2 Tunnel Road Berkeley , CA 94705

Author: Admin

May 2, 2017

8 Reasons Why You Should Work With a REALTOR®

8 Reasons Why You Should Work With a REALTOR®

Not all real estate practitioners are REALTORS®. The term REALTOR® is a registered trademark that identifies a real estate professional who is a member of the NATIONAL ASSOCIATION of REALTORS® and subscribes to its strict Code of Ethics. Here’s why it pays to work with a REALTOR®.

1. Navigate a complicated process. Buying or selling a home usually requires disclosure forms, inspection reports, mortgage documents, insurance policies, deeds, and multipage settlement statements. A knowledgeable expert will help you prepare the best deal, and avoid delays or costly mistakes.

2. Information and opinions. REALTORS® can provide local community information on utilities, zoning, schools, and more. They’ll also be able to provide objective information about each property. A professional will be able to help you answer these two important questions: Will the property provide the environment I want for a home or investment? Second, will the property have resale value when I am ready to sell?

3. Help finding the best property out there. Sometimes the property you are seeking is available but not actively advertised in the market, and it will take some investigation by your REALTOR® to find all available properties.

4. Negotiating skills. There are many negotiating factors, including but not limited to price, financing, terms, date of possession, and inclusion or exclusion of repairs, furnishings, or equipment. In addition, the purchase agreement should provide a period of time for you to complete appropriate inspections and investigations of the property before you are bound to complete the purchase. Your agent can advise you as to which investigations and inspections are recommended or required.

5. Property marketing power. Real estate doesn’t sell due to advertising alone. In fact, a large share of real estate sales comes as the result of a practitioner’s contacts through previous clients, referrals, friends, and family. When a property is marketed with the help of a REALTOR®, you do not have to allow strangers into your home. Your REALTOR® will generally prescreen and accompany qualified prospects through your property.

6. Someone who speaks the language. If you don’t know a CMA from a PUD, you can understand why it’s important to work with a professional who is immersed in the industry and knows the real estate language.

7. Experience. Most people buy and sell only a few homes in a lifetime, usually with quite a few years in between each purchase. Even if you have done it before, laws and regulations change. REALTORS®, on the other hand, handle hundreds of real estate transactions over the course of their career. Having an expert on your side is critical. 8. Objective voice. A home often symbolizes family, rest, and security — it’s not just four walls and a roof. Because of this, homebuying and selling can be an emotional undertaking. And for most people, a home is the biggest purchase they’ll every make. Having a concerned, but objective, third party helps you stay focused on both the emotional and financial issues most important to you.

By Admin
May 2, 2017

Does Moving Up Make Sense?

Does Moving Up Make Sense?

These questions will help you decide whether you’re ready for a home that’s larger or in a more desirable location. If you answer yes to most of the questions, it’s a sign that you may be ready to move.

1. Have you built substantial equity in your current home? Look at your annual mortgage statement or call your lender to find out. Usually, you don’t build up much equity in the first few years of your mortgage, as monthly payments are mostly interest, but if you’ve owned your home for five or more years, you may have significant, unrealized gains.

2. Has your income or financial situation improved? If you’re making more money, you may be able to afford higher mortgage payments and cover the costs of moving.

3. Have you outgrown your neighborhood? The neighborhood you pick for your first home might not be the same neighborhood you want to settle down in for good. For example, you may have realized that you’d like to be closer to your job or live in a better school district.

4. Are there reasons why you can’t remodel or add on? Sometimes you can create a bigger home by adding a new room or building up. But if your property isn’t large enough, your municipality doesn’t allow it, or you’re simply not interested in remodeling, then moving to a bigger home may be your best option.

5. Are you comfortable moving in the current housing market? If your market is hot, your home may sell quickly and for top dollar, but the home you buy also will be more expensive. If your market is slow, finding a buyer may take longer, but you’ll have more selection and better pricing as you seek your new home.

6. Are interest rates attractive? A low rate not only helps you buy a larger home, but also makes it easier to find a buyer

By Admin
May 2, 2017

7 Reasons to Own Your Home

7 Reasons to Own Your Home

1. Tax breaks. The U.S. Tax Code lets you deduct the interest you pay on your mortgage, your property taxes, as well as some of the costs involved in buying your home.

2. Appreciation. Real estate has long-term, stable growth in value. While year-to-year fluctuations are normal, median existing-home sale prices have increased on average 6.5 percent each year from 1972 through 2005, and increased 88.5 percent over the last 10 years, according to the NATIONAL ASSOCIATION OF REALTORS®. In addition, the number of U.S. households is expected to rise 15 percent over the next decade, creating continued high demand for housing.

3. Equity. Money paid for rent is money that you’ll never see again, but mortgage payments let you build equity ownership interest in your home.

4. Savings. Building equity in your home is a ready-made savings plan. And when you sell, you can generally take up to $250,000 ($500,000 for a married couple) as gain without owing any federal income tax.

5. Predictability. Unlike rent, your fixed-mortgage payments don’t rise over the years so your housing costs may actually decline as you own the home longer. However, keep in mind that property taxes and insurance costs will increase.

6. Freedom. The home is yours. You can decorate any way you want and benefit from your investment for as long as you own the home.

7. Stability. Remaining in one neighborhood for several years gives you a chance to participate in community activities, lets you and your family establish lasting friendships, and offers your children the benefit of educational continuity.

 

Online resources: To calculate whether buying is the best financial option for you, use the “Buy vs. Rent” calculator at www.GinnieMae.gov.

By Admin
May 2, 2017

10 Ways to Prepare for Homeownership

10 Ways to Prepare for Homeownership

1. Decide what you can afford. Generally, you can afford a home equal in value to between two and three times your gross income.

2. Develop your home wish list. Then, prioritize the features on your list.

3. Select where you want to live. Compile a list of three or four neighborhoods you’d like to live in, taking into account items such as schools, recreational facilities, area expansion plans, and safety.

4. Start saving. Do you have enough money saved to qualify for a mortgage and cover your down payment? Ideally, you should have 20 percent of the purchase price saved as a down payment. Also, don’t forget to factor in closing costs. Closing costs — including taxes, attorney’s fee, and transfer fees — average between 2 and 7 percent of the home price.

5. Get your credit in order. Obtain a copy of your credit report to make sure it is accurate and to correct any errors immediately. A credit report provides a history of your credit, bad debts, and any late payments.

6. Determine your mortgage qualifications. How large of mortgage do you qualify for? Also, explore different loan options — such as 30-year or 15-year fixed mortgages or ARMs — and decide what’s best for you.

7. Get preapproved. Organize all the documentation a lender will need to preapprove you for a loan. You might need W-2 forms, copies of at least one pay stub, account numbers, and copies of two to four months of bank or credit union statements.

8. Weigh other sources of help with a down payment. Do you qualify for any special mortgage or down payment assistance programs? Check with your state and local government on down payment assistance programs for firsttime buyers. Or, if you have an IRA account, you can use the money you’ve saved to buy your fist home without paying a penalty for early withdrawal.

9. Calculate the costs of homeownership. This should include property taxes, insurance, maintenance and utilities, and association fees, if applicable.

10. Contact a REALTOR®. Find an experienced REALTOR® who can help guide you through the process.

By Admin
January 25, 2017

How Much Money Will You Need

How Much Money Will You Need?

You’ve selected your Realtor – you’ve looked at tons of property profiles on the Internet – you’ve even visited Open Houses – you are now ready to go find your own home, right? Well, maybe! Before you can go out and start looking at homes, you will need to be Pre-Approved. During the pre-approval process, your loan officer determines a number of very important financial parameters. These parameters are required by your realtor to effectively structure an offer on any home you may wish to purchase. These parameters include the following:

The Amount Of Your Deposit

The deposit is the earnest money that is submitted along with your offer on a home to demonstrate to a homeowner that you are truly serious about buying their home. A standard deposit is typically 1-3% of the total purchase price. When you write up an offer, you Realtor will ask you to write a check for the deposit to be submitted with the offer. This check will be held until your offer is accepted. If your offer is not accepted, the check will be given back to you un-cashed. Once an offer is accepted, an escrow is opened with a title company, your deposit check is cashed and the funds are held in escrow until your loan is funded. The deposit is counted towards the total amount of cash you will be putting towards the purchase (your down payment). If you are financing 100% of your home purchase, the offer will be written in such a way that you will get your deposit back when escrow closes. After discussing the deposit with your Realtor, you then determine the amount of the deposit to be submitted with your offer. This amount depends upon the various factors affecting the purchase of any given home. For some buyers, the amount of the deposit is limited by the actual amount of cash you have on hand. This is often true of those buyers who are financing 100% of the purchase and are putting no money down. For buyers who have more available cash, the amount of the deposit can vary as a part of the negotiation process when submitting an offer. Typically, the higher the deposit, the more attractive your offer will be. There is one final thing you need to know about the deposit. If, after your offer is accepted AND the contingencies have been removed, you decide to NOT go through with your purchase, you stand a good change of losing your deposit. Make sure that this aspect of the deposit is carefully explained to you so that you completely understand the risks involved.

The Amount Of Your Down Payment

The down payment is the amount of cash you will be providing from your own resources towards the purchase of your new home. This amount may come from your savings, the sale of a previous house, a gift – there are a number of possibilities. The amount of down payment you can provide is a very important part of the negotiation process when buying a home. Typically, the higher the amount of deposit, the more attractive your offer. Homeowners want to know that you are investing a decent amount of cash in your purchase. This means that:

  • You may be offered better rates and program options from the lender.
  • There is less chance that there may be a problem if the appraisal is too low.
  • There is less chance that something may go wrong with your loan during the escrow process.

The Amount Of Your Loan(s)

The loan amount(s) for which you qualify is determined by a number of factors including your level of income, current indebtedness, available cash, credit scores and so on. Your loan officer will consider all of these factors when determining the amount that a lender will loan you. To avoid PMI (Private Mortgage Insurance) if you have less than 20% down, your loan officer may structure a two-loan package. The loan amount added to the amount you provide as a down payment determines the maximum price you may pay for a home. This number is used by your Realtor when searching for suitable homes to show you. Under normal circumstances, your Realtor will not show you homes that have prices higher than the amount for which you qualify.

The Amount Of Your Projected Closing Costs

The last important number is the amount of the projected closing costs. It includes all of the non-recurring closing costs for items such as Title Insurance, Escrow Fees, Loan Fees, Inspection Fees and so on. You will need to have this amount IN ADDITION to your deposit. This amount is paid into escrow at the time of closing. If you do not have this additional amount, your Realtor can structure any offer you make to include the seller paying your closing costs. Depending upon the market conditions, this may weaken your offer. Your Realtor will carefully explain this to you when you meet for the first time and go through this binder.

Do Not!

Once you’ve met with your Loan Officer and have been pre-approved, you are ready to go find your new home! However, there are some very important things to be aware of at this point. Many potential homeowners fail to realize that certain actions done AFTER you have been pre-approved may directly, negatively affect your pre-approval. Make sure you are aware of the following:

  1. DO NOT Make Any Major Purchases Until AFTER Escrow Closes: This may sound obvious, however, some people get so excited about buying a new home that they decide to buy other things as well. Like a new car. Or that big screen plasma TV and entertainment system for their new family room. Or furniture. You get the idea! Any new purchases may affect your credit score and debt ratios and may directly reduce the amount of home loan for which you qualify.
  2. DO NOT Run Your Own Credit Score Prior To Applying For A Loan: Many people these days are “credit bureau conscious” and like to run their credit scores themselves before seeing a lender. There are many advertisements offering free credit checks. To do so can cause credit scores to drop. Since your lender will be running your credit anyway, ask them to give you a copy of your credit report and have them review it for you as part of the application process.
  3. DO NOT Apply For Any Other Credit: You are excited about buying a new home and then you suddenly realize that you will have no furniture to sit on! Some people rush out and apply for a new credit card. They think that since they will not be using this card until AFTER they are in their new home, they will be OK. Wrong! Do not apply for a new credit card, store account, major retailer credit card, line of credit or any other credit related account of any kind. Even if you plan to not use it until AFTER you are in your new home, it will affect your credit NOW.
  4. DO NOT Continue To Shop Your Loan: Once you are pre-approved, do not shop your loan again. Do sufficient research BEFORE you take the pre-approval step. Every time you shop your loan with a different lender, your credit scores are run. The more times your scores are run, the more your scores are lowered. It is possible that they may be lowered to the point where you no longer qualify for your pre-approved loan package. This has actually happened! You or your loan officer may not discover this until your lender tries to fund your loan and cannot.
  5. DO NOT Pay Any Judgments Or Collections Unless Instructed By Your Lender: You may have a judgment, collection or lien on your credit and want to pay it off — DON’T, unless instructed by the lender. They will know the effect it may or may not have on your credit and if the collection is small enough or old enough, you may not be required to pay it to close the transaction on your home. Before you buy or pay on anything while in a transaction, take the time to call your lender – it could save your home!
  6. DO Check Your Lender’s Truth-In-Lending Statement: Many people are excited about their new loan UNTIL they read the fine print on the Truth-In-Lending Statement. Then they may discover hidden costs, high loan fees and more. Make sure you get a copy of this statement from your lender and forward it on to your Realtor as well. Carefully read it to make sure there are no hidden fees or surprises. If you are not careful, you may fall into the trap of setting aside a specific amount for the closing costs, only to discover at the close of escrow that your lender fees are higher than anticipated and the total closing costs are too high for you to pay. Your escrow cannot close until these costs have been covered. This is a very unfortunate situation to be in and can be completely avoided by careful reading up front.
  7. DO NOT Change Loan Companies Once You Are In Escrow You are finally in escrow! Once we reach this point, the timing of everything becomes very critical. For this reason, I insist that you do not change loan companies once you are in escrow. To do so can seriously jeopardize your transaction. Typically, a new loan company will need to start from the beginning – and it takes time to do – often more time than is available under escrow contractual time constraints. As an example, if the time periods for removing contingencies are not kept, the seller of the home you are buying has the right to cancel the contract and put the home back on the market. If this happens, you stand a chance of losing any monies you have paid for inspections, appraisals and the like.
By Admin
January 25, 2017

Loan Process Flow Chart

By Admin
January 25, 2017

Funding your Home Purchase

Funding your Home Purchase:

  1. Financial pre-qualification or pre-approval: Application and interview Buyer provides pertinent documentation, including verification of employment Credit report is requested Appraisal scheduled for current home owned, if any
  2. Underwriting: Loan package is submitted to underwriter for approval
  3. Loan approval: Parties are notified of approval Loan documents are completed and sent to title
  4. Title company: Title exam, insurance and title survey conducted Borrowers come in for final signatures
  5. Funding: Lender reviews the loan package Funds are transferred by wire

Why pre-qualify? We recommend our buyers get pre-qualified before beginning their home search. Knowing exactly how much you can comfortably spend on a home reduces the potential frustration of looking at homes beyond your means.

By Admin
Scroll to top