ARE YOU READY TO BEGIN LOOKING FOR A HOME?
You've been thinking for some time about buying a home in an Adult Community but are not sure of many things:
• Am I ready to sell the home I've lived in for years?
• Am I ready to move somewhere new?
• Do I want to live in an Adult Community?
• Where will I put everything from my current home?
• Is this the right time for me to buy a home?
I hear these questions all the time from people considering purchasing a home in an Adult Community and many others as well.
The place to begin is with what I call a "Shopping Trip". Tell me your basic requirements, your price range, and your "I'd love to have" wishes. I'll suggest several developments or homes to you and schedule visits to these homes. I'll tell you that the homes we will see on this first visit probably will not be available for purchase when you're ready to buy but are typical of the homes you can expect to find when you are ready to buy a Monroe Township Adult Community home. We'll drive through the neighborhoods, then visit the Clubhouse so you can see the amenities and get a sense of the community.
You'll leave with a better sense of our communities and have more information to help you make an informed decision about whether or not one of these homes is right for you. You may not have found the exact home or model you want but it is very likely you'll have a good idea of which development you'd like to explore further.
One thing I promise and always do - I will NEVER pressure you into buying something that is not right for you!
HOW DO YOU DETERMINE WHO IS A GOOD AGENT?
The most important factor in working with a Realtor is to find someone who has both experience and knowledge about the area you are looking to purchase your new home. The second important factor is to find a Realtor who is easily accessible, by phone, Internet or both - and is able to answer your calls immediately or return all calls promptly, even on evenings and weekends. Additionally a good agent typically works full-time so that they can follow the market on a daily basis to see and advise you of any new homes that come on the market or, just as important, any price changes or homes that return to the market.
CAN I USE A REALTOR TO BUY A NEW HOME?
Yes, however buyers should be aware of the differences between working strictly with the sales agents who are employed by the developer versus working with a traditional Realtor. The sales agents who are hired by the builder may try to up-sell upgrades and improvements that you might not necessarily want but are influenced to purchase by these sales agents. A Realtor is knowledgeable about both the existing homes in the existing development as well as comparable homes in other developments and might be in a better position to advise you about purchasing upgrades.
Before you visit a new home site it is best to contact a Realtor who can tell you if that builder will work with a Realtor. If they agree to work with your Realtor you must go to that development the first time with the Realtor, otherwise the Realtor will not be paid and will be unable to help you, and builders can refuse to pay any commission regardless of how helpful an agent may become later in the process.
WHAT IS A BUYER'S AGENT?
In many states, it's now common for an agent to represent the buyers exclusively in the transaction and be paid a commission by the buyers. Some states have buyers agents where the buyers are obligated to pay a commission to the agent they have signed a contract with even if that agent doesn't find the home or write the contract.
In this area Realtors almost always work where they represent the buyer, or the seller, or both and seller, but the commission is still paid by the seller. YOU SHOULD MAKE SURE TO WORK WITH A REALTOR WHO DISCLOSES HOW THEY WILL BE REPRESENTING YOU AS SOON AS THEY COMMENCE SHOWING YOU HOMES.
WHAT CAN I AFFORD?
Knowing what you can afford is the first rule of home buying, and that depends on how much income and how much debt you have. In general, lenders don't want borrowers to spend more than 28 percent of their gross income per month on a mortgage payment and total debts including housing should not exceed 36 percent. Of course factors too numerous to elaborate here can be taken into consideration in order for a lender to prequalify you for a loan. Factors that are considered by lenders are the following:
1. gross income
2. the amount of cash available for down payment, closing costs and reserves
3. outstanding debts
4. credit history
5. the type of mortgage
6. current interest rates
HOW MUCH WILL I SPEND ON MAINTENANCE EXPENSES?
Experts generally agree that you can plan on annually spend 1 percent of the purchase price of your house on repairing gutters, caulking windows, sealing your driveway and the myriad other maintenance chores that come with the privilege of homeownership. Newer homes will cost less to maintain than older homes. It also depends on how well the house has been maintained over the years. Remember that many of the Adult Community homes have maintenance of the structure, including roof, siding, gutters and walkways, all taken care of as part of the monthly maintenance fee. Windows are almost always the responsibility of the homeowner.
WHEN IS THE BEST TIME TO BUY?
Here are some frequently cited reasons for buying a house:
You need a tax break. The mortgage interest deduction can make home ownership very appealing.
You can afford the monthly payments.
You plan to stay in the house long enough for the appreciation to cover your transaction costs. The costs of buying and selling a home include real estate commissions, lender fees and closing costs.
You prefer to be an owner rather than a renter.
You can handle the maintenance expenses and costs involved with home ownership.
You are not greatly concerned by dips in home values. You want to feel a part of a community.
BUT THE BEST TIME TO BUY IS WHEN YOU FIND THE HOUSE YOU LOVE and ARE READY TO BUY - you wouldn't decide one day to buy a house and then buy the first or second home you see simply because you've decided you're ready. On the other hand, even the most perfect home couldn't tempt you to buy if you just weren't ready.
WHAT IS INVOLVED WITH WRITING AN OFFER?
What is the difference between list price and sales prices?
The list price is how much a house is advertised for and is usually only an estimate of what a seller would like to get for the property. The sales price is the amount a property actually sells for. It may be the same as the listing price, or higher or lower, depending on market conditions.
Are low offers advisable?
A low offer is an offer on a house that is substantially less than the asking price. While any offer can be presented, a low offer can sour a prospective sale and discourage the seller from negotiating at all or even discourage a seller from countering the low offer. In the event another offer is presented the seller might be more encouraged to negotiate with someone presenting an offer closer to the asking price instead of negotiating with someone who has presented a low offer. It's probably a good idea to have your Realtor do a market analysis of the home you wish to purchase, but keep in mind that current market conditions can have a great effect on the asking price, something that a buyer might not be aware of. Of course a seller's motivation might also affect the sales price.
What contingencies should be put in an offer?
Most offers include two standard contingencies: a financing contingency, which makes the sale dependent on the buyers' ability to obtain a loan commitment from a lender or to provide proof of funds, and an inspection contingency, which allows buyers to have professionals inspect the property to their satisfaction. A third contingency is the sale of the buyer's home. Even if the buyer is paying cash for a home purchase, if that cash is coming from the sale of another home it is advisable to include a home sale contingency in order to protect the buyer - that way should the sale of that home not be completed the buyer is not obligated to purchase the new home. A buyer could forfeit the deposit under certain circumstances, such as withdrawing the contract for a reason not stipulated in the contract. The purchase contract must include the sellers responsibilities, such things as passing clear title, maintaining the property in its present condition until closing and making any agreed-upon repairs to the property.
Do I need an attorney when I buy a house?
Although you do not need an attorney to complete a real estate transaction in New Jersey it is advisable to seek the advice of an attorney to avoid future legal hassles. Although I am a licensed Realtor I cannot provide legal advice and may not be able to advise you the same way an attorney can. I can provide a list of attorneys that I have worked with who are experienced and knowledgeable specifically in real estate transactions.
WHAT IS THE DIFFERENCE BETWEEN MARKET VALUE AND APPRAISED VALUE?
The appraised value of a house is a certified appraiser's estimate of value of the worth of a home at a given point in time. Lenders require appraisals as part of the loan application process and as result the buyers pay for the appraisal when the lender requires one. Appraisers consider square footage, construction quality, design, floor plan, neighborhood and availability of transportation, shopping and schools, as well as lot size, topography, view and landscaping.
Market value is what price the house will bring at a given point in time and may be determined by either an appraisal or by a comparative market analysis (CMA). A CMA is an estimate of market value performed by a Realtor based on similar sales and property attributes and should be done with no fee or obligation.
What's a house worth?
A home ultimately is worth what someone will pay for it. Everything else is an estimate of value. Factors that determine what someone will pay include location, condition of the home, and current market conditions but might also include motivation of either buyers or sellers and requested contingencies.
What is the difference between list price, sales price and appraised value?
The list price is a seller's advertised price, a figure that usually is only a rough estimate of what the seller wants to get. Sellers can price high, low or close to what they hope to get. Homes in Monroe Township Adult Communities are generally priced close to the anticipated sales price - the days of large differences between asking and selling prices have disappeared as the market has changed. To judge whether the list price is a fair one, be sure to consult comparable sales prices in the area. The sales price is the amount of money you as a buyer would pay for a property. The appraisal value is a certified appraiser's estimate of the worth of a property, and is based on comparable sales, the condition of the property and numerous other factors.
WHAT IS A BUYER'S HOME INSPECTION?
A home inspection is when a paid professional inspector -- often a contractor, engineer or a professional home inspector -- inspects the home, searching for defects or other problems that might not be obvious to a buyer or to the Realtor. They represent the buyer and are paid by the buyer. The inspection usually takes place within an expressed time frame after a purchase contract between buyer and seller has been signed. It is best for a seller not to be present for the home inspection.
The home inspection report is given to the buyer and the buyer's attorney, who then presents the buyer requests for repairs to the seller's attorney. Every item mentioned in the inspection report may not be a request for repair or replacement but is often just presented to the buyers to advise them of conditions to be aware of. It is best to discuss with your attorney what to request should be repaired or replaced.
What repairs should the seller make?
Nearly all purchase contracts include an inspection clause, a buyer contingency that allows a buyer to back out if numerous defects are found that the seller is unable or unwilling to repair. Generally minor repairs are negotiated by the attorneys while major repairs can sometimes be more difficult. Many buyers are willing to buy at almost any price, but on the other hand, making major repairs may be the only way a seller can sell that house to any buyer.
Whose obligation is it to disclose pertinent information about a property?
In most states, it is the seller, but obligations to disclose information about a property vary. Sellers should disclose all facts materially affecting the value or desirability of the property which are known. This might include: homeowners association dues; whether or not work done on the house meets local building codes and permits requirements; the presence of anything that a prospective buyer might not notice, and any restrictions on the use of the property, such as zoning ordinances or association rules.
People buying in an Adult Community development must be told about covenants, codes and restrictions or other deed restrictions as well as any changes in association fees or proposed assessments.
IT IS A STRICT POLICY OF GLORIA NILSON & Co TO OBTAIN A SELLER'S DISCLOSURE ON ANY PROPERTY LISTED BY THE COMPANY.
Do I need a Certificate of Occupancy before closing?
In Monroe Township the only required inspection is a Fire Inspection, performed by the district's fire department. State law requires that a fire extinguisher be installed in the kitchen of every home within 10' of an exit door. Carbon monoxide detectors must also be installed within 10' of every bedroom in a home that has a fuel-burning device or an attached garage. Smoke detectors must be installed on every level of the home. The current fee for this inspection is $35 and is paid by the seller.
WHAT ARE THE CLOSING COSTS?
Closing costs are the fees for services, charges and prepaid escrows that occur with the purchase of a home. They include upfront loan points, title insurance, escrow or closing day charges, document fees, prepaid interest, prepaid homeowners fees and application, and property taxes. Unless these charges are rolled into the loan, they must be paid when the home is closed.
Who pays the closing costs?
Closing costs are either paid by the home seller or home buyer. It often depends on local custom and what the buyer or seller negotiates.
How can I save on closing costs?
Studies show that the closing costs, which can average 2 to 3 percent of a total home purchase price, are often more costly than many buyers expect. But there are some ways to save:
* Negotiate with the seller to pay all or part of the closing costs. The lender must agree to this as well as the seller.
* Get seller financing. This kind of arrangement usually does not entail traditional loan fees or charges.
* Rent the property in which you are interested with an option to buy. That will give you more time to save for the upfront cash needed for the actual purchase.
* Shop around for the best loan for you. Decide what type of loan will work for you but be wary of lenders who try to sell you another type of loan that promises a lower payment or more savings for you – many times lenders earn a higher commission for non-traditional loans and may try to convince you that a non-traditional loan is a savings for you.
Why do I need a title report?
A clear title report ensures there are no liens placed against the prior owners or any documents that will restrict your use of the property. It is designed to protect the buyer, and therefore it is the buyer and not the seller who pays for the title search and report. You also may have to consider interests of any third parties, such as easements granted by prior owners that limit use of the property, but easements are rare in Adult Communities. Sellers will generally try to clear these unwanted items prior to purchase once the buyers attorney has reviewed the title report. A list of standard exceptions and exclusions not covered by the title insurance policy may be attached.
Where do I get information about closing costs?
Ask your attorney and your lender for details about costs and what you should expect to pay.