If you are looking to move to a larger home, first time home buyer, or relocating to Alabama now is the time to buy. There are lots of homes in Alabama that are priced to sell. Great deals are happening all over the state. There are Foreclosures, Short sales, and just great deals now is the time to make your move. If you need any help selling or buying your next home just give me a call and I will be glad to help you any way I can. Don't forget homes in Alabama are selling like HOT CAKES, so make you move to you new home NOW!!!
Christie Addaway
Weichert,Realtors/Access Realty
(205)296-1580 cell
(205)833-6300 office
Thursday, April 23, 2009
Thursday, February 5, 2009
New Site for Open Houses in Birmingham
Weichert, Realtors has just launched a new site for Open Houses in the Birmingham area.
Each week the site is updated with the open houses coming up for the weekend.
The new open house site is www.8YellowBalloons.com
It already has the upcoming houses for the weekend of February 7th and 8th 2009. If you are looking to buy a home in the Birmingham Area, 8YellowBalloons.com is your one stop resource for open house times and directions.
Thursday, May 15, 2008
Selective Immersion draws Rave Reviews from Real Estate Students
New Teaching Method helps Students Pass Real Estate Exam
(Birmingham, AL) A new method of teaching and instructing students has recently shown amazing results in students who have attended Real Estate Success Institute in Birmingham, Alabama. The teaching method is referred to as "selective immersion" by the originator of the technique, Mike Carraway.
After spending years sitting through real estate classes and in many cases having trouble staying awake, Mr. Carraway decided to do something about the "old school" methods of instruction to make sure students were engaged and really enjoyed classes and learned from them.
"I have taken the pre-license class in 3 different states and also have had to sit through Continuing Education classes in all these states. One thing they all have in common is that all of them consisted primarily of lecture, lecture, lecture." Mr. Carraway says that is not effective in appealing to all of the different learning styles that students use.
According to Mr. Carraway, because some students are visual learners, some are aural learners, some are active learners, and some are tactile learners, the classroom content must address all of these styles of learning. In addition, classroom content must focus on one subject area at a time. The subject area can contain many subareas, but, all of the learning types and teaching styles must be used to insure that all of the students grasp the main concepts first, and then the sub-concepts second.
"The idea is to totally immerse the student in the subject, and engage them in many different ways", says Carraway. Real Estate Success Institute uses a 2 week or 10 day format for the required 60 hour pre-license class.
"The 2 week format provides an excellent venue for the selective immersion teaching technique.", says Carraway. His students are drawn into the subject with engaging stories that illustrate the main points, role plays that further illustrate the subareas, question and answer sections, challenge quizes, and games akin to Jeopardy. In essence, the student is totally immersed in that particular subject for that day through a wide variety of activities. But it doesn't end in the classroom.
"All of our students are instructed to do 2 activities each evening - read their notes - and make up flashcards." But, Carraway says, the students are told to spend no more than 45 minutes each evening on these activities. He says that during the classroom time, students form new neural pathways in their brains that make new synaptic connections. These new pathways quickly disappear unless they are reinforced a few hours later. That's why the evening activities are so important.
"The first thing we do the next day is a quick review of the day before, further reinforcing these new neural connections." Carraway says he can always tell which students have not completed their 45 minutes of evening activities: he gets blank stares the next day from those students.
The results from this teaching method have been nothing short of amazing. Most of the students that attend the Alabama 60 hour pre-license class pass the state real estate exam the first time they take it. His school, Real Estate Success Institute draws students from the entire state of Alabama from as much as 5 hours away. Some students even book a hotel room for their 2 week stay and return home during the weekend break.
"I am very proud of the students who are accepted into the class, who do the activities, and who are helping us produce a successful track record for this new instructional technique."
Some of Carraway's past students have interesting comments on the classes. Debbie from Montavallo said, "The in-class exercises really reinforced the information; you are actually learning this stuff and didn't even realize it at the time." This comment tends to substantiate Carraway's claim of selective immersion being a really new and unique teaching method. Another student, Joe K., said, "The classroom was filled with real life examples and a multitude of professionals from the real estate marketplace.", which is referring to quick appearances from professionals in the business such as attorneys, home inspectors, and a variety of others.
Carraway says that having quick guest appearances for 10 minutes or so provides even more stimulation for the students. According to Carraway, stimulating the students constantly is what it's all about. "We live in a video game, reality TV show world. Our teaching method takes that into account and uses continual stimulation to help students learn new concepts."
Selective Immersion as a teaching technique looks like it could be the next new wave in schools and instructional programs. "It takes a lot of work on the instructors part, but to me, it's worth it if all of the students pass the exam the first time."
Real Estate Success Institute can be found on the web at www.BirminghamRealEstateSchool.com and can be reached by calling 205-833-6325. The school is located just off of I-59 in the Roebuck area near Trussville, Alabama. The address is 1100 East Park Drive, Suite 104.
"If you are looking for a fast paced, exciting class where you will get the information you need, learn the concepts you need to know, and remember them, then our 2 week pre-license class is for you."
Mike Carraway is a Real Estate Broker, Certified Real Estate Instructor, Author, Motivational and Sales Training Speaker and is the Real Estate Success Institute administrator. The school website is http://www.BirminghamRealEstateSchool.com Mike Carraway has been active in the real estate business for the last 21 years and owns the 2 office company WEICHERT, REALTORS - Access Realty in Birmingham, Alabama and the website is located at http://www.access1000.com He also maintains a weblog at http://www.access1000.blogspot.com
Article Source: http://EzineArticles.com/?expert=Mike_Carraway
Mike Carraway
Broker/Owner
WEICHERT, REALTORS - Access Realty
1100 East Park Drive, Suite 104
Birmingham, AL 35235
office - 800-840-0165
fax - 205-833-3350
4500 Valleydale Road, Suite 160
Birmingham, AL 35242
office - 995-3939
fax - 995-3929
www.Access1000.com
www.BirminghamRealEstateSchool.com
www.Access1000.blogspot.com
www.WEICHERT.com
Broker/Owner
WEICHERT, REALTORS - Access Realty
1100 East Park Drive, Suite 104
Birmingham, AL 35235
office - 800-840-0165
fax - 205-833-3350
4500 Valleydale Road, Suite 160
Birmingham, AL 35242
office - 995-3939
fax - 995-3929
www.Access1000.com
www.BirminghamRealEstateSchool.com
www.Access1000.blogspot.com
www.WEICHERT.com
Monday, March 24, 2008
Home sales rose, prices fell in February By MARTIN CRUTSINGER, AP Economics Writer
32 minutes ago
WASHINGTON - After falling for six straight months, sales of existing homes posted an unexpected increase in February which may have reflected more aggressive price cutting by sellers in some parts of the country, a real estate trade group reported.
ADVERTISEMENT
The National Association of Realtors said that sales of existing homes rose by 2.9 percent in February to a seasonally adjusted annual rate of 5.03 million units. It was the biggest increase in a year and caught economists by surprise. They had been expecting a small decline.
The trade group reported that the median existing sales price in February fell to $195,900. That was the largest year-over-year drop on records that go back to 1999.
Lawrence Yun, chief economist for the Realtors, said that prices in some formerly hot markets in California and Florida were seeing significant price declines now as sellers try to attract buyers.
Analysts cautioned against reading too much into the one-month rise in sales. Many economists are predicting that the steep slump in housing will not bottom-out until later this year after prices fall further and allow huge levels of unsold inventories to be reduced.
"We're not expecting a notable gain in existing-home sales until the second half of this year, but the (February) improvement is nother sign that the market is stabilizing," Yun said.
By region of the country, sales surged by 11.3 percent in the Northeast and were up 2.5 percent in the Midwest and 2.1 percent in the South. The only region of the country to see a decline in the sales was the West, where they dropped by 1.1 percent.
Sales of existing homes fell by 12.7 percent in 2007, the biggest decline in 25 years. Over the past two years, housing has been in a steep downturn made worse by a severe credit crunch as financial institutions tightened their lending standards in reaction to their multibillion-dollar losses on mortgages that have gone into default.
The steep slump in housing has raised concerns about a possible recession. Democrats are pushing the Bush administration to do more to stem a tidal wave of mortgage foreclosures to keep more unsold homes from being dumped on an already glutted market.
Sen. Hillary Clinton, campaigning for the Democratic presidential nomination, on Monday called on President Bush to appoint an emergency working group on foreclosures to recommend new ways to confront the housing crisis.
"Over the past week, we've seen unprecedented action to maintain confidence in our credit markets and head off a crisis for Wall Street banks," Clinton said. "It's now time for equally aggressive action to help families avoid foreclosure and keep communities across this country from spiraling into recession."
32 minutes ago
WASHINGTON - After falling for six straight months, sales of existing homes posted an unexpected increase in February which may have reflected more aggressive price cutting by sellers in some parts of the country, a real estate trade group reported.
ADVERTISEMENT
The National Association of Realtors said that sales of existing homes rose by 2.9 percent in February to a seasonally adjusted annual rate of 5.03 million units. It was the biggest increase in a year and caught economists by surprise. They had been expecting a small decline.
The trade group reported that the median existing sales price in February fell to $195,900. That was the largest year-over-year drop on records that go back to 1999.
Lawrence Yun, chief economist for the Realtors, said that prices in some formerly hot markets in California and Florida were seeing significant price declines now as sellers try to attract buyers.
Analysts cautioned against reading too much into the one-month rise in sales. Many economists are predicting that the steep slump in housing will not bottom-out until later this year after prices fall further and allow huge levels of unsold inventories to be reduced.
"We're not expecting a notable gain in existing-home sales until the second half of this year, but the (February) improvement is nother sign that the market is stabilizing," Yun said.
By region of the country, sales surged by 11.3 percent in the Northeast and were up 2.5 percent in the Midwest and 2.1 percent in the South. The only region of the country to see a decline in the sales was the West, where they dropped by 1.1 percent.
Sales of existing homes fell by 12.7 percent in 2007, the biggest decline in 25 years. Over the past two years, housing has been in a steep downturn made worse by a severe credit crunch as financial institutions tightened their lending standards in reaction to their multibillion-dollar losses on mortgages that have gone into default.
The steep slump in housing has raised concerns about a possible recession. Democrats are pushing the Bush administration to do more to stem a tidal wave of mortgage foreclosures to keep more unsold homes from being dumped on an already glutted market.
Sen. Hillary Clinton, campaigning for the Democratic presidential nomination, on Monday called on President Bush to appoint an emergency working group on foreclosures to recommend new ways to confront the housing crisis.
"Over the past week, we've seen unprecedented action to maintain confidence in our credit markets and head off a crisis for Wall Street banks," Clinton said. "It's now time for equally aggressive action to help families avoid foreclosure and keep communities across this country from spiraling into recession."
Wednesday, March 19, 2008
Mortgage lenders to pump $200 billion into markets By Patrick Rucker
5 minutes ago
WASHINGTON (Reuters) - Two U.S. home financing heavyweights won government approval on Wednesday to pump $200 billion more into troubled U.S. mortgage markets, the latest step to stabilize credit markets and avert a deep recession.
ADVERTISEMENT
Despite intensive efforts to battle rising home foreclosures and calm shaky markets by the Treasury Department and the Fed, which has pledged $400 billion to free up credit, Democratic lawmakers continue to press for bolder action.
"All hands are on deck to try and prevent this U.S. situation from becoming a dire crisis," said David Watt, a currency strategist with RBC Capital Markets in Toronto. "They're doing everything they can, making policy on the fly."
Still, markets were not calmed by the latest move by the regulator that oversees Fannie Mae (FNM.N) and Freddie Mac (FRE.N) to immediately loosen their capital requirements and give them a bigger role in buying up mortgages.
The blue chip Dow Jones industrial average (.DJI) lost almost three-quarters of the 420-point gain notched a day earlier, closing down 293 points, in part on worry brokerage Merrill Lynch & Co may need to write down more bad assets.
More relief, however, is in the works. A separate regulator appeared near a decision to allow the Federal Home Loan Bank System to double some mortgage holdings to around $300 billion -- which would be another big shot of market liquidity.
Sources familiar with the proposal said a vote on the measure was likely this week.
PUSHING FOR MORE
There were no signs, however, that Democratic lawmakers were about to let up in a push to have the government step in to play a larger role.
Rep. Barney Frank, chairman of the powerful U.S. House of Representatives' Financial Services Committee, said the Bush administration was warming to his plan to use the Federal Housing Administration to insure up to $300 billion of shaky home loans for lenders willing to erase some of the debt.
The Treasury, however, said it had "no interest" in the proposal, although it was willing to listen to any new ideas.
Fannie Mae and Freddie Mac's regulator, the Office of Federal Housing Enterprise Oversight, said its decision to relax capital rules toughened in the wake of accounting scandals in 2003 and 2004 would allow the two companies to buy or guarantee $2 trillion worth of mortgages this year.
The decision reduces to 20 percent from 30 percent the additional amount of capital they must keep on hand against potential losses, giving them $200 billion in buying power. OFHEO said it may lower the capital requirements further.
Efforts to ease financial market stress helped bring down mortgage rates early this year, but they have risen in recent weeks as investors dumped souring loans to meet margin requirements, undercutting the Fed's attempts to spur the economy by lowering overnight interest rates.
Shares of Fannie Mae and Freddie Mac, which rose sharply on Tuesday in anticipation of the announcement, blasted higher for a second day on Wednesday. Fannie Mae stock rose $2.49 to $30.71 and Freddie Mac shot up $3.88 to $29.90.
The global nature of the credit crisis was underlined as the Bank of England stepped in to dampen rumors that HBOS (HBOS.L), Britain's biggest home lender, might be in trouble. "No meetings have taken place, or been scheduled, to discuss problems with any institution," a BoE spokesman said, taking the rare step to comment on a rumor.
DRASTIC TIMES, DRASTIC MEASURES
In a joint statement with OFHEO, Fannie Mae and Freddie Mac promised to raise "significant capital" in return for easing in their reserve requirements, but the two companies gave no indication how and when they would do so.
The Treasury Department has been pushing financial firms to face losses and quickly raise new capital. That is vital for a return to normal lending and business activity and to avert a full-blown financial meltdown.
Treasury Secretary Henry Paulson, a pragmatic veteran of Wall Street, has so far hewed to the Bush administration's line that it will not countenance a taxpayer "bailout" for people who took excessive risks.
But that argument suffered over the weekend when Treasury helped broker a proposed deal for a takeover of troubled investment bank Bear Stearns.
President George W. Bush said on Tuesday the White House was monitoring financial markets and, if further actions were needed to ease mortgage woes, it would be done "in a way that does not damage the long-term health of our economy."
(Additional reporting by Svea Herbst in Boston, David Lawder and Mark Felsenthal in Washington, Al Yoon in New York and Steve Slater in London; Writing by Glenn Somerville and Patrick Rucker, Editing by Chizu Nomiyama)
5 minutes ago
WASHINGTON (Reuters) - Two U.S. home financing heavyweights won government approval on Wednesday to pump $200 billion more into troubled U.S. mortgage markets, the latest step to stabilize credit markets and avert a deep recession.
ADVERTISEMENT
Despite intensive efforts to battle rising home foreclosures and calm shaky markets by the Treasury Department and the Fed, which has pledged $400 billion to free up credit, Democratic lawmakers continue to press for bolder action.
"All hands are on deck to try and prevent this U.S. situation from becoming a dire crisis," said David Watt, a currency strategist with RBC Capital Markets in Toronto. "They're doing everything they can, making policy on the fly."
Still, markets were not calmed by the latest move by the regulator that oversees Fannie Mae (FNM.N) and Freddie Mac (FRE.N) to immediately loosen their capital requirements and give them a bigger role in buying up mortgages.
The blue chip Dow Jones industrial average (.DJI) lost almost three-quarters of the 420-point gain notched a day earlier, closing down 293 points, in part on worry brokerage Merrill Lynch & Co may need to write down more bad assets.
More relief, however, is in the works. A separate regulator appeared near a decision to allow the Federal Home Loan Bank System to double some mortgage holdings to around $300 billion -- which would be another big shot of market liquidity.
Sources familiar with the proposal said a vote on the measure was likely this week.
PUSHING FOR MORE
There were no signs, however, that Democratic lawmakers were about to let up in a push to have the government step in to play a larger role.
Rep. Barney Frank, chairman of the powerful U.S. House of Representatives' Financial Services Committee, said the Bush administration was warming to his plan to use the Federal Housing Administration to insure up to $300 billion of shaky home loans for lenders willing to erase some of the debt.
The Treasury, however, said it had "no interest" in the proposal, although it was willing to listen to any new ideas.
Fannie Mae and Freddie Mac's regulator, the Office of Federal Housing Enterprise Oversight, said its decision to relax capital rules toughened in the wake of accounting scandals in 2003 and 2004 would allow the two companies to buy or guarantee $2 trillion worth of mortgages this year.
The decision reduces to 20 percent from 30 percent the additional amount of capital they must keep on hand against potential losses, giving them $200 billion in buying power. OFHEO said it may lower the capital requirements further.
Efforts to ease financial market stress helped bring down mortgage rates early this year, but they have risen in recent weeks as investors dumped souring loans to meet margin requirements, undercutting the Fed's attempts to spur the economy by lowering overnight interest rates.
Shares of Fannie Mae and Freddie Mac, which rose sharply on Tuesday in anticipation of the announcement, blasted higher for a second day on Wednesday. Fannie Mae stock rose $2.49 to $30.71 and Freddie Mac shot up $3.88 to $29.90.
The global nature of the credit crisis was underlined as the Bank of England stepped in to dampen rumors that HBOS (HBOS.L), Britain's biggest home lender, might be in trouble. "No meetings have taken place, or been scheduled, to discuss problems with any institution," a BoE spokesman said, taking the rare step to comment on a rumor.
DRASTIC TIMES, DRASTIC MEASURES
In a joint statement with OFHEO, Fannie Mae and Freddie Mac promised to raise "significant capital" in return for easing in their reserve requirements, but the two companies gave no indication how and when they would do so.
The Treasury Department has been pushing financial firms to face losses and quickly raise new capital. That is vital for a return to normal lending and business activity and to avert a full-blown financial meltdown.
Treasury Secretary Henry Paulson, a pragmatic veteran of Wall Street, has so far hewed to the Bush administration's line that it will not countenance a taxpayer "bailout" for people who took excessive risks.
But that argument suffered over the weekend when Treasury helped broker a proposed deal for a takeover of troubled investment bank Bear Stearns.
President George W. Bush said on Tuesday the White House was monitoring financial markets and, if further actions were needed to ease mortgage woes, it would be done "in a way that does not damage the long-term health of our economy."
(Additional reporting by Svea Herbst in Boston, David Lawder and Mark Felsenthal in Washington, Al Yoon in New York and Steve Slater in London; Writing by Glenn Somerville and Patrick Rucker, Editing by Chizu Nomiyama)
Playing the Housing Slump; Is It Time to Make Your Move?
Move?
by Jonathan Clements
Saturday, March 15, 2008
provided by
Financial lore says you should buy when there's blood in the street -- which suggests real estate is a bargain, because there's blood all over the neighborhood.
Time to invest? I wouldn't be surprised to see home prices drop sharply this spring, as long-suffering sellers in hard-hit areas throw in the towel and slash their asking price.
That could spell opportunity for this year's buyers. But what if you already own a home -- and have no desire to become a landlord? Here are three ways to play today's battered housing market.
More from The Wall Street Journal Online:
• Minding the Gap: Home-Price Downside
• Low-Cost Fixes to Make to Make Your Home More Green
• Blacklisting Hits Home Sellers
Trading up. If you're hankering after a larger home or a house in a better neighborhood, this could be your chance to trade up on the cheap.
To be sure, when you go to sell your current home, you will likely get a modest price. Since 2006's second quarter, real estate has fallen 10.2%, as measured by the S&P/Case-Shiller U.S. National Home Price Index. But your new, grander house will also be relatively inexpensive, so you're effectively cranking up your real-estate exposure when the market is well below its peak.
That said, I wouldn't think of this move as an investment. Your new home will probably mean not only a bigger mortgage, but also higher ongoing costs, including homeowner's insurance, property taxes and maintenance expenses. These ongoing costs will offset a large chunk of any future home-price appreciation.
In other words, trading up to a larger home or a better neighborhood is really about wanting to consume more real estate. Still, like any thrifty shopper, you want to buy when there's a sale -- and that is what today's market offers.
"It's like going from a Honda to a Mercedes," says Charles Farrell, a financial adviser with Denver's Northstar Investment Advisors. "It's a lifestyle choice. As long as it doesn't cut into your ability to accumulate capital for retirement, this is probably a pretty good time to upgrade."
Doubling down. Instead of trading up, you might be eyeing a vacation home. If you don't plan to rent the place out, the same logic applies: Once you subtract the annual costs from the price appreciation, you likely won't make very much money -- which means the property won't be much of an investment.
On the other hand, maybe you're two or three years from retirement and are toying with buying a second home that could become your sole residence once you quit the work force. Does it make sense to purchase now, given the decline in home prices?
Buying today is no doubt appealing, because it'll give you a chance to vacation in your future home. But whether it turns out to be a wise financial move depends on what happens to property prices -- and that's tough to predict.
Still, I wouldn't bank on a rapid bounce back in home prices. At the current sales pace, it would take a whopping 10.3 months to clear January's backlog of unsold homes. By contrast, in January 2005, the supply of unsold homes was at a mere 3.6 months, according to the National Association of Realtors.
The bottom line: If you think you'll get a lot of use from a second home, go ahead and buy. But if you view the purchase as a bet on rising home prices, I would hold off for now.
Helping hand. While buying more real estate for your own use probably won't be a great investment, you could help your adult children make good money -- by transforming them from renters to homeowners.
To that end, you might give your kids an advance on their eventual inheritance, so they have enough money to make a down payment. Yes, that means they will start to incur the housing costs I mentioned above, including property taxes and maintenance expenses. But your children will also replace their monthly rent check with a monthly mortgage check, and that will allow them to start building home equity.
"If you have kids who are first-time buyers in markets that are relatively depressed, this could be a good time," Mr. Farrell reckons. "These days, they might need to make a 10% down payment. You could make a gift to them of the down payment or make a loan to them."
Copyrighted, Dow Jones & Company, Inc. All rights reserved.
by Jonathan Clements
Saturday, March 15, 2008
provided by
Financial lore says you should buy when there's blood in the street -- which suggests real estate is a bargain, because there's blood all over the neighborhood.
Time to invest? I wouldn't be surprised to see home prices drop sharply this spring, as long-suffering sellers in hard-hit areas throw in the towel and slash their asking price.
That could spell opportunity for this year's buyers. But what if you already own a home -- and have no desire to become a landlord? Here are three ways to play today's battered housing market.
More from The Wall Street Journal Online:
• Minding the Gap: Home-Price Downside
• Low-Cost Fixes to Make to Make Your Home More Green
• Blacklisting Hits Home Sellers
Trading up. If you're hankering after a larger home or a house in a better neighborhood, this could be your chance to trade up on the cheap.
To be sure, when you go to sell your current home, you will likely get a modest price. Since 2006's second quarter, real estate has fallen 10.2%, as measured by the S&P/Case-Shiller U.S. National Home Price Index. But your new, grander house will also be relatively inexpensive, so you're effectively cranking up your real-estate exposure when the market is well below its peak.
That said, I wouldn't think of this move as an investment. Your new home will probably mean not only a bigger mortgage, but also higher ongoing costs, including homeowner's insurance, property taxes and maintenance expenses. These ongoing costs will offset a large chunk of any future home-price appreciation.
In other words, trading up to a larger home or a better neighborhood is really about wanting to consume more real estate. Still, like any thrifty shopper, you want to buy when there's a sale -- and that is what today's market offers.
"It's like going from a Honda to a Mercedes," says Charles Farrell, a financial adviser with Denver's Northstar Investment Advisors. "It's a lifestyle choice. As long as it doesn't cut into your ability to accumulate capital for retirement, this is probably a pretty good time to upgrade."
Doubling down. Instead of trading up, you might be eyeing a vacation home. If you don't plan to rent the place out, the same logic applies: Once you subtract the annual costs from the price appreciation, you likely won't make very much money -- which means the property won't be much of an investment.
On the other hand, maybe you're two or three years from retirement and are toying with buying a second home that could become your sole residence once you quit the work force. Does it make sense to purchase now, given the decline in home prices?
Buying today is no doubt appealing, because it'll give you a chance to vacation in your future home. But whether it turns out to be a wise financial move depends on what happens to property prices -- and that's tough to predict.
Still, I wouldn't bank on a rapid bounce back in home prices. At the current sales pace, it would take a whopping 10.3 months to clear January's backlog of unsold homes. By contrast, in January 2005, the supply of unsold homes was at a mere 3.6 months, according to the National Association of Realtors.
The bottom line: If you think you'll get a lot of use from a second home, go ahead and buy. But if you view the purchase as a bet on rising home prices, I would hold off for now.
Helping hand. While buying more real estate for your own use probably won't be a great investment, you could help your adult children make good money -- by transforming them from renters to homeowners.
To that end, you might give your kids an advance on their eventual inheritance, so they have enough money to make a down payment. Yes, that means they will start to incur the housing costs I mentioned above, including property taxes and maintenance expenses. But your children will also replace their monthly rent check with a monthly mortgage check, and that will allow them to start building home equity.
"If you have kids who are first-time buyers in markets that are relatively depressed, this could be a good time," Mr. Farrell reckons. "These days, they might need to make a 10% down payment. You could make a gift to them of the down payment or make a loan to them."
Copyrighted, Dow Jones & Company, Inc. All rights reserved.
Monday, March 17, 2008
How to Buy a Home
Owning a home is a very important step in most people's lives. It's a goal that can easily be reached if you work hard and take the right steps. After years of work and saving, finally purchasing your first home is a reward in and of itself, however its a reward that keeps giving and might put you and your family on the path to financial security.
[edit] StepsGet your credit in order. Find out your credit score rating at http://www.experian.com/. Know what your finance report says about you before applying for a loan. If it is as not as cherry as you would hope work on cleaning it up, and improving your score since this is what a mortgage loan is largely based on.
Find the right loan and lender. You will need to research whether using a broker (who can really help if you have bad or so/so credit), or going directly to a bank or possible friend or family for a loan is the best route for you.
Determine your budget. Often in this day and age, lenders will give you much more money than you realistically can pay on a monthly income. Take the time to realistically sit down and make a budget of what you think mortgage, taxes, and the rest of the expenses will cost then raise this by 30%, and this should be your true budget. Before you start thinking, "I can have this house if I eat peanut butter and jelly sandwiches for a year", be realistic!
Identify property to buy. With your list of needs and wants have your agent prepare a list of available properties in the areas you would like to search in. Make sure you indicate which neighborhoods interest you the most and which interest you the least. If you need help finding schools, shopping, demographics, entertainment and the like in a particular neighborhood, ask your realtor to prepare a demographic report for the area - it will help you determine where the closest supermarket is, the movie theater, schools, businesses and even personal demographics of the residents. (Do you want to be surrounded by Volvo Station Wagons or Harley Davidsons)
Schedule time to tour these properties you've already identified. Don't take a quick look and move on to the next one. Your agent should point out special features or items that might need attention. Take a moment to imagine yourself living in this home. Ask yourself, what would it be like, am I comfortable here, can I see myself living here for a long time? Try to ignore fixtures or cosmetic things that can be easily changed. Buyers walk away from a property because it was poorly decorated. Picture the home with your furniture, family photos, momentos, etc. These are the things that make your house, a home, not the previous owner's Elvis themed bathroom.
Be reasonable with your time on your tour - You should plan to see no more than 3 or four homes in a day. Give yourself time to absorb your observations a decide whether this property might be right for you.
Be ready to write an offer. Your agent will prepare all the paperwork and go over the terms with you. And for goodness sake, if you have a question, ASK!!! Don't sign an offer and then ask, "what does that mean?". Now, lets step back just a tad - If you're looking to buy in an area that has a hot real estate market - don't think too long about writing an offer - You're agent will be able to advise you if there are likely other bids for the property. If you find a home that you want, make an offer and put an offer on the one next door too.
Be prepared to submit an "earnest money" deposit. This indicates that your are serious about buying a property, and a are ready, willing, & able to go through with the transaction. The deposit generally is held by your agent and isn't placed into escrow until the offer is accepted. (so you wont be writing checks all over town)
After your offer is presented to the seller, your agent will review with you the response. There are three possibilities; 1.) Acceptance 2.) Counter Offer 3.) Rejection. Once, the offer is accepted, its time to open escrow. The Escrow company will receive, hold and distribute all monies involved in the transaction. After escrow account is opened and funded, now begins your contingency period.
The contingency period is the time allowed by your purchase agreement to obtain financing, perform inspections, and approve of various reports and disclosures. This is also the time to ask for credit to repair that leaky roof the inspector found.
Home owner's insurance: Your agent should coordinate with your insurance representative to make sure that you are fully covered when escrow closes.
Closing time... When all the conditions of the purchase agreement are met, you will sign your loan documents and closing papers - deposit the balance of your down payment, and closing costs and your lender will deposit the balance of the purchase price. Finally the deed will be recorded with the County Recorder's office and you will be handed the keys to your new home. CONGRATULATIONS! You just became a homeowner.
Owning a home is a very important step in most people's lives. It's a goal that can easily be reached if you work hard and take the right steps. After years of work and saving, finally purchasing your first home is a reward in and of itself, however its a reward that keeps giving and might put you and your family on the path to financial security.
[edit] StepsGet your credit in order. Find out your credit score rating at http://www.experian.com/. Know what your finance report says about you before applying for a loan. If it is as not as cherry as you would hope work on cleaning it up, and improving your score since this is what a mortgage loan is largely based on.
Find the right loan and lender. You will need to research whether using a broker (who can really help if you have bad or so/so credit), or going directly to a bank or possible friend or family for a loan is the best route for you.
Determine your budget. Often in this day and age, lenders will give you much more money than you realistically can pay on a monthly income. Take the time to realistically sit down and make a budget of what you think mortgage, taxes, and the rest of the expenses will cost then raise this by 30%, and this should be your true budget. Before you start thinking, "I can have this house if I eat peanut butter and jelly sandwiches for a year", be realistic!
Identify property to buy. With your list of needs and wants have your agent prepare a list of available properties in the areas you would like to search in. Make sure you indicate which neighborhoods interest you the most and which interest you the least. If you need help finding schools, shopping, demographics, entertainment and the like in a particular neighborhood, ask your realtor to prepare a demographic report for the area - it will help you determine where the closest supermarket is, the movie theater, schools, businesses and even personal demographics of the residents. (Do you want to be surrounded by Volvo Station Wagons or Harley Davidsons)
Schedule time to tour these properties you've already identified. Don't take a quick look and move on to the next one. Your agent should point out special features or items that might need attention. Take a moment to imagine yourself living in this home. Ask yourself, what would it be like, am I comfortable here, can I see myself living here for a long time? Try to ignore fixtures or cosmetic things that can be easily changed. Buyers walk away from a property because it was poorly decorated. Picture the home with your furniture, family photos, momentos, etc. These are the things that make your house, a home, not the previous owner's Elvis themed bathroom.
Be reasonable with your time on your tour - You should plan to see no more than 3 or four homes in a day. Give yourself time to absorb your observations a decide whether this property might be right for you.
Be ready to write an offer. Your agent will prepare all the paperwork and go over the terms with you. And for goodness sake, if you have a question, ASK!!! Don't sign an offer and then ask, "what does that mean?". Now, lets step back just a tad - If you're looking to buy in an area that has a hot real estate market - don't think too long about writing an offer - You're agent will be able to advise you if there are likely other bids for the property. If you find a home that you want, make an offer and put an offer on the one next door too.
Be prepared to submit an "earnest money" deposit. This indicates that your are serious about buying a property, and a are ready, willing, & able to go through with the transaction. The deposit generally is held by your agent and isn't placed into escrow until the offer is accepted. (so you wont be writing checks all over town)
After your offer is presented to the seller, your agent will review with you the response. There are three possibilities; 1.) Acceptance 2.) Counter Offer 3.) Rejection. Once, the offer is accepted, its time to open escrow. The Escrow company will receive, hold and distribute all monies involved in the transaction. After escrow account is opened and funded, now begins your contingency period.
The contingency period is the time allowed by your purchase agreement to obtain financing, perform inspections, and approve of various reports and disclosures. This is also the time to ask for credit to repair that leaky roof the inspector found.
Home owner's insurance: Your agent should coordinate with your insurance representative to make sure that you are fully covered when escrow closes.
Closing time... When all the conditions of the purchase agreement are met, you will sign your loan documents and closing papers - deposit the balance of your down payment, and closing costs and your lender will deposit the balance of the purchase price. Finally the deed will be recorded with the County Recorder's office and you will be handed the keys to your new home. CONGRATULATIONS! You just became a homeowner.
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