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Home – Buying/Selling

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  1. Home –Buying/Selling

  2. Benefits vs. Drawbacks • Benefits • Stability • Freedom / Flexibility • Decorate • Pets • Tax deduction • Equity (Profit) • Ownership (outright) • Drawbacks • Down payment (saving) • Value may not go up • Limited mobility • High expenses • Repairs • Maintenance

  3. Types of Housing • Single-Family Dwellings • Multiunit Dwellings • Duplex • Townhouse • Condominiums • Cooperative Housing (Coops) • Shares in a Corporation that Owns the Property • Prefabricated Homes • Mobile Homes

  4. Affordability and Your Needs • Price and Down Payment • Examine your income, savings, current expenses • Determine how much you can afford to spend • How much will you qualify for • Size and Quality • Trading Up • Size • Location

  5. Evaluate Where to Purchase • Neighborhood • City • Suburbs • Small town / country • Employment Opportunities • Cost of living • Climate • Lifestyle • Schools

  6. Finding a Property • Hiring a Real Estate Agent • They arrange the sale/purchase of buildings/land • Provide info: • Location • Market • Contacts: attorney, insurance, inspector • Internet / Websites • Newspapers

  7. Evaluate a Property • Overall Size • Location • Schools • Property Taxes • Living Space • Bedrooms • Bathrooms • Kitchen

  8. Evaluating Property- ExternalChecklist

  9. Evaluating Property- InternalChecklist

  10. Price to Offer • Determine your price for the home • Look at the listing price • How long has the home been on the market/listed • Similar homes sold in the neighborhood • Buyers/Sellers market • Current owners (in a hurry, old, estate, relocating) • Condition of home • Home fits your needs/wants

  11. Negotiating the Purchase Price • Offer may be accepted, rejected, or countered • Conditions • Closing cost (bank, attorney, inspector, title insur) • On the sale of the home currently living in • Sign Purchase Agreement / Contract

  12. Obtain Financing • Down Payment • Suggested 20% or more • Private Mortgage Insurance (PMI) • Financial Qualification • Income, debt, savings • Interest Rate Factors • Market rate & Credit Score • Repayment Period • Size of Mortgage • Monthly Payments

  13. Mortgages (15, 20, or 30 yrs) • Fixed-Rate (aka conventional) • Fixed interest rate and schedule • Adjustable-Rate (ARM) • Interest increase or decreases during life of loan • Graduated Payment • Payment increases • Subprime • Higher Interest Rate for Those with Poor Credit • Government Programs - (FHA) & (VA)

  14. cont’d Mortgages • Home Equity Loans • Based on difference between current market value and the amount owed on mortgage • Refinancing • Another mortgage to replace the current one

  15. Closing • Closing Cost • Title Insurance • Insurance from problems found on title after purchase • Property Taxes • Home Owner Insurance • Bank Fees • Attorney Fees (may not be required) • Points – may buy points to lower interest rate • Mortgage Lock-in

  16. Selling a Home • Preparing Your Home • Repairs / Paint • Clean / Bright / Airy • Maintenance (lawn / pool)

  17. Determine Selling Price • Appraisal • Real Estate Agent Comparisons • Evaluate an improvements • Already completed • Ones to increase value • Kitchen • Bathroom

  18. Selling Agent vs. Sale by Owner Real Estate Agent Sale by Owner • Actively working • Commission (5%-7%) • MSL (listing it for the public) • Advertising • Save you money • Time and Energy • Handle your own Advertising