Wednesday, November 11, 2009
Thursday, November 5, 2009
Tuesday, October 20, 2009
Naples
Great News Article About the Naples Life Style!
NAPLES — Robert Feerick knows the value of Naples.
Click Here To See My Video
Eight years ago, the prospect of warm weather year-round and Saturday golfing with friends at the Hideout Golf Club were too good to pass up.
So he picked up life in Milwaukee and moved his home and business to Naples.
Feerick now lives with his wife in Pelican Bay and oversees manufacturing plants located as far away as Vietnam from the Naples headquarters of his private investment holding company, Horizon Partners Ltd.
Housing might have been more expensive in Naples but the city had something Milwaukee didn’t, he said.
“The reason we’re here is, quite frankly, the quality of life,” Feerick said.
And Feerick isn’t alone in his thinking.
Naples housing may be expensive but the city provides a lifestyle that pays off for its residents, according to a working paper by University of Michigan economist David Albouy.
Naples was ranked as the tenth most valuable city in Albouy’s study, which compared the housing prices of more than 200 U.S. cities to their perks like favorable weather and lively downtown areas.
Also in the top 10 were cities like Santa Barbara, Calif., and Honolulu, even metropolitan heavy-hitters like San Francisco, which topped the list, and New York.
What put Naples in such good company?
People gravitate toward favorable weather and that’s one of Naples greatest “natural advantages,” Albouy said.
“People talk about it all the time. It matters,” he said.
Also, residents like Feerick have the option of strolling Fifth Avenue shops, swinging a tennis racket at city courts or spending an afternoon swimming in the Gulf of Mexico, lifestyle amenities that tack value onto a home, he said.
Naples outranks all cities “east of the Mississippi” when it comes to quality of life, Albouy said.
Still, that comes with a bit of a price tag.
For homes priced above $300,000, which was nearly half of the Naples market in May, the median price leveled off at $550,000, far above the national median of $169,000 tracked by the National Association of Realtors.
Though Albouy’s study used housing and rental prices from 2000, several years before the housing bubble burst, he said living where the amenities are is still “like bidding for a great painting.”
People are willing to pay, Albouy said.
As Feerick puts it: “I could I have bought the same house for less in Tuscaloosa, Alabama, but I don’t want to live in Tuscaloosa.”
Albouy’s findings echo what many community leaders have been saying for years.
Quality of life is “a term that gets thrown around a lot” but one that truly is a top priority for Naples government and residents, Naples Mayor Bill Barnett said.
Barnett said he thinks Naples’ natural beauty and the friendly people that live here combine to give the city its ambiance.
“It’s really a wonderful, wonderful mix,” he said.
Most feel that ambiance is unique to Naples.
Residents can walk through boutiques and cultural events and dine out on Fifth Avenue in shorts and flip-flops, said Cathy Christopher, who heads the Naples Downtown Association board.
That’s something you can’t find in Los Angeles or New York, she said.
“People like getting away from the formality,” Christopher said.
So why, with all its allure, did Naples just make the top 10?
Albouy’s study of city value also factored in the amount of high-paying jobs and productivity in each area.
Naples, with a population of around 21,000, doesn’t compare to New York or San Francisco, both epicenters of trade that pump out high-paying jobs that, in turn, help feed area businesses.
Naples needs to pull in more businesses if it wants to remain on a list with those cities, said Greater Naples Chamber of Commerce President Michael Reagan.
“In the crowd we’re in, if we don’t keep up they could eat our lunch,” Reagan said.
Still, Naples isn’t a bad place to do business, with wages at the national average and demand for commercial real estate steady, Albouy said.
And there’s access to airports, an important factor for Horizon Partners’ business, Feerick said.
Some even feel reluctant to accommodate the churn of productivity.
John Schmieding, general counsel for Naples-based Arthrex Inc., moved to Naples from Detroit in 2002 and said he’s seen the area grow “from a town without a Starbucks to replicate a real city.”
Schmieding, who lives in The Moorings with his wife and three children, was always drawn to the once “sleepy fishing village” with its flux of sunshine and dramatic thunderstorms.
Now, development seems overwhelming at times, he said.
Still, Schmieding said he thinks the small town quality that gave Naples its edge in Albouy’s study is here to stay.
“The soul of that sleepy fishing village is here,” he said.
NAPLES — Robert Feerick knows the value of Naples.
Click Here To See My Video
Eight years ago, the prospect of warm weather year-round and Saturday golfing with friends at the Hideout Golf Club were too good to pass up.
So he picked up life in Milwaukee and moved his home and business to Naples.
Feerick now lives with his wife in Pelican Bay and oversees manufacturing plants located as far away as Vietnam from the Naples headquarters of his private investment holding company, Horizon Partners Ltd.
Housing might have been more expensive in Naples but the city had something Milwaukee didn’t, he said.
“The reason we’re here is, quite frankly, the quality of life,” Feerick said.
And Feerick isn’t alone in his thinking.
Naples housing may be expensive but the city provides a lifestyle that pays off for its residents, according to a working paper by University of Michigan economist David Albouy.
Naples was ranked as the tenth most valuable city in Albouy’s study, which compared the housing prices of more than 200 U.S. cities to their perks like favorable weather and lively downtown areas.
Also in the top 10 were cities like Santa Barbara, Calif., and Honolulu, even metropolitan heavy-hitters like San Francisco, which topped the list, and New York.
What put Naples in such good company?
People gravitate toward favorable weather and that’s one of Naples greatest “natural advantages,” Albouy said.
“People talk about it all the time. It matters,” he said.
Also, residents like Feerick have the option of strolling Fifth Avenue shops, swinging a tennis racket at city courts or spending an afternoon swimming in the Gulf of Mexico, lifestyle amenities that tack value onto a home, he said.
Naples outranks all cities “east of the Mississippi” when it comes to quality of life, Albouy said.
Still, that comes with a bit of a price tag.
For homes priced above $300,000, which was nearly half of the Naples market in May, the median price leveled off at $550,000, far above the national median of $169,000 tracked by the National Association of Realtors.
Though Albouy’s study used housing and rental prices from 2000, several years before the housing bubble burst, he said living where the amenities are is still “like bidding for a great painting.”
People are willing to pay, Albouy said.
As Feerick puts it: “I could I have bought the same house for less in Tuscaloosa, Alabama, but I don’t want to live in Tuscaloosa.”
Albouy’s findings echo what many community leaders have been saying for years.
Quality of life is “a term that gets thrown around a lot” but one that truly is a top priority for Naples government and residents, Naples Mayor Bill Barnett said.
Barnett said he thinks Naples’ natural beauty and the friendly people that live here combine to give the city its ambiance.
“It’s really a wonderful, wonderful mix,” he said.
Most feel that ambiance is unique to Naples.
Residents can walk through boutiques and cultural events and dine out on Fifth Avenue in shorts and flip-flops, said Cathy Christopher, who heads the Naples Downtown Association board.
That’s something you can’t find in Los Angeles or New York, she said.
“People like getting away from the formality,” Christopher said.
So why, with all its allure, did Naples just make the top 10?
Albouy’s study of city value also factored in the amount of high-paying jobs and productivity in each area.
Naples, with a population of around 21,000, doesn’t compare to New York or San Francisco, both epicenters of trade that pump out high-paying jobs that, in turn, help feed area businesses.
Naples needs to pull in more businesses if it wants to remain on a list with those cities, said Greater Naples Chamber of Commerce President Michael Reagan.
“In the crowd we’re in, if we don’t keep up they could eat our lunch,” Reagan said.
Still, Naples isn’t a bad place to do business, with wages at the national average and demand for commercial real estate steady, Albouy said.
And there’s access to airports, an important factor for Horizon Partners’ business, Feerick said.
Some even feel reluctant to accommodate the churn of productivity.
John Schmieding, general counsel for Naples-based Arthrex Inc., moved to Naples from Detroit in 2002 and said he’s seen the area grow “from a town without a Starbucks to replicate a real city.”
Schmieding, who lives in The Moorings with his wife and three children, was always drawn to the once “sleepy fishing village” with its flux of sunshine and dramatic thunderstorms.
Now, development seems overwhelming at times, he said.
Still, Schmieding said he thinks the small town quality that gave Naples its edge in Albouy’s study is here to stay.
“The soul of that sleepy fishing village is here,” he said.
Friday, October 16, 2009
Saturday, September 19, 2009
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Sunday, July 26, 2009
Now is a Good Time to Buy a House, for Many People
Now is a Good Time to Buy a House, for Many People
by Brandon Cornett
Should I buy a house now or wait until later? This has always been a common question among first-time home buyers. But with the uncertainty of our current economy, this question becomes even more important. In truth, nobody can answer this question for you. It’s up to you, the home buyer, to decide whether or not it’s a good time to take the plunge.
Five Good Reasons for Buying Now
Should you buy a house now, or wait until next year? Here are five things to consider when making this important decision.
1. In May 2009, housing starts rose by 17% over April. This surprised many economists, who were not expecting such an increase. This rise in housing starts (new construction) indicates rising confidence within the building industry. This kind of trend usually coincides with housing recovery in general.
2. Many economists are saying that the housing market has reached bottom in many parts of the country. In other cities, prices are still falling but are expected to reach bottom in the near future. This means that buyers could get into a home at “rock bottom” prices, and without losing any further value after the purchase.
3. Mortgage rates have been at record lows for several months now, but they are starting to rise. During the week of June 8, 2009, the average rates on a 30-year fixed mortgage reached their highest point in seven months. Nobody has a crystal ball, of course, but many economists expect rates to exceed 6% by the end of this year (they were around 5.3% at the time of this article). Rising rates are another good reason to buy now instead of later.
4. “First-time” home buyers who have not owned a home in the last three years can still qualify for a tax credit on their purchase, up to $8,000. Currently, this program is set to expire in December 2009. So it’s yet another reason to buy a house now, rather than later.
5. Prices are still relatively low in most cities across the United States, but this may soon change. The positive signs mentioned above will be bring more buyers into the market. This will eventually reduce the huge surplus of homes for sale, which in turn will drive prices upward once again.
Here’s what it all boils down to. Only you can decide if now is a good time to buy a house. You need to review your finances and establish a budget, before you can answer this question with any certainty. But there are plenty of good reasons to buy a home sooner, rather than later. So give it some serious consideration!
© 2009, Cornett Communications.
About the Author: Brandon Cornett is a consumer advocate and publisher of the Home Buying Institute. You may visit the author's website at www.HomeBuyingInstitute.com to learn more about this topic.
by Brandon Cornett
Should I buy a house now or wait until later? This has always been a common question among first-time home buyers. But with the uncertainty of our current economy, this question becomes even more important. In truth, nobody can answer this question for you. It’s up to you, the home buyer, to decide whether or not it’s a good time to take the plunge.
Five Good Reasons for Buying Now
Should you buy a house now, or wait until next year? Here are five things to consider when making this important decision.
1. In May 2009, housing starts rose by 17% over April. This surprised many economists, who were not expecting such an increase. This rise in housing starts (new construction) indicates rising confidence within the building industry. This kind of trend usually coincides with housing recovery in general.
2. Many economists are saying that the housing market has reached bottom in many parts of the country. In other cities, prices are still falling but are expected to reach bottom in the near future. This means that buyers could get into a home at “rock bottom” prices, and without losing any further value after the purchase.
3. Mortgage rates have been at record lows for several months now, but they are starting to rise. During the week of June 8, 2009, the average rates on a 30-year fixed mortgage reached their highest point in seven months. Nobody has a crystal ball, of course, but many economists expect rates to exceed 6% by the end of this year (they were around 5.3% at the time of this article). Rising rates are another good reason to buy now instead of later.
4. “First-time” home buyers who have not owned a home in the last three years can still qualify for a tax credit on their purchase, up to $8,000. Currently, this program is set to expire in December 2009. So it’s yet another reason to buy a house now, rather than later.
5. Prices are still relatively low in most cities across the United States, but this may soon change. The positive signs mentioned above will be bring more buyers into the market. This will eventually reduce the huge surplus of homes for sale, which in turn will drive prices upward once again.
Here’s what it all boils down to. Only you can decide if now is a good time to buy a house. You need to review your finances and establish a budget, before you can answer this question with any certainty. But there are plenty of good reasons to buy a home sooner, rather than later. So give it some serious consideration!
© 2009, Cornett Communications.
About the Author: Brandon Cornett is a consumer advocate and publisher of the Home Buying Institute. You may visit the author's website at www.HomeBuyingInstitute.com to learn more about this topic.
When Selling Your House, Proper Pricing is Critical
When Selling Your House, Proper Pricing is Critical
by Brandon Cornett
As the financial crisis continues to unfold in the U.S., many home sellers have found themselves in a bind. Prices have dropped, banks are failing, and home buyers are having an increasingly hard time getting mortgage loans.
So how does one go about selling a house in the current economy? For starters, you need to price your home properly. The pricing process intimidates a lot of sellers, especially those who are handling the process by themselves (without an agent). But it doesn’t have to be scary or confusing. Here are some tips to help you get it right.
1. Detach Your Emotions
When you live in a home for a certain length of time, you develop an emotional attachment to it. This is perfectly natural. After all, it’s your “safe haven” from the world. It’s where you go for privacy, security and relaxation. It might even be the place where you witnessed your child’s first steps, or their first day at school.
But the thing to keep in mind when selling your house is that emotional value does not carry over into financial value. In other words, you can’t price a home based on the memories it holds or the good times it has given you. You cannot set the selling price based on what the place is worth to you. Instead, you must base your numbers on what the house is worth in the current market, based on the concept of comparable sales that we will discuss below.
You might think this is something of a no-brainer or an obvious point. Yet, you would be surprise by how many sellers let their emotions get in the way of real estate reality.
2. Research Comparable Sales in Your Area
The pricing process will be much easier for you when you research comparable sales in your area, as well as homes that are currently listed for sale. The real estate terminology for this is “comps,” short for comparable sales. Here, we are talking about homes that are similar to yours that have been sold in your area recently. By using this information, you can determine your own price — and it will be based on real data, not on emotions.
If you decide to work with a real estate agent during your selling process, this will all be easier for you. This is one of the things an agent will handle for you. They refer to it as the comparative market analysis, or CMA. If you would rather handle the pricing yourself, you can do that too. Agents get their data from public information, not from some private source. They look at the same thing you could look at — recent sales data on similar homes in your area.
3. Consider Supply and Demand
This is always an important consideration for sellers, but right now it plays a major role. Due to recent economic events, the supply and demand of real estate is skewed like never before. The subprime mortgage crisis has led to record numbers of home foreclosure, which drives up the supply of houses. But it has also become much harder for buyers to qualify for mortgage loans, which decreases the demand. When supply goes up and demand goes down, it becomes a buyer’s market. This is what’s happening in most cities across the country right now.
Of course, there are some anomalies in certain cities across the U.S. For example, I live in Austin, Texas, and the market here has not suffered as badly as other cities. The reasons are twofold — (1) our housing prices were not artificially inflated before this crisis, and (2) there is a high rate of immigration as people relocate here from elsewhere in the country.
To figure out the supply and demand situation in your area, you’ll have to do some homework. Your local newspaper is a good place to start.
Conclusion and Going Forward
It may be harder to sell a home in today’s market, but it is by no means impossible. The key is to go into the process with proper research and expectations. If you do your homework and price your home based on real market conditions — and if you do a good job preparing and marketing the property — there is no reason you can’t sell in a reasonable amount of time. On the other hand, if you have conjured your asking price out of thin air, you will be in for a rude awakening.
© 2009, Cornett Communications.
About the Author: Brandon Cornett is a consumer advocate and publisher of the Home Buying Institute. You may visit the author's website at www.HomeBuyingInstitute.com to learn more about this topic.
by Brandon Cornett
As the financial crisis continues to unfold in the U.S., many home sellers have found themselves in a bind. Prices have dropped, banks are failing, and home buyers are having an increasingly hard time getting mortgage loans.
So how does one go about selling a house in the current economy? For starters, you need to price your home properly. The pricing process intimidates a lot of sellers, especially those who are handling the process by themselves (without an agent). But it doesn’t have to be scary or confusing. Here are some tips to help you get it right.
1. Detach Your Emotions
When you live in a home for a certain length of time, you develop an emotional attachment to it. This is perfectly natural. After all, it’s your “safe haven” from the world. It’s where you go for privacy, security and relaxation. It might even be the place where you witnessed your child’s first steps, or their first day at school.
But the thing to keep in mind when selling your house is that emotional value does not carry over into financial value. In other words, you can’t price a home based on the memories it holds or the good times it has given you. You cannot set the selling price based on what the place is worth to you. Instead, you must base your numbers on what the house is worth in the current market, based on the concept of comparable sales that we will discuss below.
You might think this is something of a no-brainer or an obvious point. Yet, you would be surprise by how many sellers let their emotions get in the way of real estate reality.
2. Research Comparable Sales in Your Area
The pricing process will be much easier for you when you research comparable sales in your area, as well as homes that are currently listed for sale. The real estate terminology for this is “comps,” short for comparable sales. Here, we are talking about homes that are similar to yours that have been sold in your area recently. By using this information, you can determine your own price — and it will be based on real data, not on emotions.
If you decide to work with a real estate agent during your selling process, this will all be easier for you. This is one of the things an agent will handle for you. They refer to it as the comparative market analysis, or CMA. If you would rather handle the pricing yourself, you can do that too. Agents get their data from public information, not from some private source. They look at the same thing you could look at — recent sales data on similar homes in your area.
3. Consider Supply and Demand
This is always an important consideration for sellers, but right now it plays a major role. Due to recent economic events, the supply and demand of real estate is skewed like never before. The subprime mortgage crisis has led to record numbers of home foreclosure, which drives up the supply of houses. But it has also become much harder for buyers to qualify for mortgage loans, which decreases the demand. When supply goes up and demand goes down, it becomes a buyer’s market. This is what’s happening in most cities across the country right now.
Of course, there are some anomalies in certain cities across the U.S. For example, I live in Austin, Texas, and the market here has not suffered as badly as other cities. The reasons are twofold — (1) our housing prices were not artificially inflated before this crisis, and (2) there is a high rate of immigration as people relocate here from elsewhere in the country.
To figure out the supply and demand situation in your area, you’ll have to do some homework. Your local newspaper is a good place to start.
Conclusion and Going Forward
It may be harder to sell a home in today’s market, but it is by no means impossible. The key is to go into the process with proper research and expectations. If you do your homework and price your home based on real market conditions — and if you do a good job preparing and marketing the property — there is no reason you can’t sell in a reasonable amount of time. On the other hand, if you have conjured your asking price out of thin air, you will be in for a rude awakening.
© 2009, Cornett Communications.
About the Author: Brandon Cornett is a consumer advocate and publisher of the Home Buying Institute. You may visit the author's website at www.HomeBuyingInstitute.com to learn more about this topic.
A No-Nonsense Guide to Home Buying
by Brandon Cornett
In the last few years, the process of buying a home has been altered by the so-called mortgage crisis and the continued evolution of online real estate tools. So in this article, we will take a fresh and modern look at the process of buying a house. More specifically, I will outline the general process in twelve clear steps.
1. Check Your Credit
Credit scores have always been important for home buyers, but they are more in the wake of the mortgage meltdown of 2007 - 2009. According to industry experts, home buyers in 2006 needed a credit score of at least 620 to qualify for the best interest rates on a loan. Two years later, borrowers needed a score of 760 or higher to get the best rates. That’s a much stricter requirement!
So your first step should be to review your financial situation. Order your credit reports from Experian, Equifax and TransUnion, and check them for errors. Order your credit score (different from your reports) to see how you stack up against the national average. If necessary, focus on improving your score by paying down credit card balances, making all future payments on time, etc.
2. Determine Your Budget
Don’t make the mistake of letting a mortgage lender tell you what you can and cannot afford, in terms of a monthly mortgage payment. In reality, the only thing a lender can tell you is the amount you qualify for — not the amount you can realistically afford. In other words, you should determine your home buying budget for yourself. There are a lot of free mortgage calculators online that can make this process easier for you.
3. Research and Choose a Type of Mortgage
Do you know the difference between a fixed-rate mortgage and an ARM? This is just one of the things you need to understand before applying for a mortgage loan. Because of increased competition in the lending industry, there are more types of home loans today than ten years ago. The key to success when choosing a mortgage is to consider your long-term plans and find a loan that matches those plans. To do this, you must learn the pros and cons of the primary loan types.
4. Get Pre-Approved for a Loan
Pre-approval is a process in which the mortgage lender reviews your financial and credit history to determine your “creditworthiness” … an industry term that means: “How much of a risk is this person, and how much are we comfortable lending?” When you get pre-approved for a certain loan amount, there’s a good chance that you’ll receive final approval for that amount as well, when the time comes.
Having a pre-approval letter in hand also shows sellers that you are serious about (and capable of) purchasing their home. This can make a big difference in hotter real estate markets, where the seller may receive multiple offers from competing buyers.
5. Find a Real Estate Agent
If you are buying a home for the first time, or in a new city you’re not familiar with, it’s wise to hire a professional real estate agent. When you compare the amount of money you’ll pay for a new home with the size of the agent’s commission, you’ll see that it’s worthwhile to hire an agent. Choose an agent who specializes in helping buyers, as opposed to sellers.
6. Narrow Your Search
The neighborhood you choose is nearly as important as the house itself, because both have a direct bearing on your quality of life — not to mention the future resale value. For these reasons and more, it’s always best to live in a city for a while before buying a home, even if it means renting an apartment for a while. That way, you can discover which areas you like best before committing to an area.
7. Begin House Hunting
This is where you and your agent visit properties in order to find one that matches your needs. Here are some helpful tips. Take a digital camera with you to get pictures of each home. This will help you recall the details later on. Bring a notepad as well, and for the same reason. While you’re at it, you might want to bring a friend along for an unbiased opinion of each property — you know, that outspoken friend who calls it like it is.
8. Evaluate the Asking Price
It’s referred to as the “asking price” for a good reason. Just because a property is listed at $250,000 doesn’t necessarily mean it’s worth that amount. This is another area where it helps to have a real estate agent. Most agents are expert at validating sale prices against recent sales in the area, and that’s the best way to find out if the price is realistic or inflated.
9. Make an Offer
Once you’ve determined that the price is fair and reasonable, you are ready to make an offer on the property. Always make the offer contingent upon the home inspection (see next item). That way, if the inspector uncovers an issue that you consider a deal breaker, you have a way out of the contract. Ask your agent about contingencies.
10. Get a Home Inspection
Most inspections only cost a few hundred dollars. That’s a small price to pay for the peace of mind you get in return. A home inspector will review the structural and mechanical aspects of the house, including (but not limited to) the roof, foundation, electrical, and heating / cooling system.
11. Attend the Closing / Settlement Process
So, you’ve made it through all of the inspections and the process is still on track. Great! The next step will be the closing / settlement process (it goes by different names in different parts of the country). Actually, you can prepare for this process early on by putting extra money aside. This is when the title to the property is transferred from the seller to the buyer. You’ll also be signing a lot of paperwork and paying any other fees that are due.
12. Tie Up Loose Ends
After your move, you’ll have a few more things on your task list. Transfer your utilities if you haven’t done so already. Complete a change-of-address form with the post office. Get a safe deposit box for your home insurance policy and other important documents. Set up a mortgage payment schedule or an online auto-pay system. And give yourself a pat on the back … you’re now a homeowner!
© 2009, Cornett Communications.
About the Author: Brandon Cornett is a consumer advocate and publisher of the Home Buying Institute. You may visit the author's website at www.HomeBuyingInstitute.com to learn more about this topic.
by Brandon Cornett
In the last few years, the process of buying a home has been altered by the so-called mortgage crisis and the continued evolution of online real estate tools. So in this article, we will take a fresh and modern look at the process of buying a house. More specifically, I will outline the general process in twelve clear steps.
1. Check Your Credit
Credit scores have always been important for home buyers, but they are more in the wake of the mortgage meltdown of 2007 - 2009. According to industry experts, home buyers in 2006 needed a credit score of at least 620 to qualify for the best interest rates on a loan. Two years later, borrowers needed a score of 760 or higher to get the best rates. That’s a much stricter requirement!
So your first step should be to review your financial situation. Order your credit reports from Experian, Equifax and TransUnion, and check them for errors. Order your credit score (different from your reports) to see how you stack up against the national average. If necessary, focus on improving your score by paying down credit card balances, making all future payments on time, etc.
2. Determine Your Budget
Don’t make the mistake of letting a mortgage lender tell you what you can and cannot afford, in terms of a monthly mortgage payment. In reality, the only thing a lender can tell you is the amount you qualify for — not the amount you can realistically afford. In other words, you should determine your home buying budget for yourself. There are a lot of free mortgage calculators online that can make this process easier for you.
3. Research and Choose a Type of Mortgage
Do you know the difference between a fixed-rate mortgage and an ARM? This is just one of the things you need to understand before applying for a mortgage loan. Because of increased competition in the lending industry, there are more types of home loans today than ten years ago. The key to success when choosing a mortgage is to consider your long-term plans and find a loan that matches those plans. To do this, you must learn the pros and cons of the primary loan types.
4. Get Pre-Approved for a Loan
Pre-approval is a process in which the mortgage lender reviews your financial and credit history to determine your “creditworthiness” … an industry term that means: “How much of a risk is this person, and how much are we comfortable lending?” When you get pre-approved for a certain loan amount, there’s a good chance that you’ll receive final approval for that amount as well, when the time comes.
Having a pre-approval letter in hand also shows sellers that you are serious about (and capable of) purchasing their home. This can make a big difference in hotter real estate markets, where the seller may receive multiple offers from competing buyers.
5. Find a Real Estate Agent
If you are buying a home for the first time, or in a new city you’re not familiar with, it’s wise to hire a professional real estate agent. When you compare the amount of money you’ll pay for a new home with the size of the agent’s commission, you’ll see that it’s worthwhile to hire an agent. Choose an agent who specializes in helping buyers, as opposed to sellers.
6. Narrow Your Search
The neighborhood you choose is nearly as important as the house itself, because both have a direct bearing on your quality of life — not to mention the future resale value. For these reasons and more, it’s always best to live in a city for a while before buying a home, even if it means renting an apartment for a while. That way, you can discover which areas you like best before committing to an area.
7. Begin House Hunting
This is where you and your agent visit properties in order to find one that matches your needs. Here are some helpful tips. Take a digital camera with you to get pictures of each home. This will help you recall the details later on. Bring a notepad as well, and for the same reason. While you’re at it, you might want to bring a friend along for an unbiased opinion of each property — you know, that outspoken friend who calls it like it is.
8. Evaluate the Asking Price
It’s referred to as the “asking price” for a good reason. Just because a property is listed at $250,000 doesn’t necessarily mean it’s worth that amount. This is another area where it helps to have a real estate agent. Most agents are expert at validating sale prices against recent sales in the area, and that’s the best way to find out if the price is realistic or inflated.
9. Make an Offer
Once you’ve determined that the price is fair and reasonable, you are ready to make an offer on the property. Always make the offer contingent upon the home inspection (see next item). That way, if the inspector uncovers an issue that you consider a deal breaker, you have a way out of the contract. Ask your agent about contingencies.
10. Get a Home Inspection
Most inspections only cost a few hundred dollars. That’s a small price to pay for the peace of mind you get in return. A home inspector will review the structural and mechanical aspects of the house, including (but not limited to) the roof, foundation, electrical, and heating / cooling system.
11. Attend the Closing / Settlement Process
So, you’ve made it through all of the inspections and the process is still on track. Great! The next step will be the closing / settlement process (it goes by different names in different parts of the country). Actually, you can prepare for this process early on by putting extra money aside. This is when the title to the property is transferred from the seller to the buyer. You’ll also be signing a lot of paperwork and paying any other fees that are due.
12. Tie Up Loose Ends
After your move, you’ll have a few more things on your task list. Transfer your utilities if you haven’t done so already. Complete a change-of-address form with the post office. Get a safe deposit box for your home insurance policy and other important documents. Set up a mortgage payment schedule or an online auto-pay system. And give yourself a pat on the back … you’re now a homeowner!
© 2009, Cornett Communications.
About the Author: Brandon Cornett is a consumer advocate and publisher of the Home Buying Institute. You may visit the author's website at www.HomeBuyingInstitute.com to learn more about this topic.
Where to Begin When Buying a Home
by Brandon Cornett
Beginning a home search can be a somewhat disconcerting task. Perhaps the biggest question many first time homebuyers have is where to begin the process. Some people begin by looking at real estate magazines or websites, while others call real estate agents right off the bat. The process varies.
So, what is the best way to begin your quest for a new home? In truth, any way you begin the process is a good way, because the most important thing is to get started. After all, you will learn a lot as you go. But there are some things to keep in mind:
Do the Proper Research
Buying real estate can be an overwhelming experience for the first-time buyer. But you can make the process much easier simply by understanding it. Start with the lingo. By learning the terminology associated with home buying and mortgage, you will make smarter decisions along the way.
Set Your Budget
The best way to begin looking for a home is to first sit down with a mortgage lender to determine how a high a mortgage you can afford and be approved for. Remember, there is a difference between the loan amount you can be approved for and the amount you can actually afford. So in the end, only you can determine your home buying budget — not a mortgage lender.
When dealing with a mortgage lender you will want to provide him or her with an understanding of what mortgage payment you are comfortable making so they can give you a sense of the size of the mortgage that equates to, based on your credit, income and other factors.
Taking this step first will help “frame” your home search so you are only looking at homes within your budget range. Many first time homebuyers fail to take this step and therefore waste time and energy looking at homes that are well above their budget.
You can find plenty of websites that offer mortgage calculators, and these tools are a good place to start when determining your budget. Just keep in mind that the one variable you can never predict in advance is the interest rate. Only by speaking to a lender can you get a full mortgage quote that includes the interest rate (based on your credit history).
Get Pre-Approved for a Mortgage
Another reason you may wish to start with speaking to a mortgage lender is so you can be prepared to show a pre-approval letter to the seller. This gives them the confidence that you can buy their home, which is especially important for homes where more than one buyer makes an offer (i.e. a seller’s market). Do not confuse pre-qualification with pre-approval. Pre-qual is an informal process in which the lender tells you how much of a mortgage you might qualify for. Pre-approval, on the other hand, is a more formal review of your finances and is likely to reflect the actual loan amount the lenders extends to you. In other words, the person selling the home will pay more attention to the pre-approval letter.
Though there is no wrong way to begin a search for a new home, meeting with a mortgage lender first may be the best way to begin your search and find your dream home. Just remember to always keep an open mind when visiting each property and envision the possibilities. You must also stay realistic about your finances and do your best not to over-extend yourself by purchasing a home beyond your means.
© 2009, Cornett Communications.
About the Author: Brandon Cornett is a consumer advocate and publisher of the Home Buying Institute. You may visit the author's website at www.HomeBuyingInstitute.com to learn more about this topic.
by Brandon Cornett
Beginning a home search can be a somewhat disconcerting task. Perhaps the biggest question many first time homebuyers have is where to begin the process. Some people begin by looking at real estate magazines or websites, while others call real estate agents right off the bat. The process varies.
So, what is the best way to begin your quest for a new home? In truth, any way you begin the process is a good way, because the most important thing is to get started. After all, you will learn a lot as you go. But there are some things to keep in mind:
Do the Proper Research
Buying real estate can be an overwhelming experience for the first-time buyer. But you can make the process much easier simply by understanding it. Start with the lingo. By learning the terminology associated with home buying and mortgage, you will make smarter decisions along the way.
Set Your Budget
The best way to begin looking for a home is to first sit down with a mortgage lender to determine how a high a mortgage you can afford and be approved for. Remember, there is a difference between the loan amount you can be approved for and the amount you can actually afford. So in the end, only you can determine your home buying budget — not a mortgage lender.
When dealing with a mortgage lender you will want to provide him or her with an understanding of what mortgage payment you are comfortable making so they can give you a sense of the size of the mortgage that equates to, based on your credit, income and other factors.
Taking this step first will help “frame” your home search so you are only looking at homes within your budget range. Many first time homebuyers fail to take this step and therefore waste time and energy looking at homes that are well above their budget.
You can find plenty of websites that offer mortgage calculators, and these tools are a good place to start when determining your budget. Just keep in mind that the one variable you can never predict in advance is the interest rate. Only by speaking to a lender can you get a full mortgage quote that includes the interest rate (based on your credit history).
Get Pre-Approved for a Mortgage
Another reason you may wish to start with speaking to a mortgage lender is so you can be prepared to show a pre-approval letter to the seller. This gives them the confidence that you can buy their home, which is especially important for homes where more than one buyer makes an offer (i.e. a seller’s market). Do not confuse pre-qualification with pre-approval. Pre-qual is an informal process in which the lender tells you how much of a mortgage you might qualify for. Pre-approval, on the other hand, is a more formal review of your finances and is likely to reflect the actual loan amount the lenders extends to you. In other words, the person selling the home will pay more attention to the pre-approval letter.
Though there is no wrong way to begin a search for a new home, meeting with a mortgage lender first may be the best way to begin your search and find your dream home. Just remember to always keep an open mind when visiting each property and envision the possibilities. You must also stay realistic about your finances and do your best not to over-extend yourself by purchasing a home beyond your means.
© 2009, Cornett Communications.
About the Author: Brandon Cornett is a consumer advocate and publisher of the Home Buying Institute. You may visit the author's website at www.HomeBuyingInstitute.com to learn more about this topic.
Sunday, June 14, 2009
Top 10 Reasons to Use a Real Estate Agent
by Brandon Cornett
“Do I need a real estate agent when buying my first home, or can I handle it myself?” This is a common question among first-time home buyers. It’s also an easy question to answer, and you’ll understand why by the time you finish this article.
Let me start by saying yes, you should definitely seek the help of a licensed real estate agent when buying your first home. There are dozens of reasons for this. Let’s talk about some of the most important reasons…
Why You Should Use an Agent
1. Your first home will likely be the largest purchase of your life, up to that point at least. With so much money on the line, it only makes sense to have professional guidance.
2. In most states, the sellers pay the agent’s commission (out of the proceeds they make from the sale). In these scenarios, you get the benefit of expert advice without paying out of pocket.
3. A veteran agent can help you find the kind of home that meets all of your needs, and can save you a lot of time in the process.
4. In addition to helping you find a home, your agent can match you with the best neighborhood for your needs.
5. Agents have a trained eye and will often see things that you overlook. They can point out all of the pros and cons of a particular house and neighborhood.
6. Your agent will help you evaluate the seller’s asking price by analyzing recent sales in the same area. This is the key to making a smart offer on the home.
7. When you make an offer, you will need to include certain contingencies to protect yourself. For example, you should make the offer contingent on a successful home inspection. Your agent can explain these contingencies and help you include the right ones.
8. A good agent will educate you during every step of the home buying process. Instead of making decisions for you, your real estate agent will give you the information you need to make a smart decision of your own.
9. Your agent will keep you on track through the entire transaction, from house hunting all the way to the final closing process. He or she will help you avoid problems that can delay the process.
10. A veteran real estate agent will usually have a network of contacts in related fields. This is a good way to find a home inspector, a local lender, etc.
These are not the only reasons to use a real estate agent when buying your first home. But they are some of the biggest and best reasons. After reading this information, you’ll probably agree that it makes sense to have professional help. Buying a home is a major financial undertaking, and having expert guidance along the way is the key to success.
© 2009, Cornett Communications.
About the Author: Brandon Cornett is a consumer advocate and publisher of the Home Buying Institute. You can reach the author at www.CornettCommunications.com.
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