Cincinnati Home Buying Tips

The Real Estate Market Is Hopping!

2008-05-02T15:57:00.005-04:00

I have been very busy with buyers and sellers in this real estate market.

I wrote an offer yesterday for a client that we got accepted.

I'm working with several clients right now and haven't had much time to spend on the computer.

What am I saying here?

It's a great time to buy a home.

Interest rates are still very good.

Housing inventory is still elevated, so you have a great selection to choose from.

This weekend in the Cincinnati area, there are going to be over 2,700 open houses.

Yes, you read it right.

So why not go out and see what you can buy for your money.

But you must do one important thing first.

If you'd like me to help you when you're ready, call me before heading out. I have something important that you need to hear first that can save you time and money.

If you've been thinking about buying a home or condo, NOW is one of THE best buyer's markets we've seen in a long time. Take advantage of it.

Contact me to help you through the process, because there are people out there, who will not look out for your best interests like I will.

Have a great weekend!

Negotiations: Where Will They End Up?

2008-04-24T21:49:00.005-04:00

When you make an offer on a property, you never know how it's going to turn out.

It's important to find out as much information about the property and the seller's situation and motivation prior to making an offer, so that you can focus on their HOT buttons and hopefully get a better price and terms.

It's not always only about price, even though that's usually the case. Sometimes the timing of a closing is more important to a seller than getting top dollar.

In today's market, where the housing inventory levels are much higher than years past, sellers are often more willing to look at offers and bring them to a successful close. But some sellers still think we're in the early 2000's when it was a seller's market.

Now, don't think that every seller will just unload their property at any price.

There are listings that have been properly priced and showcased in top-showing condition, like a new home model. Those listings will sell for more than most and they are sometimes even getting multiple offers on them.

There are also HUD, VA, Fannie Mae and bank foreclosure properties, where you'll find that you're in competition with 2,3, 4, or more other bidders, because of where the properties are priced low compared to their true value.

It's also still common for some properties in various communities to be sold quickly and for top dollar, because there is a supply shortage of properties in a certain price point and area at a specific point in time.

As we are in the spring market right now, don't forget that there are numerous other home buyers out there looking at the same properties as you and they are deciding which properties like just like you are doing. You're not in a vaccuum.

If you get in a multiple offer situation, understand that you may only get one shot at making your proposal to the seller, so figure out what's the most you would spend for the property and if your bid didn't get accepted, you knew you gave it your best shot.

There are sometimes where you and the seller are far apart in price. Tell them the reasons why you're bidding the way you are. Show them the recent, comparable sale prices of other properties that are in the area.

Tell them a little bit about yourself and which features of the property you like most. Try to connect with the seller on an emotional level. It doesn't always work, but it's worth a shot.

People always ask me "How many times do sellers and buyers go back and forth with their offers?" I tell them that it can once, it can be 2 or 3 times, or more. The best piece of advice is to keep the lines of communication open. Not usually, but sometimes it can take a week. You should try strategies to get the seller to see why it's to their benefit to accept your offer.

In the end, most of the time you and the seller will come to an agreement and you'll have a new home.

Multiple Offers Even In A Buyer's Market!

2008-04-19T00:25:00.003-04:00

Even in a buyer's market, you will sometimes find yourself up against other buyers making a bid on a home the same time as you. I've had it happen a few times recently to my clients.

You need to understand that in a buyer's market the best listings will still stand out and be sold. Properties all over town are still selling...now not at the premium prices that they were a few years ago, but they are still be sold. Not every home will sell right now, but many will.

Don't into the trap of thinking you're the only buyer looking at various properties in a given point of time. There are still many buyers out in the market...especially now that it's spring time.

It's still best to have your pre-approval letter in hand when you make an offer. All lender-owned and foreclosure properties normally require a pre-approval letter and earnest money deposit when submitting an offer.

If you write an offer and find out that you're in multiple offers, understand that your offer may be compared to the other bid and the seller will ask you if you want to increase your bid or change any other terms of your bid. One strategy to consider is at what price would you be comfortable paying for the property, but if you lost out, you knew you gave it your best shot. Many times in a multiple offer situation, you may only have one shot at getting the property, so part of the equation is determining how much you like it.

So as you view properties, understand that you're not the only buyer looking and when you find a home that you're attracted to and want to make a bid on, don't wait too long.

Short-Sale Listings Abound!

2008-04-10T17:08:00.008-04:00

As I continue showing homes and condos in our current real estate market, I'm finding up 50% of the properties are listed as foreclosures or short-sales.

What does this mean to you, the buyer?

Timing, for one thing, can be widely varied.

In many foreclosures, where the lender has already purchased the home, the normal time frame from accepted offer to closing is usually 30 - 45 days. With foreclosures, you're also buying them in 'as-is' condition, even though you can have inspections to see if you still want the property. Fannie Mae also requires the buyer to pay around $125 for changing the locks through their approved contractor. Even though we're out of winter time, many properties are still winterized and lender are requiring the buyer to pay for that expense too - around $250 - $300.

In short-sale listings, nobody knows in the beginning when an actual closing can take place. I wrote an offer this weekend, where the listing agent told me that the lender may take up to 45 days before approving the short sale amount. That's not uncommon right now. It can even be longer than that too.

A 'short-sale' is where the homeowner is in a financial distress situation and in order to sell the property, must sell it for less than the outstanding mortgage that's on the property. The homeowner must show that they don't have the ability to continue paying the mortgage or that they don't have the assets necessary to cover the difference between a sale price and mortgage amount.

So, if you don't have a lot of time to make a move, most short-sale properties are not going to work for you. The other thing is you're in limbo from looking at other homes, because you have a signed agreement with the seller that is subject to the lender approving the short-sale amount.

Now is a great time for home buyers to invest in real estate, because interest rates are good and housing inventory is high.

But do be aware that there are sometimes price points of properties, where the inventory is low and it may be tougher to negotiate if you get in a multiple offer situation. I've had that happen twice in the past couple of weeks. With many homes in foreclosure or short-sale situations, they are usually not in very good condition and will take some TLC & cash on your part to fix up.

If you have any questions on these types of properties, give me a call or drop me an email.

At your service,

Dan

What questions do you have? I'll gladly answer them at: dan@danweis.com.

Tell a friend about my next Free Home & Condo Buyer Class - April 23rd!

Are you ready to find your dream home? Contact me for a Free Consultation: (513) 615-1890 or dan@danweis.com

Put Your Spending Habits Into a Deep Freeze!

2008-04-03T17:39:00.005-04:00

Once you apply for a mortgage, put your spending habits into a deep freeze for the next 30 - 45 days, just until you close on your new home.

An important factor you need to know about during your mortgage approval process is your active credit situation. DON'T make any major purchases...credit or cash or lease a car or apply for a new credit card. Don't buy an item to put it layaway. You need to freeze your spending habits except for normal purchases, like food and gas, etc.

It used to be that mortgage lenders would only check your credit history once when you appled for a mortgage. Now they will check it 2 or 3 times and the last time could be the day of or day before your real estate closing. So don't do anything without checking with your mortgage consultant. You don't want your credit score to go down or have your cash reserves and other assets change until after your closing.

At your service,

Dan

What questions do you have? I'll gladly answer them at: dan@danweis.com.

Tell a friend about my next Free Home & Condo Buyer Class - April 23rd!

Are you ready to find your dream home? Contact me for a Free Consultation: (513) 615-1890 or dan@danweis.com

Even if all your ducks are in a row...

2008-03-27T16:01:00.006-04:00

When you apply for your mortgage pre-approval, understand that it's just the beginning of the paperwork and the watching of your ongoing credit.

Once you find a home and write an accepted offer, that's when the mortgage approval process really gets in full swing. During the normal 3 - 4 weeks of having your credit, assets, debts and property appraisal reviewed, there will be times where your mortgage consultant will ask you for additional documentation.

You may be thinking to yourself or saying out loud, "Why didn't they ask for this earlier?" or "Why do they need this document?"

You need to understand that since the mortgage industry has turned 180 degrees on its head, many changes have been implemented and they continue to happen on a daily basis.

What an underwriter didn't need yesterday, they now need today. (An underwriter is the person who reviews your entire loan file and approves or denies it....not your loan officer.)

There are other outside forces like the government, Fannie Mae, Freddie Mac, private mortgage insurance
companies and others, who are causing all of these changes. What paperwork your mortgage consultant may not have needed at the beginning of your mortgage pre-approval, they now are asking for...all because of the changing of the guidelines. They are double-checking and triple-checking credit and everyone is C.Y.A. themselves.

It's outside the control of your mortgage consultant, so please don't give them a hard time. This is just the
way the market is right now and for the foreseeable future.

You could have an 800+ credit score, make a great income and have lots of money in the bank....and you'd still be going through all of the same hoops today, just like everyone else.

At your service,

Dan

What questions do you have? I'll gladly answer them at: dan@danweis.com.

Tell a friend about my next Free Home & Condo Buyer Class - April 2nd!

Are you ready to find your dream home? Contact me for a Free Consultation: (513) 615-1890 or dan@danweis.com

Home Warranties Can Add Peace of Mind!

2008-03-20T17:34:00.004-04:00

When purchasing a property, is it worth getting a 1-year home warranty plan?

I say "Definitely, YES"!

Prior to a few years ago, home warranties were available for purchase, but weren't always selected, because sellers wouldn't always offer them. Now, in the Cincinnati Area Board of Realtors purchase agreements, home warranties are included in the paperwork and negotiated into an offer with the buyer having the option to ask a seller to purchase one on their behalf or the buyer can purchase a policy themselves.

What's often covered in a home warranty plan?

heating system
air conditioning system
plumbing system
water heater
electrical system
kitchen appliances

It's important to read the policy to make sure you know exactly what's covered and what's not covered? Most plans don't cover roofing systems and basement foundations.

When I write up an offer for my clients, we ask the seller to purchase a policy for the buyer to have coverage for one year after the closing. Most of the time the seller will oblige. There are also times when a seller has already activated a home warranty policy on their property when it's first listed and they get seller coverage too.

There are several, national home warranty companies in the market. The cost for a 1-year warranty can range from $375 - $435. There is also a service call fee ranging from $55 - $100 for each time a company-approved contractor handles a claim.

It's important to review the home warranty plan's fine print, because you aren't getting a blank check for anything that breaks to be replaced. There are limitations on all policies - you're looking at repairs and replacements of covered items that break down due to normal wear and tear. The best thing you as a consumer can do is keep the mechanical systems in your property maintained and serviced, so that if a covered part does break down, it should be repaired or replaced.

I believe that for the most part, home warranty plans are effective and worth the investment. They can help protect you from unexpected repair expenses that can be very costly.

It's even becoming more common for homeowners to extend the policy beyond the first year, at the company's option. Some lenders even have partnerships with home warranty companies to offer them to homeowners for an ongoing monthly premium.

So when you make an offer on a property, make sure that a home warranty plan is written into your offer.

At your service,

Dan

What questions do you have? I'll gladly answer them at: dan@danweis.com.

Tell a friend about my next Free Home & Condo Buyer Class - April 2nd!

Are you ready to find your dream home? Contact me for a Free Consultation: (513) 615-1890 or dan@danweis.com

Be Aware Of Constantly Changing Mortgage Rules!

2008-03-13T13:39:00.008-04:00

Once you find a home that you want to call your own, the next important step is to make sure that your mortgage process is moving forward smoothly.

It's just as important for you as well as your mortgage consultant to stay on top of things during the mortgage underwriting process.

In this day of constant changes in the mortgage industry, no home loan is immune from possible delays. FHA, VA, Fannie Mae and Freddie Mac are going through continuous changes in their guidelines and rules that you end up having to abide by.

What does this mean to you?

When you have your initial mortgage consultation, make sure that whatever you haven't brought to the meeting, you get to your lender as soon as possible. There will be times when your mortgage consultant will have to ask you for additional documentation on something...that's just how the industry is right now. Please don't get upset, just know that someone somewhere is trying appease a new regulation that has probably just changed for everyone.

While a couple of years ago, when just about anyone could get a mortgage, now the mortgage industry is going through a 180 degree change. They're having to be extremely rigid in the rules they have to follow. Hopefully, over the time, the restrictions will loosen up a little bit and make the mortgage lending process less stressful and go more smoothly.

In the meantime, just keep asking your mortgage consultant if there's any additional documents they need at this time. I would ask them once a week, so that you don't have to go through any last-minute hoops to get your mortgage approved.

If you know of any impactful changes to your job, credit history or finances, make sure your lender knows right away. While you're going through the mortgage process, don't make any major purchases that require you to use a credit card or pay using lots of cash. Wait until after the closing. You don't want your credit score or money reserves to go down.

It's best to be pro-active in this market and have an open dialogue with your mortgage consultant.

At your service,

Dan

What questions do you have? I'll gladly answer them at: dan@danweis.com.

Tell a friend about my next Free Home & Condo Buyer Class - March 19th!

Are you ready to find your dream home? Contact me for a Free Consultation: (513) 615-1890 or dan@danweis.com

Home Inspection Insight!

2008-03-06T19:51:00.004-05:00

I represent a lot of buyers and I believe it's important that the home inspector work in the best interests of his customer - the buyer - and point out all of the shortcomings of the home as well as the positives.

It is important for the inspector share information on the maintenance items found as well as the material defects. There is a difference between the two. A material defect affects habitability of living in the home, like a leaking roof or faulty wiring, etc, while home maintenance items are common issues that happen all of the time and have to be taken care of periodically.

Obviously, sometimes there are gray areas and that'll be up to the buyers and sellers to decide what's to be done, but in most cases, it should be clear-cut as to if it's a maintenance item or material defect.

The inspector should give full disclosure as to the best of their ability at the time of the inspection (with the buyer present), so that the buyer can determine what, if any, issues should be addressed and corrected by the sellers.

The one thing I do think inspectors get a bad rap on is when they get a call from a buyer 3 or 6 months after the buyers move into the home and the buyer tells them that the basement is leaking or some plumbing broke, etc. It's impossible for an inspector to look into the future and know what and when something is going to break. They are only at the property for 2 - 3 hours of its lifetime. They can look for possible signs of potential problems, but don't expect them to have x-ray vision or know exactly when something is going to break or cause a problem. Things do go wrong in homes and sometimes it's days after moving in or can be months or years later. Just understand that when owning a home, items do break or need to be repaired or replaced from time to time.

The role of the home inspector should not be to 'scare' a buyer. If an inspector finds many defective items, that's good. That's the purpose of the buyer paying several hundred dollars - to see if the home is in good condition or if the seller was hiding or didn't know about various defects. The property is what it is and if it's not meant to be the home for the buyer, then it's time to move on to another home.

An agent should also not downplay a bunch of defective items just to have the buyer go ahead and close on the purchase. If the items are serious enough and the seller won't correct them (it's the seller's home and their issues), then the buyer should be able to void the agreement and move on. (The buyer should be aware that they need to understand how a purchase agreement is written to see what their options are for getting out of the agreement. They may need to seek legal advice.)

I hope this sheds a little more light on home inspections.

What To Know About FSBOs!

2008-02-28T13:34:00.006-05:00

What is a FSBO?

It's an acronym for: For Sale By Owner and it's pronounced (fizz-bo)

As a new home buyer, it's important to understand the possible reasons that a seller is selling their property on their own as a FSBO. Here's a few:

They may have little or no equity in the home and need to save money.
They may have had a bad experience with a Realtor in the past.
They may have sold property as a FSBO before and are doing it again.
They may have plenty of time to sell or aren't motivated to sell.
They try on their own at first, since their new home will take 6 months to build.
They have a relative in the business, who's helping them behind the scenes for free.

Now as a buyer, it's important to have your buyer's agent approach the FSBO for information about their home. Your agent will also be able to find out if the FSBO is willing to compensate your buyer's agent (most FSBOs are willing to pay a buyer's agent's fee).

As a Realtor, I understand a seller's position of wanting to sell their property on their own. They have every right to do that. But you need to know that by attempting to deal directly with a FSBO without a buyer's agent, you don't have any representation assisting you in the transaction and helping you negotiate through the entire process.

I believe that having an experienced buyer's agent can save time, money or aggravation. There are so many pieces to the real estate puzzle in today's market that need to be solved before it can hopefully come together. There's also a lot of emotion involved on both sides of the transaction. Most buyers don't want to negotiate directly with a seller, because they don't want to be put in a potential, confrontational situation. The seller may also not have the appropriate state-mandated disclosure forms that are part of a transaction.

When you decide to hire a buyer's agent, it's important to find out how they handle FSBOs. Some agents won't work with FSBOs and so you're missing part of the market. They won't even tell you about them. In some cases, FSBOs can be as much as much as 10% to 15% of an area's inventory, but they aren't always easily identifiable, because they may only have a hand-made sign in the front yard and aren't doing any other advertising.

In closing, I look at FSBOs just like any other seller in the marketplace. They are just representing themselves. If they have a property that you want, then I'll do everything I can to help you get it.

At your service,

Dan

What questions do you have? I'll gladly answer them at: dan@danweis.com.

Tell a friend about my next Free Home & Condo Buyer Class - March 5th!

Are you ready to find your dream home? Contact me for a Free Consultation: (513) 615-1890 or dan@danweis.com

Viewing Homes In Adverse Conditions!

2008-02-21T17:30:00.004-05:00

There's nothing like looking at homes on a nice, sunny day in the summer. But with homes and condos selling year-around, you don't always get the best weather conditions.

Like today, there's already snow on the ground and we're getting more snow right now. Does that mean you shouldn't view homes on a day like this? Well, you need to consider a couple of factors:

Is it safe to drive in the current weather conditions?
Will the property have its driveway and sidewalk shoveled? (Often times, not!)
What things would you miss on a snow-covered roof?
You won't get a good look at the exterior of the property and grounds.

If the weather conditions are harsh (below freezing and howling winds), it's easy to get distracted and not really focus on the exterior surroundings of the home.

The best time to view properties is during the day, especially in the fall and winter, because once you get to dusk, it's harder to view the property on the exterior and the interior has a different look and feel to it after dark than during the day.

So if you want to view a home, slip away during the lunch hour or leave work a little early at the end of the day. You'll have a better chance of getting a true picture of the property you're viewing.

If it's a brand new listing on the market, you'll also get a jump on all of the other buyers, who may be waiting until the end of the day or the weekend before they go look at it. That way, if you like it, you'll have a chance to make a bid on it before most other buyers.

At your service,

Dan

What questions do you have? I'll gladly answer them at: dan@danweis.com.

Tell a friend about my next Free Home & Condo Buyer Class!

Are you ready to find your dream home? Contact me for a Free Consultation: (513) 615-1890 or dan@danweis.com

Your Lender's Expertise Is Critical!

2008-02-14T15:26:00.005-05:00

As the real estate and mortgage markets continue to recover, we are seeing more and more restrictions on lending to try and right the ship. One monster that started to surface way back in July of 2007 was the "Declining Markets" guidance sent out by FannieMae (Federal National Mortgage Association).

In short, FNMA began to notice in their massive data base that there are areas of the country that are seeing consistent declines in market value, yet they don't have a standard industry definition of what constitutes a declining market.

So what does this all mean?

Well, if your lender receives this message when underwriting your conventional mortgage loan and you are not putting any money down, you will be penalized. (An FHA loan is another option.) The lender must immediately lower the highest acceptable loan-to-value ratio by 5%. So, your 100% loan just became a 95% loan, no matter how you slice it. You may be out of luck when looking at conventional financing. One action that you can take to avoid the surprise of this scary, but protective rule is to have your lender run your file through the automated system before even making an offer. This way you will know up front if you will be dealing with this issue on this property regardless of sale price.

In the past, an appraiser had a little lead way in determining value. The appraiser may have been able to go slightly out of area or scope of time, but Not any more. While the following are always considered the best practice, they are now considered the ONLY practice.

These guidelines are not intended to be all inclusive and may differ depending on the lender. They should be viewed as the minimum requirements used to set the market value by using data for comparable properties:

Must be within a 3 to 6 month period, with similar features such as square footage.
Must provide days on market for the subject property and comparable sales used.
Must be within close proximity of the subject property, looking at neighborhood character as well.
Must be within a one mile radius of the subject.
Must provide one current listing or pending sale from the Multiple Listing Service to help support value.

If any of these guidelines cannot be positively addressed or supported in the appraisal, the appraiser needs to provide a detailed written explanation of the circumstances.

There are a few other solutions. For example, FHA and VA do not have an issue with properties located in declining market areas. They leave the determination to those is the field that they trust, the lender and the appraiser.

The bottom line is that while this rule may cause some headaches, but it does not mean that houses can not be sold. It does mean that you need to make sure your lender is up to speed on these changes to assure a smooth transaction.

Getting pre-approved with a mortgage professional before you start looking at properties is more important than ever, because you need to decide which mortgage program will work best for you.

You also need to understand that mortgage guidelines can change even during your loan underwriting process, so don't be surprised if you are asked to provide additional information.

This post was co-authored by Dan Weis and Rick Pilger.

At your service,

Dan

What questions do you have? I'll gladly answer them at: dan@danweis.com.

Tell a friend about my next Free Home & Condo Buyer Class!

Are you ready to find your dream home? Contact me for a Free Consultation: (513) 615-1890 or dan@danweis.com

"Is This The One?"

2008-02-07T11:11:00.000-05:00

As you look at different homes, you're always wondering "is this going to be the one"?

"Is this the home that I'll fall in love with and live in for many years?"

Whether you've looked at 5, 10, 20 or more homes, you'll always wonder if you're picking the right property for you.

One of the ways to help you compare is to set up a rating system. On a scale of one to ten, how do you rate each home?

I always tell clients anything less than a 5 means 'run away'. If you pick the numbers 6 or 7, it means that the property is ok or nice, but if someone else bought it tomorrow, you wouldn't be upset. If you rate a home an 8 or 9, that's one you should seriously consider making an offer on.

Also, it's okay if your spouse, significant other or friend disagrees with you by putting a different number value on the property. You each have your own opinions and you need to talk out what's the most important to each of you. All properties have pros and cons to varying degrees, so don't let that stop you.

By the way, I haven't seen a 10 yet. You may think the home you're choosing is a 10 and that's fine, but no home is perfect.

Another factor you need to consider is there's more than one home that's 'right' for you, because if you're looking at homes right now or you decide to look at homes a year from now, the same homes are not going to be for sale on the market. (At least, not usually unless there's something seriously wrong with them.)

So you need to consider the criteria that's important to you as you go through different homes and see what best matches what you want in a home.

I've told clients that many times the right home will "smack them in the face" when they pull up out front or walk inside. You'll know it in your gut when it's the right one for you. You'll go "WOW"...this is it!

At your service,

Dan

What questions do you have? I'll gladly answer them at: dan@danweis.com.

Tell a friend about my next Free Home & Condo Buyer Class!

Are you ready to find your dream home? Contact me for a Free Consultation: (513) 615-1890 or dan@danweis.com

3 Focus Points When Viewing Properties!

2008-01-31T13:19:00.000-05:00

When you begin your home/condo search, there are 3 things you need to be focused on when viewing properties:

Functionality of Floor Plan - Does the floor plan flow or is it choppy? Does it meet your needs? When you walk through a home, it's important initially get a feel for the home, because emotion plays a big part when house-hunting. It's easy to get distracted by the seller's furnishings if the home is occupied, so you need to do your best and visualize the property with how you would furnish it. Is the floor plan bright & open or seem dark with narrow hallways? If you have large furniture or a lot of it, will the furniture fit in the rooms?
Cosmetic Conditions - Would you need to repaint... re-carpet... replace cabinets or counter tops...etc? As you approach the front door, how does the exterior look? Is the landscaping maintained? Any cracked window panes or failed window seals? Is there a lot of wallpaper that may need to come down? Look at what things you feel you could reasonably handle yourself versus having to hire a contractor to take care of.
Big-Ticket Items - What are the ages of the roof... furnace... water heater... appliances... etc? It's important to get a rough idea of how old different mechanical systems in the home are. You'll never know how long an item will last, but knowing if it's on its last leg and can go at any time will help you in figuring out how soon you'd have to save some money to replace it. One of the reasons for a home inspection is to make you aware of any defective items. If an item is defective, then you can request the seller to correct it (they can say 'yes or no'). If an item is just older, but is still working fine, then you need to understand that the seller is under no obligation to replace it. That's why it's important when walking through a property to do your best to determine the ages of the mechanical systems, so that will help you when deciding on an asking price for an offer.

Focusing on these 3 points will help you during your home/condo search. It's also important to make detailed notes to yourself as you go through each home, because that will make it easier for you to remember things about the property when it's time to make an offer on it.

At your service,

Dan

What questions do you have? I'll gladly answer them at: dan@danweis.com.

Tell a friend about my next Free Home & Condo Buyer Class!

Are you ready to find your dream home? Contact me for a Free Consultation: (513) 615-1890 or dan@danweis.com

Appraiser's Role in the Home Buying Process!

2008-01-24T15:53:00.000-05:00

The appraiser's role in the home buying process is to determine a value of the property for their client, the lender.

No, not for you, the buyer, but the appraiser is looking out for the lender's interests in the value of the property, because if something goes wrong and you can't make the payments any longer, then the lender needs to know that they have a salable property.

In the early 2000s, it was easier for appraisers to value properties, because home values kept rising. Though they did need to be careful not to over-value. Now, appraisers need to figure out if an area is rising, stable or declining in value.

Appraisers have guidelines they need to follow to provide lenders with an accurate picture of the property and in the current marketplace of increased foreclosures and short sales, appraisers are being required to follow more stringent guidelines.

If the appraiser determines that there are repair, defect or improvement issues attached to the property, they may need to be addressed by the owner or buyer of the property before a sale can be completed.

It's extremely rare that you'd ever see or talk with an appraiser. They are expected to give an un-biased, third-party opinion as to the value of the property. Now in the event the appraised value of the property comes in below the agreed-upon sale price, then your agent may be able to offer information about other sales that could make a difference in the final outcome of the appraisal, but normally it won't sway the appraiser, because they have access to the same information as most agents and they do a lot of research too.

So when you're ready to make an offer on a property, understand that the lender's appraiser doesn't come into the picture until after you have an accepted agreement with the seller. Prior to writing your offer, you need to have your buyer's agent prepare a C.M.A. (Comparable Market Analysis), that will show you where values of comparable properties normally within a one mile radius have been in the last 6 - 12 months. That should help you select an asking price based on those recent sales as well as the condition, location and motivation of the seller.

If you're looking at a 3 bedroom ranch home on a slab with a 1-car garage, then you shouldn't be comparing that to 3 & 4 bedroom 2-story homes with full basements & 2-car garages in the same neighborhood. You need to find homes that are as closely similar to yours as possible.

Also, if you want to buy a condominium, the appraiser and lender may also want to review the condo documents as well.

I hope this sheds some light on the role of an appraiser.

At your service,

Dan

What questions do you have? I'll gladly answer them at: dan@danweis.com.

Tell a friend about my next Free Home & Condo Buyer Class!

I'm available to help you find your dream home! Contact me for a Free Consultation: (513) 615-1890 or dan@danweis.com

Insights To Selecting Homeowner's Insurance

2008-01-17T11:12:00.000-05:00

The other day I asked one of my Preferred Service Team Professionals, Karen Bastian of American Family Insurance, the following question: "What are some things a buyer needs to know about making a decision on which homeowner's insurance policy to purchase for their new home?" Here's what Karen said:

"There are several things to consider when purchasing a homeowner's insurance policy.

First we’ll look at the dwelling coverage, which is insuring the structure itself and anything permanently attached to the structure (such as kitchen cabinets). It’s very important to make sure the policy is covering your house for replacement cost. There’s software we go through to determine how much it would cost to rebuild your house if you had a total loss. You want to make sure they’ll be able to rebuild your house just as it is. This is also why it’s important to review your policy every year or two with your agent so you can continue to monitor the policy and it’s coverages to make sure you’re never underinsured.

Replacement cost is also an important factor when it comes to your contents. The contents are everything you own in the house that isn’t attached: your furniture, clothing, electronics, dishes etc. In the event of a loss, when you have replacement cost, depreciation is not factored in. For example, if lightning strikes your TV, you would just go buy a similar new TV. We also strongly recommend that you take an inventory of your contents. If you were to have a major loss, there’s no way you’d remember everything you need to replace. You can make a written list, take pictures or a video. It just needs to be enough to jog your memory. Keep the list or pictures off premises with a family member or a safe deposit box. It wouldn’t do you any good if the list burned up in the same fire that destroyed your contents.

Another coverage that’s part of your policy is called “loss of use”. This means that if your home is uninhabitable due to a covered peril, your additional living expenses would be covered. The important thing here is to make sure the policy gives you a 12 month time limit to repair or rebuild without a dollar limit. Some companies impose a dollar limit but there are times when it takes awhile to rebuild so you could potentially run out of coverage.

Many people don’t realize that their homeowners policy also includes liability coverage. This certainly covers any guests who may be injured on your property but it also covers you and your family wherever you are. For example, if you’re on the other side of town at your child’s ball game and they injure someone during the game, the liability part of your policy will provide coverage.

These are just a few of the basic things you need to know when purchasing a homeowner's insurance policy. Please feel free to contact me with any questions you may have. "

Karen Bastian Agency, LLC

American Family Insurance
3476 Irwin Simpson Rd, Ste 112
Mason, OH 45040
(513) 459-3063

kbastian@amfam.com

Watch Out For Homestead Tax Reduction!

2008-01-10T10:16:00.000-05:00

The state of Ohio has expanded the Homestead Exemption program to reduce property taxes for all qualifying senior citizens and permanently disabled homeowners, who are at least 65 years of age.

What does this mean to you, the home buyer?

When you're planning to make an offer on a property and you're determining what your monthly payment will be, you need to make sure that the property taxes that are being quoted on the Multiple Listing Service information sheet don't include the Homestead Exemption as a credit. Unless you're 65 or older, you won't be getting that credit and your tax bill will be higher.

So you or your Realtor can check the county auditor's web site and review the property's tax bill to see whether or not there's a Homestead Exemption amount listed on it.

For example, if the semi-annual tax amount is $1,200, but there's a $200 Homestead Exemption credit, that means if you're under 65 years of age, you'd be paying $1,400 every six months instead of the $1,200. That's an extra $33.33 per month you'd be paying.

So don't get a surprise at the closing table or when your tax bill comes out with a higher amount than you thought!

At your service,

Dan

What questions do you have? I'll gladly answer them at: dan@danweis.com.

Tell a friend about my next Free Home & Condo Buyer Class!

I'm available to help you find your dream home! Contact me for a Free Consultation: (513) 615-1890 or dan@danweis.com

You Have 4 Choices!

2008-01-03T17:09:00.000-05:00

When deciding on whether you want to purchase a house or condo, you really do have four choices in your decision-making.

Your choices are:

Doing nothing

Yes, no one can force you to buy a home. While most people will greatly benefit from owning real estate, there are a few people, who at certain points in their lives, should continue to rent and not put a financial burden on themselves.
Doing it on your own

This is also an option, but why would you do it? If you needed surgery, would you operate on yourself? If you were going to court, would you represent yourself? Usually not. Then work with a real estate professional, who knows the real estate business inside and out. They can save you time and money in the home buying process.
Using a typical salesperson

The problem with many agents is they don't have the experience and knowledge needed to help you. Do you know up to 25% of area agents sold one or ZERO homes in the past 12 months? Do you know the qualifications of the agent you're working with? There are others who are only in the real estate business to make a FAST BUCK and they really don't care about you. They'll do and say what they can to get you to buy quicker. Then they're out of your life forever.
Teaming up with a real estate consultant

A real estate consultant is still a salesperson, but their business philosophy is based on serving your best interests. They look at doing what's right for you. They explain the pros and cons of each situation - so you can make an informed decision. They aren't afraid to share why you shouldn't buy a certain property.

Selecting the wrong real estate agent can cost you BIG, so make sure you have an experienced real estate consultant working for you.

At your service,

Dan

What questions do you have? I'll gladly answer them at: dan@danweis.com.

Tell a friend about my next Free Home & Condo Buyer Class!

I'm available to help you find your dream home! Contact me for a Free Consultation: (513) 615-1890 or dan@danweis.com

Is A Condo A Good Fit For You?

2007-12-27T14:04:00.000-05:00

I'm often asked the pros & cons of condo living.

There's really no "one size fits all" answer!

I can share some insight with you, because my wife, Amy, and I owned a condo before we had children. We actually moved 4 times in 10 years. Yes, it must have been an occupational hazard. Our first home was a starter Cape Cod. Then we fell in love with a new condo community near Sharon Woods - close where I grew up. Next, our son came and we moved to a 2-story. Finally, after wanting a kid-friendly backyard, we moved to a neighborhood with lots of kids. It's been 10 years here, because we don't want to move our kids. Now that doesn't mean I'm not planning my next move. :)

Now, back to my insights on the pros and cons of condo living:

PROs

condos are great for exterior, maintenance-free living
condo fee normally covers landscaping, mowing, snow
removal, decks, patios, roofs, community features, etc
if you often work a lot of hours or travel a lot and don't
spend much time at home, a condo is a great option
condos are more affordable than houses in many areas
many condo communities come with a pool, clubhouse,
tennis and other amenities

CONs

make sure condo association is financially solvent and
monthly fees cover maintenance and future reserves -
every owner is jointly responsible
make sure you agree with the association rules and that
they are being enforced - you'll need board approval before
making any exterior changes to your condo
if you have large or many pets, there may be restrictions
on their size or how many you can have in a condo
proximity to your neighbors depending on how your condo
is situated - common walls or shared/divided patios or decks

These are just some of the things to consider when buying a condo.

You also want to make sure that the type of mortgage financing you're approved for is offered for the condo community you're considering. If it's a new community or a community where there's a large percentage of renters vs. owners occupying the condos, then you may need to look at alternative financing.

At your service,

Dan

What questions do you have? I'll gladly answer them at: dan@danweis.com.

Tell a friend about my next Free Home & Condo Buyer Class!

I'm available to help you find your dream home! Contact me for a Free Consultation: (513) 615-1890 or dan@danweis.com

Who Do You Know...?

2007-12-22T16:02:00.000-05:00

You've successfully attended our Free Home & Condo Buyer Class.

"Who among your family and friends would also benefit from our class?"

Our purpose for teaching the class is to educate consumers, who plan on buying a home in the near future. We want consumers to be armed with the knowledge that's needed in today's market, so that they don't get scammed by unethical people.

There are many mortgage loan programs out there that are not in your best interests. We can help you decipher which ones can work best for you. We also want to prepare you for the guidelines that you now being put into place with many mortgage companies.

I wanted to let you know that the next scheduled class dates are Jan. 9th & Jan. 23rd.

Please forward this post to your family and friends by clicking on the small envelope with the arrow in it at the bottom of this post.

For more details and registration, go to: Free Home Buying Class.

At your service,

Dan

ARMs Can Be Dangerous To Your Wealth!

2007-12-20T10:35:00.000-05:00

In my opinion, most home buyers today should not sign up for an Adjustable Rate Mortgage (ARM), because there are too many downsides to them.

An ARM assumes that you expect your income to continue to increase each year, so that when your mortgage interest rate adjusts, you can afford the additional payment increases.

There are times when you may fall in love with a home and with a fixed rate mortgage, it's just out of your reach financially. Well, a mortgage lender then comes along and says that by getting an adjustable rate mortgage, you would qualify nicely and get what you want. Then you say "Really? Let's do it." Without thinking through what you've just done, you may end up 'being in the desert with vultures flying overhead waiting for you to drop'.

Is that a little melodramatic? Maybe, but too many consumers jump headfirst into an adjustable rate mortgage for the wrong reasons. Lenders will say "Oh, you'll get pay raises, right?" Don't fall for it.

Many buyers are pre-approved for an adjustable rate mortgage based on the initial "teaser" rate that's offered. So what happens in two years when the interest rate adjusts upwards by 2%and now the monthly payments are too much to handle. If you're maxed out, because your house payments are too high, then you don't have any money left over to maintain your home. All homes need to be continually maintained......sometimes it's small expenditures and other times it's major repairs.

I believe that all buyers should be pre-qualified at the higher rate. For example, on a 3/1 ARM, the interest rate is fixed for the first three years and then it adjusts annually for the rest of the loan term. If you have 2/6 CAPS, that means the interest rate can adjust up or down as much as 2% per year, but never go more than 6% above the original rate. So if you have a 5.5% initial rate, after 3 years, your rate could move up to as high as 7.5% and then the next year, it could jump up to 9.5% and the following year, it could go to 11.5%. It could never go above 11.5% though, because of the 6% CAP (5.5% + 6% = 11.5%).

Now would your rate keep increasing by 2% each year? It's doubtful, but it depends on what the financial markets are doing. In this scenario, you should at least be qualified to be able to afford a 7.5% interest rate. In markets like today, I call the initial rate a 'teaser' rate, because it's usually going to increase when it's time for the adjustment.

Most home buyers are not meant to have adjustable rate mortgages. The lending industry has just found another way to get people into homes that they may not be able to afford in the long-term.

I believe you need to be more fiscally responsible and stay with a fixed interest rate mortgage. That way you know that your payments won't go up except for when your property taxes and homeowner's insurance premiums increase...and they do go up over time.

If a fixed rate mortgage means you qualify for a less expensive home than you'd like, then it's done its job. That's the reason for it. You need to live within your means. Many Americans today have lost their homes, because of skyrocketing prices and the only way they could afford the homes was to take out an adjustable rate mortgage (or even worse, an interet-only mortgage).

Don't put yourself behind the eight-ball! While I believe saving for a downpayment before buying a home doesn't usually work to your advantage, the affordability of your monthly payment is crucial. I always tell clients "You don't want to be house-poor." So make sure that you get a fixed interest rate mortgage and live within your means.

Most problems that happen in life revolve around money issues. Don't live a stressed life living in a home that you can't afford. You don't need to keep up with the Joneses.

One other thought: You may even want to buy a home with a 20 year or even 15 year mortgage term, but that's another topic for another day.

When you hire me to be your buyer's agent, I'll help you review your mortgage options to make sure that you're getting the right kind of mortgage that benefits you and not the lender.

At your service,

Dan

What questions do you have? I'll gladly answer them at: dan@danweis.com.

Tell a friend about my next Free Home & Condo Buyer Class!

I'm available to help you find your dream home! Contact me for a Free Consultation: (513) 615-1890 or dan@danweis.com

Look Out For The RED FLAGS...

2007-12-13T17:59:00.000-05:00

When you begin your home search, it's important to be very observant when viewing different properties. It's easy to get lured into a property that's cosmetically appealing, yet one that needs a lot of TLC.

Most people try to connect on an emotional level with a property to see, sense and feel if it's the right one for them. That's OK to do, but it should only be the first of two steps when viewing.

Second and more importantly, go through the property again and make a list of potential issues with the property that you'd need to address should you purchase it. What repairs are needed in the short-term? What improvements would you make to the property? Is the landscaping over-grown and not well maintained? How old are the mechanical systems? Does the basement appear to have any water leakage problems?

These and other questions are important to delve into when looking at properties.

Since you don't have your whole house inspection until after you've entered into an agreement with the seller, you need to have an idea of how much you may end up spending on the property in the short-term and that will help you when you make your bid.

At your service,

Dan

What questions do you have about this tip or any other topic?
I'll gladly answer your questions at: dan@danweis.com.

Tell a friend about my next Free Home & Condo Buyer Class!

I'm available to help you find your dream home! Contact me for a Free Consultation: (513) 615-1890 or dan@danweis.com

Stay Alert About Your Credit!

2007-12-06T15:54:00.000-05:00

Credit card companies are smart and sneaky! You have to be vigilant and make sure that you're paying attention to all of your credit cards. One mistake can cost you thousands of dollars in the long-term. Credit card companies are looking for you to make a mistake and then they'll be able to raise your interest rate. Here are some things to watch out for:

Don't pay your bills late or try to cut it too close - it may not get processed in time and then it could show up as a RED FLAG on your credit report allowing the credit card company to raise your interest rate.
Don't pay extra on one bill if you have others coming up that you may not be able to pay on time.
Work on keeping your credit score as high as possible - having a low credit score will cost you more in your mortgage, car loans, etc.

Whether it's now, 3 months or one year before you plan to buy a home, sit down with a reputable mortgage consultant and have them run a 'tri-merge' credit report on you. That way you can see if there are any discrepancies on your report and it'll also show you what your credit scores are. If they are in the lower range (where you would only qualify for higher interest rates), then this opportunity will give you time to work on improving your credit score, thus allowing you to hopefully qualify for a lower interest rate mortgage.

Now is the time to develop a plan to increase your credit score. If you have more credit cards than you need, then you can systematically wean yourself off the cards and close the accounts over time. But you need a plan to do this. You can't just do it all at once or you'll really mess up your credit score.

If you have any questions, don't hesitate to contact me. I'm here and I'll be glad to help you.

At your service,

Dan

Are You Protecting Yourself Legally?

2007-11-29T22:15:00.000-05:00

One of the common mistakes home buyers make in the Cincinnati real estate market is not having access to legal counsel during their home buying process.

While it's very common to not have real estate attorneys involved in a typical real estate transaction in the Cincinnati area, I believe there are at least 2 times, where their services should be utilized to protect your interests.

Have your real estate attorney review your purchase agreement prior to submitting an offer to the seller or write a contingency clause in your offer that allows your real estate attorney to review the accepted offer to their satisfaction.
Consider having a real estate attorney attend your real estate closing. While the documents presented to you for your signature are on pre-printed forms, you need to make sure that the terms and conditions you agreed to with your mortgage lender and seller are still the same. Also, if any unexpected issues arise at the closing, it's re-assuring to have legal counsel there by your side.

Now, you may be wondering, aren't attorney fees expensive? Attorney fees can be in the range of $100 - $200 an hour or more depending on the law firm and the service needed.

Another option for you to consider in hiring an attorney is Pre-Paid Legal Services. Their Life Events Legal Plan is a great service. Since 2000, we've been very pleased every time we've used it. I am an independent associate for the company and offer this service to people. For more information, you can check out my web site at: Life Events Legal Plan or contact me at 513-615-1890 or dan@danweis.com.

At your service,

Dan

What's your BURNING question? You can e-mail me at: dan@danweis.com.

Tell a friend about my next Free Home & Condo Buyer Class!

I'm available to help you find your dream home! Contact me for a Free Consultation: (513) 615-1890 or dan@danweis.com

Surround Yourself With Professionals

2007-11-22T12:09:00.000-05:00

When I began my real estate career in 1985, we used one page contracts...no property disclosures...no fax machines...MLS book came out once every 2 weeks...no property searches on a computer...we had to drive to real estate offices wherever they were to pick up a house key for a showing and then return it...

So much has changed.

But as time goes on, technology changes, the market changes, paperwork changes, etc. It all gets more detailed and complex. Expectations are raised. People want to know everything about a property...before making a decision.

What this leads me to is the fact that you need to work with professionals through your real estate process. Here's a list of most people involved when you purchase a property:

your buyer's agent
the seller
the seller's agent
mortgage loan officer
mortgage underwriter
private mortgage underwriter (if getting PMI)
appraiser
home inspector
radon tester
termite inspector
contractors (if issues come up, give estimates)
homeowner's insurance agent
title company

There are also many other people behind the scenes that you'll never see or hear, but they are just as important to you in completing the purchase of your new home.

Surrounding yourself with others, who are experienced, is critical in today's market.

Did you know that anyone can be a home inspector? There's currently no licensing requirements for home inspectors. Scary, isn't it?

Make sure that you do some investigating of who you want to have assisting you in your purchase. The professionals that you do hire also should be able to make recommendations of others they've worked with in the past, who are reliable, competent in their field and have years of experience under their belt.

Sometimes, the real estate transaction can go smoothly from start to finish, but more often than not, there are things happening behind the scenes that may take the loan approval up to the wire to close on time. It's like a duck. On top of the water, the duck appears to be just gliding through the water, but underneath the water, it's paddling ferociously.

Do your best to surround yourself with professionals and soon you'll be in a new place you call "HOME SWEET HOME".

At your service,

Dan

What questions do you have about this tip or any other topic? I'll gladly answer your questions at: dan@danweis.com.

Tell a friend about my next Free Home & Condo Buyer Class!

I'm available to help you find your dream home! Contact me for a Free Consultation: (513) 615-1890 or dan@danweis.com

Acclimate Yourself To The Market...

2007-11-15T12:34:00.000-05:00

Once you've been pre-approved for a mortgage that fits your needs, your next step is to get acclimated to the real estate market and find out what's available in the price range and areas you want to look in. Even if you're not ready right at this moment to start looking at properties, a smart thing to do is start viewing properties that are currently on the market.

You can do this a couple of ways:

read through local newspapers in the real estate sections,
pick up some real estate magazines at local stores, etc,
search online from website to website,

Or a better way is to sign up for the free service: New MLS Listings By E-Mail.

This service searches daily for new listings that come on the market through all real estate companies that are part of the Multiple Listing Service. So when a home is listed and entered into the MLS system, you'll receive an e-mail with property details about the new listing.

It's a great way to find out what properties have to offer in different price ranges and what you can get for your money. To find out how to use this service and input your housing criteria, just click on: New MLS Listings By E-Mail and you're on your way to researching the market.

When you find a property or several you want to see, I'd love to show them to you as your buyer's agent. All you need to do is let me know when you're ready to start viewing properties and when you find some, I'll set up the viewing appointments for you.

At your service,

Dan

What questions do you have about this tip or any other topic?
I'll gladly answer your questions at: dan@danweis.com.

Tell a friend about my next Free Home & Condo Buyer Class!

I'm available to help you find your dream home!
Contact me for a Free Consultation: (513) 615-1890 or dan@danweis.com

Beware of Internet Mortgage Companies!

2007-11-08T20:12:00.000-05:00

The last thing you ever want to do is work with an Internet mortgage company. Now, the overwhelming majority of them have the ability to have you thinking that you're going to get a great rate with low closing costs, when in reality, you get to the closing table and all of the numbers are different than what you were previously told.

The problem with Internet mortgage companies is that you'll never see them face-to-face. They may be working out of some small office space in the Southwest or Florida or Northeast. They may use an out-of the-area appraiser, underwriter, loan processor and title company, who aren't familiar with local customs, and you end up not being able to get your mortgage approved.

You also need to understand that many so-called Internet lenders are actually lead-generation companies. They get your information and then sell it to mortgage companies who solicit you to get your business.

The Internet can be a great place to do research, but I don't recommend finding your mortgage through an online mortgage broker.

At your service,

Dan

What questions do you have about this tip or any other topic?
I'll gladly answer your questions at: dan@danweis.com.

Tell a friend about my next Free Home & Condo Buyer Class!

I'm available to help you find your dream home!
Contact me for a Free Consultation: (513) 615-1890 or dan@danweis.com

Determine Your Financial Comfort Level!

2007-11-01T14:41:00.000-04:00

One of the most important steps to start with when you decide it's time to purchase a home is to see where you stand in regards to your financial ability to own a home.

When you're ready to start looking at properties, don't start driving by homes or go online.

You first need to sit down with an experienced mortgage professional, who has your best interest at heart. How can you tell if they're really looking out for you?

Look for someone who calls themselves a mortgage consultant vs. a loan officer. A person who titles them self as a mortgage consultant is more likely to take a fiduciary approach and serve your financing needs - looking out for you.

If a loan officer just wants to take your information over the phone and never plans to meet with you in person, then hang up the phone.

If a loan officer answers your phone call and starts quoting you interest rates, then it's probably a 'bait & switch'. They can't possibly know what interest rate you qualify for without knowing your personal information. Hang up the phone!

One way is ask family and friends, who have purchased recently, would they recommend their mortgage consultant.

Another way is to ask your experienced buyer's agent, who do they recommend. Many times an agent has worked with a few mortgage professionals over the years and knows how they operate, knows how they handle problems that may arise, knows that they are held to a higher standard when being recommended, etc.

An experienced mortgage consultant will ask you a series of questions prior to meeting in person. Then they will put together a Personalized Mortgage Plan, which should consist of at least 3 different mortgage programs that are aligned with what you're trying to accomplish. They should then review the mortgage products with you, answer your questions and help you by recommending which mortgage product best fits your situation.

One person I've recommended since 2003 is Rick Pilger, a mortgage consultant with Union National Mortgage. You can reach him at (513) 770-6999, cell: (513) 600-9003 or e-mail: rpilger@unmco.com.

At your service,

Dan

What questions do you have about this tip or any other topic?

I'll gladly answer your questions at: dan@danweis.com.

Tell a friend about my next Free Home & Condo Buyer Class!

I'm available to help you find your dream home!
Contact me for a Free Consultation: (513) 615-1890 or dan@danweis.com

Welcome To "Home Buying Tips"!

2007-10-31T14:43:00.000-04:00

You're being introduced to my weekly series of 'Home Buying Tips'!

Having taught my free, Home & Condo Buyer Class to over 1,450 people in the past 20 years, I recently realized that we give so much valuable information in 2.5 hours that it's often difficult for you to decipher and then remember everything.

So I've decided to write various strategies in this blog that are important for you to implement when investing in a property in today's real estate market.

It's extremely important for you to become an educated and informed consumer, because there are people in the marketplace just waiting to take advantage of you and your money. My goal is to arm you with the knowledge you need to purchase a property that is the right one for you.

I'll be posting my first "Home Buying Tip" tomorrow, so keep your eyes for it.