Monthly Archives: June 2014

Are there Benefits to Renting to Own?

Posted on June 25, 2014 in Uncategorized

Renting to own, also called a lease option or lease purchase, can be perfect for those who want to own their own home, but simply can’t get financing or are unable to come up with a down payment.  A portion of the monthly rent is applied against the price of the home.  Often, homeowners have covered their down payment within a year of renting the property.  In that case, they may be able to go ahead and get permanent financing to purchase the home.

Renting to OwnHow does a lease option work?  Usually, the seller and buyer agree that the buyer will rent the property for a certain amount of time (usually no more than five years).  Sometimes, an up-front consideration fee is required, but that’s not always the case.  The renters pay their rent until the agreed-upon time is up, they then have the option to buy the home with a pre-determined amount they’ve paid in rent, going towards the cost of the property.  If for whatever reason they decide not to go through with the purchase, they may have the option to continue renting the property—this really depends on how the agreement is written.

Finding a seller who is willing to do a lease option may not always be easy.  Many prefer to simply sell the property and be done with it.  If they’re technically a landlord, they may be required to handle upkeep and other maintenance.  They also typically have to continue to pay all of the taxes associated with the property and continue to provide insurance.

Buyers should beware of entering into a lease option without thinking it all the way through.  If for some reason the deal does fall through in the end, the potential down payment money is lost.  There’s also the fact that even though you’re renting to own, you don’t technically own the home until you get financing and make the actual purchase.

Despite these factors, renting to own can still be a good idea.  For sellers, it offers the chance to at least get someone in the house and start making rent money.  That can be very attractive if the property has been on the market for a good amount of time.  For buyers, it’s a chance to start the buying process without dealing with financing, at least in the beginning, or worrying about a down payment.

Before you sign a rent to own contract, make certain to have it examined by a real estate attorney or top real estate professional at GayRealEstate.com.  These contracts can be tricky, and you want to make certain you’re getting the best deal possible.

Tips on Winning a Bidding War

Posted on June 19, 2014 in Buying a Home

In a perfect world, you’d put a bid out on your dream house, the seller would accept, and everything would be great.  Even if you and the seller had to go back and forth a bit, you’d still end up with a great house.  But more and more, especially when it’s a seller’s market, people end up in bidding wars with other potential buyers.  What can you do if you get caught up fighting for a property?  Here are a few tips you can use to win the bidding war.

  1. Bidding WarsGet pre-approved.  If you can show a seller that you’ve already got your financing lined up and can put your money where your mouth is, you have an edge.  This is especially true if the other potential buyers aren’t pre-approved.  Even better, have a pre-approval letter that’s specific to the property you’re bidding on.
  2. If you’re going in with all cash, you have several advantages.  For one, there’s no worry that the financing will fall through.  Another advantage is that you have the option to waive the appraisal.  While this isn’t always recommended, it can tip the scales in your favor.  Make certain you have the paperwork backing up your cash offer.
  3. If you’re not waving the inspection (and again, you probably shouldn’t), you’ll want to have your home inspector ready to spring into action.  You can actually have an inspection done before you make an offer, or you can have the inspection done after.  Remember, too, that the seller might have had a home inspection done already.  They may offer the report to buyers.
  4. Have as few contingencies as possible.  A seller will see an offer with several contingencies as an offer with numerous stumbling blocks to a successful sell.  The fewer contingencies you have, the better position you’re in to win the bidding war.
  5. See the home as soon as possible.  If you can, see the home on the day it goes on the market and be ready to put in the bid.  Your real estate agent can speak to the listing agent to find out what the sellers want.  The easier you make it on them, the more likely they’ll pick your offer.

If you really want to bid from a point of strength, you’ll want to follow several of these tips.  If you’re interested in a specific property you know is about to be listed, you should get pre-approved, see the property as soon as it’s listed, and make a bid with few contingencies.

What is a Contingency Offer?

Posted on June 11, 2014 in Buying a Home

When shopping for a house, you may come across a few properties that your Realtor tells you have contingency offers on them.  What does that mean?  Basically, it means that a buyer has made an offer on the property and the seller has accepted it, but before everything is finalized and the sale actually takes place, certain criteria have to be met. Contingencies are generally to allow the prospective purchaser to get their home sold, the buyers mortgage hasn’t officially been approved by the lender, because they have a home they need to sell.  All in all, a property with a contingency offer on it may give you the opportunity to still present a successful purchase contract.

Contingency PlansWhat’s the point of these contingencies?  They’re basically there to give the buyer a way out just in case something goes wrong.  Generally, they also protect the buyer from losing their deposit.  While a contingency officer is in the works, the seller can consider their offers, and may be able to accept another offer if the contingent offer is unable to drop their contingency.

Smaller contingencies may be when an offer is contingent upon a home inspection, which means the buyer is waiting to have a professional inspector view and evaluate the property.  If something major is found, the buyer can either ask the seller to fix it or can withdraw their bid.  Buyers do have the right to wave a home inspection, but no realtor advises this.  A good inspection will find anything and everything wrong with a house.  Sometimes these things are minor, but sometimes they are major issues like mold of faulty wiring.

An offer contingent upon an appraisal means that the buyer is waiting for a neutral third party (normally hired by the lender) to evaluate the home and provide its fair-market value.  This assures the buyer and the lender that they’re not paying more for the property.  The lender often will only approve a mortgage for up to the appraised value, not the asking price, so it’s always a good idea to know just how much the home is really worth.  If there’s a big difference between the appraisal and what you’re paying, you will have to make up the difference with your down payment.

If you put an offer on a property but don’t have the financing to back it up, you and the seller enter into an offer contingent on the mortgage.  This simply means that the seller has accepted your bid and has given you a specific period of time to find a mortgage loan to back up that bid.  If you can’t, the agreement falls through and the seller moves on to the next buyer.

It’s always advisable to work with a “buyer broker” that is representing your best interests. Select one free and www.GayRealEstate.com.

Why Isn’t My Home Selling?

Posted on June 4, 2014 in Uncategorized

You’ve found a great realtor. You’ve fixed all those little nagging issues you’ve put off for months. You’ve even done some great lawn maintenance and put on a new coat of paint. But for some reason, your house is still sitting on the market. It’s just not moving. Why?

Selling Your HomeThere can be a number of reasons. While the ones listed here may be common issues, they by no means will apply to every seller or every situation. Your realtor can help you identify the particular issues with your property. That said, however, these are common problems that may make a house less appealing to buyers.

  • It’s a buyer’s market. This means that there are more houses available than there are buyers, so buyers can afford to be really picky. They might see a high price and walk out the door without even really looking at the home. Be prepared to lower your initial asking price by seeing what homes in your area are selling for. If they’re all lower than your house, you may have to settle for less.
  • Your home is too dark. If that’s the case, make your home look light and airy.  People are looking for large spaces they can transform into their dream house. Open up the curtains, replace all of those burnt out light bulbs, and move things around to make your home look large and spacious. You might even want to remove dark wallpaper or paint over darker walls.
  • Your home looks cluttered and dirty. When you’re selling, you want to put your best foot forward. That can be difficult if you’re still living in the home, but you have to do your best to make the property look immaculate. Dust, vacuum, sweep, and mop. Even take a good look at your furniture. No, it’s not a part of the house, but an old, stained sofa is still a turn-off to buyers.  Think about covering it with a slip cover. Also, be sure to mow the yard and take out the trash.
  • Your home is a reflection of you. While that might sound like a great thing, it may not always be. Imagine what you would think if you walked into a home and found a room full of different clown figurines. Unless you love clowns, it would probably turn you off to the home, even though it’s obviously not something that would stay. Do your best to make your home as neutral as you can. Remove anything that’s religious, political, or a little out of the ordinary.