Buying Tips

The best approach in buying a home is to first understand how a home is financed. There are three crucial elements:

• a down payment
• closing costs
• the mortgage

When you know the amount of down payment and closing costs you can afford, and how much mortgage money you will be able to borrow, you can know how much home you can buy.

Do I Have Enough for a Down Payment?

A down payment is the money you pay up front toward the house. The more cash you pay as a down payment, the less money you will pay each month on the mortgage, and the lower the interest costs will be over the life of the mortgage. Typically, a conventional lender will require 20 to 25 percent of the purchase price as a down payment.

In some cases, involving an excellent credit history and sufficient income, lenders will agree to a 10 percent down payment. This may give you more cash for other moving expenses, but will also increase your monthly mortgage payments.

Loans through the Federal Housing Administration (FHA) or Veterans Administration (VA) carry very attractive down payment requirements of five percent or less. There is usually a maximum on the amount of money you can borrow with these types of loans, and VA loans are only available to veterans. FHA and VA loans are available at competitive interest rates. An additional benefit is that the seller may pay part of the points. In addition, when the time comes to sell, the next buyer may be able to assume the loan, subject to certain conditions.

If permissible, secondary financing may be used as an alternative to way to finance your new home. This means that the seller may hold a second mortgage for 10 percent of the purchase price, while the buyer puts 10 percent cash down.

Typically, conventional lenders are willing to accept a lower down payment if private mortgage insurance (PMI) is secured. PMI protects the lender in case of default on the loan. It will cost more, but it can reduce your down payment to 10 percent.

Selling Tips

To sell and market a house requires specialized skills, is time consuming, and costs money. Are you prepared to buy advertising space? Advertising is one way to let the buying public know your house is on the market. If not, can you afford the time it will take to sell your house with only a sign in the yard? Are you willing to stay close to home for days, weeks, maybe months to show your house? Do you possess the necessary legal and financial knowledge to answer the buyers' questions, negotiate a contract, or close a sale?

If you answered "No" to any of the above questions, perhaps hiring a real estate firm to help would be the most efficient way to sell your house. They can be indispensable to you in the following ways. A real estate professional will:

• Access the Multiple Listing Service (MLS)
• Assist with pricing based on Comparative Market Analysis
• Provide a detailed marketing plan
• Screen potential buyers for financial qualifications
• Suggest ways to make your property more attractive to buyers
• Show your home whether or not you are there
• Answer potential buyers' questions
• Present all offers
• Assist with negotiating the best sale price
• Facilitate the closing process

Preparing to Sell

Of course, any major repairs should be completed before showing the house, if a top selling price is expected. Limit your repairs to functional parts of the house, such as the roof, plumbing, and major appliances. Cosmetic changes like new carpeting and draperies may not match your future buyer's tastes, and could even discourage the sale.

The key words to remember in preparing your house are neat and clean..... sparkling clean...... clean enough for royalty to visit. Take a look at your house as if you were seeing it for the first time. You may not notice crowded closets and untidy flower beds, but potential buyers will!

Outside

When potential buyers drive up to your house, what they see will make a lasting first impression. Keep the grass mowed, edged and the weeds pulled. trim trees and bushes away from windows, put children's toys in the garage. Plant some flowers to add a touch of color.

If your house needs painting do it now. A good paint job will more than pay for itself in the selling price. Try to maintain the neighborhood look when choosing paint; you don't want your house to be remembered as "the green one with the blue door." put children's toys in the garage. Plant some flowers to add a touch of color.

Remove oil stains from the driveway. Buy an inexpensive drip pan to avoid further stains. Replace a weather-beaten mailbox. Make sure your doorbell works. remove torn screens. Clean outdoor light fixtures. Repair loose brickwork and fill cracks in the walk and driveway. In other words, make your house a show-piece from the curb to the front door.

Outside

A coat of paint will brighten interior walls. Choose neutral shades of white, off-white, beige, or light pastels that will coordinate with most decor. This inexpensive investment will increase the show ability of your house.

Clear out closets and cupboards. Have a garage sale or donate your unused items to charity. With less clutter, your closets will appear bigger. Remove all necessary furniture to make your rooms seem more spacious.

Open the curtains and pull up the blinds. Turn on as many lights as possible. Give your house an airy look. Fresh flowers bring color, fragrance and a touch of spring that enhances a room.

The bathroom should be absolutely spotless. Remove any stains from fixtures, repair dripping faucets, and polish the mirrors. Add a sanitizer to the toilet bowl and keep the lid down. Wash and fluff bathroom rugs, hang fresh towels. Potpourri or scented soaps add a nice fragrance to the air.

A clean kitchen tells the buyer that the house has been well cared for. Remove excess pots, pans, bowls, and clutter from the cupboards. Clean the oven inside and out. Run a lemon through the garbage disposal for a fresh smell. Make sure all appliances are working.

When a sales associate is showing the house, keep children and pets under control. Also turn off the televisions and stereos. The noise may distract tired clients, causing them to overlook many fine features.

Check garages and basements for debris. A two car garage should have plenty of space for two cars. Brighten basements with the highest wattage lighting allowed and clear away any cobwebs.