First-timers can be eager to jump into home ownership. But we see them committing the same mistakes, time and time again. Here are some of the most common ones
1. They’re unprepared to compete against all-cash offers. Buyers need to be ready to make a quick decision if they’re housing market is heating up. Buying a home is really like finding a job – it’s going to take a lot of time to prepare, and when the deal comes along, you’re ready to pounce on it. buyers should have already saved as much as possible for a down payment, repaired any credit report blemishes, and gotten preapproved for a loan as they start their house hunt to put them in a better position to compete. 2. They place a car ahead of the home. Lenders are going to scrutinize applicants’ debt-to-income ratio when assessing how well they can afford a mortgage payment. Consumers’ debt has gone on average from $40,000 in 2010 to $61,000 today. It would be much easier to own a home if you can show a history of saving and not have gotten yourself into too much debt. 3. They place too much emphasis on online loan information. Online sites can be good for finding out general information about loan products and estimated costs, but experts recommend visiting with mortgage lenders face-to-face to help demystify some of the process and to take into account your specific situation. Go to different places and talk to loan officers to get a feel for what the differences are between similar types of loans. Sometimes a company won't charge an origination fee, but then the interest rate is higher … and in some cases you can put many of the upfront costs—closing costs, title insurance—into the loan, which makes your balance larger. 4. They bank too much on online home values. Some real estate websites are giving buyers a false sense of home values. If a buyer believes that the actual value of the property is $1.1 million [as listed online] when it's really $1.3 million, it's a real disservice to the client. You really should [spend time] with someone that understands the market, someone who's there day in and day out. Home buyers can get the best feel of the market by working with a real estate agent and driving around neighborhoods and get a sense of things about homes that may be less valuable or even more valuable than perceived online. 5. They forgo the home inspection. About 10 percent of homes recently purchased weren’t inspected by a home inspector. Some buyers were trying to cut down on the costs of hiring an inspector to investigate a home – which usually averages about $450 — but defects uncovered later could potentially result in the loss of thousands of dollars. "It takes a trained eye to be able to see the problems that can exist in a home. The inspection can also give the first-time buyer a bit of a schooling on the house and how to maintain it. Buyers should also be prepared to ask questions about conditions that are common to specific areas, such as radon; sewer lines in older homes; and active clay soils in some locations that can lead to foundation issues. The home may also require additional inspection from a specialist to rule out potential problems.
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What can you do to Prepare?
Emergency preparedness is everyone's job. Disasters of all kinds, ranging from floods to winter storms, can happen when least expected. It is important that each household be prepared before disaster strikes with a 72-hour Family Emergency Kit, so each family can be self-sufficient until relief arrives. Assembling the following items to create your own 72-hour Family Emergency Kit will be a great start in preparing your household for the new millennium. Such preparation will be valuable in potential emergencies that may affect our area such as blizzards, power outages, floods, tornadoes, or hazardous materials spills. You Must Be Ready To Act on Your Own The 72-Hour Emergency Kit should be individually tailored to meet the basic survival needs of your family for three days to a week. Most families prefer to store their emergency supplies in a location that is relatively safe, yet easily accessible if evacuation is required. Items may be stored in a 32-gallon trash can, suitcase, duffel bag, footlocker or individual pack (with a note on top listing a few items to grab if you have to evacuate). Emergency Needs Water Storage (1 gallon/person/day) Sleeping Bag and Blanket (wool and thermal) First Aid Kit and Manual Emergency Candles Waterproof/Windproof Matches Extra Eyeglasses/Contact Lenses Non-Perishable Foods Water Purification Tablets Utility Knife Manual Can Opener Extra Clothing Battery Powered Radio Flashlight Essential Medications Suggested non-perishable food items: Ready-to-eat goods in unbreakable containers, canned meats, juice, fruits and vegetables, powdered milk, infant care foods, crackers, peanut butter, freeze-dried and dehydrated goods. (Store what you normally eat. Children will not eat food that is strange to them.) Sanitation Kit Plastic Bucket w/Tightly Fitted Lid Baby Supplies Plastic Bags and Ties Aluminum Foil Disinfectant Paper Towels Improvised Toilet Seat Toilet Paper Personal Hygienic Needs Soap Paper Cups and Plates Plastic Utensils Personal Toiletries Other Emergency Needs Pen and Paper Work Gloves Money Basic Tools Address and Phone Number Children's Securities (blanket, pacifier, etc.) Standard First Aid Kit First Aid Manual Scissors Aspirin or Pain Relievers Sanitary Napkins (Pressure Dressing) Triangular Bandages (36"x36"x52") Disposable Diapers (Dressing/Splint/Padding) Car Survival Kit Always Maintain at Least 1 Tank of Gas Non-Perishable Food Stored in Coffee Can First Aid Kit and Manual Flashlight and Batteries Class ABC fire Extinguisher Waterproof Matches and Candles Radio and Batteries Bottled Water Reflectors and Flares Jumper Cables Bag of Sand, Shovel and Tools Short Rubber Hose for Siphoning Paper, Pencil, Map, Tissues, Pre-moistened Blankets or Sleeping Bag Towels, Plastic Bags, Essential Medications Make Copies of All Legal Papers Marriage License Jewelry Appraisals House Mortgage Drivers Licenses Automobile Ownership Insurance Policies Wills Bank Accounts Vacation Home/ Property Ownership Trailers, Snowmobiles, Boat Ownership RV Ownership Take color pictures of every room plus pictures of valuables. Send one copy of legal papers and one copy of pictures to an out-of state contact. Plan How Your Family Will Stay in Contact if Separated by Disaster Pick two meeting places: A location a safe distance from your home in case of fire. A place outside your neighborhood in case you can't return home. When Assembling Emergency Supplies for the Household, Include Items for Pets How to Store Water Store your water in thoroughly washed plastic, glass, fiberglass or enamel-lined metal containers. Never use a container that has held toxic substances. Remember that your hot water tank is a source of 40 to 50 gallons of drinking water. Be sure to purify the water by: Boiling Disinfecting (household liquid bleach: 16 drops/gal. of water, stir and let stand 30 min.) Distillation (boil pot of water and collect the vapors by tying a cup to the upside down pot lid - the cup shouldn't dangle in the water - it will condense back to water in the cup) Other Considerations Stock supplies to last several days to a week for each family member. Have extra cash on hand in case electronic transactions (ATM card, credit cards, etc.) cannot be processed. Work with your family in talking about the steps each needs to take to be ready if disaster happens. It’s a crazy market out there. Buyers are doing anything they can to secure a home, but inventory is low because potential sellers don’t want to be buyers in this market. And when a seller does list their home, their biggest fear is they won’t be able to find a new home in the time they must be out of their old one. A post-closing occupancy agreement might just work for your buyer who’s looking to make a stand-out offer, and your seller who’s worried about the timeline.
What is a post-closing occupancy agreement? A post-closing occupancy agreement is when a seller retains occupancy of the property for up to 60 days after closing occurs, the tactic isn’t often used, but in this market, brokers consider it an ace in the hole, if navigated correctly. Evaluate Not all buyers are good candidates for the post-closing occupancy agreement, and it’s important to understand the clients’ current living arrangements. If the buyers are living at an extended-stay hotel, Airbnb, month-to-month apartment, etc., and can lengthen their stay or find another budget-friendly, temporary living arrangement, the post-closing occupancy agreement could be something to consider. Similarly, there’s a note of caution on the seller’s side. Again, not all buyers can accommodate a post-closing occupancy agreement. If you list it as an upfront requirement, you run the risk of decreasing the number of offers you receive. As the weather starts to heat up each Spring, so too does the housing market. Spring is an optimal time to get your house ready to sell. The first thing that potential buyers will see of your home is the landscaping, so make a great first impression with beautiful outdoor spaces. An investment in landscaping can help sell your home faster and for more money. There are simple projects at every price point that can help you achieve great curb-appeal. Inexpensive $ 1. Keep the Lawn Well-Manicured The easiest and most obvious landscape project when hoping to sell your home is to get your lawn looking its best. Spring is a great season to try to sell because your lawn is helped by Mother Nature. Wet, mild Spring weather will help the lawn stay green with less effort. To show off that green lawn, make sure to mow and edge it often. 2. Keep Your Yard Weed Free It may not cost much, but it will require some time and effort to control the weeds around your property. Spray or pull weeds in flowerbeds, on property borders, and along the driveway. A weed-free yard will help potential buyers feel confident that the home is well cared for, which can create an overall positive impression of your home. 3. Add Flower Pots Near Your Front Door A splash of color in the yard is a great way to highlight your home. If you are looking to sell quickly, it might be too late to do major yard improvements since new flowers and plants will not have adequate time to grow and mature, but a few beautiful pots of flowers strategically placed near your front door can have a similar effect without requiring a lot of time and maintenance. Moderate $$ 4. Add Outdoor lighting Outdoor lighting has become a trendy feature that buyers have embraced. Lighting can add interest to your yard, highlight areas of beautiful landscaping, and make your home stand out at all times of the day. Solar lights are particularly easy to use because they will recharge during the day and automatically come on in the evening to illuminate your home. 5. Install Curbing/Edging If you have a little extra money to spend, consider adding curbing or edging around your yard. It helps the landscaping appear crisp and clean, and makes the lawn easier to mow and trim. Savvy buyers will appreciate the ease of maintenance and the defined spaces that curbing creates. 6. Hire a Lawn or Pest Control Company It is important when selling a home to make sure that their aren't any obvious problems. If your lawn is dead or patchy or you have pest problems like spiders, mice, etc, you will need to get those under control. Some of these projects are beyond the scope of what an individual without training can quickly achieve and should be left to professionals. Lawn care companies and exterminators can assess the issues you may have and recommend treatments. This may even be limited to a one time visit that can quickly improve the chances of selling your home. High-End $$$ 7. Create Outdoor Living Areas If you have money to invest in your home, high-end landscaping projects can increase your bottom-line and draw attention from buyers looking for upgrades. Extra living area outside of your home is a huge attention grabber that attracts buyers. This could range from simple patios staged with outdoor furniture, to screened in porches, to full outdoor kitchen areas. Depending on your location, these upgrades may or may not be worth the investment, so do your research before proceeding. 8. Replace or Update Fencing Fences provide a safe place for children and pets and also give homeowners a feeling of privacy, so they are highly sought after. Fencing is also one of the first things people see when coming to your home. If your fence is an eyesore, it will be worth it to make the effort to have it replaced or fixed up. A new fence is quite an investment, so first determine if your fence can be spruced up with some nails and a new coat of paint. 9. Hire a Professional Landscaper If you are serious about creating a stunning yard, a professional landscaper can add massive amounts of curb appeal to make your home one of a kind. A landscaper can help you add impressive things like paving stone walkways, decorative retaining walls, and water features. Outdoor improvements definitely increase house values, but it is always good to know what the market will support in your area before moving forward. No matter how much money you have to invest in your home's landscaping, there are projects you can do this Spring to improve your home's curb appeal and get it noticed by buyers. Protest, protest, protest. Front Range homeowners may have that reaction when they first see how much county assessors increased the value of their homes over the past two years amid worries that next year’s property taxes will shoot up as well. Neighborhoods throughout metro Denver have recorded double-digit price increases, which reflects the region’s hot real estate market. The biggest percentage gains are coming in lower-income neighborhoods that lagged in past cycles. The first steps for those who disagree with value placed on their home is to figure out how much the value should be adjusted and whether a protest has a chance of winning. And with a June 1 deadline for protests, homeowners need to act fast. Should I protest? While a big jump in property value may come as a shock, in most cases it is probably justified. But county assessors can have basic information about a property wrong, and they won’t know details about a home’s condition versus others in the neighborhood. A key calculation to make upfront is whether any potential savings are worth the time and effort. Spending $700 for an outside home appraisal, assuming one can be obtained on short notice, won’t justify saving $50 or $100 in extra property taxes. And it isn’t necessary. How do I research a protest? Researching home price trends in the neighborhood is key to understanding whether a lower valuation is justified and will stand up. For a typical home, assessors say, property owners can do the legwork themselves, perhaps with information on recent sales from a friendly real estate agent. And staff at the county assessor’s office can answer basic questions. Just make sure to say the call is informational and not a protest. If you get a higher value than what’s on your valuation, quit while you’re ahead. If you get a lower value, then it’s time to do some math. To get a ballpark figure on your 2018 property taxes, first, take the new “actual” value in the statements you recently received and multiply it by 7.2 percent. That’s your assessed value. To get a rough estimate of how much lower your 2018 bill might be, do the same math but this time plug in the lower home valuation you came up with. What can I do to improve my odds of winning a protest? Property owners will have a stronger case if they make an argument based on the characteristics or condition of a property. For example, county records may overstate the square footage or number of rooms or show a basement is finished when it isn’t. Your home’s condition can also help you contest a valuation. County appraisers rely on automated models and don’t go inside a home when they set a value. A home with deferred maintenance and no upgrades since the day it was built decades ago is worth less than one that has been remodeled and maintained. Homeowners who’ve had a professional appraisal recently may also have a leg up. Assessors rely on the sales of comparable homes in the surrounding area to determine what a given home is worth. For this last valuation cycle, they looked at sales between July 1, 2014 and June 30, 2016. Given how many borrowers refinanced their mortgages in 2015 and 2016, a homeowner may have a professional appraisal in hand that could support a lower value than what the county determined. Some assessors, like Arapahoe County’s, provide a list of sales they used to support the valuation. A property owner might feel there are other sales that match up better and support a lower value. A real estate agent with access to the multiple listing service can help track down those sales. But again, any sales must be before June 30, 2016, and the closer the better. If I think I’ve got a shot, now what? If you’ve decided that a protest is worth your while, you can either file in person at your assessor’s office, by mail or, in most metro-Denver counties, online, at your assessor’s website. Regardless of how you do it, remember that your protest is due by June 1. My protest didn’t get me what I wanted. What are my next steps? If a protest is turned down, or the property value not adjusted as much as the owner requested, those decisions can be appealed before a County Board of Equalization. In most counties, assessors must rule on a protest by the end of June and property owners can appeal to the CBOE by July 15. In more populated counties like Denver, Boulder, Douglas and Jefferson, assessors have until the end of August to rule on protests, with appeals due by Sept. 15. There are two venues for another level of appeal beyond the county boards, and those are the district courts or the state Board of Assessment Appeals. Not many homeowners, however, go that far. What else can I do to reduce my tax burden? Homeowners age 65 or older who have lived in a home for 10 years or longer only have to pay half of the property taxes on the first $200,000 in value. A similar exemption is also available for permanently disabled veterans. Also, some local governments and school districts can help some homeowners who want relief with their tax burden. If you’re disabled or age 60 or older, you can trade volunteer hours in lieu of taxes in what are called property tax work-off programs. By: Aldo Svaldi |
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