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of HUNT Real Estate ERA

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May 2016

Different types of Mortgages?

There are 4 basic types of mortgages. And they all depend on several factors such as income, credit score, down payment, geographical location, etc.

*DISCLAIMER* Each lender is different and Realtors are by no means professionals on this topic. The laws are constantly changing and you need to speak to a licensed mortgage officer to have accurate up-to -date information.  So PLEASE call your bank, lender, credit union, etc.

Conventional- This type of mortgage requires good credit and a decent down payment. Conventional appraisal guidelines are less strict. This type of loan carries PMI (Private Mortgage Insurance) but can be eliminated after 20% of the principle has been paid. Conventional mortgages are not backed by any government agency.

FHA-  This type of mortgage requires only 3.5% down. The appraisal guidelines have more regulations, and PMI (Private Mortgage Insurance) is also required. This is a 1.75% fee and carries for the life of the loan (Unlike Conventional Mortgages where the PMI can be eliminated). It’s a great opportunity for first time home buyers who may not have much of a nest egg or possibly struggling with credit. Concessions of up to 6% are allowed. Beware if your credit is too low, you may have to put more than 3.5% down, or pay points.  FHA mortgage’s are backed by the Federal Housing Agency.

VA- This is for active or retired military and their families. There is a o% down payment (unless you want to put more down).VA appraisal guidelines are similar to FHA, and you can ask for up to a 4% concession.

USDA-  The USDA will fund  mortgages for specific income ranges based on county, in rural areas and requires 0% down. Appraisal guidelines are similar to VA and FHA.  Concessions of up to 6% are allowed on this type of loan as well. Check the USDA website to search geographically for eligibility.

 

Factors that determine what kind of mortgage a person qualifies for are

  • Credit Score
  • Down Payment
  • Debt to Income Ratio
  • Type of Income
  • Length of Job History
  • Geographical Location
  • Military Experience

Mortgage Lenders cannot discriminate against a borrower based off any of the protected classes as per the Fair Housing Act.

 

There are other factors and sub types of mortgages such as Fixed vs Adjustable, Conforming and Non-Confirming, Balloon loans, etc. The 4 above descriptions provided are a crash course in Mortgage’s 101.  And please remember the mortgage industry is constantly evolving and changing, Realtors are not Mortgage Professionals, so please consult your local lender.

 

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Real Estate Agent v.s. Realtor

What is the difference between a Real Estate Agent and a Realtor? This is one of the biggest misconceptions in Real Estate among our clientele.

Here is the simple answer:

A Realtor is always a real estate agent, but a real estate agent is not always a Realtor.

Here is the long(er) version:

A Real estate agent is a state licensed professional whose job is to procure the sale of real property. They acquire sellers who want to sell their property, market & advertise (or find a buyer the perfect home once their finances are in order and they know what their needs are) and then negotiate. Ensure all the necessary steps and measures are fulfilled before finally handing over the keys at closing.

They have to take a 75 hour course, pass a state exam, a background check (no ex-felons allowed!), and then find a broker (A.K.A. company) to “hold” their license. Then they must fulfill continuing education every 2 years.

A Realtor does all of that and then some & with better resources. A Realtor is a member of the National Association of Realtors (NAR), and will belong to a local board where multiple Realtors share listing information, data, educational resources and more, they pay fees for these services. (Ours is the Mohawk Valley Association of Realtors)

They also have the ability to earn additional designations. Such as MRP (Military Relocation), ABR (Accredited Buyer Representative), SRS (Seller Representative Specialist), and others.

Realtors have a strict code of ethics they must adhere to. If they are found to be negligent or malicious towards a client or another Realtor they can be banned from the association and even loose their license or go to jail depending on the situation.

They help support lobbyist groups that work towards protecting your rights and interests as home owners and property owners. In fact, here is a link to the NYSAR (New York State Association of Realtors) Legislative action web page NYSAR Legislative Action Center

 

 

 

Staging: Short and Sweet

Let’s be real.

For the vast majority of us our homes are NOT show worthy 99% of the time. Convenience, kids and pets are the usual culprits. In other words, life happens. And that’s a beautiful thing in and itself, but we’re talking about real estate, not the meaning of life.

So when it comes time to sell your home you ask, “What do I do?”

And here is what I say.

In an ideal world your home would be out out of the scene in a movie or magazine. Grand mansions and cozy cottages. But in reality we all have our independent abilities both in finances and  decorating, not to mention persistence. Because remember, you will have to keep up on your homes appearance right through until you close.

So with that here is #1 Curb Appeal

If they don’t like the outside, they wont go inside. First Impressions really are everything. Buyers wont even want to schedule an appointment in most cases if the first picture in the listing isn’t appealing. So clean it up! Don’t leave the trash can or water hose laying around. Pressure wash the siding and clean the windows.

Use neutral tones, have walk-able paths, a broken and loose entry is a tripping hazard and not appealing. And use clean looking landscaping where able. Hosta’s, mulch and a few annuals or colorful perennials will do the trick. A nice porch light fixture and clean looking front door. Paint any faded or chipped paint.

Doing anything off this list will improve your appearance and chances of selling quicker and for more money.

#2 Declutter, Clean up & Depersonalize

When someone is coming to look at your home they are interested in your home, not you and your belongings. So put them away. Take EVERYTHING off your refrigerator (except your Realtors magnet). Put away family photo’s. Hide the garbage can, the dogs toys and bowls, the tissues, toothpaste, and soap. AND DO the dishes. Remove anything in excess, including furniture, shoes, coats on the coat rack, etc.

Put away laundry and organize. It can be tough to hide everything, especially with kids and pets, so use space carefully. Ottomans with storage make great coffee tables, totes can be stacked neatly in the garage or basement.

Use this as a chance to thin out as well. You never realize what’s been accumulating until it’s time to move. Donate unused clothing to the Salvation Army, as well as unwanted furniture, etc. If you have enough belongings they’ll come get it. Habitat for Humanity is another great way to be rid of old but usable items.

Declutter your closets & keep your fridge clean, if it’s coming with the house people are going to want to see what kind of shape it’s in and open it.

Basically, just purge your home.

#3 Decor

If you’ve gotten through decluttering and the curb appeal homework, congrats! You’ve accomplished all the heavy work. This is the more relaxing part. You now get to dress up your house. But again remember, think neutral. Browns, blues and tans are common colors when used in the right shades.

Do everything in groups of three. Three colors per room, three items on the mantle place. 3 photo’s on the wall. Go online to get ideas if you aren’t the artsy type. Pinterest, google, better homes and gardens, etc are all great tools.

Tips:

  • Frugal minded folk can find great deals at garage sales, craigslist, or the salvation army. Borrow unused furniture from friends and family if you need to.
  •  Cover up a beat up table with a neutral table cloth and use a vase of flowers to detract attention.
  •  Update old cabinets with new door knobs.
  • If you have a lot of painting to do try to use the same color as much as possible through to save money with a bulk 5 gallon bucket instead of individual 1 gallon amounts.

 

#4 Ambiance

Almost there! This is all about creating a sense of home. You’re trying to appeal to all the of the senses, sight, smell, feel, noise…

  • Keep your newly clean home CLEAN!
  • Make your house smell nice, use flowers, timed scent release devices or wax melters. But at the very least keep it from smelling unpleasant. If you’re a smoker or have pets considering getting your carpets and upholstery professionally cleaned. Additionally, use a dehumidifier in musty basements.
  • Noise- or the opposite of, actually. Have something neutral playing. Use the radio, Pandora or a CD. Something that can continually play for at least two hours in case you have back to back showings.
  • Feel- keep counters and doors clean, no smudgy hand prints, or wet nose marks. Area rugs over cold hardwoods in the winter time make people less worried about their feet and more interested in your home.
    • Another note. In the summertime  keep the house cool and in the winter vise versa. If a buyer is wishy-washy about your home having a cool reprieve from the heat outside might keep them in long enough to change their mind. It also creates a psychological idea that the house has provided a need to them, which subconsciously allows the buyer to like the house more.

 

If you’re able to do any one of these suggestions than you have successfully added appeal to your home. The world of real estate has become increasingly competitive when it comes to updated and appeal. So if you want the upper had do your homework and don’t be afraid to have your Realtor come over to give you advice on where and what to invest your money into. The only thing worse than an under invested property is an over-invested one.

 

 

 

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