Category Archives: Mortgage & Lender Tips

Mortgage Interest Rates are Going Up

The housing market is rebounding, and that means mortgage interest rates are going up. Every percent that interest rates increase has a direct effect on how much home buyers can buy for the same amount of money. Watch the video to learn more from the KC Live home and real estate expert, Elizabeth Sady.

How to be a Competitive Home Buyer

As a buyer in today’s market, it is an absolute must that you are prepared. Here are a few ways to make sure you are prepared to put your best foot forward when looking for a new home.

With great houses getting multiple offers in just a few days on the market, I have many additional techniques and strategies to make sure your offer stands out! Give me a call to discuss how these techniques and strategies can help you, I don’t want to blog them and give away the best stuff to everyone. 😉 816-200-SADY(7239)

Please share with friends, family or co-workers that are considering buying a home!

TIPS for BUYERS

[wpaudio url=”http://esadyrealestate.com/radio/2012-02-05/eSADY-2012-02-05-segment1.mp3″ text=”Preapproval Letter (on the radio show)”]

[wpaudio url=”http://esadyrealestate.com/radio/2012-02-05/eSADY-2012-02-05-segment2.mp3″ text=”Closing Costs (on the radio show)”]
[wpaudio url=”http://esadyrealestate.com/radio/2012-02-05/eSADY-2012-02-05-segment3.mp3″ text=”Days to Close (on the radio show)”]

[wpaudio url=”http://esadyrealestate.com/radio/2012-02-05/eSADY-2012-02-05-segment4.mp3″ text=”Question #1 (on the radio show)”]
[wpaudio url=”http://esadyrealestate.com/radio/2012-02-05/eSADY-2012-02-05-segment5.mp3″ text=”Question #2 (on the radio show)”]
[wpaudio url=”http://esadyrealestate.com/radio/2012-02-05/eSADY-2012-02-05-segment6.mp3″ text=”Question #3 (on the radio show)”]

Sell in January – Prep for the Market

Sell now? Or wait for the Spring and summer months that everyone seems to believe is the golden opportunity? Based on my experience and the numbers that the market is currently producing, selling at either time can produce similar results. I find that it is important to guide clients to the time of year that is best for them and their families.

Reasons to list NOW!!

  • Shining Star Power: There is an opportunity to be a shining star without the perfection that the spring market can sometimes require. Often, less bells and whistles may be needed to become a buyer’s #1 choice. If you’ve got a fabulous kitchen but are lacking in the master bath department, now may be the time to get your home on the market.
  • More SERIOUS showings: Getting your home in show condition and available to buyers to view is very important. At this time of year, buyers are typically more serious and ready to buy, so you’ve got less looky loo buyers scheduling showings!
  • Less late weeknight showings: Buyers do not wish to view homes after it gets dark, which is around 5:00 pm this time of year, so you often have less showings on hectic school nights.
  • Less teenager & child herding for weekday showings: If you’ve got teenagers, you can worry less about getting them up and out of bed for showings, like you would in the summer time while you’re working. This time of year, they are already out of the house and in school.
  • Less competition: The inventory of homes for sale in so many parts of Kansas City is extremely low. Buyers have less to choose from and thus the chances of selling your house are higher.
  • No weeding the landscaping beds: Many believe that the brown grass and bare trees is a negative, but that is not always the case. You can set out pictures of your beautiful flower beds and feature cards pointing out the privacy the trees provide to the back deck when they are filled out in the summer. This is a great way to market them without having to keep them perfect for live inspection.
  • Relocating buyers: There are a number of out-of-town buyers that are out searching for homes right now due to being relocated.
  • Listing now may mean selling in the beginning of the Spring market: Most of my clients need at least 2 weeks to prepare their home for the market, and then it may take 30 days or slightly more to find the perfect buyer. Often, that buyer will be financing the purchase and will require at least another 30 days to close the loan. If you spread these days out across the calendar, listing now would most likely have you closing and ready to purchase your new home in the beginning of the heat of the spring market.
  • Use your summer to enjoy your home and family: Summer is one of my favorite times of year! Why not spend it enjoying your family rather than stressing about keeping a home in show perfection?
  • Interest Rates are low! Rates are low now and there is never a guarantee that they will stay that low. 🙂

 

If now is not the time, here is a recap of ways to start preparing your home for the market:

The first important step: Contact a real estate agent and begin building a relationship.

  • A plan & schedule: They can help develop a plan & schedule for getting you prepared for a sale or purchase, incorporating important dates for you and your family and helping reduce the stress of preparing your home.
  • Tentative spot on the calendar: You can also get tentative time on their calendar. In addition to the time and effort you spend preparing your home, your agent will need time to prepare the marketing and logistical items of getting your home on the market. If you give them advance notice, this can make the initial week on the market easier on all parties involved.
    • Some examples of some of your realtor’s prep work: MLS listing, flyers, websites, showing instructions, open house and agent tour accommodations
  • Market value of your home: You can begin understanding your home’s market and how your home falls into it. Plus, agents can typically set you up with tools to continue to monitor your home’s market for the months to come prior to you listing your home.
  • Pocket listing: In our industry, we have pocket listing. These are homes that as agents we know the sellers are interested in selling, but they may not actually be on the market at that time. I get emails constantly when agents have shown every house in the $325-450,000 price range in an area and nothing is fitting.
  • Contractor and lender recommendations: An agent can help you get in contact with the best contractors to help with those little projects that are beyond your toolbelt skills. They can also lead you to the best lenders for you to contact.

 

The second, but equally important step: Contact a lender.

  • Determining your new purchase price: This means understanding what you qualify for, but more importantly, feel comfortable purchasing. You can start planning for down payment funds and other purchases that may need to take place before and after a move.
  • Best credit score: Bruce and the Credit Guys help speak with us a ton about this. There are times that you have negative marks on your credit that may be a mistake or easy to repair. Getting these items corrected before you are ready to buy can improve your interest rate and other terms, and ultimately save you lots of money.

If you have any specific questions feel free to contact me, via my contact page, by email at e@eSADY.com or at 816-200-SADY (816-200-7239).

Seller Paid Closing Costs

Buyer Question: On the FEE WORKSHEET from my lender, how do I know which “closing costs” I can ask a SELLER to pay for when I purchase a home?

eSADY answer: On the fee worksheet, add the CLOSING COST amount to the PREPAIDS. This equals what industry calls “closing costs” that you could ask a seller to pay.

What you see below as “Est. Closing Costs (+)” are the lender fees, broker fee, recording fees, etc. The “Est. Prepaid Items/Reserves (+)”
represents the money collected to start your escrow account for taxes and homeowners’ insurance.

Closing Costs and Prepaids

Closing Costs and Prepaids

It does not matter if you are in Kansas or Missouri; a seller can pay for closing costs. This is a part of the negotiation. A seller does not HAVE to pay a buyer’s closing costs. If you want them to pay your closing costs, you have to consider how it affects the amount that the seller will net. Let’s use an example…

You find your dream home and your agent runs COMPs for you. He/she finds that the market value is right around $290,000. If you want the seller to pay your closing costs of $4,000, you may want to offer $292,000. The seller will have to pay the $4,000 of closing cost out of the proceeds they receive from the sale of the home at $292,000, thus they are really only receiving $288,000 for their home.

Other fun CLOSING COST facts:

–> You CAN ask for closing costs when purchasing a foreclosure.

–> You CAN ask for closing costs when purchasing a short sale.

–> A seller MAY NOT have proceeds to pay for closing costs in some transactions. (If they are upside down in their home, they may have to bring money to closing to sell their house, thus, not have additional money to pay your closing costs.)

–> The type of loan may limit how much of your closing costs that a seller can pay. (for example, FHA)

–> Negotiated Seller Paid Closing Costs are of the “use it” or “lose it” variety. If you ask for $4,000 and then only need $3,000, the seller keeps the additional $1,000.

–> You can include some of your inspection costs in your Seller Paid Closing Costs at closing.

I would highly recommend a REALTOR be used in your purchase. Every transaction is different and you need a professional to help you make sure you negotiate smartly and as much as possible, as well as protect you through the closing of the transaction.

Make sense? If not, feel free to call or email me and I will do my best to explain it better.

elizabeth SADY

e@eSADY.com 816-200-SADY (816-200-7239)