TOM PLANT'S HOUSTON REAL ESTATE BLOG

Most of you are aware that the down payment is not the only cash cost required to buy a home. An earlier post discussed the need and costs of home inspections. In addition to inspection costs, a Buyer will have certain costs which must be paid at closing. Depending upon the type and amount of financing and the negotiations between the Buyer and Seller, typically a Buyer will have bank fees, appraisal fees, Title Insurance for the Lender, and county filing fees.

When they first begin to look for a home, Buyers whom I represent receive an estimate of cost to close for a home in the price range they are seeking. Once we find a home and make an offer, I provide the Buyer an estimate of cost to close for that specific home. I always want Buyers who work with me to have the information necessary for them to make informed decisions with no surprises.

Interested in Buying a Home? Want more information about the Buying process or the cost to purchase a Home? Contact me and I will be happy to provide you the information you need with no obligation on your part. tom@tomplant.com  713.942.6895.

Here is a video from Houston Association of REALTORS discussing in general the costs a Buyer will incur at closing.

Buyers should never rely solely upon the Sellers’ Disclosure to determine the condition of a home. An experienced, professional home inspector can save a Buyer from purchasing a home with significant defects that will require expensive repairs. I even encourage Buyers of new construction to have an inspection. Having problems addressed before closing is far better than relying upon a builder’s warranty after closing.

The best inspectors have become quite expensive. An inspection in Houston will cost several hundred dollars and, for larger homes, can be near $1,000. Selecting an inspector is not a time to comparison price shop. All homes in Houston should have a structural and mechanical inspection and a termite inspection. Other inspections that are sometimes needed include pools, leak detection, lead paint, asbestos, roofing expert and foundation expert.

This video from the Houston Association of REALTORS® will provide some general information about inspections.

A Buyers’ agent should do much more than simply help find you a home. In fact, finding the home you want is a small part of what you should expect when you are represented by a Realtor®. A Realtor’s advice and counsel on market conditions, market value and resell potential of a home; skill and experience in negotiations; and, managing the process through closing are what makes representation valuable.

Shown below is how I go about representing a Buyer. If you decide to work with someone besides me, make sure they will provide complete representation.

When I represent you as a Buyer, I will:

• Listen carefully to understand your objectives, criteria and limitations.
• Provide extensive information on every property we decide to visit, including MLS information, property tax records, flood map, and Sellers’ Disclosure , when available.
• Offer you advice and opinions based upon analysis, experience and my knowledge of the market.
• Develop with you negotiating and bargaining strategies that will work in your best interest.
• Before making an offer, provide to you a Comparable Market
• Analysis with an explanation of the comparable sales.
• Provide my candid and honest opinion of the property.
• Advise you on an initial offer.
• Advise you about location subtleties affecting market price and future resell potential, e.g., flood plain, traffic noise, planned road construction or known new construction plans.
• Prepare and review all documents with you, explaining the issues and advising how to protect your interests.
• Assist in due diligence and manage all aspects of the purchase procedure.
• Provide an estimate of closing costs and explain the closing procedures.
• Provide any other assistance necessary to achieve a successful purchase.
• Provide Quality Service Guarantee including third party survey and evaluation with results online.

When you begin to consider purchasing a home, the REALTOR® you select can make the difference between an intelligent purchase and making a large mistake. No agent is right for everyone. Decide what factors are most important to you and choose the agent accordingly. Buyers with whom I work tend to be people who value a great deal of information, comprehensive market analysis and candid opinions as to value. A later post will provide details about how I work with Buyers. The following HAR video recommends you check an agent’s online ratings. Click these links to check my ratings. HAR    QSC

This is first in a series about the process of buying a home in Texas. When you choose me to represent you in purchasing a home,  you will receive the benefit of my proven real estate expertise, extensive business experience, analysis and attention to detail combined with the market strength of Greenwood King Properties. Read what Buyers have said about me.  With me, Real Estate is All Business.

A study from Bankrate found that 90 percent of owners do not regret buying their home.

The findings also revealed improved mortgage awareness, with only 8 percent of home owners in the dark about what type of loan they have — down from 26 percent two years ago.

The poll of 1,001 randomly selected home owners in August showed that 79 percent had fixed-rate financing, and this type of mortgage was used by almost 90 percent of respondents who make more than $75,000.

Source: Realty Times, Broderick Perkins (09/02/10)

© Copyright 2010 Information Inc.

Understanding how appraisals work will help you achieve a quick and profitable refinance or sale.

If you think the appraisal value of your home is too low, you can seek a second opinion. Image: David Sacks/Lifesize/Getty Images

When you refinance or sell your home, the lender will insist that you get an appraisal—an opinion of the value of your home based on what similar homes in your area have sold for in recent months.

Here are five tips about the appraised value of your home. 

1. An appraisal isn’t an exact science

When appraisers evaluate a home’s value, they’re giving their best opinion based on how the home’s features stack up against those of similar homes recently sold nearby. One appraiser may factor in a recent sale, but another may consider that sale too long ago, or the home too different, or too far away to be a fair comparison. The result can be differences in the values two separate appraisers set for your home. 

2. Appraisals have different purposes

If the appraisal is being used by a lender giving a loan on the home, the appraised value will be the lower of market value (what it would sell for on the open market today) and the price you paid for the house if you recently bought it.

An appraisal being used to figure out how much to insure your home for or to determine your property taxes may rely on other factors and arrive at different values. For example, though an appraisal for a home loan evaluates today’s market value, an appraisal for insurance purposes calculates what it would cost to rebuild your home at today’s building material and labor rates, which can result in two different numbers.

Appraisals are also different from CMAs, or competitive market analyses. In a CMA, a real estate agent relies on market expertise to estimate how much your home will sell for in a specific time period. The price your home will sell for in 30 days may be different than the price your home will sell for in 120 days. Because real estate agents don’t follow the rules appraisers do, there can be variations between CMAs and appraisals on the same home. 

3. An appraisal is a snapshot

Home prices shift, and appraised values will shift with those market changes. Your home may be appraised at $150,000 today, but in two months when you refinance or list it for sale, the appraised value could be lower or higher depending on how your market has performed. 

4. Appraisals don’t factor in your personal issues

You may have a reason you must sell immediately, such as a job loss or transfer, which can affect the amount of money you’ll accept to complete the transaction in your time frame. An appraisal doesn’t consider those personal factors. 

5. You can ask for a second opinion

If your home appraisal comes back at a value you believe is too low, you can request that a second appraisal be performed by a different appraiser. You, or potential buyers, if they’ve requested the appraisal, will have to pay for the second appraisal. But it may be worth it to keep the sale from collapsing from a faulty appraisal. On the other hand, the appraisal may be accurate, and it may be a sign that you need to adjust your pricing or the size of the loan you’re refinancing. 

More from HouseLogic

How to use an appraisal to eliminate private mortgage insurance

Understanding the assessed value of your home for tax purposes

Understanding the amount at which to insure your home 

Other web resources

More information on appraisals

How to improve the appraised value of your home

By G.M. Filisko: G.M. Filisko is an attorney and award-winning writer who’s had more than 10 appraisals performed on her properties in the past 20 years. A frequent contributor to many national publications including Bankrate.com, REALTOR® Magazine, and the American Bar Association Journal, she specializes in real estate, business, personal finance, and legal topics.

Reprinted from HouseLogic (www.houselogic.com ) with permission of the NATIONAL ASSOCIATION OF REALTORS®
Copyright 2010.  All rights reserved.

The Federal Reserve released a proposal Monday to give mortgage applicants three days to change their minds.

The proposal was part of a 930-page document that clarifies and finalizes the new financial reform law.

The Fed’s document says that for closed-end loans secured by real property or a dwelling, a creditor must:

• “Refund any appraisal or other fees paid by the consumer (other than a credit report fee), if the consumer decides not to proceed with a closed-end mortgage transaction within three business days of receiving the early disclosures (fees imposed after this three-day period would not be refundable); and
• “Disclose the right to a refund of fees to consumers before they apply for a closed-end mortgage loan.”

The Fed says this proposal will make it easier and cheaper for consumers to comparison shop. It also acknowledged that borrowers who want to close a transaction in a hurry would be handicapped because most lenders will delay sending out an appraiser for a few days.

Other proposals affecting home buyers included:

• A ban on yield-spread premiums, which encourage mortgage brokers to push buyers toward more profitable mortgages.
• A requirement for lenders to tell borrowers when their mortgage is sold or transferred.
• An explanation of the effects of balloon payments, adjustable loan payment fluctuations, and minimum payments on loan balances.

Source: Bankrate.com, Holden Lewis (08/17/2010)

MY BLOG HAS BEEN NOMINATED AS BEST IN HOUSTON BY ZILLOW.COM – PLEASE CLICK ON THE LINK AND VOTE -  http://www.zillow.com/homes/for_sale/Houston-TX/#poll

1.  Low mortgage rates serve as an equity shock absorber. When buyers borrow at today’s record-low rates, they start building equity as soon as they close. That means they can absorb a few ups and downs as the still-recovering housing market gains traction.

2.  Houses are in move-in condition. Home owners have continued to spend on maintenance and repair, according to the Harvard Joint Center on Housing. As these houses enter the market, they are in marked contrast to tattered foreclosures.

3.  Terrific houses are coming on the market. Foreclosures are finally starting to clear the system, and they are being replaced by some very attractive properties.

4.  Appraisal regulations are finally aligned with market realities. Fannie Mae has adjusted its appraisal guidelines, giving appraisers more flexibility to set values that reflect the current market.

5.  Plenty of programs. Many programs that encourage middle-class families to buy homes continue to exist, despite market downturns. Buyers who qualify can get a big boost by combining one of these programs with today’s low mortgage rates.
Source: ForSaleByOwner.com (07/29/2010)