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Starter Home - A Guide for First-Time Homebuyers

by The Hat Team


Purchasing your first home is a huge milestone…and not one that should be taken lightly.  It’s a big commitment and you want to make sure you get it right.  It’s important that you educate yourself before you begin the home buying process so that you can find the right property and procure the financing for it. 

Here are some things you should know as a first-time homebuyer:

  1. PEOPLE INVOLVED IN THE HOME BUYING PROCESS

Entering the home buying process for the first time might feel a little overwhelming. You will have a lot of questions, but don’t worry, there will be people who will guide you through.The first thing to do is to find an . Your Realtor will assist you in finding your starter home, making an offer, and negotiating with sellers. Another person you should meet with prior to starting your home search is a mortgage lender. Your mortgage banker will help you complete your loan application along with determining the amount you qualify for. Getting pre-approved for a mortgage is an important step that will set you on the right course for buying your first home. 3 Essential Reasons to Get a Mortgage Preapproval

  1. STARTING YOUR HOME SEARCH

I’m sure you’ve heard the saying in relation to real estate. It exists for a reason. Because location is one of the most important aspects in choosing a home.The first thing you must do when searching for your starter home is determine the area you want to live in.You should take many things into consideration when making this decision. Do you want city, suburban, or country living?What is the reputation of the school system?Are there shopping, dining and entertainment activities nearby?The answers to these questions aren’t just important for you when you’re living there, but may also have an impact on resale value. Remember, this is your starter home; not necessarily your forever home. So, you should take resale value into consideration when choosing the location. Once you’ve determined WHERE you want to look, you can create a list of what you’re looking for in a home.You may have to compromise on some things, but going into your search knowing what you want will make things less confusing. Home Buying Wish List

  1. FINANCIAL IMPLICATIONS

When buying your starter home, there may be some expenses that you didn’t anticipate.  Don’t risk being blindsided by unexpected expenses.  Do your research and make sure you know what you are getting into.  Here are some costs you may not have thought of:

  • Closing costs
  • Home inspection
  • Moving expenses
  • Setting up your new house

Remember that your Realtor and Mortgage Banker are there to answer questions you may have, so don’t hesitate to take advantage of their expertise!

If you are considering the purchase of your starter home, let Sandra Nickel and her Hat Team of professionals assist you with all your real estate needs!  Call them today at 3234-834-1500!

What is Title Insurance and Why Do You Need It?

by The Hat Team


When you are purchasing a home, especially if you are a first-time homebuyer, it’s easy to become overwhelmed by all the things you need to think about.  Something like title insurance is probably not even on your radar. It’s a fee that will appear on your closing document and chances are you don’t even know what it’s for.  If that’s the case, we’ve got you covered.  Here are five things you need to know about title insurance:

  1. Like other insurance policies, title insurance is something that protects you financially should there be a loss.  In this case it protects you with regard to property ownership. It not only ensures that the property you are purchasing will be legally transferred to you from the previous owner, it also protects you from possible future Title Defects.  There isn’t a monthly premium with title insurance; it is a one-time fee paid at closing.  This one-time payment will protect the insured from title defects for the life of the loan.
  2. Title insurance is important because while a title research company will look into the history of ownership of the home to be sure there are no title defects, there is always a possibility that an issue could arise later due to several reasons such as improperly recorded documents, mistakes in ownership history or other legal matters that occurred prior to your purchase of the home.
  3. There are two types of title insurance; one that protects the home owner and one that protects the mortgage lender.  Your lender will require that you purchase the lender’s policy to protect them from any loss should a problem arise.  The owner policy protects you and will cover legal fees or other losses that occur due to a title defect. You are not required to get an owner policy, but it’s well worth it to have it in place just in case something goes wrong in the future.
  4. It can be frustrating to pay for insurance that you might never use, but it is risky to not have it in place. Think of it as paying for peace of mind.  With title insurance, you will be protected from catastrophic circumstances should a title defect be found.  You could not only lose a lot of money; you may even lose your home.
  5. Title insurance is purchased when closing on your home. You have the option of buying it from whatever company you choose, but if your lender has a preferred company, you may find it less expensive to add your owner’s policy onto your lender’s policy. Average Cost of Title Insurance 2019

If you are in the market to sell or buy a home, let Sandra Nickel and her Hat Team of professionals assist you with all your real estate needs!  Call them today at 334-834-1500!

Photo Credit: wsj.com

Furnishing Your First Home - Choosing Pieces that Will Last

by The Hat Team

Congratulations! You are a first-time home owner!  Now it’s time to furnish your new space.  While you may already have furniture from your previous home, if you are moving into a larger place, chances are you will be looking to add to it.  When deciding what to purchase, it will pay to think long-term so that you can choose pieces that will last, both in quality and in style. Here are 5 pieces of furniture that will stand the test of time;

  1. A SIMPLE BUT STURDY DINING TABLE

A small, well-built table is a great starter piece for your dining room or eat-in kitchen.It doesn’t have to be ornate; you can use table cloths to spruce it up.What’s nice about it…and what makes it lasting…is that when you upgrade to a larger dining room table down the road, you can use this table in your breakfast room, sunroom, craft room, or even as a desk in your office.


Photo Credit: etsy.com

  1. INDOOR/OUTDOOR CHAIRS

When looking for chairs to go with your dining table, avoid upholstered ones and instead look for durable materials that are suitable for both indoor and outdoor dining. Why? Because your dining set of today can be your patio furniture in the future.Look for chairs made of metal or with slats in the seat or back so that they can withstand being outdoors in the rain.


Photo Credit: pinterest.com

  1. A KING-SIZED HEADBOARD

An elegant headboard can dress up a bedroom. It might not be a priority to have one right away, but if you choose to purchase one, go big.Maybe you are sleeping in a double bed right now and you are wondering why you would buy a king-sized headboard for that.Well, down the road when you upgrade to a queen or king-sized bed, you will already have a headboard ready to go! So, choose a wall-mounted or freestanding headboard that will give your double bed a luxurious look now and you will still be able to use it when you get that king-sized bed later!


Photo Credit: pitus.info

  1. A SMALL LEATHER SOFA

You don’t necessarily need a large sofa right away, but it’s still important to have a quality, comfortable one.The family room is often the heart of the home and you will spend a lot of time sitting on your sofa. So, it should not only be comfy, but also made to last.The nice thing about a leather sofa is that while providing a cozy lounging spot for one or two people now, it will age well and become a great accent piece as part of a larger family room later.It will coordinate easily with colors and patterns in a larger seating arrangement.

Top 7 Benefits of Leather Furniture


Photo Credit: livingspaces.com

  1. A CLASSIC SIDEBOARD

A sideboard may not provide a lot of storage, but it adds a lot of style and function to just about any room in your home.Choose a warm, wood unit that will last through years of style and décor changes.It is such a versatile piece that can be used as a storage space/server in a dining area, as a media stand in a family room, as a bedside table in a bedroom, or as the perfect place to display treasures in a foyer or living room.


Photo Credit: pinterest.com

If you are in the market to sell or buy a home, let Sandra Nickel and her Hat Team of professionals assist you with all your real estate needs!  Call them today at 334-834-1500!

Which Should You Do First - Buy or Sell?

by The Hat Team


It’s time for you to move. Maybe it’s because your family is growing and you need a larger home. Or perhaps your nest has recently emptied and you want to downsize.  Whatever the reason, as a home owner, you not only need to find a new home, you also need to sell your current home.  This brings us to the question…which should you do first?  Buy, then sell? Sell, then buy? Or do both at the same time?  There is no one right answer for everyone, but certainly there is one that is right for you. Here are the pros and cons of each of these options:

BUYING FIRST - PROS

  • One perk of buying a new home before you sell your current one, is that it allows you the time to find the ideal home without having to rush to a decision. There is no pressure to get out of your current home by a certain date, forcing you to maybe choose a house that isn’t quite right.
  • If you are a planner by nature, then knowing where you’re going to be living once you sell your home is definitely a positive aspect of buying first.  It will give you peace of mind to know that you can move directly to your new house once you have sold your current one.
  • If you buy first, you can take your time moving.  You will also have the time to do any work on your current property that is needed, such as home improvements and/or updates, before you put it on the market.

BUYING FIRST - CONS

  • Ideally, you would be able to sell your current home within a month of purchasing your new one so that you don’t have to pay two mortgages.  But there is no guarantee that will happen.  Your house might sit on the market for a while, and if it does, you need to be prepared to make two mortgages each month until it sells.  If this is not something you are able to do, you probably shouldn’t buy before selling.
  • If you buy before selling your income will need to be able to support both mortgages.  This will increase your debt-to-income ratio ( DTI )meaning that if you’re already struggling to qualify for a new mortgage, it’s going to be even less likely you will qualify if you have two mortgages.  You may want to sell first to lower your DTI so you will qualify for your new mortgage.

SELLING FIRST - PROS

  • Depending on the state of the current real estate market, there may be a lot of competition for homes.  In this case, you will find that selling first and having cash on hand will be an advantage when competing with other buyers.  You will also be in a better negotiating position if you don’t need a contingency when you buy. Home Sale Contingencies for Buyers and Sellers
  • When you sell your current home first, you will have a clear picture of how much you can afford for your new home.  It will also provide you with cash to put toward your down payment.  If you can put a full 20% down, depending on your loan program, you can avoid paying mortgage insurance each month. This will save you money over the life of your loan.
  • Selling first will eliminate some expenses.  If you buy a new home before you sell, you will not only be making two mortgage payments until your current property sells, but you will also be paying for utilities in both homes.  These expenses can add up quick!

SELLING FIRST - CONS

  • When you sell your house before you have found a new one, you may have to find temporary housing…which can be a real hassle. Trying to find a place to live on a short-term lease is challenging and becomes even more complicated if you have pets or you are looking for specific school district.  It also means you will have to move…twice. Moving once is stressful enough. Moving twice in a short period of time is exhausting. And when you do find your new home, you may have to juggle both a rent and mortgage payment for a month or more depending on your lease.
  • If you’ve sold your current home, but haven’t found your new one, you may feel panicked about finding a home quickly.  This feeling might lead you to rush your search and to perhaps settle for a home that isn’t right for you.  Buying a home is likely the largest financial investment you will ever make, not to mention the logistical and emotional implications, so it is a decision that you definitely don’t want to rush.

Believe it or not, it is possible to buy and sell simultaneously.  For example, you can make a contingent offer, meaning that your offer is dependent on your current home selling.  A contingent offer may not be as appealing to sellers in a competitive market, but it eliminates the risk of ending up with two mortgages. Another option is to use a HELOC: Home Equity Line of Credit to cover the cost of purchasing a new home while still paying mortgage on current home.  There is also the possibility, depending on your lender, of getting a Bridge Loan to help cover expenses in the time between buying and selling.

There are many factors involved when deciding whether to buy or sell first. Let an experienced Realtor like Sandra Nickel assist you in navigating the home buying/selling process.

If you are in the market to sell or buy a home, let Sandra Nickel and her Hat Team of professionals assist you with all your real estate needs!  Call them today at 334-834-1500!

Buying a Home in 2019 - Tips for Success

by The Hat Team


Are you planning to become a home owner in 2019?  If so, it’s important that you educate yourself about the real estate market so that you know what steps to take to successfully find and purchase the right home for you.

With the continued shortage of homes for sale, buyers need to be prepared for competition with other home buyers as homes will likely get many offers.  That being the case, it is vital that serious buyers put their best foot forward from the very start.  Their first offer will need to be their best one in a situation where there are likely to be multiple offers, because they may not have an opportunity to negotiate.  Unless you intend to pay cash, the best thing you can do is to get Pre-approved for a Mortgage Loan before you start shopping for your new home.  This will let buyers know that you are serious and that you can afford the purchase price.  Remember that in a seller’s market, homeowners are calling the shots and it’s not a time to take risks.  It’s also worth mentioning that the best offer might not be the offer of the most money.  Sellers will take into account the financing and likelihood of a successful closing. The more cash in the offer, the more likely the loan will close.

As a buyer in this market it benefits you to be flexible when it comes to a closing date. The best strategy is to have your Realtor find out from the sellers when they would like to close.  If they need to close by a certain date, they may pass on an offer if those buyers can’t close by that date.  Being flexible about when you want to take possession of the house will help you stand out to sellers as well. Sometimes sellers might need a little extra time to move out and if you can work with them, they might accept your offer over someone who needs to move in right away.

Be ready to make an offer right away. When a house comes on the market that you would like to bid on, have your pre-approval letter ready.  Take a look at the home as soon as possible and if it’s right for you, have your Realtor make an offer as soon as possible. This is not a time for a low-ball offer. A Realtor who is very familiar with the market can help you decide on the right amount to offer. In fact, one of the most important things you need to do to prepare to buy a home is to hire a professional, experienced Realtor like Sandra Nickel to assist you in the home buying process.

Finally, don’t wait!  Home prices are rising, as are interest rates. So, if you’re planning on becoming a home owner this year, now is the time to start your home search! 2019 National Housing Forecast

If you are in the market to sell or buy a home, let Sandra Nickel and her Hat Team of professionals assist you with all your real estate needs! Call them today at 334-834-1500!

Building Wealth by Investing in Real Estate

by The Hat Team

 

Investing in real estate is a time-tested way to successfully build wealth.  While there are many ways to invest your savings, investing in real estate is unique in that it offers cash-flow, liquidity, profitability, and tax and diversification benefits that other investments do not.  If you’ve been thinking about how to build wealth for your retirement, you would be smart to consider investing in real estate. Diversification and Real Estate Investing

There are four primary ways to make money in real estate:

  1. Appreciation. When a property increases in value, you have real estate appreciation. Sometimes is happens due to changes in the market and other times it may be due to upgrades made on the property.
  2. Cash flow income (rent). Cash flow income is a nice perk of real estate investment that you don’t have in other types of investments.  It is generated when you purchase a home or apartment building or an office building and rent them out.
  3. Real Estate Income.  This is income earned by people who earn commissions through real estate transactions or buy property managers who oversee the operations of rental properties.
  4. Ancillary Real Estate Income - This can be a huge source of profit.  Things like application fees, vending machines and laundry facilities are money makers that go beyond the monthly rent.  Increase Your Bottom Line - Supplementing Rent with Ancillary Income

While there are certainly Risks of Real Estate Investing, there are a lot of benefits that outweigh the risks:

  1. Real estate is something that people who grew up lower to middle class are familiar with.  They may not have been exposed to things like stocks and bonds, but they likely know the importance of owning a home.  Buying a home is an investment that is reachable for them.
  2. Having an investment that you can see; something that is tangible, is psychologically important.
  3. You have the control in a real estate investment.  You don’t have to worry as much about being defrauded the way you might when entrust your money to someone else to invest for you.
  4. You will reap the benefits of tax advantages.
  5. You can Leverage Your Debt to buy more real estate and increase your net worth.

Whether you are thinking of purchasing a home for yourself and investing in your own future by building equity or you are considering buying property to rent out, investing in real estate is great way to build wealth!

If you are in the market to sell or buy a home, let Sandra Nickel and her Hat Team of professionals assist you with all your real estate needs! Call them today at 334-834-1500!

On the 12 Days of Christmas My Realtor Gave to Me

by The Hat Team

On the first day of Christmas my Realtor said to me:

Buyers: if you’re looking to buy your first home, now is the time! There might be less inventory now, but there is also less competition and more highly motivated sellers. 5 Reasons to Buy a Home This Fall

On the second day of Christmas my Realtor said to me:

Sellers: if your home is for sale during the holiday season, feel free to decorate, but don’t go overboard.  You want your home to look its best while still enjoying your personal touch.  Avoid large decorations that can be overwhelming or distracting.  Remember that potential buyers want be able to envision your home as their own.

On the third day of Christmas my Realtor said to me:

Buyers: take advantage of less competition from other buyers during the holiday season. Less competition might mean you'll be able to negotiate a favorable price for a home you want to purchase. Homes are often priced to sell this time of year. Although there is so much going on during the holidays, it might be worth it to go house hunting if it means a better price for you!

On the fourth day of Christmas my Realtor said to me:

Sellers: make your home feel inviting. If it’s cold outside, make it warm and cozy inside. Play soft, classical music and offer homemade holiday treats. If potential buyers are comfortable, they will spend more time in your home and will have more time to appreciate all its best features.

On the fifth day of Christmas my Realtor said to me:

Buyers: consider possible tax advantages.  If you itemize your taxes, you can deduct any points you paid upon closing, as well as property taxes and mortgage interest. Whether it is to your advantage to buy before or after year’s end depends on factors such as how many other deductions you have this year and expect to have next year.

It is best to consult with a tax professional before purchase. Even though you do not want to decide on a home purchase strictly for tax reasons, it could be to your benefit to close before the end of the year. Buying a Home: The Tax Impact of Your New Home

On the sixth day of Christmas my Realtor said to me:

Sellers: there will be motivated buyers this time of year. If people are house hunting during the holidays, they probably have a good reason for doing so. For example, they may be relocating for a job or investing for a tax deduction.  If they are on a deadline, they will be highly driven to find a home quickly.  It may be worth it to do the extra work involved in showing your home during the holiday season.

On the seventh day of Christmas my Realtor said to me:

Buyers: you may find that there are better interest rates this time of year. Generally, there is often a cyclical trend of lower interest rates during the holidays due to limited demand forcing greater competition among lenders.

On the eighth day of Christmas my Realtor said to me:

Sellers: price your home to sell.  A home that is reasonably priced for the market will make buyers feel merry and bright.  Many real estate agents advise sellers to initially price their home to sell rather than making small price reductions over time.

On the ninth day of Christmas my Realtor said to me:

Buyers: you may get a faster closing on your new home since all parties involved have incentive to complete the transaction before the end of the year. Lenders want to close their books; realtors want to receive their commissions and buyers and sellers want to settle into their new homes. Since all parties are motivated and there are fewer transactions taking place during this time, in many circumstances, it should be easier to put everything in place for a smooth and rapid closing.

On the tenth day of Christmas my Realtor said to me:

Sellers: provide photos that show your home year-round.  Yards and landscaping aren’t always at their best during the winter months.  Make sure that potential buyers see the beauty of your home during other times of year when the grass is greener and trees and flowers are in bloom.

On the eleventh day of Christmas my Realtor said to me:

Buyers: motivated sellers may mean a better deal for you. People who are selling their homes over the holidays often have a need to sell fast. If a house has already been on the market for a while, that need is even greater. It may be advantageous for you to buy now. You can negotiate fairly but firmly with the sellers for a lower price and/or other concessions such as having them pay closing costs.

On the twelfth day of Christmas my Realtor said to me:

Sellers: create a video tour for the web. You might get less foot traffic during the holidays due to the business of the season.  By posting a video tour, you may attract house hunters who don’t have time to go to your home in person.

If you are in the market to sell or buy a home, let Sandra Nickel and her Hat Team of professionals assist you with all your real estate needs! Call them today at 334-834-1500!

How to Raise Your Credit Score to Save Money

by The Hat Team

Want to buy a house but a low credit score has you down?  Don’t despair! There are ways to raise your credit score and save thousands on your mortgage.   A strong credit score can lead to better interest rates, additional loan programs to benefit homebuyers, and easy and quick approvals which will put you on the fast track to home ownership.  Here are some tips for raising your credit score:

  • Make sure your credit reports are accurate.  The first step toward improving your credit score is checking your credit reports.  You will find your credit scores on three different reports, one each from the 3 Major Credit Bureaus.  Keep in mind that credit reports can have mistakes…and they often do.  That’s why it’s important that you analyze them carefully.  Make sure that the information on the reports is accurate, because if there are mistakes, they will be reflected in your score.  It’s easy to check your credit reports and doesn’t have to cost anything since you are entitled to a free copy, once a year, of all three thanks to the Fair Credit Reporting Act.  Once you have copies of your credit reports go through them carefully and make sure of the following:
  • Is your personal information is accurate?
  • Are all your credit accounts are being reported?
  • Are there any late or missed payments that you remember making on time?
  • Are there any applications for credit that you don’t recognize?
  • Are there any accounts you don’t recognize?
  • Are there decades old items still on your report?

Highlight any discrepancies you find.  If you do find errors, you will have to dispute each one separately.  How to Dispute Errors on Your Credit Report

  • Figure out what you need to fix/change/improve.  Here are some examples of things that could be causing your score to be lower than it should:
  • Your identity may have been stolen and someone is screwing up your credit.
  • An old collection account could still be haunting you, way past its statute of limitations for your state.
  • Do you have an ex-spouse? Perhaps he or she has not paid a bill he or she was supposed to pay per your divorce settlement.  Unfortunately, you could be suffering the consequences.
  • If you have ever defaulted on a loan it might be showing up as several defaults on your credit report because it has been sold to other debt collectors.
  • It might be a simple name mix up…your credit information might be mixed up with that of someone with a similar name.
  • Devise a plan to improve your credit score.  You can open a free account on Credit.com where you can get tips to help you determine where your poor credit issues are and they can assist you in creating an action plan for improving your score.  To get started, try keeping your credit card balances as low as possible, and start paying down debt rather than moving it around.
  • If you have a habit of making late payments…stop.  It’s vital that you make payments on time. Set up alerts when payments are due so that you won’t forget.  If due dates don’t coincide with when you get paid, make some calls to get the dates moved around to better suit your schedule.  Don’t be afraid to ask a credit card issuer or lender to forgive a past due payment. You might be surprised to discover they will happily work with you if you have a history of making on-time payments.
  • Open a secured credit card.  This is a type of credit card that allows you to make a deposit into a checking account that “secures” the line of credit being extended to you.  You will be able to get a secured credit card even if you already have bad credit, and adding a new account with a positive payment history will help improve your credit score over time.

2018's Best Secured Credit Cards for Building Credit

Once you get your credit score where it needs to be, you will reap the benefits by qualifying for better rates and save money on your mortgage loan!

If you are in the market to sell or buy a home, let Sandra Nickel and her Hat Team of professionals assist you with all your real estate needs! Call them today at 334-834-1500!

Photo Credit: cfcw.com

Home Closings - What Can Go Wrong

by The Hat Team

Closing on a home is the final step to the home selling/buying process.  It can feel stressful and overwhelming, especially to first-timers.  Here are some things that most often go wrong with home closings, and how to avoid them!

     WALK THROUGH - A walk through of the home is done before closing to confirm that everything is as it was when you signed the purchase agreement.  It’s also the time to make sure any repairs that you requested were completed.  If you get to your walk through and discover that the owner took the washer and dryer they had agreed to leave or there were agreed upon repairs not done, your closing will definitely be put on hold.  Money will be placed in escrow to cover the costs and deadlines will be extended.

     FEES - You will want to look at a copy of your HUD-1 Settlement Statement before going to your closing so that you can look over all the fees and ask questions should you have any. Fees on the statement will include those from your lender, closing attorney, city, insurance, surveys, and transaction fees among other things.  You don’t want to get all the way to your closing and find out there are fees you weren’t aware of which may delay proceedings.

     TITLE SEARCH - Make sure the title search is completed with plenty of time to deal with any issues that may arise.  A professional title examiner should be utilized by your closing attorney to be sure there are no defects on the title that would prevent the property from being sold.   If the title search is done at the last minute and there are problems, it might take a long time to fix thus holding up the closing.

     WIRE TRANSFER - The wire transfer of funds needs to arrive within a specific window of time for closing.  An issue with the wire can hold up closing.  It’s vital to check with your lender and closing attorney to be sure that all parties have the correct wire information and timelines.

     CLOSING PACKAGE - A common problem that delays closings is the Closing Package not being ready.  At the end of the loan process, there are a lot of loose ends that must be tied up and they can sometimes cause delays. Timing is everything.  You may be scheduled to close at 11:00 AM, but if your package isn’t ready until 2:00 PM and your lender and attorney has other closings scheduled, your closing may be postponed to the next day.

If you are in the market to sell or buy a home, let Sandra Nickel and her Hat Team of professionals assist you with all your real estate needs.  Call them at 334-834-1500 today!

Photo Credit: realtor.com

Buyer & Seller Guides Fall 2018

by The Hat Team

Displaying blog entries 1-10 of 39

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