Category: Uncategorized

Home Purchases, Home finance, and Appraisals

 

Have you ever wondered why you must get your home appraised when financing?  It is required to tell the lender several things.  The most important are the value and condition of the property.  So many factors determine if the property is eligible for financing.  Here are the key things possible outcomes you need to understand about your pending property for purchase.

Desired Values

The property value tells you how much the home is worth.  Values are determined by several factors, and fluctuate.  The values are a snapshot in time based on comparable sales.  It is an opinion of one person’s research based on market sales performance. A certified real estate appraiser creates an appraiser.   Lenders use this value to determine your equity and Their risk position as a percentage.  Lenders call it loan to value.  (LTV) An acceptable appraisal value is one that is at or above purchase price.  If refinancing, it is at or above projected value you stated for your required loan approval.at the initial credit application.

As Is Value

When you receive an “As Is“ appraisal, this means your home is priced at the indicated value the exact condition the property currently is in.  No improvements need to be made, and there are no notable issues with the property.  This is the ideal status for an appraisal required for most final approvals on financing.

Subject To

When a property is “Subject To” the appraiser is noting that the property is one of the following

  • Structure is incomplete in the example of new construction with a home builder. A final “as is” inspection must be obtained prior to final approval for financing.
  • Not compliant with required living conditions per federal lending regulations. Repairs are required, and a final “as is” inspection is required prior to final approval for financing.
  • The current value is based on future repairs as with renovation or repair financing or construction permanent financing. This loan can close in this condition because the financing makes provision for the final inspection for completion.

 

Underwriter Red Flags in the Fine Print Comments & Photos

Every now and then, an appraiser brings back a covert notation to the lending underwriter (decision maker) that says RED FLAG!  These messages are suttle, but a trained lending professional looks for them daily.  They show up in fine print comments and photographs.  They say a picture is worth some 1000 words and that is true when looking at appraisal photos.  Some common things reported are damages to the property, wear and tear, mold “black spots”, cracked chipped, peeling paint, cluttered and blocked spaces, safety hazard, and weird floor plans (functional obsolescence).  Another really big thing are mentions and photos showing the proximity to undesirable locations or hazardous objects. (examples are landfills, nuclear plants, gas stations, sanitation facilities)

 

If you are working with a great realtor, they can always justify the value of the offer price you are submitting so that you can be confident.  There are always those unforeseen surprises, but for the most part, getting the value right starts with a great real estate agent.

If you need assistance pricing, selling your current home, or making an offer on a property, we are the RIGHT agents for you!  Contact us today at 888-362-1706 or email us  at rmorton@mwrealtors.net

 

 

The importance of using financing tools to gain the perfect property

In today’s market place, re-sale properties are in low supply and high demand.   We call this a seller’s market.  We often see multiple offers, and over bidding on home offers.   This makes shopping for a home very competitive.

 

When you are considering making an offer. Know that your financing can help you gain an advantage.

Many sellers are offering little or no closing cost, and are not making repairs on properties. This should not be a deterrent for you getting the house you desire.

Consider This

Using a renovation loan product on a foreclosure or re-sale property

The renovation loan products allow you to make the necessary and desired improvements to a property after you take ownership in one loan.  It is a great solution to purchasing resale properties and avoiding repair request denials.

Taking a contractor with you shopping for houses

Getting a home inspection is a customary and recommended thing.  However, all it tells you is what is wrong.  What you really need to know is how much it cost to fix what is wrong.  A contractor can tell you this.  If you can schedule one to go with you shopping, you should do this.

Staying focused on your desired location

There are so many choices and options when considering where to purchase a home.  The only thing about a home that you can’t readily change is its location.  I don’t sell houses, but I do see a lot of indecisive buyers out there.  I always tell them to stick to their favorite location, and keep as many options open as possible.

Working with a team that is excellent at explaining the process and negotiating on your behalf.

It is imperative that you work with a realtor who has a team of professionals that are all working on your behalf.  You don’t have to use their recommendations, but if they are excellent at what they do, they will have a team of professionals designed to assist you with exactly what you need so that you home buying processes can be simple and seamless.  This team includes lenders, contractors, inspectors, stagers, designers, and local area specialist as well.

Foreclosed properties still present some of the best opportunities in the market place. As a consumer you need to know how to make the negotiations work in your favor without involving the seller.  Following these suggested tips will ensure that you’ll find the perfect house that can be tailor made into perfection for you.

 

If you need information about investing, or purchasing a property, we would love to help.

Contact us at 888-362-1706 or online at www.mwrealtors.net

 

What to do after you own your home

Buying a house is a fun, exciting experience. What happens next?

Home Maintenance and Repairs

Experts say that you should budget at least 1% of sales price of your home for upkeep each year.

If your home cost $300,000, then plan on spending at least $3000 per year for upkeep.

When is the best time to sell?

The best times to sell your home are when you

  • Need more space
  • Need less space
  • Relocating
  • Appreciated value over 20% of the original purchase price
  • During Spring and Summer

When is a good time to think about buying more properties?

The best time to consider investing in real estate is when you are able to pay your expenses and save significantly. Owning rental properties helps to hedge against inflation. Historically real estate out performs market variable investments.

Staying in contact with your real estate agent

It is important to stay connected to your realtor because they are resourceful. The best realtors service their clients long after the home closing.  You will have many questions as time progresses about upgrades, repairs and equity.  Your realtor should be able to refer you to home related services that will save you time and money.

Our firm specializes in helping buyers and investors of all types. We are happy to share our knowledge and expertise with every client. Regardless of what is needed or desired we will find a way to help you create the optimal solutions for you.

For more information contact us at 888-362-1706