What You Should Know Before Buying a Home

The number of reality shows which give you a peek at the home buying process has grown with each passing year. All the quick shots of realtors and homeowners fighting for a house is one great way to get an audience’s attention. While these shows might give you a general idea of what the purchasing process is, there is a lot more behind the scenes that you won’t know until you’ve been in the purchasing shoes. The tips below will give you a good idea of what you should absolutely know before buying your home.

Credit

Credit. It’s a word that gets thrown around a lot when it comes to buying your first home, or another home for that matter. Do you know your credit score? Is your credit score high or low? How do you get credit? Do you even have any credit in the first place? Credit is the name of the game when it comes to buying a home. Banks judge you based on your credit score. Understanding how credit impacts your potential purchase might be overwhelming at first but having the right bank or lender on your side makes all the difference.

Home Value

Buying a home is difficult no matter how you look at it. The sheer number of things to think about, plan for, and pace over can make all other chores on your plate look like child’s play. One of the biggest parts of the buying process is digging into your dream home a little deeper. Do you truly know the value of the home you’re looking at? Looking at comparables in the area can give you a jumping off point. But inspecting the guts of your home can make or break a purchase. The beautiful outside of a home can hide potential dangers inside. Knowing the value of your home inside and out can save you buyer’s remorse down the road.

Budget

As obvious as this tip might seem to some people, it’s the biggest hurdle when it comes to buying a home. Deciding on a budget is a difficult task even for buyers with all their ducks in a row. If you’re buying a home with someone else, then the discussion can become even more complicated. The absolute best advice that can be given concerning your budget is to finalize you budget beforehand. The pressure to max out your budget or go beyond will more than likely happen at some point during your purchasing journey. If you have a budget you’re comfortable with then stick to it.

Steps for Buying a Short Sale Home

As a home buyer the whole process can be baffling for anyone not experienced in the process. There are regulations and laws to follow which, while sometimes frustrating, have to be adhered in order to keep the process legal. For buyers interested in a short sale home the whole event can become even more uncertain. A short sale is wholly unlike a normal sale. There are many more steps to get right and to get through until the keys are in your hand. While an experienced real estate agent can help you navigate each step, buyers should also be aware of the general process before diving in.

Find the Right Agent – As mentioned above, short sales are unlike normal sales. A buyer will have to finagle a few more hills to get their home. A real estate agent with experience dealing in short sale homes is the agent you need to have in your corner.

Find the right Home – This may be the toughest part of the whole process. Finding the right home is the biggest hurdle. Make sure you inspect the home carefully during the process to avoid surprises.

Get Your Finances in Order – A short sale works closely with a bank in order to pass through all the hoops. Having your finances in order can make the process go much more smoothly. Knowing exactly how much you can offer means the difference between the bank taking your offer or passing you over.

Work with Your Agent – The next few stages will have you working closely with your agent through different steps between the lender and the buyer. Your realtor will know how to submit your offer and short sale packet in order to proceed.

Prepare to Wait – It may seem like you’re waiting for paint to dry during this step but patience is important. It takes time for lenders to review offers and decide on their next move. Make sure the lines of communication are open with your realtor so you’ll know when the wait is finally over.

How to find a Real Estate Agent

Like a good doctor or dentist, finding a real estate agent to help you navigate the path to finding or selling your home can be a chore. It may take a few times to click with an agent depending on what you’re looking for. No one agent will fit every buyer or seller so taking time to search out the right one for you will make the process go a lot smoother. The right agent for you will match your personality. Someone you feel comfortable with can make things much easier where stress is concerned. Instead of calling up the first agent you see online it might be best to take pause and decide who you’re looking for. Finding an accomplished agent in the Northern Virginia area and around the country takes time. If you are searching for the right agent to meet your needs then take a look at the list below for some insightful tips on how to find the best real estate agent for you.

Don’t Panic

It’s easy to become overwhelmed with the buying and selling process fairly quickly. Stress leads to knee-jerk reactions which might not end the way you expect them to. Seeing a sign on the front lawn of a home you like doesn’t always mean you should immediately jump to let that agent do your dealing for you. How much do you know about that agent from the sign? Have they made many sales? What do consumers say about them? How much do they know about the home or neighborhood? How long have they been an agent? It can be frustrating to pin down someone you can trust but the alternative means matching with an agent unable to give you the service you deserve.

Word of Mouth

We might live in a highly technological world with businesses competing online with their farm of social media sites but that doesn’t mean word of mouth still isn’t king when it comes to specific services. No matter how many reviews you read online it is much easier talking to people you know who have dealt with a service. They can tell you whether they would work with someone again or pass over them. When you are finding a real estate agent to work with it can be extremely helpful to get input from friends, family, or even neighbors who may have bought their home with a specific agent. A review online can give you the basics but your friend telling you the truth face-to-face is something you can’t beat.

Be Nosey

This is the good kind of nosey. Slip into sleuth mode and do a little background digging on your agent. Has she sold many homes in the last few years? Does he have a good track record with his organization? Checking on sites such as MLS can give you a good jumping off point. Make sure your realtor is actually online. Since a majority of buyers see homes for the first time online, a good agent will also have an online presence. Reading reviews from homeowners and buyers is also helpful for making your choice. Digging around for information can give you a broader understanding of whether or not the realtor has enough experience to assist you.

Decline Green Family or Friends

It may seem rude but it’s a good course of action. If a friend of the family or someone close to you just got their license and wants to help…it may be best to kindly decline the offer. A new real estate agent has limited experience and hasn’t sold a home yet. Until a realtor has been out in the field a few years, they haven’t truly dealt with everything that can go wrong with the sale or purchase of a home. Make sure you always go for an experience real estate agent such as Claudia Sarmiento who will keep you steady during the long process.

How to Buy a Short Sale Home

In the current housing market it doesn’t matter where you live. You could be searching for a home in a rural town or a thriving city, finding a suitable house can be a bear of a task. If you’ve ever switched your television over to HGTV then you’ll notice a familiar strain in every episode – homes are expensive, not in the right area, need too much work, and the list goes on. Searching for your home is a grueling process for many prospective buyers. Finding the right balance between location, price, and condition can lead to some sleepless nights scrolling through your local realtor site. The market is full of so many different types of properties that a buyer might have plenty to choose from if you don’t mind stepping off the main pathway. A short sale home can serve you with everything on your checklist if you’re patient enough and willing to put in a little extra effort. Below are some tips for how to buy a short sale home.

 

Find an Experienced Agent

This is the absolute first thing you need to do if you stumble upon a short sale home you truly love. Buying a short sale isn’t like seeing a car you really like in someone’s yard and chatting up the owner. A short sale home isn’t as simple as the title might imply. More often than not, the process isn’t going to be short. It’s going to take time and a huge need for patience on the part of all parties. So before you plunge in you should find an experienced agent to help you take the leap. Most realtors can handle a short sale but finding one with experience in navigating the sometimes tricky waters can save you heartache and stress down the road. A realtor with experience handling short sales will know the process much better. While there will always be a few bumps in the road, the experience will make it easier on you as a buyer by giving you valuable information on how the process works.

 

Get Finances Ready

A short sale differs from a regular home sale by a huge list of reasons. One of the biggest being how long it takes to complete the process. One of the most important things you can do when entering the short sale arena is making sure you have your finances in order. An experienced real estate agent such as Claudia Sarmiento will make sure that’s at the top of your priority list. Most buyers aren’t aware of how tricky a short sale can be. More often than not the first offer on the table is the one accepted. It matters little if the offer is low. Why? Due to the logistics of a short sale, casting aside one offer if the paperwork has already been started could take a long time. Throwing all the work aside isn’t something banks and lenders are interested in. Make sure you’re pre-approved to buy a short sale home. Otherwise a lender may not even look your way.

 

Prepare for Unexpected Obstacles

So you have the money lined up, the paperwork has started, and an experienced realtor is on your side. That should cover everything, right? Sadly the answer to that question is a resounding no. Preparing for the unexpected is critical when you’re buying a short sale home. There are certain things you’ll always need to keep an eye out for. One example of this would be making sure you have an escape route. When papers are being drawn up, request a contingency plan for if the house is in horrible shape. This will give you an escape route if you suddenly find out the home needs a completely new roof or the electrical needs huge updates. That way you’re not left with a home that’s in secret shambles. Buying a short sale home also comes with its fair shares of financial responsibilities. You may be required to pay legal fees, realtor fees, and a host of other little fees which can quickly add up. Know your rights and always have a qualified realtor to help you through.

What is a Short Sale?

 

The real estate market can be a difficult world to traverse no matter how many times you have bought or sold a home. There are more rules, regulations, and lingo to understand than the average person has time for. While it’s okay not to understand every phrase that’s thrown at you during the course of searching for a phone, there are a few that you absolutely should know before you even visit your first house with a qualified agent. Buying a home is a fairly scary and exciting event in life. Having a tested realtor by your side can save you from making a big mistake. One word which has been popping up lately is buying a Short Sale. It’s a double-edged sword if you’re not working with a qualified agent such as Claudia Sarmiento, but for homeowners with a great realtor then buying from this pool of homes can be a great deal.

What is a Short Sale?

Often you might hear couples on television getting involved in the short sale of a home. A real estate agent will explain the terms; the couple might be rightly hesitant, and the finale will show them in a beautiful home they never thought they could afford. If you’re unsure of what a short sale actually is then here are the basics. A short sale may also go by the name of a pre-foreclosure sale. It’s when the owner of the home is facing a foreclosure – or loss of the home. The house is sold for less than what’s remaining on the mortgage. In essence, the home is sold for less than it’s actually worth. If you’re a homebuyer looking for a home on a budget then a short sale could be just what you need.

How can a Short Sale Benefit You?

Did you know that short sales and foreclosures comprise around half of all real estate sales? If you’re buying your first home then deciding on a short sale can give you a great deal. Working with an established real estate agent with experience dealing with short sales will help you avoid getting in over your head. A big benefit of a short sale, aside from the price, is that you don’t have to deal with the issues which often arise from a foreclosed home. With a short sale you are one step behind a foreclosure which means the owner of the home is still in the mix. An experienced realtor will know all the right steps to help get the ball rolling when it comes to a short sale. Understanding the process can help you get a clearer view of what it takes to get a home from the hands of a seller into your hands as a buyer. It may not always be the easiest route to take but a short sale can be hard to pass up at the end of the day.

Things to Consider

Buying a short sale is a major choice on the part of any home buyer. There are certain things to consider about a short sale that might turn you from one direction to another. One fact about a short sale is the condition. Between a foreclosure and a short sale, the short sale is likely to be in better condition than a foreclosure. A homeowner who has lost their house may take their anger out on the house itself – that means the foreclosed home you have your eye on might need a lot of work. A short sale can be a lot different. With a short sale home the owner may still even live in the home which increases the likelihood that the place won’t be trashed when you arrive. One caveat of buying a short sale is the waiting game. A short sale will more than likely take longer than a traditional home to close. While a short sale can be the deal of a lifetime, it requires a lot of patience on the part of the buyer.

 

 

The Deal of the Century??

The Deal of the Century?? | Simplifying The Market

Recently, Freddie Mac published a blog post titled Mortgage Rates: Still the Deal of the Century. They explained that, if you are planning to purchase a home, now may be the time:

“If you are in the market to buy a home, today’s average mortgage rates are something to celebrate compared to almost any year since 1971.”

And they let their readers know that there is no guarantee that rates will remain this low:

“Over the past few years, we’ve enjoyed a long run of historically low mortgage rates. While no one expects them to change dramatically overnight, they are expected to head up. Most experts agree that mortgage rates will drift up in the coming months to end the year approaching 4.50%… Buying a home is a big investment – perhaps the biggest one you’ll make in your life. So, it’s important to be sure you are ready to make that purchase. If you are ready, today’s rates are not to be missed.”

The article went on to calculate what the principal and interest payment would be based on a $200,000 fully amortizing mortgage at different times in history.

Mortgage Payments | Simplifying The Market

Here is a look at rates over the decades:

Historic Mortgage Rates | Simplifying The Market

Here is a look at rates over the last four years and what Freddie Mac projects for next year:

30 Year Fixed Rate Mortgage Rates | Simplifying The Market

Bottom Line

If you are thinking of buying your first home or looking to move up to your dream home, now may be the time to do it.

Where Will Mortgage Rates Be in 12 Months?

mortgagerates750

One of the biggest questions plaguing the current housing market is where mortgage interest rates will be at this time next year. Over the last two months, rates have begun to creep up (see chart).Interest Rates.1

Though we don’t like to project rates moving forward, we do want you and your family to have the information you need in order to decide whether to wait before buying your first house or moving up to your ultimate dream home.

Here are the most current mortgage rate projections from Fannie Mae, Freddie Mac, the Mortgage Bankers’ Association and the National Association of Realtors.

Interest Rates.2

Projecting interest rates is not easy. So what should you do – do it now or wait? We like the advice Doug Duncan, senior vice president and chief economist at Fannie Mae, recently gave:

“The rule for when is it time to buy is always the same: given your household budget and where current interest rates are, if it makes good financial sense to take out a home loan today, then today is the day to do it.”

Bottom Line

If you are ready, willing and able and are thinking of buying a home over the next twelve months, waiting may not make sense.

 

 

How Will Mortgage Rate Hikes Impact Home Sales?

Mortgage-Rates

 

 

When mortgage interest rates begin to climb, experts immediately begin to discuss home affordability indexes. They calculate how an increase in rates will slow home purchases as more and more potential buyers are priced out of the market. Today, with home prices also increasing, many believe that home sales may slow down rather dramatically.

This may prove to be true in the long term. However, in the short term, increasing mortgage rates may have the opposite effect. Many buyers who have been sitting on the fence may realize that delaying their purchase no longer makes sense.

Last week, in a CNBC article, Matt Weaver of Florida-based PMAC Lending explained the impact an increase in rates will have:

These increases really help the home-buying market. It really gets buyers to really understand that ‘wait a minute, rates are at an all-time low, let’s react now, let’s react before they go higher’.

As an example, we can look to 2013 when interest rates spiked up by a full percentage point over a two month period. The result is that many buyers rushed to the market on the fear that rates would continue to climb. It didn’t necessarily increase the number of sales that year dramatically.

However, it did seem to move some sales up in the year as evidenced by the chart below:

Home-Sales-and-Interest-Rates

 

We can see that the sales cycle did not follow a more normal cycle (2014) with more sales being pushed into July and August and slightly less sales in September and August.

Bottom Line

If you are waiting to put your house on the market, think twice. Now may be the perfect time to sell as buyer competition will continue to heat up as more purchasers jump into the market. You may also save a pretty penny on the monthly mortgage payment of your next home by selling now before rates shoot up.