Real Estate Information Archive

You are ready to purchase your first house.  Your credit score is great.  You know you can afford a monthly mortgage payment based on your budget.  You are sure you will be approved for a mortgage loan.  But that down payment!  How the heck are you supposed to come up with 20%?  Don’t despair, because the truth is, you don’t need a 20% down payment to purchase a house!

Saving for a down payment on a house can seem overwhelming for many people.  Keep in mind that it can come from various sources.  Funds can come from bank accounts, stocks or mutual funds, an inheritance, or a gift from a family member.  Some people will even use assets from their retirement portfolio.  Requirements regarding where the money comes from for your down payment depend on the loan type.  Also, purchasing a primary residence usually requires a lower down payment than if you are purchasing a second home or buying an investment property. The Different Types of Mortgage Loans in 2018, Explained

The myth about down payments is that 20% is the norm. While that may have been true in the past, it’s not anymore.  The fact is that per the National Association of Realtors, a majority of homebuyers purchased their home with a down payment of 6 percent or less. Unfortunately, a lot of people don’t even consider buying a home because they still think they need 20% down.  The NAR'S Aspiring Home Buyers Profile 2018 found that 36% of non-owners believed that saving for a down payment would be very difficult. Chances are they still believe in the 20% down myth and it is just not the case anymore!

So, now that you know you don’t have to have 20%, perhaps buying a home seems more within reach.  But there are still some things you should be aware of before taking that first step toward homeownership.  Various factors are at play in determining if you should take on a mortgage with lower down payment.  For example, the less you put down, the larger your mortgage payment will be each month.  That is because you will have a larger loan amount, possibly a higher mortgage interest rate, and the added cost of Mortgage Insurance.  So, while you don’t have to come up with more cash, your monthly costs go up.

Once you have educated yourself about the requirements, you can make informed decisions about your budget and how much you can afford.  Don’t let the 20% down payment myth stop you from pursuing your dream of home ownership! 

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!

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!

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Unless you plan to stay in a home for the rest of your life, resale value should be a major consideration when purchasing a house. Home-ownership is a huge financial investment and the goal should be to get as much monetary return as possible when you sell.  While you can’t always predict what the future holds for the real estate market, there are some basic guidelines for what kind of properties have good resale value.  Don’t make the error of focusing only on what you want when doing your home search.  Think about the following factors that will affect the resale value:

1. LOCATION - This should be a primary consideration when looking for a home that will provide a good return on your investment.  A desirable location is likely to remain a hot market for home sales.  Think about the school district you will be in.  Even if you don’t have children in school, a top district will draw many buyers.  Different people will be looking for different things, but most buyers will want basically the same things from the location of the home. Home Buying: Location Matters
2. NUMBER OF BEDROOMS - A house with more than two bedrooms will sell faster and for a better price than one with only one or two bedrooms.  Even a couple with no children will want extra space for an office or guestroom (or both).
3. NUMBER OF BATHROOMS - Buyers will expect to pay much less for a home with only one bathroom.  If people are choosing between a house with one bathroom and one with two, they will almost always be willing to spend a little extra to get that additional restroom.
4. GATHERING SPACE - Buyers want a large, informal space for relaxing and entertaining family and friends.  You will get more value out of a spacious family room than you will out of a formal living room. 
5. STORAGE - These days people have a lot of “stuff” and they need places to put it all.  Storage space, including closets, a pantry and loads of cabinets will improve the odds of getting high bids for your house. 
6. GARAGE - People who live in suburban areas need places to park their cars.  A covered parking place or two is ideal.
7. OPEN FLOORPLAN - Buyers are looking for homes with open spaces and rooms that flow from one to the next.  A house with an Open Floorplan will improve your chances for a profitable resale.
8. OVERALL CONDITION - A property that is well-cared for, updated and remodeled will greatly enhance resale value.  Focus on rooms that matter most to buyers - kitchens and bathrooms. Make sure everything is in good working order.  Some people might be looking for a fixer upper, but many buyers are willing to pay a premium for a move-in ready home.

If you are in the market for a new home let Sandra Nickel and her Hat Team of professionals assist you in finding your dream home.  Call them at 334-834-1500 today!

The decision to purchase your first home is not one that should be made lightly.  It is an important, life-changing decision that should be given serious consideration.  So, before you take the plunge into searching for the prefect home, here are some questions you should ask yourself to make sure that you are ready.

- Can I afford a home?  The first step is to determine if you can afford to buy a home based on your current financial situation.   Using a Home Affordability Calculator will help you figure out how much you can afford by plugging in your income, debt and the amount of a down payment you will be able to make.   You will now have a number for the highest amount you can afford and what the monthly payment will be.

 - Is it better for me to rent or buy?  Using a Rent vs. Buy Calculator will allow you to crunch the numbers. You can enter the current amount of rent you’re paying (or how much you would be able to pay) and the zip code where you want to live. The calculator will provide a comparison of the cost of buying a home versus renting in that area.  You will also be able to see which option is more cost effective over time.

 - How long will I live here?  If you plan to stay in a home for a long time, it is generally better to buy versus rent. If you’re going to be living somewhere for a short term, renting might be the better option.  The reason is that when you buy a home you will likely have to pay closing costs which can total in the thousands of dollars.  In addition, most of your early mortgage payments go toward interest rather than paying down the principal, which is the actual amount you owe on the home.  A good rule of thumb is that home buyers should stay put for at least five years.  Otherwise, renting may be better.

 - Are you saving for retirement?  Retirement may seem a long way off to young home-buyers, but it is important to start saving early.  It’s not a good idea to neglect your retirement accounts to “save” money to put down on a house.   Consider meeting with a financial counselor who can help you find a balance in saving for retirement and saving for your first home at the same time.

 - Am I ready for the responsibility?  Owning a home is a huge responsibility.  With rentals, you can call your landlord to fix things that aren’t working in the home, but as an owner, it’s all up to you.  You need to be sure that you have the time, willingness and resources to keep up with home and yard maintenance.

Sandra Nickel and her Hat Team of professional Realtors at Homes for Sale in Montgomery AL can assist you in the process of determining if you are ready to purchase your first home.  Give them a call at 334-834-1500 and get started today!

With interest rates still relatively low, buying a house right now is less expensive than renting in many places, including Montgomery, AL.  Now is a great time to lock into a rate.

Buying is often considered to be financially better than renting over the long run because your mortgage payments build equity in your home, which you will eventually own, while rent only goes toward the upkeep of your home and the pocket of your landlord. That is just one reason buying is better than renting.  Here are some others:

• You can do what you want with your property. Making home improvements will be your choice…from colors to paint the walls to light fixtures to types of floors, you won’t need permission from a landlord to make changes.
• Tax benefits. Tax Deductions are a great perk of home ownership.
• Stable monthly payments. Rents can go up, but with a fixed-rate mortgage, your monthly payments won’t change.
• Forced savings.  Renting might seem less expensive, but would you actually save the money you don’t spend on rent?  Since your mortgage payments are building equity in your own home, which you can later sell for profit, it’s like a forced savings.

Using a Rent vs But Calculator you can see how buying is a better financial option right here in Montgomery.  For example, after 4 years, the cost of homeownership (down payment, mortgage, taxes, etc.) for a $150,000 home in Montgomery would be $94,094.  The total cost to rent the same house for that period would be $52,193.  Renting would leave you with $41,901 in your pocket (including the money you didn’t spend on a down payment).  So, it looks like renting would be better financially, right?  But wait…not so fast.  Let’s look at what you gain over the same 4-year period if you buy.  After 4 years, your home will have $70,371 in equity. However, if you instead rent and invest your down payment and the other money you save at a 6% return rate, it will earn around $8,351 in 4 years.  So, if you look at your gross costs, equity and investment potential, it’s better for you to buy than rent if you plan to live in your home more than 3 years and 3 months.

The bottom line is, if you’ve been thinking about buying a home in the Montgomery area, don’t wait!  Start investing your money in your own home vs that of a landlord today!

Contact Sandra Nickel and her Hat Team of professional Realtors at 334-834-1500 and let them help you find your dream house today!

Perhaps you have imagined your dream house.  You’ve pictured it in your mind and can only hope that you can find it in real life.  Some buyers have to look for a long time before finding the home of their dreams, but others know right away. When reality matches the vision you have for your home, you might fall in love at first sight. Here are some things that make buyers know they had found “the one” the moment they see it:

• A gorgeous front porch. Nothing says “welcome home” better than a beautifully appointed front porch.  A creative front door with porch railings painted a complementary color are a great way to draw a potential buyer into a home. That first look can make or break the interest of buyers.
• Standing out among the crowd.  That neighborhood full of “cookie cutter” houses may be the right area for you, but you don’t want your house to look like everyone else’s.  A home that stands out is the one for you.  For example, maybe that one white brick house in a sea of red brick houses is just different enough to make it the right one for you.
• Layout. Open concept has been popular for a long time, but maybe your dream house affords more privacy.  When you walk into a home that has defined rooms that serve specific purposes, you have found what you have envisioned as the perfect home for you.
• The great outdoors.  Perhaps the inside doesn’t matter quite as much as the outside to you.  Despite the imperfections in the house itself, that huge, beautiful yard is all you ever wanted.
• Good bones.  If your dream house is one that you design yourself, then you might just fall in love with a fixer upper that has good bones.  Just make sure to educate yourself about what it will take to make the vision you have for your home a reality.

There are many things that can make a buyer fall in love with a house at first sight. A professional Realtor like Sandra Nickel can help guide you through the process of finding and purchasing your dream home.  Give her a call at 334-834 1500 let The Hat Team of Realtors help you today!

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Photo Credit: East Bay Homeless

Coming up with the money needed for a down payment on a house is not easy for many people.  Some are lucky enough to have someone (or several people) give them cash as a gift to go towards purchasing a home.  No doubt, that is a wonderful thing!  But there are guidelines that must be followed when using financial gifts for your down payment.

Using gifted funds to buy a home is not as simple as it sounds.  First, the money can’t come from just anyone.  Lenders want the money to come from a family member, such as a parent, grandparent or sibling.  You can also receive gifts from your spouse, domestic partner or significant other if you’re engaged to be married.

You may or may not be able to use gifted money for your entire down payment. It depends on the type of loan you are seeking.  If you are taking out a conventional loan, all your down payment can come from a gift, if you are putting down 20 percent or more.  If you are putting down less than 20 percent, you must include some money of your own.  With FHA and VA loans, the entire amount can be gifted unless your credit score is less than 620, in which case you will have to come up with 3.5 percent of the down payment yourself. No matter what type of loan you apply for, you can only use gifted funds to purchase a primary residence or a second home.

In addition to there being restrictions about who can give you money, you will also have to prove that the money is a gift.  You will need to provide a gift letter that includes the name of the donor, their relationship to you, the date and amount of the gift and a statement that says the money is given with no expectation of repayment.  Both you and the donor must sign the letter. 

While it’s not necessary, it is a good idea to have the gift in your bank account prior to applying for a loan. That way when your lender looks through your bank statements for the previous few months, they will already see documentation of the gift.

If someone has given you money to go toward a down payment, Sandra Nickel and her Hat Team of real estate professionals can help you find your dream house.  Give them a call today at 334-834-1500!

http://www.homesforsaleinmontgomeryalabama.com/Blog/Guide-for-First-Time-Home-Buyers-5-Steps-to-Get-You-Started

http://www.homesforsaleinmontgomeryalabama.com/Blog/Defeat-Debt-and-Become-a-Homeowner-in-2018

http://www.homesforsaleinmontgomeryalabama.com/Blog/Dont-Be-Deceived-by-Real-Estate-Myths

With interest rates still relatively low, now is the time to start your search for a new home. Here are some tips to help you find your dream home:

• Make a list of priorities.  Ideally, your dream home would have everything you want in it, but it’s still a good idea to make a list of what you want in order of importance to you. What are you most concerned about?  Location? Square footage?  Private backyard? You may have to give up one thing to get another, so you want to be prepared with your priorities so you will know what is non-negotiable for you.  Also, think about desires verses needs when making your list.  For example, a home might not have the vaulted ceilings that you love, but meets your needs and wants in every other way. Those vaulted ceilings are a “want” more than a “need”.
• Think ahead.  How long do you plan to live in the home?  If you are single or newly married you may want a starter home that you will only stay in for a few years while you save for a larger home.  But if you are expanding your family or planning to work from home, make sure you factor in the space that you will need.  Don’t buy a house that will only suit your needs for a year if you think you may live there for ten years.  There is always the chance that things will change, but plan for what you know for sure now.
• Decide on your “most lived in” spaces. Where do you spend the most time in your current home?  If you love to cook, chances are the kitchen is going to be the most important room for you.  If you are a homebody who likes to kick back and watch movies, your den or family room might be the room to focus on.  It might be challenging to find a home where you love every room, but you can give a little on the others if the one you use the most is perfect for you.
• Stick to your budget.  While searching for your dream home, it may be tempting to extend your budget a bit. Don’t do it. A standard goal is to keep your mortgage payment (with taxes and insurance included) at around 25% of your monthly household income.  Make sure that you have looked at your overall monthly budget to see what you can afford, and then limit your house hunting to properties in your price range.  Refrain from looking at houses 1-2 price ranges above yours. You don’t want to get excited about a property that you can’t afford. In addition, once you have seen them, the houses that you can afford won’t look as good in comparison.  The exception is that if it is a buyer’s market, you might be able to negotiate a lower price, so it is ok to look at homes just slightly above your budget.
• Decide if you want to do renovations or if you want a move-in ready home.  If you are handy, you might see a diamond in the rough that you want to fix up yourself.  Make sure if you do this that you are not shopping at the top of your price range because you will need extra funds for doing the renovation.
• Try to see through the “ugly”.  It’s easier said than done for some people, but try not to just pass on a home because of cosmetic reasons.  Look at the bones of the house and imagine its potential. Focus on layout and flow rather than paint and décor.  If it’s the right home for you, cosmetic changes are easy and will give you the opportunity to make the home your own.
• Don’t give up!  It might take a while to find exactly what you want.  Be patient and don’t settle for something just because you’re tired of looking.  You never know when just the right house will go on the market.  It will be worth the wait when you move into the home of your dreams!

http://www.homesforsaleinmontgomeryalabama.com/Blog/The-Top-Features-to-Look-for-When-Buying-a-House

http://www.homesforsaleinmontgomeryalabama.com/Blog/Dont-Be-Deceived-by-Real-Estate-Myths

http://www.homesforsaleinmontgomeryalabama.com/Blog/Mortgage-Tips-for-First-Time-Homebuyers

House hunting can be overwhelming sometimes, especially when beginning the search for your first home.  Chances are you might get caught up in the process and important details might slip by you. While the number of rooms, condition of the kitchen, and size of the yard are important, there are other things to consider before you make an offer.  This list of things to look for can help get your search off to the right start.

1.      Location

They say that the 3 most important things to look for when buying a home are location, location, location.  While a home might not be perfect, loving your neighborhood and neighbors can make all the difference in living with imperfection.  And face it…you can change almost anything about your house, but you can’t change its location or the people living nearby.  When you go house hunting, make sure to consider the home’s proximity to your work, the appeal of the neighborhood, where in the neighborhood the home is situated, ease of access, noise from neighbors, traffic, pets and access to parks, shopping, schools and public transportation.

2.      Home Placement

Beyond location, look at how the home is situated.  If the home is on a hill does it have a view, a walkout basement, or lots of stairs to climb? Do neighbors' windows look directly into the home? Is the yard suitable for kids, pets, gardening, or other uses? Is their safe access to the home? These are all important questions to ask yourself when determining if it is the right property for you.

3.      Check Out the Neighborhood

While it’s important for your house to meet your expectations, it’s equally important that the neighborhood meets them too. Take a drive around the development you are interested in on week days and weekends, during the day and in the evening.  Are the homes in good repair? Are yards kept clean and tidy?  Is the neighborhood safe enough for people to walk, run or bike?  Are there children playing outdoors?

4.       Consider a Home’s Curb Appeal

You want a home that is going to reflect your lifestyle. Do you live a    casual, laid-back life? Then you probably won’t want a formal Victorian or Tudor style home.  A simple, contemporary home might better suit you.  Pay close attention to exterior features.  Think about maintenance.  For example, a brick home is easier to maintain than one with siding.  Do you like working in the yard?  If not, you might not want a house with extensive landscaping.  Is the roof in good condition?  Attention to detail will help you choose the home with the best curb appeal for you.

5.       Size and Floor Plan

You may be thinking about buying your dream home. But is your dream home practical?  Do you need 4 bedrooms and 4 baths when you live alone? A spacious home may provide the extra room you've always wanted for a home office or a theater room, but you'll pay higher heating bills and have higher taxes. Additionally, it will take more furniture to furnish and money to decorate. Think about how the new home space will be used and whether it will fit your lifestyle now and in the future.

6.        Bedrooms and Bathrooms

Decide how many bedrooms and bathrooms you will need and only    look at homes that meet that criteria.  You don’t want to fall in love with what is otherwise a perfect house if it doesn’t provide the space needed for your family.  It’s smart to consider counting an extra bedroom in that number so that you have extra space for a home office or guest room. If you think you might add on to the home later, make sure you consult an architect who can advise you on space planning and regulations.

7.         The Kitchen

For many people, the kitchen is the heart of the home. Don’t settle for a home with a kitchen that doesn’t work for you.  Yes, you can remodel later, but at great expense.  If it’s an easy fix like replacing cabinets or countertops, get a price quote before committing to the house so that you will know if it is within your budget to take that on.

8.          Closets and Storage

Older homes often have small closets and lack storage space.  As you’re looking at a home ask yourself where you will store your belongings.  Tiny closets don’t have to be a deal breaker.  There are ways to maximize storage without renovations. Newer homes tend to have lots of storage and you may sacrifice living space while having more closet space than you need.

9.          Windows and Lighting

While looking at a home keep in mind your preferences regarding light and privacy.  Do you want a lot of windows to provider bright, sunny rooms?  Pay attention to the locations of electrical outlets and fixtures to make sure they will meet your lighting needs.

10.            Finishing Touches

Even a simple home can look spectacular with the right moldings, hardware, and a fireplace.  If elements like these are important to you, look for them while house hunting. 

You may not find everything you want in one house, but keep this list handy and you are more likely to find the home that best suits your needs and desires.  Happy House Hunting!

http://www.homesforsaleinmontgomeryalabama.com/Blog/Mortgage-Tips-for-First-Time-Homebuyers

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