Is Winter a Good Time to Buy a Home?

Is Winter a Good Time to Buy a Home?

Winter has arrived! The temperatures have dropped and Christmas is only days away. So one may wonder is this a good time to buy a home?  The answer is a resounding YES! 

Buying a home during the winter may seem like a fool’s errand, but it is actually a clever time to buy.  Here are a few reasons why:

Even though there is less inventory, there are also less buyers.  Everyone knows that Spring and Summer are the best times to buy a home.  It is warmer and those with families or are planning to start one, begin looking at school districts and wanting to get into the best neighborhoods.  This also means that even though you may find your dream home so have a dozen other potential home buyers causing a bidding war that you may not be prepared to fight.  During the colder times of the year, fewer people are looking and fewer people are selling.  This can be great news for you as you may not have quite so many cash buyers and those willing to pay over the asking price. 

Thespruce.com tells us all the low activity in the winter will result in sellers being far more motivated to sell. Real estate agents know that the slow winter months are when sellers are more willing to negotiate, whether it is on selling price, closing costs, closing date or even terms of the sale, including what household appliances and items are included in the sale. And these are all the very reasons that many real estate agents recommend that their clients delay listing their homes till at least the spring. The winter is not a great time for sellers, in general.

Winter is also the perfect time to take a look at how the house looks and feels in harsher climate.  During this time you can check the windows to see if they are drafty, how warm does the house feel with the furnace running, are there ice dams on the roof (if you live in a colder climate than Texas), and is the home still aesthetically pleasing with bare trees and bushes? 

Anyone who has purchased a home before knows that during peak real estate months, you must work around your lender’s schedule for your closing.  At the end beginning of the year home sales drop 25-30% hopefully allowing you to close on your new home quicker.

Speaking of having to wait, did you know that it is easier to hire movers during cooler months as well?  Since the moving busy season tends to be during late Spring to late Summer, hiring movers can be daunting to say the least.  Sometimes you may even get lucky and get a break in price because moving companies need the work.  

Many people may feel that searching and buying a home during the winter months isn’t ideal, but with a little knowledge and open mind, you could be sitting by your new fireplace in less time that you thought possible.  

Please take a moment to make sure you follow me on Facebook, YouTube, Twitter, LinkedIn, and Pinterest for other life tips and all things real estate. 

Types of Mortgages

Types of Mortgages

Buying a home today can be a daunting task.  There are so many choices to consider:  condo, townhome, single family home, HOA, school districts, commute, the list goes on and on.  Add to that the type of mortgage you should get and you may feel like quitting before you even get started.  While I can’t help you decide on the type of home you should consider in a blog (I’m better at that in person), with the help of payoff.com I can help you learn the differences between the different types of mortgages to help you make an informed decision.  

The Basic Types of Loans

1. CONVENTIONAL / FIXED RATE MORTGAGE

Conventional fixed rate loans are a safe bet because of their consistency — the monthly payments won’t change over the life of your loan. This is your standard, plain-vanilla mortgage.

They’re available in 10, 15, 20, 30, and 40-year terms but 15 and 30 are the most common.

2. INTEREST-ONLY MORTGAGE

Interest-only mortgages give you the option, during the first five or 10 years, to pay only the interest portion of your monthly payment instead of the full payment. You aren’t required do this. This slows down your repayment time but can be useful in a pinch. Afterward, the rest of the mortgage is paid off in full like a conventional mortgage.

3. ADJUSTABLE RATE MORTGAGE (ARM)

There are many different ARMs. The basic idea is that their interest rate changes over time throughout the life of the loan. The rate changes reflect changes in the economy and the cost of borrowing money. A common ARM is called the 5/1 loan — the interest rate stays the same for the first five years and then is free to change for the remaining 25 years.

Special Assistance for Certain Groups

4. FHA LOANS

These are mortgages guaranteed by the Federal Housing Administration. They come with built-in mortgage insurance to protect against the possibility of not being able to repay the loan. The required down payments are smaller with these loans.

5. VA LOANS

These loans make it easier for veterans of the U.S. armed forces, and sometimes their spouses, to buy homes. They don’t require a down payment and are guaranteed by the Department of Veteran Affairs.

More Exotic Types of Loans

6. COMBO / PIGGYBACK

The combo occurs when you put a down payment of less than 20% and take two loans of any type in combination to avoid paying Private Mortgage Insurance.

7. BALLOON

On a balloon mortgage, you pay interest only for a certain period of time — five years for example — and then the total principal amount is due after this initial period.

8. JUMBO

Jumbo refers to a mortgage that’s too big for the Federal Government to purchase or guarantee. Currently, the limit is about $700,000. This means that the borrower wouldn’t get the lowest interest rates available on smaller loans.

Now that you have a basic idea of what kind of mortgages are available, you are in a better place to work with your mortgage broker in finding the best type of loan for you.  Once you are pre-approved you can begin shopping for your new home with confidence and excitement.  

Please take a moment to make sure you follow me on Facebook, YouTube, Twitter, LinkedIn, and Pinterest for other life tips and all things real estate. 

5 Reasons You Should Hire a Real Estate Agent

5 Reasons You Should Hire a Real Estate Agent

Technology is amazing!  You can order groceries, clothes, appliances, even cars just by pointing and clicking on your computer.  So it’s understandable why people ask why they need a real estate agent to help them buy or sell a home. I am happy to provide five reasons why you should hire an agent. 

Buying and selling a home is considered one of the most stressful times in a person’s life. Real estate agents understand this and are skilled in easing any worry in order to insure the next chapter in your life begins with a smooth transition.   

  1. Education and Experience – In this fast paced world we are all looking for ways to save time.  Real estate agents have the education and experience to help with your home buying/selling needs.  Every state requires hours of education and an exam in order to secure a license. Doesn’t it make sense to hire an agent with the education and experience to guide you through one of the most stressful stages in life? 
  2. Objectivity – One of the best things about hiring a real estate agent is their objectivity when it comes to school districts, neighborhoods, and local amenities.  Because they work locally, they know the areas that will cater to your wants and needs. They take your wish list and are able to suggest areas that will fulfill those desires saving you time researching it on your own. 
  3. Networking and Marketing – A great perk of having a real estate agent on your side while you are selling or buying a home is their network of other agents, past clients, family members, and friends.  Having a network at their fingertips keeps them in the loop with new listings or new clients who may just fall in love with the property you are trying to sell. Along with professional networking, real estate agents also market your home by placing it on the MLS (multiple listing service), marketing it on the internet, holding open houses, and sending out mailers in your neighborhood. 
  4. Negotiation Skills and Confidentiality – Top producing agents negotiate well.  They remove the emotional aspects of the transaction and because they know the market, they can negotiate a win-win. It’s part of their job description. They are professional and trained to present their client’s case in the best light and agree to hold client information confidential from competing interests. 
  5. Paperwork – Buying or selling a home requires a lot documentation in the form of disclosures, contracts and amendments before you get to the closing table.  This is by far one of the best things about hiring a reputable real estate agent. They have the knowledge to be able to complete and present a contract that has your best interest at heart.  They will handle all the paperwork that is needed for the transaction so the only thing you have to do is sign on the dotted line.  

If you are ready to buy a home or are looking to sell, please contact me using this link:  https://alessiobassrealestate.com/contact/ 

Please take a moment to make sure you follow me on Facebook, YouTube, Twitter, LinkedIn, and Pinterest for other life tips and all things real estate. 

The Importance of a Home Warranty

The Importance of a Home Warranty

If you are planning to purchase a home you know you must have homeowner’s insurance in order to apply for a mortgage.  But what about a home warranty?  A home warranty is not required when you purchase a home.  Homeowner’s insurance and a home warranty are two very different things.  Homeowner’s insurance covers the structure of your home in the event of a fire, flooding, storms, or other unforeseen tragedies.  A home warranty covers certain appliances in the home when they breakdown due to normal wear and tear.  

What is covered under a home warranty?

Each home warranty company offers different plans to suit your needs and budget.  Much like insurance, you can choose a higher premium in order to have a lower service call amount or deductible and vice versa.    Many companies also offer a variation of what the plan covers.  One plan may cover only one appliance, another could cover all appliances, and another could cover only plumbing and electric.  Sometimes multiple warranties are necessary if you want to cover something extra like a swimming pool.  

What if I have a new build?

Most home builders will warranty the structure for a year after purchase, and the appliances generally come with a manufacturer’s warranty.  However with any large purchase, always check the fine print and make note of when the warranties are due to expire so you can add or update a home warranty just before expiration.

Can I get a warranty even if my home is older or I have lived in it without a previous warranty?

Absolutely!  A home warranty can be purchased at any time no matter the age of the home or the appliances within.  

Should I purchase a home warranty when I sell my home?

Yes!  Having a home warranty in place when you put your home on the market can give the buyer peace of mind and save you the expense of a post-sale conflict.  

What if the home I’m buying does not offer a home warranty?

No problem!  Ask your Realtor® for information on a home warranty provider or turn to the internet or friends and family for recommendations.  Many companies will offer free quotes so feel free to check with a few to find the one that works best for you.  Always read the agreement carefully and make sure everything you want covered is at the agreed upon price. 

A home warranty is not a requirement for any homeowner it is simply an added layer of peace knowing you are covered when the hot water heater needs replacing or the A/C has to be serviced.  With the stress of everyday life, a little peace of mind can go a long way.  

Please take a moment to make sure you follow me on FacebookYouTubeTwitter, LinkedIn, and Pinterest for other life tips and all things real estate.

HOA:  Yay or Nay?

HOA: Yay or Nay?

When you are searching for a new home, chances are you have been to at least a few that are a part of a homeowners association or more commonly known as an HOA.  HOA’s may offer great amenities; community pool, children’s playground, fitness center, etc., so it is easy to gloss over the realities of living within the guidelines of the HOA.

What is a Homeowners Association?  A homeowners association is an organization founded by a real estate developer in order to manage a community of houses, townhouses or condominiums.  According to the New York State Attorney General’s website, this association “is given the authority to enforce the covenants, conditions, and restrictions as well as manage the common elements of the development.” In order to belong to a homeowners association (and, subsequently, live in the community it oversees), you pay dues.  Depending on the community, the dues can range from $100 a year to over a $1,000 a month or more.  You need to consider if the amenities and benefits are of value to you and whether you are comfortable with the rules associated with that particular development. 

The association fees are included in the mortgage lender’s assessment of your monthly mortgage payment, so it is important to confirm that your credit score and debt-to-income ration will support the home development that you choose.  Credit scores can be checked for free at credit.com.  

Why pay a monthly association fee to abide by rules that potentially do not support your lifestyle or support the cost of the amenities you are unlikely to use?  Listed below are some advantages and disadvantages of homeowners associations.

Pros:

  • The HOA maintains the landscape in the common areas as well as community pools, tennis courts, fitness areas, etc.
  • The HOA can be utilized to help with conflicts between neighbors such as unwanted vehicles parked in front of your house or unkempt landscaping. 
  • The HOA can reduce your responsibilities such as snow removal or maintenance you would normally have to pay for yourself.
  • Often, HOAs promote a strong sense of community. Friends can gather at the clubhouse or common areas, people get to know their neighbors, and there are usually social functions planned year round.

Cons:

  • There may be rules or regulations in the HOA documents that will dictate what color you can paint your house, or what type of holiday decorations are acceptable.
  • The HOA may put restrictions on residents wanting to rent out their home. The association may require potential renters to be screened and approved by the HOA board, how much you charge for rent could also be regulated along with the duration of the rental. Some HOA’s ban rentals altogether.
  • An HOA can foreclose on your home.  

Texas Homeowners Association recommends before purchasing a property within an HOA or condo community it is very important that you find out how the association is run, how much the monthly association fees are, what the fees cover and how much money is in the reserve fund to cover any large expenses such as replacing a clubhouse roof. Always get a copy of the rules and regulations before you purchase so that you are completely aware of what you can and cannot do within the community. For example, if you purchase within a condo/townhouse community where there are zero lot lines, more than likely you won’t be able to touch the landscaping outside your home. If you are an avid gardener then this is definitely something you will want to consider before purchasing.

I am available to answer any questions about homeowners associations or any other aspect of buying and selling a home.  Feel free to call me at 970.393.3424 and please take a moment to make sure you follow me on Facebook, YouTube, Twitter, and Pinterest for continual market information.