower initial rate of appreciation.
A 1991 Census Bureau Housing Survey suggests that operating costs are lowest
for brand new homes, slightly higher for relatively new existing homes, but
lower on average for older existing homes. Operating costs per square foot of
living space, however, are consistently higher for progressively older existing
homes. Utility costs represent the largest factor in operating costs. Energy
consumption per square foot depends on the size of the home, the insulation and
quality of the windows, air leakage and the efficiency of the furnace.
New homes require fewer expenditures for routine maintenance. The cost of
maintenance first increases with age, then declines, so you will generally
spend less maintaining a home built before 1960 than for a home built between
1970 and 1975.
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New Homes |
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Buying a house that is under construction gives you the opportunity to
customize your new home by adding "extra" features to the basic home. When
deciding on special features, consider how they will affect the re-sale value
of the home and whether these additions will over-improve your home.
Money spent to improve and modernize kitchens and bathrooms is almost always a
good investment. Corian counter tops, side-by-side refrigerators, quality
flooring and whirlpool tubs are good ideas. Hardwood floors in the living and
dining rooms are a plus when selling a home. If the builder's standard flooring
for the foyer is linoleum, it is definitely worth changing to wood or ceramic.
And even if you don't enjoy sitting around a roaring fireplace, the next owner
may want one. If you plan to finish the basement later, you may want to
"rough-in" the plumbing for a bath during the original construction. You should
consider your own enjoyment--and what will increase the value of your home when
you sell.
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Building and Designing |
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If you are planning to build a new home, you should take full advantage of
the opportunity to design a custom-built home that takes into account your
needs and includes all the amenities you want in your home. If you want a
kitchen for the "gourmet cook" in you-- you can have it! If you want the master
suite at the opposite end of the house from the kids, it's no problem. This may
be the biggest project of your lifetime, so be certain to select a team of
professionals to work with you. Your home team should consist of a real estate
salesperson, an architect, a builder, and a lender. Your "Dream Team" will work
with you to assure that all the legal requirements are met and that there are
no "surprises" in your future.
Interview each member of your team and get references so that you have the best
professionals for the job. You will be working closely with these professionals
for over a year, so you want to be sure that your team will be able to work
well together.
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A Buyers Market |
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Is the real estate section of your local paper filled with stories about how
slow the real estate market in your area is? Is it taking months to sell the
homes on the market? If this description fits your area, and you have been
waiting for the perfect time to buy a house, this is the time!
This kind of market is referred to as a "buyers' market" for good reason--it is
an opportunity for buyers to select from a large number of homes that could
satisfy their needs. Everyone involved is ready to bend over backwards to make
it possible for you to buy your dream home. Most sellers are highly motivated
and so are the local Realtors, loan officers, title companies, and other
professionals involved in the transaction. It is important to remember that the
real estate market runs in cycles, and conditions can change without a lot of
warning. This could be the perfect time to contact a good Realtor to discuss
your needs and to explore the possibilities available to you.
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Making An Offer |
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You have found the perfect house and are thinking about making an offer. Even
though you trust your Realtor, you are feeling some pressure just when you feel
that you need time to consider the matter. The agent tells you that another
party is thinking about making an offer, so you shouldn't waste time if you
really want the house. What should you do? Trust your agent!
It is natural to feel some pressure from even the most easy-going Realtor--and
some uncertainty about making an offer. If you really like a house, there is
always the possibility that someone else will share your same enthusiasm for
it. Sometimes you can "sleep on it" and it won't matter. Whether the market is
good or sluggish, it is a good idea to assume that another offer is likely to
come in, and move as quickly as possible to minimizes the possibility of
another buyer materializing.
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Submitting Offers |
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Many of the offers we submit for prospective buyers aren't exactly what the
sellers want; the price may be lower than they are asking or there might be
terms that will require negotiation. What happens after the offer is submitted?
The seller's Realtor will present the offer to the sellers, along with the
buyer's qualifications. If the sellers accept the offer, then you have a
purchase agreement. If the sellers counter the offer, the next action would be
initiated by the buyers. If you want to buy a particular house, your chances of
succeeding are greater if your offer is as close to the asking price as
possible. You could save money by engaging in lengthy negotiations, but you run
the risk of losing the home if another offer comes in or you risk offending the
seller.
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The Buyer Interview |
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The first step to matching you with the perfect home usually involves an
in-depth interview with the Realtor who will help you to establish a price
range and to determine the features that you need in a home.
The agent will ask a lot of questions, and many of them will seem very
personal. What is your income and debt situation? Where do you work? Are
schools an important factor? Do you have children or pets? Do you have hobbies
that will create special needs? The more information your Realtor has, the
easier it will be to eliminate the homes that will not work for you and show
you the ones in your price range that should fit your needs. A good Realtor can
be a tremendous resource in this process by providing you with information
about the homes that are available, as well as about shopping facilities,
community services, and public transportation. There is more to being a great
real estate professional than merely marketing. The best Realtors are also the
best listeners and counselors.
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| Jeannie Sattler | Tiffani Clark | |
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