Real Estate Information Archive

Use what you have first. If you are already anticipating the move, hold on to any packaging your deliveries have come in. Stack them out of sight if your house is still on the market, or go ahead and pack non-necessities in them and hide them under the bed or storage area. 
 

Other items you have on hand to use: suitcases, duffel bags, trash cans, and reusable grocery bags can all be utilized to cut back on cardboard boxes. 
 

Produce boxes make great moving containers! They are very sturdy and some come with lids so you will not have to use so much tape to close them. Ask for them at local grocery stores and produce stands. 
 

Towels, sheets, and pillows can be used in place of packing material, and towels and sheets can be used for wrapping fragile items as well. Using them is a double win because you will have one less thing to pack! 
 

If it is within the budget, consider using an eco-friendly moving company. 
 

Already contracted with a mover? Ask them about any green options they have in place for your move. 
 

It only takes a quick search online to find a company that rents clean and ready-to-pack storage containers. Many of them will deliver them to your door, then pick them up at the new house when the containers are empty! 
 

Another option is ordering a moving kit or just the boxes from UsedCardboardBoxes. The company “rescues” misprinted or in-almost-perfect-condition used cardboard boxes that are headed for a landfill, and ships them directly to you. 

Does my credit need to be perfect?  Not necessarily, but the higher your credit score, the better the loan’s interest rate will be. Lower credit scores could cost thousands over time in higher interest rates. FICO has some tips for improving your credit score. 
 

I am not sure how much house I can afford.  Lenders will look at your debt-to-income ratio when deciding to grant a home loan.  Get an idea for yourself by using this handy DTI calculator. 
 

How much money do I need for a down payment?  That depends! Most lenders require 5-20% for a down payment. USDA and FHA offer no- or low-down-payment home loans. Veterans and servicemembers have the benefit of applying for a no-down-payment VA Home Loan through the Veterans Administration as well. 
 

What is Private Mortgage Insurance (PMI) and will I have to pay? For most lenders, PMI is a requirement for homebuyers that do not pay a 20% down payment. The cost is normally included in the mortgage payment. 
 

I am pre-approved for a mortgage. Can I make an offer on a house that I love?  Sellers will likely reject an offer that has no lender back-up. Return to the bank and go through the pre-qualification process so you will know just how much you will have to offer on a property. 
 

Are there any tax advantages to owning a home?  While there are many costs associated with homeownership that renters do not have, there are tax credits for some of the taxes you pay, as well as for those who use points to get a lower interest rate. And with rent prices rising, your monthly mortgage payment could be lower than rent! 
 

How long does the whole process take?  A smooth home-buying transaction takes approximately 30-45 days. The time varies as there are so many aspects to the process, and once in a while, there are hurdles to get through.   
 

Who pays closing costs--the seller or the buyer?  In most cases, the buyer pays the closing costs, an expense that can run 3-6% of the cost of the home.  In some instances, however, the seller will offer to help with these costs as an incentive to buy the home. 

When you start your house hunt, be certain you are pre-approved for a mortgage. This will show any seller that you can buy their property. A pre-qualification is not enough. 
 

Before you even put in your offer, make sure there is some wiggle room in the amount. Offering the maximum that you are approved for can take you out of the contest during the first round. 
 

If you can offer cash for the purchase or a better-than-average earnest money deposit, sellers are more likely to add you to their “possibilities” list. Cash talks, no matter the amount of your purchase offer. 
 

Some potential buyers ask an agent to add an escalation clause to the contract.  The downside to this is leaving your negotiations on a purchase price laid bare for the seller to see. It may be best to make sure your Realtor® is ready with counteroffers in case your original is rejected. 
 

Being competitive means laying aside some contingencies.  For instance, a well-maintained home may have fewer issues in the inspection, so waiving the home inspection contingency could be enticing to the seller. This can be risky, however, if the house has not been updated in a long time, so make this decision wisely. 
 

If you absolutely love the home, talk to your agent about allowing your offer to be a back-up.  Keep an eye on the sale just in case it does not go through. Remember that most sales do go through, but there is always hope! 
 

Finally, it may simply be best to take the loss and walk away. In a sellers’ market, it may be best to let go of some of the items on your “want” list, as well as look at houses that are under budget.  

Rent-to-own agreements can also be called lease-to-own, lease-with-option-to-purchase, or simply a lease option. Lease-purchase agreements require the tenant to buy the property, and this can cause major financial issues if the tenant cannot follow through on the purchase, no matter the reason.  
 

Decide on a final purchase price at the end of the option period, or agree upon an appraisal contingency. Depending on the fluctuation of the housing market, however, this could benefit the buyer if market value goes down, but could benefit the seller if values increase.  
 

It may be a good idea to have a home inspection performed before getting into this situation. In the case that the inspection raises concerns, repair costs can be worked out between the tenant and the owner. 
 

A portion of the above-market rent will go towards the purchase of the house, most commonly in the form of a down payment.   
 

Some tenants agree to pay HOA fees (if applicable), property taxes, insurance and take care of the cost of necessary repairs. 
 

In most situations, the tenant can purchase the property at any time during the option period, but once that time is up, the option expires and the owner can sell the property to someone else.
 

One very important thing to remember is that there is still a lease involved. If you fall behind on the payments, the landlord can have you evicted. Besides eviction, the option fee and extra rent paid will be lost. 
 

Sometimes a seller offers to finance the purchase altogether, and that situation will require a completely different set of agreements. Again, owner-financed sale contracts should be handled with a real estate attorney. 
 

Begin by requesting a free credit report from all three reporting agencies.   Look for errors and report them to the credit bureau and company that posted them.  Legitimate collections that have been paid will not be removed from your credit history for seven years, although they will be marked as paid. 
 

Late payments hurt your credit score.  Stay current by creating a written budget with due dates for your bills or set up automatic drafts through your bank. 
 

Pay off your credit cards!  This is particularly important, because the more outstanding debt you have, the lower your score.  Begin by paying off the smallest balance. Larger balances can be paid off sooner by increasing your payments or send equal payments twice per month if the creditor allows. 
 

According to FICO™, it is better to pay off a credit card than canceling the account.  Use it as minimally as possible--simply charging a once-a-month take-out meal will keep it active. 
 

Having just one credit account in good standing is better than none for those who have not started establishing credit history. Shop around for a credit card with a good interest rate and apply. 
 

Avoid new credit accounts while you are trying to bring your score up. Pay cash for everything, and if you do not have the cash, unless it is an emergency, do not buy it. 
 

When you cannot see a light at the end of the financial tunnel, contact a reputable credit repair agency that can assist you in getting your bills paid, manage your finances, and increase your chance of becoming a homeowner. 

- You will need a buyer agent to represent you. The builder’s agent will be looking out for their client--not you. 

- Go through the pre-approval process but shop around for the loan that fits your needs.  If the builder’s lender has incentives and discounts, take advantage of them if it will benefit you in the end. 

- How many lots and homes have been sold, how large each lot is, and how much space is between houses? 

- What is the length of the home’s warranty, and what does it cover? 

- How much input does the buyer have in choosing paint colors and materials for flooring, kitchen, and bathrooms? What is the policy if the builder runs short on chosen materials? 

- Is smart technology wiring included in the basic home package, and is wiring to all bedrooms an extra expense? 

- What appliances are included in the basic price? 
 

- Keep in mind that the model home you are shown has all the bells and whistles! Never assume you are getting everything in your home that the model shows. Ask about these features and write everything down as you get answers. 

- Talk to residents who are already living in the community, and ask them about any concerns they have, and what they love about their new home. 

- Do not skip the home inspection just because it is new construction. Be sure your purchase contract allows you to hire an inspector outside the building company. 

- If the model home is one of the last homes left in the neighborhood, ask about buying it!

- You may not get every finish just as you would like, but you can paint a room or change the flooring! 

The home-buying process and moving are no small feats and undertaking a renovation can take another toll.  Give yourself a break before starting something new. 
 

Getting used to living where you are could cause you to rethink your plans. For instance, you wanted a bay window to replace the two smaller windows in the dining area, but after feeling the hot afternoon sun shining in, you change your mind.  Little things like this are not noticeable from a few walkthroughs and virtual tours. 
 

Many fixups are inexpensive and can tide you over until you make your final decision on whether to renovate or not: painting, fixing up the floors, or purchasing new furniture are all ways you can satisfy that itch and make the new house feel like your own. 
 

Living in your home as it is for a while could show you that a major renovation is not needed at all! One room could simply need better lighting, or a closet you wanted to enlarge simply needs a few organizational pieces. 
 

Continue the savings habits you adopted while saving for your down payment and other costs associated with your home purchase, and you can pay for your redo in cash, one step at a time! 
 

Go ahead with your planned decorating! It is possible that you will find those renovations unnecessary once you have new furniture, draperies, and wall color. 
 

Some renos cannot wait and are best completed before moving in structural work, full kitchen or bathroom re-do, large room addition, or changes to the layout.   

A home warranty covers what homeowner’s insurance does not. When one of your home’s systems or major appliances breaks down or is damaged from normal wear and tear, a home warranty will help you with the costs. 
 

Homeowners pay a monthly fee, on average $300-$600 per year, according to Consumer Affairs. Most service calls through the company will require the homeowner to pay a set service fee to the technician when making a claim. 
 

A home warranty can be purchased at any time, which is great for someone who is selling their home.  Sellers can spend a good amount of money prepping the house for sale, and a warranty will help considerably if something breaks down during the selling process. Warranties can be transferred to the buyer, as well! 
 

A newer home may not necessarily need a home warranty, so stash an amount equal to a monthly warranty payment into your savings account!  You can build emergency savings and have the funds for unexpected repairs. 
 

Research home warranties for prices and coverage available. Your Realtor® will be able to direct you to companies they are familiar with, and you can trust you are working with a reputable home warranty company. 
 

Current homeowners who do not have a home warranty can find a company that is registered with the Service Contract Industry Council. Scroll to the “Home Service Contract Companies” for a complete contact list.