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Real Estate Terms Explained

by Galand Haas

Good Monday Morning!

Sometimes when you are speaking with your Real Estate Agent, the terms that they are using may seem as foreign to you as those terms that your doctor throws out to you. I saw this article in "Realty Times" that talks about Real Estate terms and I decided to share it with you!


We saw an ad today for an acreage community in Texas offering barndominium shells during their Grand Opening special. That's right, barndominium shells.

Don't know what that is? Yeah, neither did we (they're apparently structures built with prefabricated materials like metal shells, which can then be customized to individual specifications.

Because much/most of the structure is prefab, the construction can be quick, and cheap). Great. Good to know.

Anyway, it got us thinking that there may be a lot of real estate terms out there that are confusing or misunderstood. So, behold our first real estate terms rundown. We'll be back with part two soon.

Alley-loaded: This is a type of home that puts the garage in the rear of the home, accessed by a common alley.

Appraised Value: When you are buying or selling a home, an appraiser will tour the home and assign a value according to several factors including similar homes in the neighborhood and condition, size, and location of your home.

As-Is: An as-is home is typically sold without a warranty and without any commitment to making repairs. As-is homes are commonly foreclosures.

Backup Offer: This is an offer that's second (or third or fourth…) to an accepted offer on a home. The idea is that if the home falls out of escrow for some reason, the backup offer can move up in line.

Buying down your interest rate: Your lender may offer you the opportunity to buy down your interest rate. This means coming up with money out of pocket in exchange for a lower interest rate.

Closing: Closing takes place once all the escrow requirements have been met. This is when the buyer signs all the necessary documents and takes ownership of the home.

Comparables: These are homes that compare to the one you are buying or selling. Comparables or "comps" are used to identify a home's sales price by comparing the home to others that are similar in terms of size, age, location, condition, and other factors.

Contingency: A contingency is sometimes attached to an offer, making said offer dependent on other factors, like the sale of a potential buyer's existing home.

Earnest money: This is typically paid when making an offer on a property. If your offer is accepted, you enter into escrow and the earnest money becomes part of your down payment.

FSBO: A home that's being sold "For Sale By Owner" instead of with a Realtor. You may hear this pronounced "Fizbo."

HOA: Newer communities and masterplans usually have a Homeowner's Association, which charges a fee to homeowners for things like landscaping and amenities. In acreage communities, there is instead a Property Owner's Association (POA).

P&I: Refers to principal and interest only. You always want to make sure you keep in mind all the other monthly charges you'll be responsible for, like taxes, insurance, and an HOA fee if there is one.

PITI: Principal, interest, taxes and insurance, otherwise known as the four main elements of a monthly mortgage.

PMI: This stands for private mortgage insurance, and is typically required on homes where the buyer has put less than 20 percent down.

Points: You may be charged points by your lender when processing your loan. One point equals one percent of the loan amount, and so on.

Zero lot line: Zero lot line homes, also known as Z lots, are built differently than traditional single-family or attached homes. "Zero-lot-line house are built very close to the property line in order to create more usable space," said Investopedia. "Rowhouses, garden homes, patio homes and townhomes are all types of properties that may be zero-lot-line homes. They may be attached (as in a townhome) or detached, single story or multistory."

Have an awesome week!

THIS WEEKS HOT HOME LISTING:



593 71st Street

Price: $225,000     Beds: 4     Baths: 2    1/2 Baths: 1     Sq Ft: 1564

Charming home with some updates. Features new roof, laminate wood floors, vinyl windows and heat pump. Lovely living room with wood burning fireplace and built-in storage. Kitchen with eating bar opens to spacious dining room with slider. Bedrooms a...
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RMLS Market Activity for September 2015

by Galand Haas

Good Monday Morning!

Real Estate sales in the Eugene and Springfield area were slightly down in September, but remaining at a higher pace than 2014.  The biggest trend remains to be the lack of inventory.  This is especially true in the lower price ranges.  Don't look for any serious changes as long as mortgage interest rates continue to be at their current low levels.  Here are the numbers for September 2015.

Activity in Lane County cooled slightly this September, but all measures are still ahead of last September. Pending sales (461) fared 31.3% better compared to the 351 offers accepted in September 2014, though 9.8% below the 511 offers accepted in August 2015. Closed sales (443) rose 26.9% over the 349 closings posted in September 2014 but fell 1.8% short of the 451 closings from August 2015. New listings (486) showed an increase of 11.5% compared to last September (436) but were 21.0% lower than the 615 new listings offered last month in August 2015.

Inventory fell just slightly in September to 3.0 months.

Year to Date Summary

Activity was up during the first nine months of this year compared to the same period last year. Pending sales (4,094) were up 30.3%, closed sales (3,658) were up 28.8%, and new listings (5,400) were up 10.0% this year compared to the first nine months of 2014.

Average and Median Sale Prices

Comparing 2015 to 2014 through September of each year, the average sale price rose 3.5% from $235,200 to $243,400. In the same comparison, the median sale price rose 4.8% from $210,000 to $220,000.

Have An Awesome Week!

THIS WEEKS HOT HOME LISTING!



1062 Adams St

Price: $314,900     Beds: 3     Baths: 2     Sq Ft: 1845

Prime location property! Updated hm can be used as single fam, mother-in-law or duplex. Hardwood, 3 ductless heat pumps, storm wdws, corian counters, hardi shingle siding, 40yr roof, tankless hot water, weatherized, gas fp. Original wainscoting, cas...
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What To Expect When Buying Your First Home

by Galand Haas

Good Morning!

With mortgage interest rates remaining extremely low, first time homebuyers are still making up a huge part of the home purchase market.  If you are currently renting and wanting to own a home or if you are otherwise thinking of that first home purchase, this is the market to do it in.  The affordability of homeownership may never be much better than it is right now. Here is an article from Realty Times that gives great advice if you are thinking about that first home purchase.

Few things in life are more exciting than buying your first home. The feeling of turning the key for the first time (or clicking the garage door opener) is thrilling. You'll likely feel a sense of pride like never before. But getting to that point may be a challenge. And the challenges won't end once you move in.

The more you know about the process, the more prepared you can be for the wrinkles that pop up, and the more you can relax and enjoy homeownership.

1.It may cost more than you expect.

When you're calculating your monthly payment, don't leave anything out. Add in principal, interest, taxes, and insurance, plus any HOA fee. Then estimate landscaping, pool maintenance if needed, and any other fees there may be. Don't forget to include your monthly home warranty cost if you have one.

Experts recommend putting aside a minimum of one percent of your home price for repairs and maintenance per year, so add that in. Think also about utilities. If you're coming from a small apartment, you might have a bump in that monthly cost. Only by taking a real look at the numbers can you get a true feeling for what you'll pay every month as a homeowner.

2. You may only have to put three percent down.

FHA loans aren't your only low down payment option anymore. Ask your lender about 97% LTV loans that require only three percent down for first-time buyers.

3. You can probably afford it more easily than you think.

Rents have been going up way more than home prices in many real estate markets. A recent analysis by RealtyTrac found that, "Payments on a mortgage used to purchase a three-bedroom home were more affordable than paying rent on a similar home in 66 percent of the counties."

4. But…know how much you can really afford.

Your loan approval will tell you how much the bank thinks you can afford. But they only know so much. If you're planning to have a baby or change careers sometime soon and your income could be affected, you may want to stay lower on the payment scale, which means a higher down payment or a less expensive house (or both).

5. You need a preapproval.

Your REALTOR® will tell you this. Believe him. Even if he takes you out to look at houses without a preapproval (many won't, since it could be seen as an indication that you're not serious about buying), you won't be in a good position to make an offer if you find a place you like. And in a competitive market, that could be disastrous.

6. It may be easier to buy a single-family home than a condo.

Strict FHA restrictions on condos can make for a limited pool of options, and, if you can find one that is approved, it might have a higher interest rate. Be sure to ask your lender to provide a side-by-side analysis of a condo and single-family home in similar price ranges; a home that is priced slightly higher may end up being the answer when you examine the numbers carefully.

7. You might be able to get money to fix up your home.

Fashion yourself a DIYer? Ask your lender about 203(k) and HomeStyle loans. "Fannie Mae and the Federal Housing Administration have home renovation mortgage programs that allow buyers to borrow based on what the house is expected to be worth after the home rehab is completed," said Bankrate.

8. You might be able to get a gift for your down payment.

"Cash gifts are also allowed for low-down payment mortgages including the FHA purchase mortgage, which requires a 3.5% down payment and the Conventional 97 mortgage from Fannie Mae and Freddie Mac which requires just 3% down," said The Mortgage Reports.

They're also allowed on many other conventional loans, and can help a first-time buyer get to a 20 percent down payment that would help them qualify for the lowest rates. Check out The Mortgage Reports for important details about down payment gifts. Do it wrong, and your application can be rejected. There also may be tax implications for improper gifting.

9. Gift funds may also be allowed for your closing costs.

Be sure to ask your lender. Not having to come up with thousands of dollars at closing means money for new furniture!

10. You'll have a love-hate relationship with your HOA.

You'll appreciate them when the car up on blocks for a week in front of the neighbor's house is towed. Not so much if it's your car up on blocks.

11. You'll want to thoroughly check out the neighborhood.

Make sure there are no development plans that may affect your home value in the neighborhood you're looking at. Talk to the neighbors. Check for sexual predators nearby. And spend some time in the area at different times and on different days so you can observe the neighborhood flavor. You also might want to arrange to commute from/to the house one day to see what you have in store.

12. You'll want good schools. Even if you have no kids.

Families inherently seek a neighborhood with quality schools. But studies show that good schools can dramatically affect home value, making these neighborhoods desirable to buyers without kids as well. "Living near a high-scoring school can increase your home's value by over $200,000, according to the  Brookings Institution," said AOL.

13. You can derail your loan approval.

Don't check your credit, get a new store credit card, close an account, or buy a new car while you're in escrow - you might not stay in escrow. Listen to your lender and hold off on anything that could affect your credit or financial situation until you close.

14. The home inspection will reveal some issues. It always does.

Keep a cool head and let your Realtor handle any negotiations. You just might come out better than before.

15. You're gonna get a tax break.

You're probably already looking forward to this, but do you know the details? Your mortgage interest is a write off. So are your Private Mortgage Interest (PMI) fees and any points you pay to buy down the rate on your mortgage. All told, you could be getting a nice little return come tax day. Check out this calculator to estimate your tax break.

16. It will be more work than you imagined.

Stuff leaks, breaks, makes weird noises, shuts down, peels, crumbles, flames out, and falls off. You will learn how to fix it all, or at least how to make a phone call to someone who can.

17. It will all be worth it.

Have An Awesome Week!

THIS WEEKS HOT HOME LISTING

 
 
 



2685 Valley Forge Dr

Price: $524,900    Beds: 3    Baths: 2    ½ Baths: 1    Sq Ft: 2302

Anslow & DeGeneault 2015 Tour of Homes model home. Gas forced air 92% efficiency, exquisite single level, located in beautiful Hawthorne Estates. Easily entertain in Great Rm overlooking backyard. Escape to luxurious owner’s ste w/ tray ceilin...
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Changes to Your New Mortgage Loan

by Galand Haas

Good Morning!

Things have now changed with your new mortgage loan.  New documents are now going to be required on all transactions and these new documents and new rules will most likely increase the amount of time it takes to close on your loan.  Here is a recent article from Realty Times that talks about the new items that went into effect on October 3rd of this year.

The Know Before You Owe disclosure form issued by The Consumer Financial Protection Bureau will go into effect on October 3, 2015. The rule provides for easier-to-use mortgage disclosure forms that clearly lay out the terms of a mortgage for a homebuyer.

But some lenders and real estate agents say the new mortgage rules may delay closings. What will change is that three documents, the HUD-1 Settlement Statement, the Good Faith Estimate, and the Truth-in-Lending disclosure will be pared down to two new closing forms called a Loan Estimate and a Closing Disclosure.

The Loan Estimate form must be given to consumers no later than three days after they formally apply for a loan. That means providing financial information to the lender and signing a mortgage application.

When the consumer receives the Loan Estimate form, he or she will know what the loan amount and the interest rate will be, how much the monthly payment is, an estimate of taxes and insurance based on local rates, and how much down payment is required.

To prepare for settlement, homebuyers will have a three-day period to review the Closing Disclosure form. Because of the added review period, lenders are recommending that borrowers lock in their mortgage rates for longer periods than they normally would.

CNBC real estate reporter Diane Olick explains that the "new rules will require lenders, title companies, real estate professionals and insurance representatives to all come together sooner in the process to ensure the disclosures do get out in time."

For example, a 30-day rate lock is typical, but borrowers can extend the lock period up to 45 days or 60 days. However, there may be a question as to whether or not more time is really needed to close the loan.

According to Bankrate.com, Borrowers are often told there's no charge for a rate lock. That's true in the sense that the rate lock isn't associated with a fee. But a rate lock isn't free.

Josh: A longer rate lock typically involves a higher interest rate, which is more expensive for the borrower. The interest rate or "pricing" difference between a 15-day rate lock and 60-day rate lock might be as little as one-eighth or as much as half of a percentage point, or roughly $25 to $50 per month for the life of the loan.

Laura: Meanwhile, real estate agents are preparing for the worst. According to a new survey by the National Association of REALTORS® says that about 56 percent of REALTORS® say they plan to add more time to their contracts.

Have An Awesome Week!

THIS WEEKS HOT HOME LISTING!

755 Horn Lane

Price: $274,000     Beds: 4     Baths: 2     Sq Ft: 1868

Tranquil & spacious property! Beautifully landscaped 0.41 acre lot provides seclusion & great entertaining spaces. Remodeled home offers updated kitchen & baths, large living rm w/ gas fp, formal dining, large windows+skylight. Private master ste w/...
View this property >>


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Photo of Galand Haas Team  Real Estate
Galand Haas Team
Keller Williams Realty Eugene and Springfield
2644 Suzanne Way
Eugene OR 97408
Direct: (541) 349-2620
Fax: 541-687-6411

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