Posts with tag 'Buying'

You are considering selling your home, and you want to know how much your home is worth?  You decide to call a real estate professional and ask for an appraisal. More than likely, the real estate agent stops you and tells you they cannot give you an appraisal, rather what they can do is give you a Comparative Market Analysis (CMA) to help determine market value.  The next question I get from a potential seller is, "what's the difference?"

In real estate market value and appraisal are not synonyms.  There is an important difference.

Let's briefly look at what the two things are:

Market Value:  Market value is the highest amount that a buyer is willing to pay for a home given the current market conditions.  The market value of a home is ultimately set by buyers, and what they are willing to pay.  A real estate agent will use the value of active, pending*, closed homes to help you determine where y...

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Over the last few months, I have had several buyers get very frustrated.  Why?  Well, other than the obvious of loosing out on a home they loved, they do not understand the appraisal process.  When they are willing to offer well above asking price, and I caution that we have to consider an appraisal I have a few times heard something similar to the following:  "If I am willing to go $20,000 over the asking price and I am approved at that amount then why does the bank care what the value of the home is?" 

I understand the frustration, and I understand the logic.  If you are approved for a loan at $250,000, and the home cost $225,000 then you can clearly make the down payment and monthly payments at $250,000.  The banks getting more money, so why do they care?

The bank cares because they are always looking ahead and assuming the worst.  If an appraiser says the home is worth $225,000, and a buyer has taken out a mortgage more than the home is worth it becomes...

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In the highly competitive seller's market we are currently in buyers are looking for any edge they can get.  Some buyers are choosing to waive the right to have the property inspected.  This leaves other buyers very nervous.  They want to compete.  They want the home.  But, is this the wise thing to do?

This is a complicated answer.  First, removing inspections has a level of risk.  The question becomes: how much risk are you willing to take?  I can never recommend to a buyer that they waive the right to these inspections. (I just don't think it is a good idea with this large of an investment.) However, there are some times that a calculated risk is not a bad thing.  If you, or someone you know is a good DIY person it could work.

Second, sellers are required by law to reveal any KNOWN defect in the property.  To assist this process sellers will complete a Seller's Property Disclosure.  In this disclosure we can find out details ab...

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"It's better to ask 50 questions and look at 5 houses, than ask 5 questions and look at 50 houses."

The quote above is from a mentor I meet with to talk about business planning and real estate.  It was one of the things that really stood out to me in our recent conversation.  Our current real estate market is not very buyer friendly at the moment.  But, you can still find the house you want with some diligent work up front.  Part of this upfront work is understanding your needs and goals as a home buyer.  What are you looking for?  Why are those things important?  What are your goals?  

I understand that this may seem like a rather tedious process.  However, the more I know about what it is you are looking for the faster we can get you to that house that you are looking for.  In a hot seller market where every moment counts for you as a buyer knowing exactly what you are looking for will help us get to that home quickly...

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In the state of Pennsylvania, an oral agreement in real estate is not legally recognized.  Therefore, in order to be represented by a real estate agent as a buyer you must have a signed buyer's agency agreement.  

So what does this Buyer Agency Contract entitled you as a buyer to.  First, it ensures that a real estate professional is representing your interest, and not only the seller's interest.  You will have someone to explain and walk you through each step of the process, assist you with the lending process and getting connected to a lender.  You will have someone to help you find the home you are looking for, as well as help with negotiating the right price and terms for you.  You will have an advocate with lenders, appraisers, and the seller's.

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