You have an accepted offer on your dream home. Now what? Besides the inspections and financing responsibilities to do before closing, there’s a houseful of stuff to move. Here is a handy checklist from ABR Home Buying Resources designed to help you organize from 8 weeks out all the way to moving out and moving in.
I have several buyers who are patiently watching the MLS listings for an especially good deal. I’ve also been passing along listings that seem like a good fit. Sometimes buyers have been ready to move quickly, and that’s paid off.
Other buyers were busy with work and family commitments, and they needed to wait a couple weeks before we could schedule a showing. Sometimes that still works out. But other times I’ve requested a showing and learned that another buyer has just made an offer that’s already been accepted. Notice a pattern here???
I’m a Realtor, and of course you’d expect me to say that right now is a great time to buy or sell. But the thing is, right now that’s especially true. Consumer confidence is up, we’ve been seeing some promising economic indicators, interest rates are still low, and our Northwestern Wisconsin real estate market is moving faster than the snow was melting this spring. (April 25 update: snow is gone, lakes are mostly open.) That’s good news for buyers and sellers alike.
If you’re a seller, you’ll still be facing some competition. There’s a lot of inventory out there, and it’s important to have realistic expectations about what your home, cabin, or land is actually worth in today’s market. But prices are more stable; homes priced correctly for the local market are selling quickly. Homes priced on the high side are languishing.
And if you’re a buyer, here are some tips to keep in mind during this transitional market. Even if our market here in NW WI isn’t white hot, it’s at least warming up enough so you’ll need to let go of certain assumptions that are no longer valid. If you find something you like and it’s a good value, don’t assume no one else has noticed it and come to a similar conclusion. Instead, please call me so we can schedule a showing now.
If we go take a look and you like what you see, don’t assume you’ll be able to think things over for even a couple weeks before you take a second look. Someone else with similar tastes may have also seen this home or cabin for the bargain it is. By the time you’ve taken two more months to think it over, their moving van could already be backing up to the front door.
Finally, here’s one last bit of advice. Pursue perfection, but prioritize your wants and needs. Now, not all of my buyers have the same dreams. Some, for example, want a sandy beach, while others want a small quiet lake that’s better for fishing and watching wildlife. But when you do find the location that’s just right for you, you can always remodel the bathroom or replace that pink carpeting in the guest bedroom. Know what matters most, and know what you want so you’ll be ready when you see it.
Thinking of buying or selling real estate in NW Wisconsin? Call Jean Hedren, Edina Realty NW Wisconsin, 218-590-6634. Email: email@example.com.
Ready to make an offer on that dream lake home or cabin?
A preapproval letter from your mortgage lender can be an important tool to strengthen your negotiating power. Sellers and listing agents tend to take offers more seriously when the buyer has been preapproved.
When you have found your dream home, and you are ready to make an offer, submitting a preapproval letter with the offer says you are a serious and committed buyer.
A preapproval letter is based on a preliminary review of your credit information and preapproves you up to a maximum loan amount. Because a preapproval includes a credit check, it’s more powerful than a prequalification letter, which only estimates your potential buying power.
With a preapproval letter, you can confidently shop for a home in your price range, and you are in a position to negotiate an offer – especially when there are multiple offers for the home you want.
Need a great lender? Contact Sandy Vesel, Edina Realty Mortgage.
As you prepare to make one of the biggest purchases of your life, a preapproval can ensure that you are in a loan program that meets your needs. Call Jean Hedren, Your Edina Realty NW Wisconsin Realtor at 218-590-6634. Start your property search: www.JeanHedren.com
What type of mortgage loan works best for you?
Your mortgage loan consultant will be able to discuss the best mortgage loan program for you. Basically all mortgage loans belong to two main groups: conventional and government.
Two types of conventional loans:
- Fixed rate: Traditional type of financing. The interest stays the same for the full term of the loan, typically 15 or 30 years with predictable and stable payments.
- Adjustable rate: An adjustable rate mortgage (ARM) interest is linked to a financial index, such as a treasury security, so the monthly payment can vary over the life of the loan, usually 25 to 30 years. There are lower initial payments. Some ARMs can be converted to fixed rates generally after the first 5 years.
- FHA loans, which are insured by the Federal Housing Administration, are typically designed to meet the needs of first-time homebuyers with low or moderate incomes. FHA loans can be approved with a down payment as little as 3.5 percent and a credit score as low as 580.
Often called “helper loans,” they give a boost to potential borrowers who may not be able to secure one otherwise. For this reason, FHA loans have maximum lending limits. Talk with your lender to see what the FHA loan limits are in the counties where you are searching.
And remember, because the agency is taking on more risk by insuring FHA loans, the borrower is expected to pay mortgage insurance both at the time of closing and on a monthly basis, and the property must be owner-occupied.
- VA loans, backed by the Department of Veterans Affairs, are guaranteed to qualified veterans and active-duty personnel and their spouses. VA loans can be approved with 100 percent financing, meaning VA borrowers are not required to make a down payment.Unlike FHA loans, borrowers do not have to pay mortgage insurance on VA loans.
- USDA loans, backed by the United States Department of Agriculture mortgage program, are intended to support homeowners who purchase homes in rural and some suburban areas. USDA loans do not require a down payment and may offer lower interest rates; borrowers may have to pay a small mortgage insurance premium in order to offset the lender’s risk.
- WHEDA: Low down payments and below-market interest rates. Interest rate is fixed for 15 to 30 year loan term.
Ready to enter the buyer’s market?
Need help financing a new property? Understanding the loan types is step one, but you’ll need the help of a qualified expert to get you into your dream home.
Reach out today to get help connecting with a trusted, local mortgage specialist.
Start your property search at www.JeanHedren.com
Buying a home is without doubt the biggest financial commitment you’ll make. It isn’t just about dollars and cents, you are making an investment in your future.
Here are the important steps in the process. I’ll be here to help you every step of the way.
- Choose a Realtor® to assist you in the home buying process. The term Realtor® identifies a real estate professional who is a member of the National Association of Realtors® and subscribes to its strict Code of Ethics.
- Get Pre-Approved. It’s the key to increasing your negotiating power. Meet with a mortgage consultant and get pre-approved for a loan. Don’t confuse this with a pre-qualification which is simply an estimate of your potential buying power. A pre-approval is a preliminary review of your credit information and pre-approves you up to a maximum loan amount.
- Refine your focus. Discuss your housing needs, wish list, preferred location, and budget. Searching and previewing your properties online will help to narrow down your choices. I can create an online search for you at www.JeanHedren.com based on your specifications to help you narrow your choices.
- View properties. Once you find homes that meet your criteria, request a tour of several in person so you can be comfortable with what’s on the market. I can show any home, even those listed by another firm. Be realistic with your expectations. There’s no such thing as a perfect home. Make a list of priorities as a guide to evaluate each property.
- Make an offer. When you know you’ve found the right property, you may need to act quickly depending on the market conditions. Ask about current market conditions and get advice about preparing your offer. Several points for negotiation should be included in your offer, including price, financing, terms, date of possession, inclusion or exclusion of repairs and furnishings or equipment. The offer to purchase should also include a period of time to have appropriate inspections completed.
- Negotiate terms. Counter offers are common in real estate. Be prepared to be a little flexible on price, closing date, repairs, or other items.
- Get an inspection. This is your best chance to have the property’s systems and structure evaluated. In NW Wisconsin, it’s common to have three types of inspections: house, well, and septic system.
- The walk-through. Usually a day before closing, do a final walk-through of the house to make sure everything you thought was included in the purchase agreement has remained on the property.
- The closing. At the closing you will sign the mortgage loan documents and pay your closing costs. The seller will execute the deed to the property, and the closing agent will record the necessary instruments to give you legal ownership of the property. The keys will be handed to you and the house is yours!
- Move in.
Start your home search at www.JeanHedren.com. Call Jean at 218-590-6634 when you are ready to view properties.
Choosing a mortgage lender
More than half of home buyers don’t shop to find the best interest rate or loan program for their home purchase.
Generally a buyer would rarely purchase the first home they look at, they often accept the rate and terms offered by only one lender. Not all lenders are the same. They don’t offer the same terms and rates to the same buyer.
I advise my buyers that shopping around to compare rate and terms for a mortgage is a reasonable exercise considering that a half percent less interest rate could not only lower the payment but the cumulative interest that is paid throughout the life of the loan.
Mortgages consist of more than interest rates. They include the rate plus origination fees and discount points, which are prepaid interest assessed by the lender at settlement. Other considerations might include adjustable vs fixed-rate loans, low down payment vs high down payment, and whether there are prepayment penalties.
Most important, you will want to work with a lender you can trust, someone that will work effectively, and a lender that offers a range of mortgage loan options.
- Make a list of lenders. Your Realtor will know several area lenders and can provide you with a list of contacts.
- Talk to a loan officer. Call or visit the lenders on your list to learn how they might work with you. Ask questions:
- What types of loan products are offered?
- What are the rates, points, rate-lock period?
- What are the closing costs?
- How long is the mortgage application process?
- When will I know if I’ve been approved?
- What documents do I need to provide?
- What costs am I expected to pay?
- Is there an application deposit?
- Compare rates with other lenders. When comparing rates with other lenders, be sure the rates are for comparable loans.
A Home Inspection: The Best Investment You’ll Ever Make
I advise all my buyers to hire a home inspector. I tell them it’s the best investment they’ll ever make. If the inspection uncovers issues so serious that they decide to walk, it can feel like money wasted. But if it helps them avoid big surprises they would have encountered later, then it’s definitely money well-spent. That’s why I very rarely write up offers that don’t include an inspection contingency.
I even advise buyers to hire an inspector when they’re considering a foreclosure or other distressed property that’s being sold “as-is.” More information can help them, in the words of that old song, “know when to walk away… and know when to run.” Or, they can move forward with confidence, armed with solid information about just what they’re getting into. And even when a home is being sold as-is, that doesn’t necessarily mean there can’t be a little negotiating if an inspection uncovers major issues.
It’s also important to remember that a condition report is very different from an inspection report. Yes, sellers sign on the dotted line to signify that they’re telling the truth. But even though they’re completing the condition report to the best of their knowledge, they may not know about all of their home’s issues. So no matter how much you trust the seller’s condition report, it doesn’t take the place of an inspection.
If an inspection uncovers major issues, you have two choices: you can walk, or you can ask the seller to “cure.” The seller can resolve the situation by either fixing it or giving you a credit at closing. I almost never advise my buyers to walk away without trying to negotiate a solution. The only exception would be in the case of serious mold or structural issues. Almost anything else can be fixed. If this is a home and a location that you like, work with the seller to reach a fair outcome.
Most homes outside the city limits have their own well and septic, and those need to be inspected, too. Some inspectors are specialists, while others can take care of all three inspections in the same visit. Ask your Realtor for recommendations.
Don’t procrastinate on this step; start working to schedule an inspection the moment you have an accepted offer. The best inspectors can be very busy; here in northern Wisconsin, that’s especially true during the summer months. So you’ll have plenty of time for any negotiations that might need to take place between the inspection and the contingency deadline, make sure you schedule your inspection for the earliest date possible.
Start your property search: www.JeanHedren.com
Call Jean Hedren, Edina Realty NW Wisconsin Realtor, 218-590-6634