PAY LESS REALTY

Put an Experienced Buyer Representative to Work For You...

Sellers list their homes with real estate agents to assure professional representation throughout the home selling process. As a buyer, you deserve the same kind of service.

Pay Less Realty has been awarded designation by the National Association of Realtors. To attain this "Accredited Buyer Representative Manager" Designation, we must complete an extensive classroom training program on buyer agency practices and procedures, pass a written examination and submit evidence of practical experience as a buyer's representative. So... if a real estate transaction is in your future, put an ABRM to work for you.

How to House Hunt

1. Prioritize

What amenities are really important to you in a home and neighborhood? For example: Style of house, floor plan, community, school system, and transportation. Planning will help you discover valuable shortcuts in the buying process.

2. How Much?

A lot of people think they have to make a 20 percent downpayment. The good news is that over the years new and innovative loan programs have evolved which require a 5 percent downpayment or less. Those great loans with little or nothing down are not available to everyone: You need good credit. For at least one year prior to purchasing a home, you should assure that every credit card bill, rent check, car payment and other debt is paid in full and on time.

3. Get Loan Preapproval

"Preapproval" means you have met with a loan officer, your credit files have been reviewed and the loan officer believes you can readily qualify for a given loan amount with one or more specific mortgage programs. Based on this information, the lender will provide a preapproval letter, which shows your borrowing power. Although not a final loan commitment, the preapproval letter can be shown to sellers when bidding on a home. It demonstrates your financial strength and shows that you have the ability to go through with a purchase. This information is important to sellers since they do not want to accept an offer that is likely to fail because financing cannot be obtained.

4. Choose a Home

Once you have a clear picture of what you want and what you can afford, we will help you find a property that fulfills both qualifying factors.

5. Make an Offer

You sometimes hear that the amount of your offer should be x percent below the seller's asking price or y percent less than you're really willing to pay. In practice, the offer depends on the basic laws of supply and demand: If many buyers are competing for homes, then sellers will likely get full-price offers and sometimes even more. If demand is weak, then offers below the asking price may be in order. Price may not be the only consideration in structuring an offer that is best for you. Other things may be equally important to you, such as the terms and conditions of the offer, amount of deposit and possession date. We can explain the general contracting process as well as our role.

6. Negotiating with sellers

Sellers are concerned about many things when reviewing an offer including the ability of the buyers to fulfill the agreement, the terms and conditions of the offer and even the motivations and lifestyle of the buyers. We will help structure strategy to create a winning scenario.

7. Getting the Mortgage

Mortgage financing can be obtained from mortgage bankers, mortgage brokers, savings and loan associations, mutual savings banks, commercial banks, and credit unions. To obtain a loan you must complete a written loan application and provide supporting documentation. Specific documents include recent pay stubs, rental checks and tax returns for the past two or three years if you are self-employed. During the pre-qualification procedure, the loan office will describe the type of paperwork required.

8. The Closing

Before closing, buyers typically have a final opportunity to walk through the property to assure that its condition has not materially changed since the contract was signed. At closing, all papers have been prepared by closing agents, title companies, lenders and lawyers. You'll sign a number of papers and checks. After all the papers have been signed, the seller will hand over the keys and at last it's your home!

Choosing a Condo or Corporative (Co-op)

For some people, a condominiuum or co-op may be a better housing choice than the traditional detached home. Such units are usually located with convenient access to office, public trans and shopping areas. and there's a lot less time-consuming home maintenance involved. While condos and co-ops are both part of a multi-family setting, single building, or community, there are some significant differences.

Ownership

Condo: title, same as a house

Co-op: own shares in a not-for-profit corporation. Co-ops require a certain financial requirements for the buyer. Typically there is a minimum downpayment (25%-30%) and income to debt ratio (i.e. 4 to 1).

Property Taxes

Condo: unit owners taxed separately

Co-op: The entire property is owned by the corporation, so it appears on the tax rolls as a single piece of property. The co-op pays the property taxes and passess along the cost to the shareholders, usually as part of the monthly maintenance fee.

Tax Deductions

Condo:same as a house

Co-op:deduct his proportionate share of the property taxes and interest on a the underlying mortgage.

Financing

Condo:same as a house

Co-op: few lenders willing to give a mortgage

Monthly fees

Condo: includes maintenance

Co-op: includes maintenance, property taxes and frequently all utilities.

Resale

Condo: same as a house

Co-op: less costly; sale not recorded. Most co-op charge the seller a transfer fee (usually calculated by a dollar amount per share, i.e. $1.50 per share at closing).

When you look for a condo or co-op, one of the most important things to do is check out the performance of the management company. When you actually go to see the unit, check the exterior of building and grounds held in commen by everyone to see if they are well manintained. If the management firm isn't doing a good job, you could be in for a huge bill for repairs at some time in the future. And make sure to check out the rules for owners or shareholders. Some may exclude pets.

Estimating Your Closing Costs

Legal and Title Costs

1. Attorney Fee: Normally $750 and up, depending on the attorney

2. Title Search: $200-$300 approx.

3. Title Insurance: Varies. $5 per $1,000 approx.

4. Recording Fee: Required by local County clerk about $40-$60 (per instrument to be recorded).

5. Survey: Averages $300-$600

Mortgage Costs

1. Application Fee: Set by lender, approx. $250-$500

2. Lender's Attorney Review Fee: $100 - $500 average where applicable

3. Appraisal Fee : $300 - $500

4. Prepaid Interest: Paid to lender. Covers interest on mortgage beginning from day of closing to end of first month

5. Escrow Fees: Paid to lender, covering approximately 3 months of real estate taxes, fire/flood insurance, and PMI premium where applicable

6. Points: Paid to lender usually 1-3 (1 point =1% of mortgage)

7. Private Mortgage Insurance (PMI): Usually required if mortgage is more than 80% of purchase price. Average premium is 2 1/2% of the mortgage. 1% payable at closing.

Home Inspection Fee

1. Home Inspection: $300 - $600

2. Radon inspection: $100 - $200

3. Wood destroying Insect inspection: $60 - $150

4. Oil Tank (if applicable): $400 - $500

Other Costs

1. Homeowner's Insurance: One family house $600-$1,000/year. Flood Insurance (if applicable)

2. Mansion Tax on Residential Properties: 1% when Sales Price is over $1,000,000

Condo and Co-op

1. Community entry fee: Usually calculated by some formula of the maintenance, i.e. 3 times the monthly maintenance

2. Move-in fees: $100 - $500 where applicable

3. Processing fee: $25 - $300 where applicable