Moving out of your home

Yesterday I had the opportunity to move my inlaws out of their dream home.  It is an absolutely gorgeous home that had just become too much work to maintain.  

The 1.5 acres were tough to cut, the large home was a lot for 2 people, and they were 150 miles from any relative.  So, they decided to move down to Chattanooga where they have a lot of family nearby and a 6 year old grandson. 

Most guys might cringe at the idea of their inlaws moving so close, but I guess I'm fortunate that these are truly some great people. 

We weren't able to get up to their home early enough to help them pack, luckily they did have some help and most of the home was loaded up by the time we got there. 

The first thing I noticed was how clean the house was.  I don't mean just clean, I mean gleaming!  I've been selling homes since 1999, and I can promise you, most people don't leave their homes spotless when they move.  Now, they were never people to really clutter up their home in the first place, but still....I've had people leave garages full of garbage, stoves that had crust of something growing on them, you name it.  The general idea is that you leave a home "broom clean".

My inlaws left their home and it was probably cleaner than the day they moved in 10 years ago.  I understand that moving is a hectic ordeal and that you just want to get your stuff out and move into your new home, but just think for a minute about that.  What if you moved into your new home and there were 3 weeks worth of garbage in the garage and the house smelled like a wet dog?  You'd probably be pretty upset, right?  But, is that how you left your house?  If not, you'll wonder why someone could do this.  Even if you left yours in a shambles, you'll still be upset at the guy who just left his the same way you left yours.

Do yourself and everyone else a favor.  Plan ahead!  I know that kids and pets and work and everything else seem to be conspiring against you leaving a clean home.  But it's just a nice courtesy to give someone.  After all, these people did buy your home.  Start packing and moving ahead of time so that when the day finally comes to hand over the keys, you can give the buyer of your home something they will remember...in a good way. 

Getting Your Home Ready to Sell!

So, it's time for the big move.  You have hired your agent (hopefully me :)) and now you just have to wait for buyers to start rolling in, right?  Well, sort of.

What you need to realize now is that it is 2011, not 2005.  Your house has to stand out amongst a lot of competition.  I always like to tell people to go ahead and fix all those nagging little things that you have been meaning to fix or correct for the past 5 years.  You know, that trim that the dog chewed up or the hole that you put in the wall when you had the treadmill on high and it threw you off.  Those things.

Now, I am not covering a lot of other things that go into getting your home ready to sell, like title work, finances, etc.  I am just covering the basics of cosmetics.

What you want is the prom queen.  I know that you are probably still living in your home and it's tough to keep it clean, I understand; I have a 5 year old, 4 foot tall tornado who loves nothing more than taking out everything he owns and spreading over every square inch of the house.  It's tough to make all the beds and make the house look like it was just filmed for HGTV.  But you have to.

No one said selling your house was a fun thing to do.  But it doesn't have to kill you either.  Here are some things you can do that will dramatically help you when you put your home on the market.

Your Home’s Exterior

Good “curb” appeal is very important.  If people don’t like the house from the outside, they won’t want to come inside.

 Make sure your front lawn looks neat and tidy to make the 1^st impression favorable.

1. Plant some extra flowers for color, or just put some potted plants on the porch.
2. Remove any dead trees, limbs, or debris from the yard.
3. Sweep the driveway and sidewalk.
4. Paint the front door if need, it is a major focal point and helps with impressions.
5. Replace faded old house numbers with new brass ones.
6. Repaint or replace mailbox if needed.
7. Touch up paint on house if needed.
8. Check roof for shingles and flashing that need replacement or repair.
9. Fix any broken windows, screens, or window seals, and then wash for appearance.
10. Sweep away cobwebs that collect in corners.
11. Haul off any “junk” in your side or backyard.
12. Test the entry light and doorbell.
13. Clean out the garage.  Don’t be tempted to use it as a storage area.
14. Store garbage cans neatly.
15. Arrange lawn equipment in a neat and orderly fashion.

                Your Home’s Interior

 After you’ve tackled the exterior of your home, head inside.  The goal here is to make everything appear more spacious, open, and organized.

 No matter what the season, do some spring-cleaning.

1. Buy bright, high intensity light bulbs and put them everywhere.  Bright lights and open drapes and blinds give the home a friendly glow that buyers like.
2. A fresh coat of neutral paint can do wonders.  It also gives the home a “new” smell.
3. Take down pictures and remove as much furniture as possible.  This will make the house seem larger.
4. Clean out all closets of clutter and store the remaining items neatly in boxes.
5. Have a garage sale and use the proceeds for your touch up expenses.
6. Clean the kitchen and bathrooms till they are spotless.
7. Clean all windows, mirrors, and appliances.
8. Remove clutter from kitchen counters.
9. Have carpet cleaned or replaced.
10. Tighten loose knobs and handles.
11. Clean the oven and refrigerator.
12. Fix squeaky doors, floors, and stairs.
13. Clean up after pets, they can kill a sale.
14. Remove smoke odors, and smoke outside.

All of these tips will help to improve the overall impression your home makes on potential buyers. Clean and tidy homes sell faster than drab, dirty ones. Remember, you are in business now and your product is your home!

Why should you speak with a lender before looking at homes?

Over the years I have shown hundreds of homes to people that have never spoken to a lender.  Don't ask me why...I guess I was nuts or just wanting to show houses.  Nowadays, I rarely show a home unless I know who the buyer's lender is. 

Why?

Well, first of all, lenders have tightened up the requirements to get a loan.  This is a good thing, but it also means that someone really needs to be serious about buying because today is not 5 years ago when you could just fog up a mirror and a lender would give you money.  Now, you really need to qualify and even then you might feel like you are being abused.

Secondly, if you can't get a loan, why would you look at homes?  I know this sounds obvious, but in the past 2 weeks I have had several people want to look at homes eventhough they filed bankruptcy in the past year.  One person had not filed taxes in the past 5 years! 

A good lender will help set you on the correct path.  They will let you know how much you can borrow, thereby letting you know just how much home you can afford and what type of homes you should be looking at.  This is why speaking with your lender is the very first step of any serious home search.  If you have credit issues, they can direct you on how to clean it up.

A lender will ask you some tough questions and even pull your credit, so don't bother telling them you have a 760 credit score when you know you have been late on most of your bills, they will find out!  It is best to be up front and honest, after all, the lender is actually a human as well (believe it or not) and their time is just as valuable as yours and mine.

So, don't get upset at an agent if they ask you who your lender is before showing you homes.  Realtors are 100% commission.  We don't get paid to show homes, we do not have a draw account, we pay for our own gas, etc.  I only want to work with people who are serious about purchasing a home, and that means that they are ready to speak with a lender.

If you have any questions, please don't hesitate to contact me.  I would love to help out.

Should I get a Home Inspection?

Well, I'm going to spout some of my own opinion on here, but that's sort of the purpose of a blog anyway right.

I personally think that all buyer's should get a home inspection, even on a new construction.  You should also contract with a reputable home inspector, not cousin Bobby who built a shed one time.  Inspections help you to determine what may need to be done to a home or what issues it may have.  Since most sales contracts are two step negotiations, this is where the second step comes in (the first step was in the initial offer where you hammered out price and terms). 

As a buyer you will have 3 options to exercise after a home inspection.

1. Accept the home as is with any and all faults.
2. Accept the home but give the seller a list of things to be repaired or replaced.
3. Terminate the agreement and get your earnest money back.

Typically, most people will ask for some repairs.  Sometimes, in lieu of repairs, the buyer may ask for help with closing costs or a price reduction.  Personally, I like having some closing costs paid just because the seller won't have to worry about the repairs and the buyer can then get whomever they want to make the repairs after closing.  But again, all of this is negotiable.

The reason that I like to have even new construction inspected is that  builders are people too and there is a chance that something might slip by them.  A good inspector can help you find this error.  On the flip side, home inspectors are people as well and if you get 2 different inspectors you may very well get 2 separate reports with different issues.

The buyer (in Tennessee at least) now also has the burden of the "termite letter".  Buyer's are also responsible for any inspections that the home inspector may call for (if he is not qualified for it) such as having the HVAC inspected, septic, etc.

Overall, the reason for a home inspection is to find major faults with a home, not cosmetics.  If you don't like the lime green paint in the master bedroom, you want to handle that in the offer, not the inspection.

I've only touched on some of the reasons for a home inspection and have definitely not covered everything.  If you want more information, give me a call at 423-902-9836 or shoot me an email to David@MyChattanoogaHome.com.  You can also visit www.MyChattanoogaHome.com for more information.

Steps to Home Ownership

Home ownership is a goal that is worth striving for.  Many people seem to think that getting there is all but impossible now, but just the opposite is true.  Here in Chattanooga, we still have more homes than buyers and many of them are a great value.  With all of the large companies like Volkswagen, Wacker Chemical, Amazon, and more coming here, this buyer's market will not last forever.

Still, there are several steps that you will need to take in order to purchase a home.
1.  Contact a lender.  This should always be the first step.  A good lender will be able to guide you to the type of mortgage that best suits your needs.  You will want to get PRE-APPROVED!  If you have credit issues they can even steer you in the right direction to get your scores straightened out so that you can get better rates and become credit worthy.  I typically use Angel Sherlin with iServe Residential Lending.  asherlin@iservelending.com.

2.  Contact me.  Well, I hope you contact me, but if you don't you still want to contact a REALTOR.  Preferrably one who has the experience to get you what you need and help you reach your goals.  You don't want to just call every agent on every sign of every home you want to see.  It will be difficult for you to get an agent willing to give their all for you if they know you will just call the next agent on the next sign.  Buyer's agents are on your side and look out for your best interests, whereas a listing agent typically represents the seller and must look after the seller's interests.

3.  Sign a Buyer Representation Agreement.  This shows your REALTOR that you are committed to them and they to you.  If your agent doesn't ask you to sign this right away, ask them.

4.  Look for homes.  I can get you set up with homes that match the criteria of what you say you need.  Remember, needs outweigh wants, but hopefully you can find what you want and need.  Just don't fall into the trap of passing on your perfect home because you haven't seen all the homes out there.  By the time you see all the other homes the one you wanted may have been sold.  Typically, you will probably only look at 7-10 homes.

5.  Make an offer.  When you find the home you want you will want to write an offer.  Now, it seems that lately buyers will make an offer of $130,000 for a $200,000 home and think it's great...only to be disappointed when the seller doesn't even counter them.  You want to be realistic with your offer.  See what comparable homes in the area are selling for.  If the property is hot you might need to offer right around full price!  Typically in our area, well priced homes are selling for about 97% of list price.  You may also expect a counter offer (see my previous blog on counters).

6.  Inspections.  Once an offer is accepted you will enter a period where all of the inspections, title work, etc get done.  In Tennessee, all of the inspections will be your responsibility.  I will help you the entire way so you don't need to get worried, but there are a lot of steps.  Actually, this is where my real work begins and you get to relax a little bit.  If the home inspection finds some things to be fixed, we submit another form to the seller.  Here we enter another short negotiation period.  Once things get hammered out we move to the next step.

7.  Closing.  This is where you and the seller along with the agents meet at a Title Company to sign off on everything.  Typically, at the end of the closing, which is about 45 minutes to an hour, the home is yours.

Now, this is obviously just a bare bones run down of the steps you need to take to home ownership, but it will give you an overall idea of what is needed.

If you have any questions please don't hesitate to contact me at 423-902-9836.  You can also shoot me an email to David@MyChattanoogaHome.com or visit my website, http://www.mychattanoogahome.com/.  I have been a full time REALTOR since 1999 and work with Crye-Leike, REALTORS.

Counter Offers

Almost every real estate transaction has a counter offer included in it.  What exactly is a counter offer and how do you handle it?  Well, whether you realize it or not, you probably deal with counter offers every day of your life.  Here's an example.  I ask if you want to go to Subway for lunch, you say you would rather go to Quizno's and I say OK.  There, you just saw an offer, a counter offer, and an acceptance.  Of course, with a home there is a little more on the line that a sub!

Not all offers will require a counter offer.  Naturally, if someone offers full price on a home there probably won't be a counter offer.  If you have done your research and used comparable sales when coming up with  your offer and make a really good offer, you may not receive a counter offer.  Also, remember, it is not always about price, sometimes the terms are very important, if not more important than the actual final sales price.

Let's just assume that the price being asked for the home is fair for the market and we'll use $250,000 for the asking price.  The buyer offers $230,000 but also wants the seller to pay $6,000 in closing costs.  This offer is now actually only $224,000.  Even if the buyer offered full price but asked for closing costs, it is no longer a full priced offer and may be countered! 

The seller has 3 options at this point: 1.  Accept the offer.  2.  Reject the offer.  3.  Counter the offer.
More than likely he will counter.  Let's say he counters back with $245,000 and offers to pay the $6,000 in closing costs.  In reality, he is accepting $239,000 for his home.

The buyer now has the same 3 options the seller just had.  Also, realize that the more counter offers there are, the less chance the deal has to coming together...and, a better offer may be presented to the seller during all this negotiation. 

Ultimately, what both the seller and buyer are trying to do is come up with a price and terms that are acceptable to both of them.  Both sides may need to be flexible and realize that counter offers are just part of the transaction.

Right now we are still in a buyer's market, meaning there is a lot of inventory and not enough buyers.  Buyers have a slight advantage over sellers, but this does not mean that sellers are going to give their homes away.  On the flip side, the seller should realize that he only has one home to sell where as the buyer may have 20 homes just like it to look at.

Naturally, every offer and every transaction is different.  There are many other things to consider (time to close, buyer loan approval, inspections, etc.) which is why it is important for both the buyer and seller to consider using a REALTOR who has experience with these types of transactions and deals with them on a daily basis.  Let's face it, most people move every 7 years or so, that doesn't give them a lot of experience in dealing with all that goes into a real estate transaction.  It by no means makes them ignorant or incapable, but experience does go a long way in this arena.

If you have any questions, please feel free to contact me at 423-902-9836 or by email at David@MyChattanoogaHome.com.   For more tips, visit www.MyChattanoogaHome.com.  I am a full time REALTOR with Crye-Leike, REALTORS  in Chattanooga, TN.

Why right now is a great time to buy a home!

People ask me all the time, “Should I wait until the market bottoms out to buy a home?”  My answer to this is no.  The reason is that you only know when the market has hit the bottom when it starts to go back up.
There are also other reasons, the main being interest rates.  Right now, rates are hovering around 4.9% for a 30 year fixed mortgage.  This would mean that a $200,000 mortgage is around $1,061/ month (excluding taxes and insurance).  The current mortgage trend is rising, so let’s say that rates rise by just 1% to 5.9%.  That same $200,000 mortgage will now cost you $1,186/ month, or $125 more.  Over the life of a loan that’s $45,000!  Got a nice car?

What’s worse is that if the market does start to improve, and it looks like it will.  That house you have your eye on that will have a $200k mortgage might go up in price, so you might wind up with a $220,000 mortgage, which at the higher interest rate would be $1,304 a month….you can see where this is going.
Right now, in our market, there are more homes for sale than buyers.  This means that you, as a buyer, have more control and negotiating power.  However, with Volkswagen, Wacker Chemical, Amazon, and other large companies coming to Chattanooga, the pendulum may swing back the other way and cause a seller’s market.

So, to answer the initial question…..YES!  If you are in the market to buy a home it just does not make financial sense to wait, unless you have more money than you know what to do with…and in that case just pay cash.  For the rest of you, get out there and find that dream home.  You may not have another opportunity like this again.
If you have any questions about real estate, what your home is worth, or just need to find a home; don’t hesitate to call me at 423-902-9836 or shoot me an email at David@MyChattanoogaHome.com.  You can also visit one of my websites for all kinds of helpful information: www.MyChattanoogaHome.com.

I have been a Realtor in Chattanooga since 1999 and would love to help you out.