Tag: mortgage

Negotiating Ideas

Everyone wants to buy their next home at the most reasonable price. Negotiating can be done by yourself, but it’s wisest to work with the best real estate agent in the market. Find a realtor with invaluable experience that will work hard to get you the best deal possible.

Your realtor should have done research on homes recently sold or pending that are comparable to the property you want to buy in the market (comps) – look through them. Notice their size, condition, and amenities. Information gathered might look like a perfect match online but the reality is there could be some key differences that impact their value. A good realtor will have any additional details not obvious in a search. For example, there could be a beautiful, unobstructed view of mountains, a beach, or simply a line of trees that will make the home seem more private. No home will be an exact match to the property you want but you will now have the ability to see the range of the pricing.

The home inspection is crucial in negotiations. It’s imperative that you have a reputable and professional inspector that will look over the home with a fine-tooth comb. The condition of the major systems, like plumbing, electrical, and HVAC as well as the state that the roof, windows, foundation, and more are in. If any problems or flaws are found that are concerning, they can be brought up in the negotiations. Depending on the issue, the seller may be willing to pay for the repairs. Use the inspection report to your advantage.

Get an appraisal that will give you an estimate of what the home is actually worth. If it appraises lower than the price the seller is asking it can work to your advantage. After you and your realtor have explored all the possible reasons the home was appraised low, negotiations begin. An experienced realtor will have insights and ideas for the possibility of concessions.

There are other ways to negotiate in the purchase of a home from getting your closing costs paid by the seller to credits for repairs and renovations. If you are going to have to pay a lot of money to make repairs, negotiate. Sellers are often open to fixing a problem in exchange for an offer.

Keep your emotions out of the entire negotiation process. A rational head makes the best decisions. Don’t show any excitement over the home, act as if you have plenty of other options. Remember the important things that you don’t want to live without in a home and be willing to let go of the less important things. This will help you avoid getting carried away by your emotions. It’s too easy to become frustrated and angry which leads to clouding your best judgment that will affect any of your decisions.

The Bottom Line: It’s not worth overpaying for a home. You might end up in a dangerous situation financially down the road. Your biggest bargaining chip in negotiation is to always be willing to walk away – you, as the buyer, are in a position of power. There will always be more homes.

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Title Fraud & Wire Fraud in Real Estate

The rapid growth of technology in the real estate industry has brought opportunity as well as a whole new set of challenges. Potential home buyers have the ability to search for homes from their fingertips while home-related fraud has become more prevalent. It’s important to protect yourself against fraud by becoming educated on the most common types of threats.

Title Fraud


What is It:
Any forgery or fraud act that involves the home title. There are many types of title fraud, including, but not limited to, forgery committed by the seller or someone who steals the identity of the current homeowner.

Preventative Steps:
One of the easiest ways to prevent title fraud is to purchase title insurance. This type of insurance eliminates the risk of being held accountable for any type of fraud that happened before you owned the property. Additionally, title insurance protects against other potential issues such as clerical errors or incorrect information. Any errors or misinformation on the property title will be handled by the title company where the insurance was purchased.

Wire Fraud


What is It:
Wire fraud is any scheme utilizing false pretenses to obtain money or property via wire transfer or communication. This type of fraud is particularly harmful in the real estate industry because property is such a large investment. The most common type of wire fraud in the home-buying process is a fraudulent request for a deposit on the home.

Preventative Steps:
Once you’re nearing the end of the home-buying process, there are many legal documents and steps involving your personal identity. It’s critical that you protect any personal and financial information while finishing the closing process. Your information is particularly vulnerable through email or other forms of electronic communication.

Here are a few helpful steps to prevent wire fraud:

  • Never send out any personal financial information via email.
  • Do not click on any links or attachments in unfamiliar email addresses or emails that are unexpected.
  • Clean out your email regularly so that hackers cannot detect any patterns.
  • Change your usernames and passwords on a regular basis.
  • Install and update antivirus and firewall programs on your computer.
  • Report any fraudulent activity to the FBI.
  • Ask your title representative, mortgage lender, and real estate broker for their typical means of communication. If you receive anything from an unusual method of communication, confirm that it was sent from your real estate professional.
  • Don’t share detailed information about your home purchase on social media.

The Bottom Line:
No matter where you are buying a home, be sure to do plenty of research on the home-buying process so that you are able to spot suspicious activity. If you ever notice any potential threats, speak directly to your real estate professionals to confirm the security of your transaction. The best way to protect yourself against fraudulent real estate activity is to remain cautious and informed.

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Preparing to Buy a Home and Mistakes to Avoid

You’re finally ready to purchase a home, one of the biggest, most important investments you will make. The process can be filled with stress but does not have to be. Don’t skip using a Real Estate Agent. Secure a great realtor that can help you from the minute you begin thinking about buying until the key to the home is in your hands after closing.

It’s imperative to remember that your credit and finances will be monitored right up until your loan closes. Don’t apply for new credit cards or prompt any other inquiries into your credit rating. This includes financing a car or making any other big purchase on credit. For you to be able to be approved for a mortgage with a good rate, you have got to present a picture of your best financial standing. Fewer changes made to your personal finances until the mortgage is secured, the better.

It’s hard not to get emotional during this major life milestone, of buying a home. You fall in love with a home and can imagine all the memories you’ll make, and all the ways you will decorate, paint and create each space. But, being too attached and emotional often leads to overpaying for a home and stretching yourself beyond your budget. Know what you can afford, stay levelheaded, and make sure your realtor knows you want to stick to homes only in that price range.

Showing consistent employment is crucial during the home-buying process. Lenders look at your job history to make sure you are financially stable and will be able to pay your loan on time every month. A good rule of thumb is to have at least a history of two years with the same employer and not to change jobs, or quit and start your own business while going through this process.

Have a preapproval letter from a lender in hand before you even start falling in love with homes on the internet. You have to know what you can afford or you’ll just be setting yourself up for disappointment. Some sellers won’t even show their home unless it’s to a serious buyer. If there ends up being a multiple-offer situation, a pre-approved buyer is more attractive and may win over a buyer that is not prepared.

Research school ratings, commutation time, and traffic flow among other important factors of a neighborhood. Don’t settle for a home in a less desirable area because you love it. Location, location, location is the credo in real estate. Most people won’t be living in the home they buy forever, so it’s good to pay attention to what’s going on in the neighborhood and the community. Thinking long term, knowing if home prices in the area are rising or falling and if businesses are thriving or closing will be a key to a good investment going forward.

Once you find your house, and your offer is accepted it will be time for the closing and your realtor will be key to helping you gather and navigate all the paperwork. Get an inspection to help you find any potential problems that can either be easily fixed or something you may want to walk away from. Have an appraisal done to assess the value of the home. Make sure you get excellent homeowners insurance and you buy title insurance to protect your home from any claims against the property or questions of ownership.

In conclusion, this is vital and not required by law but in your, the buyer’s, best interest: DO a final walkthrough and make sure everything is as it should be. The home should be empty so that you can really see. Are the appliances, faucets, window treatments, fixtures, etc there? At this point, you are seeing that the home you are purchasing is in the same condition it was when you agreed to buy it. Additionally, you are seeing that there is no new damage and that all the home’s systems are in working order, and that the home is clean.

The Bottom Line: These are just some of the problems buyers run into and how to avoid them. Know that each time you buy a home you will learn different ways to get through the difficulties that the process brings. Have a good and seasoned realtor to help you with the confusing terminology and the many logistics of buying a house, because it’s easy to make a wrong move or wind up with an unwise investment.

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Empty Houses Look Smaller and Other Tips Realtors Want You to Know

A vacant, empty home does not sell faster. There aren’t many buyers out there that are able to see themselves and their belongings in a furniture-less home. It’s important to leave a few basic pieces behind or risk the home looking and feeling smaller than it is. As a seller, you want to help people see your home’s potential. Listen to the advice of a seasoned realtor or consider hiring a professional home-stager.

Get at least three references before choosing a realtor. Hiring an experienced agent to be with you throughout the entire process of buying a house can save you many problems. If you can, reach out to the people involved in the realtor’s last three transactions, not just names they have given you as a reference. Use this opportunity to find out if previous clients were happy with their experience. Learn what kind of a negotiator the realtor in question is and whether they were attentive to their clients throughout the process, from start to finish.

Hire a professional real estate photographer before you put your home on the market. A lot of realtors will often come to you with one, as part of their “package”, because selling your home is as important to them as to you. Everyone knows buyers are looking online before they even decide to go inside and a pro will know exactly what angle, lighting, and framing to use to bring out the best features of your home. The photos buyers see online are what ultimately help the decision of whether the home is worth the time to see.

A house that is overpriced won’t sell. If you price your home too high the right buyers won’t even give it a look. Buyers are savvy now, they are able to do homework and find out what a home is worth. They’ve hired skilled Realtors that have gathered all the comps for the neighborhood. Price it too high and your home will sit on the market without interest or traffic and the longer it sits the more of a negative association will come with your home. Buyers automatically assume homes on the market for a long time mean that there is something wrong. 

The selling of your home is a business transaction and not an emotional one. A home is one of the biggest investments made and people become attached emotionally. Acknowledge that selling your home is going to be stressful and emotional upfront and that will enable you to make good decisions going forward such as the pricing. Remember, it’s the people that make the memories, not the places. You are selling for a reason and oftentimes that means there is a new positive experience on the horizon. Focus on that.

The Bottom Line: Most successful real estate agents are true professionals and any advice they offer is in their client’s best interests. The right realtor will know how to market and sell your house. They will help you sell for more and save money where it counts while negotiating for anything else you might need.

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Why Are You Selling Your Home and Other Questions Buyers Ask

If you are selling your house, be prepared for the questions. Buyers, with the help of an accomplished, local Realtor that has their best interest in mind and will equip them with questions to ask you, lest they forget in all the excitement that comes with house hunting.

A sampling of some questions you should prepare to answer:

  • Have you made any major renovations or repairs? Have receipts ready to show if there have been any repairs or renovations made while you have owned the home. In some states, sellers must disclose any current problems but they don’t necessarily have to disclose past problems. Be prepared to have proof that if any major structural changes have been made that it was done up to code and was approved by the county.
  • How long has the house been on the market? The more time your house has spent on the market the more power a buyer believes they have to negotiate a lower price.
  • Are all the appliances and fixtures included in the sale? Usually, anything attached to the home is included in a home sale. But, it’s best to never assume or you could run into disappointment. For example lighting fixtures or window treatments.
  • When was the roof installed? Knowing the answer to this can make or break your decision. If the roof is older, it will surely need to be repaired or replaced soon after the purchase. This will give the buyer the option to ask you to fix it or adjust the price.
  • When was the last time your HVAC was serviced? This is cheaper and easier to fix than a bad roof, but it’s important to know as many details about the system. As a seller, have the paperwork ready that shows maintenance dates, the warranty (if still good), and the bills at hand for heating and cooling. What is the monthly cost of utilities? The buyer can then make a decision to either have the seller fix it or negotiate the price of the home.
  • Why are you selling? Depending on your answer, the buyer, with aid of their realtor, will be looking for a way to prepare a lower offer if it means you can get out of your home faster.
  • How long has the house been on the market? If it has been on too long, buyers become leery and think there must be something inherently wrong with the home. Additionally, if it’s been on for a long time, the seller may be more motivated and willing to negotiate.
  • What is the neighborhood like? The value of your house is affected by the neighborhood. A good realtor will have given the buyer all the comps from your area. It may be easy to read a neighborhood if there are concerns – there might be foreclosure signs or abandoned homes. Be prepared to be flexible on your asking price.

The Bottom Line: There are many questions that a seller will be asked so that the buyer will feel confident in their decision to purchase your home. It can be complicated and sometimes overwhelming but with an experienced real estate agent you can expect an uneventful transaction. The best realtors out there will be able to turn any negative into a positive while answering the questions the buyer has.

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Potential Problems That Could Delay Your Closing

If you are planning on buying or selling a home, it’s important to understand that there can be delays in the closing.  A real estate contract and the terms and conditions that are set forth in a contract do carry significant importance, but there can always be an issue.

In almost any real estate transaction that includes mortgage financing, the lender requires title insurance. The title company will conduct a search of the property’s title history to look for anything that might affect the buyer’s—and therefore the lender’s—interest in the property. Any defect in title raises the possibility of some third party asserting their own interest in the property. Liens, which give creditors a non-possessory interest in real property, are a common type of title defect. Before a closing may proceed, all title defects must be resolved to the satisfaction of the title insurance company.

If an appraisal comes back to a lender that values the home at less than the agreed-upon loan amount, it may hold up the process. Lenders will not approve loans for more money than a home is appraised for. Sellers might then lower the price of the home or choose to complete home repairs to increase the property’s value. Buyers could front the difference between the appraisal value and the original sale price. The parties could also contest the appraisal. Whichever the eventual solution, the closing date will likely move further into the future.

Home inspections can uncover mold problems, faulty wiring, roof leaks, fire hazards, code violations, cracks in the home’s foundation, and many other potential problems. Smaller issues can even put a closing on hold until the seller resolves the problem to the buyer’s satisfaction. The buyers may also discover a problem for themselves during the final walk-through of a home. They may observe problems with the plumbing, electrical, or HVAC systems, or notice that the sellers didn’t perform an agreed-upon repair or concession.

The Bottom Line: The process of buying or selling a home can be trying and a lot of the issues are simply out of your control. While these listed above are just the most common reasons a closing is delayed, there are plenty of smaller issues. It’s important to have a qualified and knowledgeable Realtor that can deal with last-minute issues and surprises and will stay on top of every step until you hear the magical words: “Clear to Close”.

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Home Inspection Before Listing

A pre-listing home inspection uncovers potential surprises that could possibly derail the sale of your house. If you’re ready to sell your home and want to ensure the sale process will go smoothly and quickly, you may want to consider a pre-listing home inspection. You will get a “heads-up” on any problems that a potential buyer will want to have repaired.

Knowing what is wrong, issues can be attended to and taken care of before you even put your home on the market. Too often, a home inspection is where the deal falls apart because buyers will make their offer contingent on approval of the results. Hidden defects or problems can turn any negotiation in the buyer’s favor. Even if you offer to fix a problem that arises on the buyer’s inspection report, skittish buyers may be hesitant to close the deal. Knowing before you list your home gives you the opportunity to fix the problem or price accordingly.

Most Realtors will tell you to make major repairs before you list your home. The buyer’s inspection will uncover significant defects, and you will be expected to repair them if you want to get the full price for your home. The problem is that you will only have until closing to get the repairs done after the buyer’s inspection.

The limited time frame leaves sellers scrambling to get everything fixed in time. With a pre-listing inspection, you set your own schedule for repairs. There is no rush to list the property until you have made sure the home is in good shape.

You’ll be putting your home on the market with the confidence you’ve corrected any large problems.

Sellers can justify their listing prices through a pre-inspection. You can feel confident in the price you are asking with the results available to buyers. In a hot market, some buyers will make an offer on a home without the home inspection contingency.

According to Forbes: …”pre-inspection is a goodwill gesture. It demonstrates a willingness to go beyond what’s expected, and that sets you apart from other sellers. You’re sending a signal that your house is an ‘open book,’ and that you’re being upfront about the property. All of this can give potential buyers peace of mind and confidence.”

Once you have the pre-inspection report in your hand you can’t ignore any issues that came up. You’ll be required to disclose that information as a known defect or fix it before anyone makes an offer.  There may be some issues that you aren’t able to take on and it will be reflected in the price. You and your Realtor will be able to establish the right sale price including what you can or can not fix before putting your house on the market.

The bottom line: As a seller, getting a home inspection before listing your home gives you more time to make the repairs that you can and to shop around and control the costs for the work.  Be sure to hire an experienced Realtor that will know how to interpret inspection reports, and let you know which issues are vital to address before listing your home.

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Fixed Rate Vs. Adjustable Rate Mortgage

What Is A Fixed Rate Mortgage?

A fixed-rate mortgage is a home loan in which the interest rate is locked in for the term of the loan. For example, if you get a 30-year fixed-rate mortgage with a 7% interest rate, your rate will remain 7% until your loan is either paid in full or refinanced, regardless of changes in going market rates.

The Benefits: Many homebuyers choose a fixed-rate mortgage because of payment stability. With a fixed-rate mortgage, your principal and interest remain the same for the duration of the loan. This makes budgeting easier since you know what the payments will be. Although it’s impossible to forecast if rates will rise or fall in the future, a fixed-rate mortgage helps protect you from an increase in rates. If you want to pay off your loan sooner, you generally have the option to make additional principal payments too.

The Cons: The drawback is that your initial rate could be higher with a fixed rate than what you would pay on an adjustable rate. There is also a chance that rates could go down, leaving you locked in at a higher rate. However, as long as you maintain solid credit, income, and debt levels, you should be able to refinance your loan to get a lower going rate if they were to go down.

What is An Adjustable Rate Mortgage?

An adjustable-rate mortgage (ARM) is a loan in which the interest rate may change periodically, usually based upon a pre-determined index. The ARM loan may include an initial fixed-rate period that is typically 5 to 10 years. The interest rate can/may change (adjust) each year thereafter once the initial fixed period ends. For example, with a 5/1 ARM loan for a 30-year term, your interest rate would be fixed for the initial 5 years and could fluctuate up or down each subsequent year for the next 25 years.

The Benefits: ARMs usually have a lower initial interest rate when compared to a fixed rate, but remember that the rate will reset. Many homebuyers consider this type of rate attractive because of the initial lower payment, which could help them get a larger loan amount. This mortgage allows you to convert it into a fixed rate once the introductory period elapses. If the economic situation seems less certain, this option is convenient. On the other hand, you can stick to the arrangement if the economy is pretty predictable, giving you the confidence of consistency.

The Cons: The potential downside to an ARM is that your rate would go up if market rates increase. This would mean a sudden increase in your monthly mortgage payments. And, depending on the severity of the rate change, the payment increase could be steep. This can make it difficult to budget accurately.     

The Bottom Line: This is a huge decision, so be sure to connect with a reputable lender who will be able to guide you on the right type of mortgage for your situation. Key questions you would need to consider are: How long are you planning to stay in the home? How will you plan your housing budget if you get an ARM and the rates rise? At the end of the day, whether you choose a fixed-rate mortgage or an ARM, don’t be enticed into borrowing more than you can afford. Plan on what fits your budget and goals.

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Improve Energy Efficiency and Add Value to Your Home

A green home sells faster and for more money than homes without energy-efficient designations according to Freddie Mac research. It was found that homes with high energy-efficiency ratings sold for 2.7% more on average compared to homes that did not.

You can invest in upgrades that will improve energy efficiency while adding value to your home. Here are a few examples of upgrades that will lower your energy bills and increase the value of your home.

Double-Pane Windows: When the heating and cooling system doesn’t have to work as hard to keep a consistent indoor temperature, there will be an obvious decrease in energy costs. Upgrade to double-pane windows, regardless of the type, and you will see some pretty significant energy savings. Energy Star-rated windows help maintain a consistent temperature inside your home year-round. And when it’s time to sell, window upgrades are a value-added selling point with buyers.

Spray Foam Insulation: Installing new spray foam insulation in a home that was already insulated or in a more contemporary house will see a 10 to 15 percent reduction in its cooling and heating costs. Adding more insulation to the attic is “one of the easiest things homeowners can do to improve the energy efficiency of their homes.

Use Energy Star Appliances: Another easy way that homeowners can improve their home’s energy efficiency is to replace all appliances with newer, more energy-efficient models. These will save you 10% to 50% of the energy required, and much more if you are replacing an old appliance.

Energy Star is a government-backed program for identifying products and appliances that meet certain energy efficiency standards. It was established in 1992 by the US Environmental Protection Agency as a way to promote products designed to use less energy and reduce recurring costs for consumers.

Upgrading your appliances is a way to increase value to your home and make it more appealing, as most buyers don’t want dated, unsanitary, malfunctioning appliances.

New Garage Door: A garage with poor energy efficiency can have a spillover effect on the rest of your home, particularly if the garage is attached to your home. Replacing your garage door will help your entire house stay cool in the summer and warm in the winter. Since a new door allows air conditioning and heating systems to work more effectively, it could reduce electricity waste and lower your energy bill.

The garage door is part of the curb appeal of your home – one of the first features buyers notice. An old, faded and damaged one can create a negative vision. Updating your garage door is one of the best home improvement return on investments.

The Bottom Line: A good realtor will know that a large part of selling your energy saving home will be to educate the buyer of all the benefits and values an energy efficient home brings. Your updated home will be a huge asset especially as the housing market evolves.

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Full-Service Title Company

Title First Coverage Map

Buying or selling a home has become a complex transaction and you need a trusted title search company to guide you through the process. The experts at Title First oversee and perform thousands of closings each year. When using Title First, you can sign confidently on the dotted line knowing that all details of your title transfer and closing are in proper order. We are here to answer any questions you may have about buying or selling a home, and our team will guide you through the entire process.

Title First will be responsible for ensuring that all the documents related to the ownership of a property are in order before the real estate transaction is performed. We will also provide an agent to oversee the entire closing process. Insurance will be furnished that protects the buyer and the lender if legal issues arise after the closing.

Once a home is bought, the buyer takes possession of the title for the property. Titles are at the local courthouses and the buyer does not own the property until his name appears on the title. There have been times when titles are not properly taken care of when a home changes hands, which means that if there are any liens on the property still have a claim on it. When this happens, the owner who did not sign off on the deed exchange still has a claim on the title.

Title First will perform searches on behalf of the property owner and the lender. We will review court records to guarantee that any liens on the property have been satisfied and that there are no outstanding claims. We also make sure that the seller that holds the title has the right to sell the property, and that it is has a clear title to close.

Title First will supervise the loan closings and any other real estate transactions. We are then responsible for recording the title, mortgage, and any other document related to the transaction at the local courthouse.

Title First will offer a title insurance policy that will provide coverage for property owners and buyers in the event of legal disputes related to the ownership of the property. However, these issues should not arise as all of the searches are done before the closing. But, there is always the occasion that something was overlooked that can threaten the interest of the owner or lender.

Title First believes in providing value-added services. Whether you’re a Realtor, lender, builder, law firm, buyer or seller, our helpful resources help you meet your goals. If you have a question or would like more information, please contact our title experts.  614-503-7434

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