As a home owner, there are routine maintenance projects such repainting the exterior or replacing an old roof. However, there are some who take on projects to increase a home's value for profit.
According to Yahoo Finance, there are six specific things that don't add value to your home.
1. Swimming Pools
From my experience dealing with various clients, there isn't a huge demand for pools. The majority of people who absolutely don't want pools are families with young kids. Many consider it dangerous unless it's gated. In-ground pools can start at $10,000 and go up, not to mention the monthly maintenance costs. In today's market, pools might add value up to 25k, but it depends on the neighborhood and size of the pool.
2. Overbuilding for the Neighborhood
Even an extensive, grand house can be a sore thumb in a mediocre neighborhood. If the surrounding one-story homes have 2-3 bedrooms, don't build a 5-6 bedroom, two-story home next door. Even though the added square footage normally adds value, most buyers won't pay more when the neighboring house is selling for $100,000 less. Overbuilding just screws up the comps in the area.
3. Extensive Landscaping
Things like dolphin-shaped bush statues or professionally maintained landscaping are great curb appeal, but they are best left to professionals. Potential home buyers might view it as a burden if they can't continue the upkeep. In this buyer's market, don't expect them to see the value when making an offer.
4. High-End Upgrades
If you're going to upgrade the kitchen to brand new stainless steel, granite counters and new hardwood floors, make sure to be consistent and modernize the rest of the home. High end features usually increase values for high end homes.
5. Wall-to-Wall Carpeting
The trend these days are leaning away from carpet. Hardwood floors, tile and stone are the leading floor covering choices. They are easier to keep clean and have a longer life span.
6. Invisible Improvements
It seems self explanatory. If the buyer doesn't see it, they won't pay extra for it. New plumbing or a new heating system makes a home more comfortable, but buyers already expect these things to be in good shape when they buy the home. This shows pride of home ownership, but don't expect to recoup your costs in added home value.
Wise investments that do add value to a home include warm and inviting decor and neutral color schemes. A tip to sellers is to walk through homes for sale in your neighborhood. Get a feel for the trends. If all the homes have granite and dual-pane windows and yours has tile counters and windows from the 80's, that's a good indicator of where to start upgrading.
Sunday, October 3, 2010
Saturday, October 2, 2010
How Long Does Escrow Last?
Before you give notice to break a lease, sell a home or hire movers, make a mental note of these typical escrow time frames.
Conventional Loans: 45 days
FHA: 50 days
VA: 62 days
USDA: 90 days
Short Sales (after lien holder approval): 45 days*
REO/Foreclosure: 47 days
Remember these are just the current average time frames. Your Realtor and lender will give you updates along the way to give you a good idea when you can close escrow.
*Short sales can take around 6 months to become approved for sale by the bank. After lien holder approval, escrow can officially open.
Conventional Loans: 45 days
FHA: 50 days
VA: 62 days
USDA: 90 days
Short Sales (after lien holder approval): 45 days*
REO/Foreclosure: 47 days
Remember these are just the current average time frames. Your Realtor and lender will give you updates along the way to give you a good idea when you can close escrow.
*Short sales can take around 6 months to become approved for sale by the bank. After lien holder approval, escrow can officially open.
Friday, October 1, 2010
Home Prices Slashed
Home prices are plummeting in the Greater Seattle area. This clip from KOMO News gives a good idea how much your home might have dipped.
Zip Realty on KOMO News
Also check out Zip Realty's "Sale Rack" to see where you can get a good deal!
Click here for Housing Sale Rack
Zip Realty on KOMO News
Also check out Zip Realty's "Sale Rack" to see where you can get a good deal!
Click here for Housing Sale Rack
Wednesday, September 29, 2010
The Widely Known Hidden Costs to Purchase a Home
With the insane housing market "sale rack" going on, buyers are definitely saving up for their down payment. However, it's not just saving for the down payment. Here is a simple break down of how much money you'll need before signing on that dotted line.
Earnest Money Deposit (EMD)
A buyer's EMD check is the key to opening escrow.For resale it's typically between 1-3% of the home price. For new construction, it sometimes depends on the builder and the home price.
Down Payment
FHA loans are currently 3.5% down. Conventional loans are typically 10-25% down depending on your credit. VA loans are 0% down. Check out your city or county programs for housing assistance programs, as well.
Home Inspection
This is paid directly to the home inspection company at time of service. Costs depends on who you choose and the home square footage. Fairly inexpensive.
Appraisal Fees
Unless it's an all cash deal, lenders will require an appraisal, which is usually a few hundred dollars, or more depending on home square footage.
Closing Costs
Always estimate high as these costs are all over the map from 1% to 8%. Your initial deposit could go toward this, but usually costs range between 3-4% of your loan.
Your lender is required to provide you with a Good Faith Estimate (GFE), which will break down all the costs line by line.
Here's an example of a $200,000 home:
Earnest Money Deposit (1-3%): $2,000-$6,000
Down Payment FHA (3.5%): $7,000
Down Payment (10-25%): $20,000-$50,000
Closing Costs (3-4%): $6,000- $8,000
Earnest Money Deposit (EMD)
A buyer's EMD check is the key to opening escrow.For resale it's typically between 1-3% of the home price. For new construction, it sometimes depends on the builder and the home price.
Down Payment
FHA loans are currently 3.5% down. Conventional loans are typically 10-25% down depending on your credit. VA loans are 0% down. Check out your city or county programs for housing assistance programs, as well.
Home Inspection
This is paid directly to the home inspection company at time of service. Costs depends on who you choose and the home square footage. Fairly inexpensive.
Appraisal Fees
Unless it's an all cash deal, lenders will require an appraisal, which is usually a few hundred dollars, or more depending on home square footage.
Closing Costs
Always estimate high as these costs are all over the map from 1% to 8%. Your initial deposit could go toward this, but usually costs range between 3-4% of your loan.
Your lender is required to provide you with a Good Faith Estimate (GFE), which will break down all the costs line by line.
Here's an example of a $200,000 home:
Earnest Money Deposit (1-3%): $2,000-$6,000
Down Payment FHA (3.5%): $7,000
Down Payment (10-25%): $20,000-$50,000
Closing Costs (3-4%): $6,000- $8,000
When 'Cash-In' Refinancing Pays Off
Typically, when a person refinances their home it's to take money out. Find out when it's a good idea to put money in.
Click Here to Read Story
Click Here to Read Story
Saturday, September 25, 2010
0% Down in Certain Rural Areas
Find a Home for 0% Down
Are you looking for a home in a rural area? Do you want a Zero Down Loan? King County has a USDA Rural Development loan program. Just click the above link and type in the property address to see if the home will qualify.
Are you looking for a home in a rural area? Do you want a Zero Down Loan? King County has a USDA Rural Development loan program. Just click the above link and type in the property address to see if the home will qualify.
Tips to Improve Your Credit Score
Are you in need of credit repair, but don't know where to start? You can begin by requesting a copy of your credit report through the credit bureaus or a credit monitoring service. On your report you can see what is making your score so low. Too many credit inquiries, outstanding balance too close to credit limit and late payments are just a few of the ways your score can dip. Focus on the main issue, and remember it does take time for positive work to reflect on your report.
One of the most effective ways to increase your score is to keep your debt under 30% of your credit limit. Anything above that will have a negative impact on your score.
Limit the amount of credit cards you have. Less is more. The minimum open lines of credit to buy a home or rent an apartment is three, so there's no need to open ten. Also, a mortgage or car lease qualifies as a line of credit that can help your score by adding to the variety of credit types.
Remember your oldest credit card and the one with the least APR% are your best friends. Keep these open and pay them down. They contain your greatest credit history. If you close them all that history goes away and so does your good score.
Overall, if you just maintain low balances and limit your lines of credit you'll be on your way to a more admiral FICO score.
One of the most effective ways to increase your score is to keep your debt under 30% of your credit limit. Anything above that will have a negative impact on your score.
Limit the amount of credit cards you have. Less is more. The minimum open lines of credit to buy a home or rent an apartment is three, so there's no need to open ten. Also, a mortgage or car lease qualifies as a line of credit that can help your score by adding to the variety of credit types.
Remember your oldest credit card and the one with the least APR% are your best friends. Keep these open and pay them down. They contain your greatest credit history. If you close them all that history goes away and so does your good score.
Overall, if you just maintain low balances and limit your lines of credit you'll be on your way to a more admiral FICO score.
Tuesday, September 21, 2010
Sunday, August 22, 2010
What is a 203k loan?
"Due to the current structure of this home, it is deemed unsuitable for financing. Only cash offers or rehab loans accepted."
You may have heard this statement before. Usually after touring a home that was in really bad shape. Examples of major cases are foreclosures that were trashed, or the previous owners stopped right in the middle of their renovation.
If you're looking for a home in this market full of foreclosures and REOs, you might have noticed a lot of unsightly interiors. Sure, the outside may look nice, and the neighborhood may even be a highly desirable one. What happens when you found the location you want, but the inside is so bent out of shape that the bank deems it unsuitable for financing?
A 203k loan, or rehab loan, may save the day. These loans are structured in a way to help a buyer finance a home that is not "finished" or built up to code. It is basically an FHA loan where the repairs are started after the close of escrow. Escrow usually lasts 60+ days, giving buyers an extra few weeks to meet with construction companies for repair quotes to bring the home up to minimum FHA building standards. Once a buyer submits the best quote to their lender, that amount will be added to the loan after the close of escrow, and the rehab can begin.
If this seems like something you are interested in, find a good lender who specializes in 203k loans, and see if you can qualify for one.
You may have heard this statement before. Usually after touring a home that was in really bad shape. Examples of major cases are foreclosures that were trashed, or the previous owners stopped right in the middle of their renovation.
If you're looking for a home in this market full of foreclosures and REOs, you might have noticed a lot of unsightly interiors. Sure, the outside may look nice, and the neighborhood may even be a highly desirable one. What happens when you found the location you want, but the inside is so bent out of shape that the bank deems it unsuitable for financing?
A 203k loan, or rehab loan, may save the day. These loans are structured in a way to help a buyer finance a home that is not "finished" or built up to code. It is basically an FHA loan where the repairs are started after the close of escrow. Escrow usually lasts 60+ days, giving buyers an extra few weeks to meet with construction companies for repair quotes to bring the home up to minimum FHA building standards. Once a buyer submits the best quote to their lender, that amount will be added to the loan after the close of escrow, and the rehab can begin.
If this seems like something you are interested in, find a good lender who specializes in 203k loans, and see if you can qualify for one.
Saturday, August 7, 2010
Washington State Ranked #1 for Future Home Price Increase
According to a Yahoo Real Estate Article, Top 10 Housing Markets That Will Be Strongest by 2014, Washington State leads with number one in projected home price recovery.
By 2014, the Bremerton-Silverdale metro area will have the biggest home price increase. The four-year forecast projects home prices to rise by 44.7%. Tacoma trails Bremerton as the second strongest market with a rise of 33.1%. Following in third place is Seattle, which is expected to grow by 25.5%.
See the detailed story here
By 2014, the Bremerton-Silverdale metro area will have the biggest home price increase. The four-year forecast projects home prices to rise by 44.7%. Tacoma trails Bremerton as the second strongest market with a rise of 33.1%. Following in third place is Seattle, which is expected to grow by 25.5%.
See the detailed story here
Friday, July 16, 2010
The Difference Between Agents and Brokers
Agents, Brokers and Realtors...oh my! All of these terms are referenced in society like they are interchangeable to describe a real estate professional. However, they are actually all different. The following information will help you decide which professional may be best for you.
I always like to describe agents and brokers in relation to school. Real estate agents are like college graduates. Real estate brokers are like graduates with a master's degree. They both are knowledgeable in their field, but in order to get a broker's license, one has to take more advanced classes and take a harder test.
In order to become an agent, one has to take a Principles of Real Estate course followed by a test. Upon passing that test they can proceed to the state exam. There are no prerequisites to become an agent.
In order to become a broker, one has to have at least 2 years experience as an agent to qualify and apply and take the state exam. That 2 year pre-requisite may be exempt if the person has a four-year degree. Before the exam, the applicant must take a series of courses such as real estate law, real estate agency, ethics, etc. The state exam is twice as long as the agent's and requires greater knowledge of real estate practices and law.
There are three types of different brokers, as well. The above description is for a transaction broker who can assist buyers or sellers. There are also Managing Brokers who manage a company, but they usually don't sell homes. Their main priority is to assist agents and brokers in their office transactions rather than assist clients. A Designated Broker is above the Managing Broker, and their job is on a more corporate level as opposed to in the field. The general public usually don't see Managing or Designated Brokers unless we work for them. Buyers and sellers typically deal with transaction brokers and just refer to them as "brokers."
A Realtor is an agent or broker who is a member of the National Association of Realtors (NAR). Only members can call themselves Realtors. There is about 1.3 million Realtors, mainly in the USA. There are about 1 million agents and brokers who are not members of NAR.
Oh, and I ought to put it out there that Realtor is pronounced Real-TOR...not Real-a-tor. Don't ever hire an agent or broker who can't say their own profession.
It's also a misconception that agents are less worthy than brokers; that's hardly the case. It's just about experience and how much knowledge a professional wants to gain; just like there are knowledgeable people out there who don't have a master's degree and knowledgeable people who do have one. I have an agent's license in California and a broker's license in Washington. When choosing a real estate professional, you should base your decision not only on a person's knowledge and expertise, but also on how well they will work for you.
I always like to describe agents and brokers in relation to school. Real estate agents are like college graduates. Real estate brokers are like graduates with a master's degree. They both are knowledgeable in their field, but in order to get a broker's license, one has to take more advanced classes and take a harder test.
In order to become an agent, one has to take a Principles of Real Estate course followed by a test. Upon passing that test they can proceed to the state exam. There are no prerequisites to become an agent.
In order to become a broker, one has to have at least 2 years experience as an agent to qualify and apply and take the state exam. That 2 year pre-requisite may be exempt if the person has a four-year degree. Before the exam, the applicant must take a series of courses such as real estate law, real estate agency, ethics, etc. The state exam is twice as long as the agent's and requires greater knowledge of real estate practices and law.
There are three types of different brokers, as well. The above description is for a transaction broker who can assist buyers or sellers. There are also Managing Brokers who manage a company, but they usually don't sell homes. Their main priority is to assist agents and brokers in their office transactions rather than assist clients. A Designated Broker is above the Managing Broker, and their job is on a more corporate level as opposed to in the field. The general public usually don't see Managing or Designated Brokers unless we work for them. Buyers and sellers typically deal with transaction brokers and just refer to them as "brokers."
A Realtor is an agent or broker who is a member of the National Association of Realtors (NAR). Only members can call themselves Realtors. There is about 1.3 million Realtors, mainly in the USA. There are about 1 million agents and brokers who are not members of NAR.
Oh, and I ought to put it out there that Realtor is pronounced Real-TOR...not Real-a-tor. Don't ever hire an agent or broker who can't say their own profession.
It's also a misconception that agents are less worthy than brokers; that's hardly the case. It's just about experience and how much knowledge a professional wants to gain; just like there are knowledgeable people out there who don't have a master's degree and knowledgeable people who do have one. I have an agent's license in California and a broker's license in Washington. When choosing a real estate professional, you should base your decision not only on a person's knowledge and expertise, but also on how well they will work for you.
Monday, July 5, 2010
So you're in Escrow...
...great! Now all that's left is the 30 something days till the home is mine! Think again. After many weeks (or months) of searching online, going to open houses, writing offers, getting rejected then finally getting accepted, the hard part is done; or so you thought.
Escrow, simply put, is the process of transferring a free and clear title from seller to buyer. During this time, your loan application (assuming this isn't an all cash deal) is put under scrutiny by dozens of people to make sure everything is correct, valid and current. Throughout Escrow, your credit score and financial assets will be checked periodically. If anything changes for the worst, everything is put on hold, and if there's too many delays, you could essentially fall out of Escrow.
Joe and Lisa (names have been changed) had stellar credit. In fact, Joe had a FICO score of over 800! Rare, but achievable. Together, he and his wife only had three open lines of credit; two credit cards and one truck payment. Joe was pre-approved by a major bank, and everything was going well. We made an offer on a great starter home for them. Joe worked as a contractor, and got a bonus once his last job was completed. So, he decided to reduce more of his debt and pay off his truck. Sounds reasonable, right? Well, in his case...not so reasonable.
Why is that? Well, in order to be approved for a mortgage, the bank wants to see that you have at least three open lines of credit. Joe just closed his third line. The bank caught that and therefore could not move forward with his loan. We lost out on that one home. Still determined to buy, Joe got a gas credit card, waited a few weeks for it to appear on his credit report, and re-applied for a mortgage. It worked! He was approved through another bank, and we were able to resume our search. Joe and Lisa found the perfect little one-story, three-car garage. Just right for the family, two cars and the ATVs.
The moral of this story...make sure you know the lending rules and requirements. Here's a little list you can follow while you're in Escrow.
Until your Escrow is closed, DO NOT:
1. Change your job or profession
2. Decide to be unemployed
3. Damage your credit by missing payments or stop paying bills
4. Buy a high dollar item, such as a luxury car or boat
5. Apply for new credit cards
6. Buy new furniture
7. Make any high dollar purchase on any credit cards
8. Make any changes to decrease savings account
9. Co-sign for anyone for anything
10. Delay completion of any paperwork requested by the mortgage company.
Escrow, simply put, is the process of transferring a free and clear title from seller to buyer. During this time, your loan application (assuming this isn't an all cash deal) is put under scrutiny by dozens of people to make sure everything is correct, valid and current. Throughout Escrow, your credit score and financial assets will be checked periodically. If anything changes for the worst, everything is put on hold, and if there's too many delays, you could essentially fall out of Escrow.
Joe and Lisa (names have been changed) had stellar credit. In fact, Joe had a FICO score of over 800! Rare, but achievable. Together, he and his wife only had three open lines of credit; two credit cards and one truck payment. Joe was pre-approved by a major bank, and everything was going well. We made an offer on a great starter home for them. Joe worked as a contractor, and got a bonus once his last job was completed. So, he decided to reduce more of his debt and pay off his truck. Sounds reasonable, right? Well, in his case...not so reasonable.
Why is that? Well, in order to be approved for a mortgage, the bank wants to see that you have at least three open lines of credit. Joe just closed his third line. The bank caught that and therefore could not move forward with his loan. We lost out on that one home. Still determined to buy, Joe got a gas credit card, waited a few weeks for it to appear on his credit report, and re-applied for a mortgage. It worked! He was approved through another bank, and we were able to resume our search. Joe and Lisa found the perfect little one-story, three-car garage. Just right for the family, two cars and the ATVs.
The moral of this story...make sure you know the lending rules and requirements. Here's a little list you can follow while you're in Escrow.
Until your Escrow is closed, DO NOT:
1. Change your job or profession
2. Decide to be unemployed
3. Damage your credit by missing payments or stop paying bills
4. Buy a high dollar item, such as a luxury car or boat
5. Apply for new credit cards
6. Buy new furniture
7. Make any high dollar purchase on any credit cards
8. Make any changes to decrease savings account
9. Co-sign for anyone for anything
10. Delay completion of any paperwork requested by the mortgage company.
Saturday, July 3, 2010
Welcome!
Hello fellow neighbors,
My name is Christine Cordova, and I am your local Realtor in the Greater Seattle Area. I live in the beautiful city of Bothell so if you see me touring the neighborhoods, don't be shy; come and say hi!
Like most real estate blogs, I will post buying and selling knowledge with a dash of finance, of course. However, as a special treat, I will delve into the minds of my clients and provide insightful, almost hands-on experience of the nitty-gritty scene of real estate.
All of my clients in years past love stories I tell of different buying and selling experiences. They always try to compare it to their own. And why not? Who wouldn't want to know how Mr. Smith bought an investment home in this economy!
If buying or selling is really what you want (or need) to do, I'll show you how. The market is what you make of it. Read more to see how your dreams can be a "realty."
My name is Christine Cordova, and I am your local Realtor in the Greater Seattle Area. I live in the beautiful city of Bothell so if you see me touring the neighborhoods, don't be shy; come and say hi!
Like most real estate blogs, I will post buying and selling knowledge with a dash of finance, of course. However, as a special treat, I will delve into the minds of my clients and provide insightful, almost hands-on experience of the nitty-gritty scene of real estate.
All of my clients in years past love stories I tell of different buying and selling experiences. They always try to compare it to their own. And why not? Who wouldn't want to know how Mr. Smith bought an investment home in this economy!
If buying or selling is really what you want (or need) to do, I'll show you how. The market is what you make of it. Read more to see how your dreams can be a "realty."
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