Why Buy With Us?
Real estate is a big deal. For most Americans, a home is the most expensive purchase they’ll make in their lifetime. It’s a serious transaction with significant financial and emotional ramifications for the parties involved, and having proper representation is critical.
Today’s buyers and sellers agree
In 2012, a full 89 percent of buyers used a real estate agent, and so did 88 percent of sellers. Realtor® representation during a real estate transaction is important for both buyers and sellers. Here are six of the chief reasons:
When you work with a Realtor®, their fiduciary responsibility is to you. That means you have an expert who is looking out for your best financial interests, an expert who’s contractually bound to do everything in their power to protect you. That’s big — the value of that commitment cannot be overstated. “For more than 100 years, Realtors® have subscribed to the NAR’s strict Code of Ethics as a condition of membership,” says National Association of Realtors® President Gary Thomas. “Realtors® have the expertise and experience to help sellers protect their investment and help buyers build theirs.
Complex, ever-changing real estate regulations
Buying or selling a home in Melbourne Beach is not like purchasing a plane ticket. Every home is different, and laws change every year and vary from state to state. Generally speaking, people purchase a new home every 7-10 years, and a lot can — and usually does — change between transactions. Realtors® are immersed in real estate, and they must stay current with all the updates in regulations, laws, contracts and practices. Once you retain your Realtor®, they put that knowledge to work for you.
Help finding the right home, beyond square footage and baths
Browsing online is a terrific way to start a home search — in fact, almost 90 percent of people start their home search online. But when it’s time to buy, knowing all the pros and cons of a property can help you make the right decision. Realtors® live and breathe real estate, and they can share information about a home that you wouldn’t otherwise know. For example, they can tell you about the perils of polybutylene piping (a plumbing material that’s prone to bursting), or the concerns with FRT plywood (a roofing material that can spontaneously combust in higher temperatures, like those in attics). Your Realtor® can go beyond the aesthetics and tell you important details about homes you’re considering.
Pricing and selling a home.
There are lots of sites where you can view price estimates for your home before you list it for sale. In some markets, online estimates can be off by as much as 35 percent, and they often rely on tax records and data that can be as old as 6-12 months. Realtors® know the local market, have access to the freshest sale data. In 2012, sellers using an agent got $40,100 more: The median sale price for the 88 percent of sellers who worked with an agent was $215,000. A median sale price of $174,900 for the 9 percent of sellers who didn’t use an agent.
Contracts and negotiations
Finding the right home is the fun part. Then the real work begins.: Today’s contracts can be 50 pages long — not counting addendums and riders. Realtors® can help you navigate these complex documents and craft an attractive offer that makes sense for you. Plus, when it comes to negotiation, your Realtor® is your advocate and can bring an objective voice to a very subjective situation.
Following a code of ethics
When you work with a Realtor®, you’re partnering with a professional who operates according to a strict code of ethics. In place for over 100 years, the Realtor® Code of Ethics ensures that consumers who work with a Realtor® are treated professionally and ethically in all transaction-related matters.
What is the importance of getting pre-approved for a mortgage? How do you go about getting pre-approved?
Getting Pre-Approved is an important step in the home buying experience, I always recommend doing it sooner rather than later. Once you speak with a mortgage professional they will be able to tell you what price home you will be able to afford. You definitely don’t want to waste time looking at homes outside your price range. Another important reason to get pre-approved is because most of the time the Sellers will not accept an offer without the Pre-Approval letter from the mortgage professional. So to answer your questions, YES you should get pre approved before looking at homes, although it is not mandatory.
Escrow and Closing Costs
What is escrow? Are there any closing costs that buyers should be aware of? What is the process of purchasing a home?
Buying a house can involve big and scary terms, and “escrow” ranks near the top. So what is escrow, anyway?
The good news is that escrow is not as ominous as it sounds. In the home-buying process, escrow is a financial tool that allows you to set aside important items such as the buyer’s earnest money check and purchase agreement document in an impartial holding area, where it will stay until all of the details are worked out between a buyer and a seller.
The escrow officer is a third party—perhaps someone from the closing company, an attorney, or a title company agent (customs vary by state). How much does escrow cost? That varies too—as well as whether the buyer or seller (or both) pays—with the fee for this service typically totaling about 1% to 2% of the cost of the home.
Escrow may seem like a pain, but here’s how it can work in your favor. Let’s say, for example, the buyer had a home inspection contingency and discovered that the roof needed repairs. The seller agrees to fix the roof. However, during the buyer’s final walk-through, she finds that the roof hasn’t been repaired as expected. In this case, the sellers won’t see a dime of the buyer’s money until they fix that roof. Talk about a nice safeguard for the buyer!
Sellers benefit from escrow, too: Let’s say the buyers get cold feet at the last minute and bail on the deal. This may be disappointing to the seller, but at the very least, buyers have typically ponied up a sizable chunk of change for their earnest money deposit. This money, often totaling 1% to 2% of the purchase price of a home, has been held in escrow. When buyers back out with no legitimate reason, they forfeit that money to the seller—a decent consolation for the sale’s failure.
Escrow, in other words, is the equivalent of bumpers on cars, keeping everyone safe as they move forward in a real estate transaction. Odds are, no one’s trying to swindle anyone. But isn’t it nice to know that if something does go wrong, escrow is there to cushion the blow?
What is a home warranty? Is it worth purchasing?
Many people buy a home warranty right when they close on a home, since such protections can provide some much-needed peace of mind that you won’t get hit with unexpected expenses soon after moving in. Imagine what a bummer it would be, after all, to wake up one morning to a broken boiler or leaking, malfunctioning fridge in your brand-new home. A home warranty can lessen those worries, which for many is worth every penny.
Don’t mistake a home warranty for homeowners insurance, which covers your home’s structure and belongings in the event of a fire, storm, flood, or other accident. A home warranty, in comparison, will cover repairs and replacements on systems and appliances due to normal wear and tear—no calamities required.
A home warranty generally covers these items:
- Electrical systems
- Plumbing systems
- Heating and cooling systems
- Washer and dryer
- Kitchen appliances such as the oven, range, and garbage disposal
While home buyers are often required to get homeowners insurance along with their mortgage, home warranties are a fully optional purchase. Basic coverage starts at about $300 and goes up to $600 for more comprehensive plans, says Bell. A homeowner can add extras if needed, such as coverage for a swimming pool or an external well.
Although many companies offer home warranties to homeowners at any point, the best deals can often be snagged if purchased at the same time you buy the home.
“The warranty plans offered at the time of the real estate transaction typically offer the most comprehensive coverage and price points, so that’s why it’s the ideal time to lock it in,” Bell says. At the end of the first year, you usually have the option to renew your plan or bail.
A home warranty benefits home buyers by providing reassurance that they can move in without worrying about shelling out even more for surprise repairs.
A home warranty can also benefit home sellers (if they don’t have it already), since it can cover these elements during the listing period; some companies even offer free seller’s coverage during this time with the hopes that the buyer will decide to continue the coverage. Oftentimes, home sellers will offer to pay for the first year of a buyer’s home warranty to entice buyers to bite.
Are they worth the cost?
But not everyone thinks home warranties are worth the cost. Typically they aren’t necessary with new homes, since most of the appliances are already covered under manufacturers’ warranties. But in general, the older your home, the greater the odds are that something’s bound to break, and the wiser it is to get a home warranty. Best of all? Many companies don’t differentiate between newer and older homes in terms of cost, making a warranty an especially cost-effective option if you are purchasing an older home.
If something covered under your home warranty breaks, you just call your provider and it will connect you with a qualified contractor in your area. One thing to remember is that a home warranty does not mean you’re off scot-free. Typically you’ll have to pay for a service call or a certain amount of the bill up to your deductible first.
While not everyone will think a home warranty is worth it. It is a good idea for people who lean toward the “better safe than sorry” approach when buying a home.
Congratulations! After years of renting, you feel ready to buy your first home. But the home-buying process can be a terrifying edge-of-your-seat endeavor, especially for first-timers. But the whole thing will seem a whole lot less scary if you arm yourself with a few facts.
Figure out how much you can afford
Homes cost a bundle, so odds are you’ll need a home loan, aka mortgage, to foot the bill, along with a hefty down payment. Still, the question remains: What price home can you really afford? That depends on your income and other variables, so punch your info into our home affordability calculator to get a ballpark figure of what you can manage.
In general, experts recommend that your house payments (mortgage, maintenance, taxes) should not exceed 28% of your gross monthly income.
But online calculators give just a ballpark figure. For a more accurate assessment, head to a lender for mortgage pre-approval. This means the bank will assess your credit history and other factors, then tell you whether you qualify for a loan, and how much. Mortgage pre-approval also puts home sellers at ease, since they know you have the cash to back up your offer.
Pick the right real estate agent
You buy most things yourself—at most, sifting through a few online reviews before hitting the Buy button. But a home? It’s not quite so easy. Buying a home requires transfer of a deed, title search, and plenty of other paperwork. Plus there’s the home itself—it may look great to you, but what if there’s a termite problem inside those walls?
There’s a whole lot of money involved
All of which is to say, you will want to have a trusted real estate agent by your side to explain the ins and outs of the process and help you make the best decisions at every step. Make sure to find an agent familiar with the area where you’re planning on purchasing; the agent will have a better idea of proper expectations and realistic prices.
It’s your first home—we understand if you’ve dreamed about the ideal house and don’t want to settle for anything less. We’ve been there! But understand that real estate is about compromise. As a general rule, most buyers prioritize three main things: price, size, and location. But realistically, you can expect to achieve only two of those three things. So you may get a great deal on a huge house, but it might not be in the best neighborhood.
Once you find a home you love and make an offer that’s accepted, you may be eager to move in. But don’t be hasty. Don’t purchase a home without doing your due diligence and add some contingencies to your contract—which basically means you have the right to back out of the deal if something goes horribly wrong.
The most common contract contingency is the home inspection, which allows you to request a resolution for issues (e.g., a weak foundation or leaky roof) found by a professional.
Another important first-timer addition: a financing contingency, which gives you the right to back out if the bank doesn’t approve your loan. A pre-approval makes this possibility much less likely, but a pre-approval is not a guarantee.
You also might want to consider an appraisal contingency, which lets you bail if your lender values the home at less than what you offered. This will mean you will have to come up with money from your own pocket to make up the difference.
The first-time home buyer tax credit may be no more, but there are a number of tax breaks new homeowners may not be aware of. The biggie: Mortgage interest deduction is a boon for brand-new mortgages, which are typically interest-heavy. If you purchased discount points for your mortgage, essentially pre-paying your interest, these are also deductible. Some states and municipalities offer mortgage credit certification. This allows first-time buyers to claim a tax credit for some of your mortgage interest paid. Check with your Realtor and local government to see if this credit applies to you.
I can refer you to two of the largest movers in this area that have positive reviews and I have had no complaints with whatsoever. Melbourne Beach Real Estate pros at William Taylor Real Estate LLC can guide you in the right direction.