Archives

July 2008

Take the Stress Out of Homebuying

Posted at 6:16 AM, Jul. 28, 2008

1. Find a real estate agent who you connect with. Home buying is not only a big financial commitment, but also an emotional one. It’s critical that the REALTOR® you chose is both highly skilled and a good fit with your personality.

2. Remember, there’s no “right” time to buy, just as there’s no perfect time to sell. If you find a home now, don’t try to second-guess interest rates or the housing market by waiting longer — you risk losing out on the home of your dreams. The housing market usually doesn’t change fast enough to make that much difference in price, and a good home won’t stay on the market long.

3. Don’t ask for too many opinions. It’s natural to want reassurance for such a big decision, but too many ideas from too many people will make it much harder to make a decision. Focus on the wants and needs of your immediate family — the people who will be living in the home.

4. Accept that no house is ever perfect. If it’s in the right location, the yard may be a bit smaller than you had hoped. The kitchen may be perfect, but the roof needs repair. Make a list of your top priorities and focus in on things that are most important to you. Let the minor ones go.

5. Don’t try to be a killer negotiator. Negotiation is definitely a part of the real estate process, but trying to “win” by getting an extra-low price or by refusing to budge on your offer may cost you the home you love. Negotiation is give and take.

6. Remember your home doesn’t exist in a vacuum. Don’t get so caught up in the physical aspects of the house itself — room size, kitchen, etc. — that you forget about important issues as noise level, location to amenities, and other aspects that also have a big impact on your quality of life.

7. Plan ahead. Don’t wait until you’ve found a home and made an offer to get approved for a mortgage, investigate home insurance, and consider a schedule for moving. Presenting an offer contingent on a lot of unresolved issues will make your bid much less attractive to sellers.

8. Factor in maintenance and repair costs in your post-home buying budget. Even if you buy a new home, there will be costs. Don’t leave yourself short and let your home deteriorate.

9. Accept that a little buyer’s remorse is inevitable and will probably pass. Buying a home, especially for the first time, is a big financial commitment. But it also yields big benefits. Don’t lose sight of why you wanted to buy a home and what made you fall in love with the property you purchased.

10. Choose a home first because you love it; then think about appreciation. While U.S. homes have appreciated an average of 5.4 percent annually over from 1998 to 2002, a home’s most important role is to serve as a comfortable, safe place to live.

Tax Benefits of Home Ownership

Posted at 6:13 AM, Jul. 21, 2008

$3,521.56 = Amount you have lowered your federal income tax (at 28 percent tax rate)

Note: Mortgage interest may not be deductible on loans over $1.1 million. In addition, deductions are decreased when total income reaches a certain level.

7 Reasons to Own Your Home

Posted at 6:11 AM, Jul. 14, 2008

3. Equity. Money paid for rent is money that you’ll never see again, but mortgage payments let you build equity ownership interest in your home.

4. Savings. Building equity in your home is a ready-made savings plan. And when you sell, you can generally take up to $250,000 ($500,000 for a married couple) as gain without owing any federal income tax.

5. Predictability. Unlike rent, your fixed-mortgage payments don’t rise over the years so your housing costs may actually decline as you own the home longer. However, keep in mind that property taxes and insurance costs will increase.

6. Freedom. The home is yours. You can decorate any way you want and benefit from your investment for as long as you own the home.

7. Stability. Remaining in one neighborhood for several years gives you a chance to participate in community activities, lets you and your family establish lasting friendships, and offers your children the benefit of educational continuity.

Online resources: To calculate whether buying is the best financial option for you, use the “Buy vs. Rent” calculator at www.GinnieMae.gov.

Lenders Giving The Cold Shoulder

Posted at 7:24 AM, Jul. 11, 2008

It has been an unexpected surprise to many.  While in the midst of home renovations, major banks have either capped or suspended home equity lines of credit.  With today's mortgage crisis, banks are finding any and every reason NOT to loan you money. 

For many homeowners, this has come at the most un-opportune moments.  Literally after they have written checks to contractors for work currently in progress on their homes. 

Did you know that most home equity lines of credit have hidden language that states if you are late on a payment or if housing values decline, they reserve the right to cap or cut-off credit?  Many banks now are limited how much they are willing to give in the first place.  Yesterday allowed homeowners to borrow up to 100% of their home value.  Today, don't expect anymore than 65%, if that.

This should put out the warning signals to those getting ready to embark on some home improvements.  If you currently have an unused home equity line and are planning on doing some work to your home, get a working budget and then write the check out in advance to yourself and cash it before you commence work.  That way, if your bank pulls the rug out underneath you, you are not sitting on a unfinished project and no funds. 

Or, plan on saving for half the cost.  If renovating your bathroom is projected at $10K, be prepared to cough up $5K (leave a margin for unexpected costs) and write the deposit check with your home equity line.  Again, if it bounces, you haven't started making your home a construction site. 

Making home improvements can help a home increase in value, or improve it's saleability.  A recommended course of action is to ask your local real estate expert if the renovations you are thinking of, add up before you put out.

Bank Of America To Eliminate 7,500 Jobs

Posted at 7:18 AM, Jul. 9, 2008

In case you haven't been following the news, Bank of America is buying out Countrywide as of Tuesday.  With this acquistion, a total of 7,500 jobs will be eliminated. 

How does this benefit anyone?  Well, becuase of this buyout, Countrywide is offering a non-repayable gift of $1,500 in Cook County for low to moderate income buyers.  Look for the Countrywide Bank Express Grant.

5 Common First-Time Home Buyer Mistakes

Posted at 6:08 AM, Jul. 7, 2008

1. They don't ask enough questions of their lender and end up missing out on the best deal.

2. They don't act quickly enough to make a decision and someone else buys the house.

3. They don't find the right agent who's willing to help them through the homebuying process.

4. They don't do enough to make their offer look appealing to a seller.

5. They don't think about resale before they buy. The average first-time buyer only stays in a home for four years.

Source: Real Estate Checklists and Systems, www.realestatechecklists.com.

Happy Fourth of July

Posted at 7:12 AM, Jul. 4, 2008

Let's not forget why we are blessed.  We live in a country everyday that allows us to make choices.  We can choose to succeed, we can choose to fail.  We can choose to believe, and we can choose to disgregard.  We only have these choices because of the selfless men and women who sacrifice their lives as well as their day to day luxuries so that we can enjoy these freedoms.  For those fighting today, and those who paved the way, let's give thanks.

HAPPY FOURTH OF JULY AMERICA.

My House Is Worth What? Take 5

Posted at 6:39 AM, Jul. 2, 2008

Well I have just completed my fifth episode of the hit show, "My House Is Worth What?".  I had the distinct pleasure of working with the Real Estate Diva herself, Kendra Todd. 

Our show today was centered in the ever popular, Lincoln Park neighborhood.  The home is currently owned by a Chicago Architect who, along with his partner, had done some fabulous renovations. 

Will their property hold it's value in today's depreciating market?  Stay tuned.