How do you get the most out of your Prescott home purchase?
From Tom Henichek, a local loan officer at Mountain Mortgage
Get a better interest rate
Well, for starters we have lower prices than anytime in the recent past, great interest rates and the possibility of seller concessions. Every product today has at least a guarantee of 3% seller concessions. So, if the seller will or cannot lower their selling price, they may allow some concessions in order to sell their home.
This is only one of the reasons why if you are thinking of purchasing a home, you should talk over your situation with a lender. In today's cash poor society, your lender can assist in this process.
After all, if you need assistance with your closing costs, your lender will be the first to advocate for you. The best way to document this is to come up with a figure for the seller's contributions. The 3% is based on the loan amount and if the contract states that the amount is for closing costs, some lenders may not allow the contribution for prepaid items i.e. interest, home insurance and property taxes. With a specific amount stated and contributed, that money can be put toward prepaid items or be used to buy down your interest rate.
Today, the spread between interest rates is lower than at any time in the past and this option may be worth considering.
The credit system is ripe for errors and something from your past may still be lurking on your report even though you thought it was corrected. With the number of foreclosures, credit reports are weighed heavier than at any time in our history. Being pre-approved for a purchase will cost you nothing but time and will put your mind at ease when the time arrives for you to make your move.
For more information about the current financing market or to get pre-approved, call
Tom 928-775-9330 or email him at tomhenichek@cableone.net.
Get All 3 FICO Scores and Credit Reports!
Washington finally looking at real stimulus
Last night, the Lieberman/Isakson Amendment was included in the senate version of the Economic Stimulus Bill by a unanimous voice vote. This amendment would provide a Tax Credit to all home buyers at the rate of 10% of the sales price up to a limit of $15,000. The credit would be available for a one year period to all purchasers of primary residences.
US House of Representitives
If you have been watching the news this week, you may have noticed that the debate in Washington has finally turned toward real stimulus for the housing industry. As a result, I believe that we could be on the brink of a substantial turn around in the real estate market. Now, it’s critical that we all join together and deliver a powerful message to our legislators that we support this stimulus.
US Senate
Today, the senate expects to debate Amendment 353, a proposal by Senator John Ensign (R-NV) that would provide 30 year fixed financing at a rate of about 4%, for anyone purchasing a primary residence.
If these two provisions survive in the final passage of a stimulus bill they could have a tremendous impact on our industry. If they are coupled together with provisions to ease the flow of credit and reduce foreclosures, we could see an immediate and dramatic turn-around in real estate.
I feel that these provisions represent real economic stimulus. They will put money in the hands of millions of homeowners, increase sales, stabilize home values and add more revenues to local communities in the form of property taxes.
I urge each of you to contact your senators and representatives to let them know that you believe these provisions are essential components of any stimulus bill. You can go to the official Senate and House web sites to locate the email and phone number of your legislators.
This may be one of the most critical moments for the real estate industry in our time. Please pass this information on to anyone you might do business with. The outcome of this legislation will have a lasting impact on us all. I appreciate your assistance on this urgent matter.
Top 10 Reasons Why You Should Stage Your Home…
1. You Will Make More Money
U.S. Housing and Urban Development reports that a staged house sells, on average, 17% higher than a non-staged house.
Staging Your Prescott Home
2. Your House Will Sell Faster = Less Headaches and Hassle
The New York Village Voice reported that the average number of days on the market for a staged house was 13.9 versus 30.9 days for an unstaged house.
3. The Cost of Staging, Doesn’t Cost A Dime…
In a 2003 HomeGain Survey of over 2000 Realtors it was discovered that sellers who spent up to $1000 Staging their home recovered almost 200% of the cost in the sale of their home.
4. Most Home Sellers Cannot View Their House Objectively
If you can’t see objectively, you can’t “package” effectively. Have a staging professional give you a detailed, step by step, “Action Plan” for less than $500 so you can do the work yourself.
5. Less Guesswork and “Do It Yourself”…
A professional home stager can manage your projects from start to finish OR give you a detailed enough report based on their extensive knowledge and training to have you “do-it-yourself."
6. Only 10% of homebuyers can visualize the potential of a home
That’s why staging a vacant home is critical! You don’t want the benefits of your beautiful home left up to the buyer’s imagination.
7. Studies show that the longer your home stays on the market the lower your selling price will be…
Don’t settle for less and lower your price…have your house staged.
8. The Money You Make is TAX FREE!
Take advantage of your tax-free capital gain by getting every dollar you can in the selling price of your home.
9. Leaving Your House in “AS IS” Condition Will Help Sell the Competition
Right now the number of homes for sale on the market is at a record high, competition is getting stiff and buyers have an expectation when they walk through your door.
Do you really need another reason to invest in your future earnings by staging?
10. Do you really need another reason?
Patrick Schutte is an Accredited Staging REALTOR and includes a free home staging walkthru with every CMA delivered.
FSBOs are down 25% in 2008
According the latest edition of Fortune Small Business Magazine, February 2009,
For Sale By Owner (FSBO) sales are down from 20% of total sales in 2006 to around 15% last year. The National Association of REALTORs has the numbers even lower as they report only 12% homes being sold by owner.
"With properties hard to sell these days, sellers are returning to brokers for professional marketing help," says Steve Muarray from REAL Trends, a market research firm.
Why do homeowners try to sell FSBO?
| Why did you choose to sell FSBO? |
2004 | 2005 | 2006 |
| Commission Savings | 61% | 53% | 51% |
| Sell to friend, relative, neighbor | 17% | 22% | 22% |
| Buyers contacted Sellers | 9% | 9% | 12% |
| Avoid dealing with Real Estate Agent | 6% | 8% | 8% |
| Seller has Real Estate License | 2% | 2% | 3% |
| Agent Unable to Sell Home | 2% | 3% | 3% |
| Couldn't Find an Agent | 1% | N/A | 1% |
| Other | 2% | 3% | 2% |
| Source: NAR, Profile of Home Buyers and Sellers 2004, 2005, 2006 | |||
Why It's Not For Everyone?
Pricing
Apparently most For Sale By Owners just aren't objective when it comes to pricing their homes. There are so many emotions wrapped up in home ownership that's it's difficult to accurately determine the market value of a home without professional assistance. FSBO homes are usually overpriced by 10% or more and in this market, that means there won't even be any showings.
Exposure
With just 1 property to sell, For Sale By Owners simply can't afford to generate enough interest in a home for sale. By contrast, real estate agents have dozens of properties to sell at one time. They can afford to advertise because they know if the potential purchaser doesn't buy the home they advertise, there's a good chance they can sell them another from their huge selection in the Mutliple Listing Service (MLS).
Patience
The average For Sale By Owner gives up after just 2 -3 weeks. The mantra seems to be something like this, "we'll try it for a few weeks, but if it doesn't sell right away, we're going to give it to a real estate broker. " Seems like a good idea, but the 1st 30 days that a home is on the market is the most critical, and not having the right initial exposure can hurt in the long run.
Experience
Without real estate selling education or experience, most home sellers are simply unprepared for the real estate marketing and transaction process. Situations that appear routine to the experienced real estate professional can seem daunting and perplexing to someone not accustomed to the home selling process.
Buyer Reticence
Most buyers don't want to deal directly with an owner. Studies show that about 88% of home buyers use a real estate agent for their home purchase. Add to that the fact that FSBO properties are just generally more difficult to find because they're not listed in any well-known repository for homes for sale information like the MLS and you can see why for sale by owners are missing out on 3/4 of the market.
For more information on how to sell your property for the most money and least hassle,
contact me for a no-obligation market report.
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