The Ideal Buying or Selling Experience

Buying or selling a house is a very stressful job. There are lots of things to do. Things that need to be considered. In the Philippines, the buying or selling process is very straightforward. If you are a buyer, you look for a house for sale, communicate with the seller, negotiate for the price, if both parties agreed, seller will give the keys to the buyer and the title, in return, buyer will give the money or check to the seller.

   

In the US, it is different. Buyer searches for a property through various portals or listing sites. Then when he gets pre-approved for a loan or once he has obtained proof of funds, buyer needs an agent to represent him. Usually, seller’s agent and buyer’s agent will communicate. There will be exchange of offers and counter offers till both parties agree. If both agree, escrow phase begins. Then escrow closes once a new deed is recorded in the buyer’s name. On the seller’s perspective, the seller signs an exclusivity agreement after contacting an agent. Title search, property inspection and CMA report will be provided by the seller. Afterwards, the agent of the seller lists the property on the MLS and other listing sites. Then the agent of the buyer will communicate with the seller’s agent. If both parties agree, they will enter the escrow phase and same procedure will happen.

It is complicated, but if you will look at it, it makes a lot of sense. Having an agent is much better as they will be the one to do all the transactions for you. Question is, how can the buying or selling process be ideal? Here are some things that you need to ponder.

For the buyer, you need to determine how much you can truly afford. Do not get a house that is beyond your means. You need to be pre-approved and decide which mortgage suits you the most. It is best if you will use fixed rate. You also need to think if you can pay your monthly mortgage in the long run. You can do it by computing for your monthly costs, tax, insurance estimates, HOA fees and maintenance cost. In that way, you will have an idea on how you can budget your money. Lastly, before looking for a house, make sure you know what you want. Looking for a house takes a long time especially if you don’t know what you want.

On the seller’s side, the ideal process begins in the first part of the process. If you decide to sell your house, make sure that the house is free from repairs. Don’t wait for the inspection day wherein the buyer will go back to you and ask you to repair the damaged or broken part of your house. Remember, prevention is better than cure. Make sure you order a home warranty. It will be frustrating on the buyer’s end if he finds out that one of the appliances is not working a couple of days after moving in. He’s not gonna be happy shelling out a large amount of money if you can prevent it by getting a home warranty. Lastly, make sure that the selling price matches the worth of your property. If it’s overpriced, the transaction might be prolonged because, most likely, buyer will make a lot of demands.

If you follow these tips, for sure the stress when buying or selling a house will be minimized.

All About Credit Scores

I used to apply to a lot of credit card companies. I was hoping that I could get at least one or two credit cards because I felt it was cool to have one. Imagine, you don’t have to bring money. All you have to do is to swipe the credit card when you want to purchase something at the mall. To my dismay, several credit card companies declined my application. Banks don’t usually tell why they denied your application. It is their right, at least in the Philippines. So, what I did was I researched the all the possible reasons as to why I failed a lot of times. One thing that caught my attention was he word Credit Score.

What is credit score? Why is it important if you apply for a car loan, housing loan or a credit card? According to Wikipedia, ‘a credit score is a numerical expression based on a level analysis of a person’s credit files, to represent the creditworthiness of the person. A credit score is primarily based on a credit report information typically sourced from credit bureaus.’

Credit score is a three-digit number generated by a mathematical algorithm using information in your credit report. The one that dominates the market is FICO credit score. FICO ranges from 300-850. The higher the number, the lower the risk.

It has three major credit bureaus: Equifax, Experian and TransUnion.

The following are the elements of your credit score: Payment history (35%), amounts owed (30%), length of credit history (15%), types of credit used (10%) and new credit (10%). Don’t you worry, personal or demographic information don’t affect the score.

If you have a good credit score, then good for you. Most likely, you will not have a hard time being approved for your car loan, housing loan, etc. If you have a bad credit score, you need to improve it. Here are the following tips you can do to move your score in the right direction:

You need to watch your credit card balances. It is how much revolving credit you have versus how much you are actually using it. The smaller the percentage is, the better. A tip to improve your credit score, as per Pamela Banks, ‘pay down your balances, and keep those balances low.’

Avoid credit card balances. If you have two or more credit card, and they have small balances, it is best to pay them off. Just use one or two go-to cards that you can use for everything.

Pay your monthly dues on time. Don’t be a delinquent payer if you want to have a good credit score. Take note when is your due date to make sure you’ll be able to pay on or before your due date. Much better if you pay your bills before your due date.

Now that you are aware about credit score, it is time to improve it because your credit score tells a lot about you, on how capable you are in paying your debts, on how responsible you are as a person.

Benefits of Buying Versus Renting

Buying or renting a house is something that needs to be think about a dozen times. You must weigh things out before you do either one of them. For some, people don’t like buying house because it is very expensive. For others, buying house is much better because at least they own the house already or because of extremely low mortgage rates at the moment. There are lots to think about when making a decision. For those who are having difficulty choosing, this will help you on what to choose.

These are the advantages of renting a house:

You don’t have to pay for maintenance. Let the landlord do that for you. You don’t have to worry if there’s a problem with plumbing. All you have to do is to coordinate with your landlord and he will be the one to contact a plumber for you. Easy right?

You don’t have to worry if you want to move out. If you are just going to stay temporarily in one location because of work or you think that you don’t have career in your current location, then you can easily move out. You don’t have to worry about selling a house.

These are the disadvantages of renting a house:

You don’t build equity. Let’s face it, when you are renting, you will not own the property. It will never be an asset, it can never be an investment. You can’t use the house for selling purposes when you want to move out.

There’s a huge possibility that your monthly dues will increase. When you live in a city, rental fee may increase. It is almost inevitable.

You can’t touch the property without the owner’s approval. You don’t have the liberty to do a renovation or to paint the house to your own liking as it is not your property. You maybe lucky if the owner approves it, but most likely, it is next to impossible. You have to consult the owner always every time you want to make changes.

Now that we know the pros and cons of renting a house, let’s talk about the advantage first of buying a house. The following are some of the advantages:

If you can’t build equity when renting, you can when you buy the house. Buying a house is an investment. When you upgrade the house or renovate it, the value of the house also rises.

Housing payments will be on fixed rate. This happens when you choose a fixed-rate mortgage. You don’t have to think about the rising monthly dues like if you renting a house.

Some of the disadvantages are:

Maintenance is your responsibility. Since you own the house, you need to shell out money for maintenance. You may need to include it on your budget.

Selling house may take time. If you are going to relocate because of better opportunities, selling your house may take a lot of time as you need to have a buyer first who will agree with your selling price. There might be a lot of negotiations. There is a possibility that you might not sell the house at your preferred price.

Now that you are aware of the pros and cons of buying and renting a house, you decide what’s best for you.

Benefits of Purchasing a Home Warranty

What is home warranty? Do we really need to purchase one? This is one of the talk about issues whether you are selling or buying a house. Do we really need to get one? What are the benefits of having one? This blog will give you a clear idea on why it is very important to get one whether you are a buyer or a seller.

First, let us define home warranty. According to hmsnational.com, home warranty is ‘covers the repair or replacement of the most frequent occurring breakdowns of home systems and appliances. Well, it is like a protection. You would want your home systems and appliances to be insured when your air conditioner , dishwasher or microwave stops working. Just remember, buying a home is a big investment, and maintaining can be expensive.

Again, keep in mind that when you are buying or selling a home, a home warranty is an excellent investment. Don’t ever think that it is just an additional cost as it will really be useful in the future, more than you ever know. What are the benefits for sellers?

Make your home a preferred home. According to Gallup Poll, eight out of ten buyers prefer to buy a home covered by a home warranty plan. When a buyer just purchased a house, then suddenly he found out that the stove is not working, it would be a headache on the buyer’s end as he would need to shell out a big amount of money. Nobody wants that to happen.

You can attract first-time buyers. That’s right! First-time buyers would love to save a lot of money from high cost of repairing or replacing systems or appliances.

You can make your home stand out from other listings. Buyers would surely notice sellers who offer home warranty. A nice house and price are factors, but having a home warranty will make the buyers more interested with sellers got one.

There is no post-sale worries. As a seller, you may be able to sell the house to a potential buyer, but as a seller, you need to think about the future. Think of what will happen to the buyer if one of appliances becomes broken. The buyer will shed out a lot of money and it will be stressful on his or her end. Think not only about the money.

What about the benefits for the buyers and current homeowners?

You can save a lot of money. Like what they say, prevention is better than cure. Yes, you will shed out money on getting a home warranty, but it is much more expensive when some of the appliances needs to be replaced. Think about it.

Complete protection. Usually, home warranty companies provide complete service. They will repair or replace covered systems and appliances no matter the age, make or model. Cool isn’t it?

If you think about it, home warranty is beneficial for both buyers and sellers. It may not be beneficial at the time of purchase, but usually, in the future, it is very important especially if the appliances are too old already. Always think of home warranty as an investment.

How to Find a High-Quality Real Estate Agent

Looking for a real estate agent is not that difficult, but looking for a high-quality real estate agent is a different story. A real estate agent should be someone whom the client is really comfortable with. There are several things to be considered for a real estate agent to be of high-quality.

To get a real estate agent, you need to ask around. Ask your friends, neighbors or relatives if they know someone who is reliable and has a good reputation for being a real estate agent. A referral from the people who you know of is a sign that the agent is really good on what he does. You can also attend open houses to get to know some of the real estate agent. Talk to them and gauge them if he or she will fit in to your criteria. Do your research. Check if they have a good reputation and if they are really capable.

When you are talking to a real estate agent, you have to ask questions. You have need to know if the real estate agent has an active license. Of course, you need to know if the agent is legit and is not a bogus one. You would want someone who really knows what he’s doing, who can provide you insight and ideas on how to sell or buy a property. If they don’t have a license, then don’t deal with them. You can also ask if real estate is his full-time career, how much of their business comes from referrals or if they live in the area or not. In that way, you are aware of his background. You can also ask if he or she is a member of MLS or Multiple Listing Service. It is better if the agent is a member because he or she has access to all the listings in the area, including pictures and descriptions.

While talking to them, you should take down notes. You can’t remember all the information that the agent would give you. It is best to note everything and compare the information that you got from other real estate agents. Pick the agent that suits your need.

You should also consider what type of agent they are. There are two types of agents, buyer’s agent and seller’s agent. If you are going to sell your property, you need a seller’s agent, if you are buying a property, you need buyer’s agent. Don’t pick an agent who represents both sides. You need someone who is loyal and honest to you. There are agents who do both, so be careful as you don’t know what their real intentions are. Your selling or buying price must be strictly confidential between you and the agent only.

Choosing the right real estate agent when buying or selling a property is a must to be successful. They represent you during negotiations. It is critical for you to get a high-quality agent so you will feel confident in every step of the way.

Listing Photos Matter

There are times when the buyer doesn’t have a time to check on the property that they are interested with. Sometimes they rely on the photos found on the MLS or Multiple Listing Service. If the picture looks really good on the eyes of the potential buyer, it could really increase the level of their interest with the property. If it looks bad, then expect that the potential buyer would look for another property. So, does listing photos matter? Absolutely yes. More than you ever know. Posting photos are very in demand nowadays. A lot are looking on the internet for their potential house because not only they are busy to go to the actual property, but it also saves time rather than going to the actual house when they are not really sure yet about the property. Why waste effort when you don’t have an actual picture what the house looks like?

How do you market your property on the MLS site? It is best to use a proper equipment for taking pictures. It is best to use a decent camera for taking pictures. The camera must have a good lighting capability, has to have high-resolution, has the capability of adjusting the exposure, ISO and focus. It is fine to take photos from your smartphone camera, only if your phone can produce quality pictures. Don’t use a camera that is VGA capable only as it produces poor quality photos. You don’t want the buyers to be turned off with the pictures. Remember, the buyer has not seen the actual house yet, so, it is best to impress your potential buyers by using a good-looking photo on MLS. Properly lit, high-resolution photos are the only type of pictures you should use in a home marketing campaign. Imagine if the pictures you have posted are not properly lit, the buyers would not be able to appreciate the house. They can’t see every detail on the picture if the lighting is really bad on the photo. It is cliché, but it is really important to put your best forward. You really have to impress them!

Once you have a decent camera to use, it is best if you or your agent spend as much time and energy on the photo shoot as they do on creating curb appeal or staging an open hose. It is best to take photos when you have the best natural light. Nothing beats that. You also have to make sure you’ll capture the best angle of the house. Make sure that the house is clean and in top shape before you start taking pictures to entice potential buyers. You need to highlight the strength of the house. For example, if the kitchen or bath is newly renovated, you have to take photos of them and capture the place property.
Most often, after buyers have checked your home, they will check the photos on their computers and will take a second look. Usually, high-quality photos that show the home well will keep them interested that may lead to an offer.

Remember, first impression lasts that’s why you need to make sure that the pictures you are going to post deserve a second glance.

How Pre-approval Works

Wondering how to get a property that you are dreaming of? Sometimes, it is hard to purchase a house especially if the house is very costly. And what if the house is too expensive for your budget? What should you do? Do you have to just let go of it and look for a house that will fit in to your budget? These questions would really come on your mind if your budget is tight. To be honest, sellers won’t really drop their price just because you don’t have the money. They might look for a potential buyer if you can’t afford their price. There is a solution though to your problem. A very helpful one. The term is what you called pre-approval.

What is pre-approval? In layman’s term pre-approval is an “evaluation of a potential borrower by a lender that determines whether the borrower qualifies for a loan from the lender, or the maximum amount that the lender would be willing to lend”, according to Investopedia. The pre-approval process involves a thorough look into the income and expenses of the borrower, including a look at the borrower’s credit report and score.

How do you get pre-approved? Though not a requirement, I suggest you do a pre-qualification. This is for you to have an idea how much bank will loan you. In that way, you can shop within your price range. This is the quick and easy way to find out. Usually, banks and credit unions will do this over the phone. The process would usually take a few minutes.

After you have your pre-qualification, you can get your pre-approval from your lender. This usually requires an appointment. In this step, the lending institution gathers all the information it requires to offer you a loan, and your credit report will be checked. You need to bring a copy of your most recent bank statements, your most recent W-2(or entire tax return if you are self-employed), proof of IRAs, any stocks or mutual funds, driver’s license, most recent pay slip from your job and an application fee depending on the lender. When the is done with their investigation, and they are happy with what they see, then they will provide you their terms, which includes the interest rate, loan type and closing costs. A document will be given which is called GFE or Good Faith Estimate. It is better to compare terms among lenders once you have GFE. Don’t accept the first offer you get. Choose the a lender which has the best offer. You may also negotiate for a good interest rate, reduced closing costs, or lender-paid private mortgage insurance. Make the lenders compete with each other.

One thing to remember is that pre-approval does not mean the bank guarantees your loan. It only means you are approved to get a loan. Commitment to the loan usually comes after the bank has had the house in question appraised to make sure the price you are paying is not higher that the home’s market value. But in general, you are pre-approved, most likely it will be approved.

So, don’t lose hope! If you can’t pay the property in full amount, it is best to get a pre-approval from your lender instead.

Home Improvement Ideas

They say that a home is a reflection of you, it reflects your personality. It is an outward manifestation of your inner experience. Your surroundings tell a lot about you. How you choose to live, how you decorate (or not), pictures and objects you display, it tells you who you are. They say your home tells your story, that’s why it is important to make sure that you are constantly improving your house for the better. Because a person who steps into your house will judge you based on what he sees at your house.

How do you improve your house? There are lots of ways to improve your house. A house that you can call your own. Some say that home improvement is pretty expensive. Yes, it can be. But there are alternative ways on how you can improve the house without spending too much. How? Do your research. Buy some books about it or get online. There are many things that you will be surprised of when you search online. You can take one of Home Depot’s free classes. You’ll be amazed to discover that you can stain, cut and install your own baseboards, tile your own floors or backsplashes, or even build large constructiony things. For you to be successful, you should have enough patience and an eye for detail.

A magazine is also a good source for home improvement. Magazines like ‘ReadyMade’ and ‘On a Budget’ are very helpful as well.

Speaking of ‘On A Budget’, if you have few bucks, you can also improve your home. Projects such as decorating, storage, lighting and more – cost little with great results. They upgrade bathrooms, kitchens, living rooms, closets, the entryway, the laundry and other areas of your home.

Bathroom mini makeover is about $430. If you’ve wanted the elegance of natural stone in your home, then this is for you. Consider a new granite bathroom vanity top. You can get granite tops at Lowe’s, Home Depot and other home centers. Prices ranges from $150 to $450 depending on the size.

Another improvement at home is by using wallpaper one wall, usually at $280. You can go to the nearest wall-covering retailer. You don’t have to cover every wall to make a dramatic change. Papering a single wall will do. It will also save you time and energy. You create instant character by doing so. Just make sure you fill holes and smooth your wall before beginning for your wall to look nice after.

Halogen track lighting is practical as well as decorative. You can put the light where you need it like walls or objects. It is usually $150 and up for a basic kit. It can take one to two hours for you to set it up if you have an electrical box on the ceiling.

Lastly, you can trim and paint. You can add two lines of trim and you can create the perfect framework for any handsome two-color wall combination.This is one of the secrets of fast, easy redecorating.

So, when will you start improving your home?

Moving Tips

Moving to a different location is a lot of adjustment. There are too many things to consider such as the place, the environment and proximity to other places such as workplace, church, market, mall and school. So, it is no joke because there is a risk in moving to another place. Another thing that we need to consider is the process of moving out. But do not worry about it, because there are lots of things that you need to know when moving to another location.

The first question is, when is the best time to move? You must take everything into consideration when deciding on the best time for you to move. But remember, summer and the beginning and end of each month are busy for moving companies. In short, avoid these months as much as possible.

If you don’t know a moving company that can help you, better ask your friends, neighbors, relatives or co-workers. If you can, check the company’s background. Investigate if they provide a good service by searching them online and get feedback, so that in the future, you can do business again with them if you decide to move again to another location.

Also, you better ask yourself as to when you should contact moving companies for estimates. If I were you, provide the moving company notice as much as possible. It is best for you to at least communicate four to six weeks before your desired moving date.

When the relocation consultant arrives at your home, they he or she will perform a visual survey of your items. They should be able to see all the items that are being moved so that the consultant can provide you with an accurate estimate. Make sure to advise beforehand the consultant about the items that are not included so that you won’t be overcharged as the consultant will calculate the weight, packing cost and any charges related to your move.

Before you move out, make sure you have sold all the items that you don’t need anymore. Having a garage sale is one of the fastest way to remove unnecessary items. In that way, you will lessen the risk that the consultant might bring unwanted items which means additional charge.

You also need to be organized. Don’t do it a day before you move out. Packed the things that you need to pack. Avoid cramming.

Make sure that the house is clean before you move out. Wash the dishes, do your laundry, disconnect your computers, stereos and pack your suitcases.

Those things that you don’t want to be packed, mark them as DO NOT PACK. In that way, the consultant will not touch it. You can also remind them beforehand of the things that you will carry yourself.

Lastly, if you will move out, communicate with the driver a day before. Provide your phone number, you may also ask the number of the driver. What if the driver got lost or did not arrive on time? That’s why it is better to exchange numbers because to know the whereabouts of the driver.

These tips can surely help you be aware on what to do and whatnot.

Home Selling Process

Before, I thought that the process for home selling is very easy. Here in the Philippines, all you have to do is to sell it yourself. Before you sell it, of course you need to prepare your house by cleaning it, repairing some parts of the house that needs to be fixed, painting the house, making sure that the house looks new. Then look for a potential buyer. Once you have a potential buyer, negotiate him or her, if the price is right, then you can sell your property in exchange of cash. All along, I thought it was simple. Never have I imagined that it is very complicated as you need to coordinate to a lot of people, even if you are going to sell it yourself.

In the US, it is very different. You need to have a lot of patience because you have to talk to a lot of people. The process is very long. It takes a month or two before you can sell the house. A similarity though is, of course, you have to prepare the house. Not only it requires cleaning and repairing some parts of the house, but you need to highlight the features of the house to make it more appealing to potential buyers. Once everything is done, you can either represent yourself when selling the house, or much better, hire a real estate agent to do the job for you. Don’t worry about the commission because selling the house is quite difficult. You need to consume a lot of time and energy. Also, you may have a hard time talking to the buyer if he or she has an agent. Imagine talking to the buyer’s agent and you are having a hard time understanding him or her because you are not on the same page. You’ll be confused that’s for sure. That’s why it is better to hire an agent so that he or she will represent you. The agent then does a title search and inspect the property to make sure the house can be sold without any issues. Once you hire an agent, call it SA or seller’s agent, SA will list your property in various portals or MLS. SA can also arrange an open house to attract more potential buyers. If there’s a potential buyer already, the SA will talk to the buyer, or usually, buyer’s agent or BA. The SA and BA will exchange offers and counter offers. If both parties agreed, a Real Estate Purchase and Sale Agreement needs to be signed, then escrow phase begins. For those who do not know, escrow is the holding of documents and money by a neutral third-party prior to closing. During this process a lot of paper and supporting documents are required. Once completed, escrow phase closes. A new deed is recorded in the buyer’s name.

So, you see, home selling process is not that easy. But if you follow the steps that I have mentioned, you will not have a hard time selling the house. This is tested and proven.