Maximize your property with an ADU

Maximize your property with an ADU

Need more room or extra income? New California laws make it easier than ever to build an accessory dwelling unit (ADU) on your property.

An ADU is a secondary housing unit on a single family residential lot. It can be attached to the primary house like a converted garage, or unattached like a freestanding cottage. You can create an ADU from a new or existing structure.

ADUs are affordableflexible and raise your property’s value. They are an excellent way for seniors to downsize while staying close to family. Homeowners can also bring in extra income by renting out their ADU.

These cozy additions are surging in popularity thanks to new California legislation. Now is the best time to start planning your ADU and reap the benefits.

Ready to discuss your property with a local real estate expert? Contact me to learn about more ways to maximize your property’s resale value.

Stella Bonin
Associate Broker

480.797.4884 / 619.250.6214

stella.bonin@yahoo.com

Coldwell Banker Residential Brokerage (Arizona)
Burke Real Estate Consultants (California)

http://www.CallStellaBonin.com (AZ MLS Search)

Follow me on Twitter: @StellaBRealtor

Join my Facebook International Real Estate Group: https://www.facebook.com/groups/irealestate/

https://www.facebook.com/myrealestateservices/

I am licensed in California and Arizona and we have a great team to serve you with members around the world.

California Bureau of Real Estate Lic. # 01222569
Arizona Department of Real Estate Lic. # BR550696000

“Equal Housing Opportunity”

Show Them You’re Serious

June and July are the busiest home sale months of the year. When inventory is in short supply and you may be competing with other offers, it is important to show the seller you’re serious. Make your offer look as good as possible because you may not get the chance to make or accept a counter-offer.

Put yourself in the seller’s shoes.  Your home has just gone on the market.  There is lots of activity and suddenly, there is more than one offer to purchase.  The seller’s first consideration may be to accept the highest offer but there are many other things to consider like closing dates, closing costs, possible repairs, contingencies and of course, the ability of the borrower to get a loan.

Offer a fair price for the property in your initial purchase agreement.  It shows sincerity and good faith that you’re actually trying to purchase the home and not trying to take advantage of the seller.  The old adage that you can always go up later may never happen if there are multiple offers on the property in the beginning.

  1. Remove the uncertainty that you may not be approved for a mortgage by having a pre-approval letter from your mortgage company.
  2. Show your sincerity by increasing the normal amount of earnest money customary for the area and price of the home.  The earnest money will be applied toward your down payment and closing costs.  Consider placing even more money in escrow when the contingencies have been met.
  3. Specify a closing date in the contract but acknowledge that you can be flexible to accommodate the sellers’ moving date.  If it becomes an issue, it still must be mutually agreed upon.
  4. Make the contingency periods shorter if possible to make the seller feel that they’ll know sooner that the offer is solid.
  5. If the contingency really isn’t important to you, leave it out of the offer.  The more contingencies included in a contract, the more the seller will wonder what might happen to keep it from closing.
  6. Write a personal note to the seller explaining why you like and want their home.  Consider including a picture of your family and pets.
  7. If you’re not using a digital contract, physically sign the offer with a felt tip pen of contrasting color.  You’d be surprised how this adds a personal touch to the offer.

One way to eliminate the competition of multiple offers is by not procrastinating.  When you have decided to write a contract, don’t wait; do it immediately and ask your agent to deliver it quickly.  As your agent, I will be able to help you craft a solid offer that makes you look serious and can give you advice that may be unique to your situation.

Thinking about buying? Let me help make your home buying or sell a success or if you’re ready to begin the buying or selling process, give me a call today!

Stella Bonin
Associate Broker

Coldwell Banker Residential Brokerage (Arizona)
Burke Real Estate Consultants (California)

http://www.CallStellaBonin.com (AZ MLS Search)

Follow me on Twitter: @StellaBRealtor

Join my Facebook International Real Estate Group: https://www.facebook.com/groups/irealestate/

https://www.facebook.com/myrealestateservices/

I am licensed in California and Arizona and we have a great team to serve you with members around the world.

California Bureau of Real Estate Lic. # 01222569
Arizona Department of Real Estate Lic. # BR550696000

“Equal Housing Opportunity”

Protect your health and home with a filtration system

Do you know the quality of the water in your home?

90% of American homes have hard water, according to the U.S. Geological Survey. Some of the highest levels are in Southern California. Hard water is water with high levels of calcium and magnesium.

Hard water can cause issues by:

  • leaving hard-to-remove spots on plumbing fixtures and dishes;
  • reducing the effectiveness of soap and detergent;
  • fading and staining laundry;
  • drying out skin and hair;
  • leaving scale buildup in boilers; and
  • clogging pipes.

Fortunately, hard water can be softened. A whole-house water filtration system that uses reverse osmosis is an ideal solution for California & Arizona homes with very hard water. Not only does it soften hard water, but it also removes any unusual odors, tastes, and colors without the use of harsh chemicals. This system protects your health and home with clean, pure water.

Want to learn more about home improvement solutions that boost your home’s resale value? Contact me to make sure your home sells fast.

Stella Bonin
Associate Broker

480.797.4884 / 619.250.6214

stella.bonin@yahoo.com

Coldwell Banker Residential Brokerage (Arizona)
Burke Real Estate Consultants (California)

http://www.CallStellaBonin.com (AZ MLS Search)

Follow me on Twitter: @StellaBRealtor

Join my Facebook International Real Estate Group: https://www.facebook.com/groups/irealestate/

https://www.facebook.com/myrealestateservices/

I am licensed in California and Arizona and we have a great team to serve you with members around the world.

California Bureau of Real Estate Lic. # 01222569
Arizona Department of Real Estate Lic. # BR550696000

“Equal Housing Opportunity”

Taxes and the Homeowner

Whether you’re an owner now or expect to be one in the future, it is important to be familiar with the federal tax laws that affect homeownership.  Since personal income tax was enacted in 1913 with the 16th amendment, homes have had preferential treatment.

The mortgage interest deduction is based on up to $750,000 of acquisition debt used to buy, build or improve a principal residence.  In addition to the interest, the property taxes are deductible, limited to the new $10,000 limit on the aggregate of state and local taxes (SALT).  The taxpayer may also deduct interest and property taxes subject to limits on a second home.

Homeowners can decide each year whether to take itemized personal deductions or the allowable standard deduction which was significantly increased under the Tax Cuts and Jobs Act of 2017.

Single taxpayers may exclude up to $250,000 of the capital gain on the sale of their home and up to $500,000 if married filing jointly.  They must have owned and lived in the home for at least two of the last five years.  For gains more than these amounts, a lower, long-term capital gains rate is paid rather than one’s ordinary income tax rate.

Capital improvements made to a home will increase the basis and lower the gain.  Homeowners are probably familiar that large dollar expenses like roofs, appliances or major remodeling are capital improvements.  However, many lower dollar items may also be considered improvements if they materially add value or extend the life of the property or adapts a portion of the home to a new use.

Homeowners are urged to keep records of money they spend on the home that they own over the years so that their tax professional can decide at the time of sale what they must report to IRS.

You can download a helpful Homeowners Tax Guide that explains in more detail and includes a worksheet to keep track of the basis of your home and capital improvements.

Ready to shade yourself from the sun in a new home? Call me to make an appointment!

Stella Bonin
Associate Broker

480.797.4884 / 619.250.6214

stella.bonin@yahoo.com

Coldwell Banker Residential Brokerage (Arizona)
Burke Real Estate Consultants (California)

http://www.CallStellaBonin.com (AZ MLS Search)

Follow me on Twitter: @StellaBRealtor

Join my Facebook International Real Estate Group: https://www.facebook.com/groups/irealestate/

https://www.facebook.com/myrealestateservices/

I am licensed in California and Arizona and we have a great team to serve you with members around the world.

California Bureau of Real Estate Lic. # 01222569
Arizona Department of Real Estate Lic. # BR550696000

“Equal Housing Opportunity”

 

Renters insurance: the no-lose policy

Renters insurance is a personal insurance policy purchased by renters in possession of the landlord’s property. Standard renters insurance policies offer the tenant coverage for the tenant’s personal property losses and tort liabilities the tenant may incur.

The tenant’s personal property includes anything moveable — jewelry, electronics, furniture, etc., but not any real estate they own or possess. Tort liability refers to the tenant’s responsibility for an injury they may cause to another person or another person’s property, such as the landlord and his rental property.

When a tenant is responsible for harming the landlord or the landlord’s property, the tenant is required to pay the costs incurred by the landlord to repair the damage. Renters insurance covers the tenant’s liability owed the landlord and relieves the insured tenant of the burden of paying the landlord’s costs.  Under the policy, the tenant’s liability for losses becomes the obligation of the insurance company.

A nonresidential tenant searching for a renters insurance policy will not find it under that name. Renters insurance is available only to residential tenants.

However, nonresidential tenants will find similar coverage under a business owners insurance policy, which insures the moveable property, including company inventory, as well as damage the tenant might cause to the leased property.

Personal property coverage

Requiring residential tenants to purchase renters insurance significantly reduces a landlord’s risk of loss caused by a tenant renting his property. It serves as both a partial replacement for a large security deposit and source of recovery for losses caused by the tenant in amounts larger than the amount of the security deposit, excluding rental payment amounts.

Whenever property — the landlord’s or the tenant’s — is damaged, disputes inevitably ensue over who is responsible for payment of the costs to repair or replace (restore) the damaged property. The burden of restoration may sometimes fall on the landlord, regardless of how much insurance either he or the tenant has. In most cases, the landlord’s expenses to correct damage to his property caused by the tenant can be significantly reduced by the coverage offered by a tenant’s renters insurance.

Many lease agreements include a provision exempting the landlord from any liability related to the rental property. However, this provision may not prevent a discontented tenant from demanding reimbursement for damage to his personal property whether or not it is due to the landlord’s negligence.

A landlord may legally include a provision in a residential lease agreement, requiring the tenant to obtain renters insurance.
A landlord may legally include a provision in a residential lease agreement, requiring the tenant to obtain renters insurance. This practice is even recommended by experts on landlord-tenant law. [Alexander v. Security-First Nat. Bank (1936) 7 CA2nd 718]

To confirm the tenant continues to comply with the terms of the lease, a landlord may also include a provision requiring the tenant to name the landlord as an “additional insured” on the renters’ insurance policy. This does not require the landlord to make any payments toward renters insurance or give him any additional responsibility. However, as an additional insured, the landlord will receive notification from the insurance company when the renters’ insurance policy is altered, canceled or expired.

Tenants with renters insurance have no need to seek satisfaction from the landlord, as their personal property is insured and will be restored through their insurance company, subject to a deductible provision amount.

Tort liability

However, much more advantageous to the landlord than coverage of a tenant’s personal property is coverage of a tenant’s personal liability for losses they inflict on the landlord by their conduct. While a security deposit is the primary cash source for recovery, renters insurance provides an added guarantee that the landlord will be covered should the tenant be responsible for damage to the landlord’s property.

Policy limits, of say $100,000, when compared to a security deposit equal to one month’s rent as a source of recovery, provide the strongest inducement for a landlord to require renters insurance of his tenants, new or existing.

Also, should a guest of the tenant be injured on the landlord’s property, the tenant’s insurance policy covers costs incurred by that guest, subject to a ceiling amount.  Essentially, the coverage removes a potential financial obligation from the landlord’s shoulders.

When a residential property is damaged by a tenant causing a loss to the landlord, the tenant’s renters insurance pays the landlord for the cost to restore the landlord’s property.  The security deposit then remains intact for collection of any unpaid rent and the costs to correct extraordinary wear and tear.

Because the cost of restoring the rental property is picked up by the tenant’s insurance, the landlord is able to avoid filing a claim with his insurance carrier.  Thus the landlord avoids an increase in the premiums he would have to pay for his coverage.

Not a substitute for the landlord’s own coverage

“Fantastic!” landlords may say, “I can cancel my landlord insurance policy and let the renters insurance pay for any damage to the property while the tenant is in possession.”

Renters insurance is not a substitute for landlords insurance or homeowners insurance.
But renters insurance does not act as a substitute for landlords insurance or homeowners insurance (or a security deposit). The landlord’s insurance policy insures the real estate which is the rental property possessed by the tenant.

Thus, if the property is damaged by the tenant or others, the landlord knows the losses are covered by the insurance carrier and the cost of restoration will be paid by that insurer (after the deduction is applied, of course).

Because the real estate is owned by the landlord, the landlord alone can insure against losses due to damage to the real estate. Renters insurance covers only the named tenant’s personal liability for causing any damage to the landlord’s property; it does not insure the landlord’s interest in that real estate against any loss.

Thus, a landlord can only count on renters insurance to provide financial reimbursement to cover the restoration of his property and then only if the tenant is liable for the cost to repair or replace the property damage. If the tenant is not liable, then renters insurance does not apply to the property damage.

Landlords cannot rely solely on renters insurance to protect their property; they must invest in homeowners insurance or landlords insurance to cover losses for which the tenant is liable as well as look to the security deposit which may be inadequate.

Sell your tenant on renters insurance

Landlords requiring renters insurance of their tenants have no need to secret from their tenants the benefits of this tenant coverage. Renters insurance acts in the best interests of the tenants, not just for the landlord.  Rather than look first to the security deposit for reimbursement, then pursue the tenant for greater amounts due, the landlord looks to the insurer for payment and the security deposit remains intact.

Minimum loss coverage under a renters insurance policy is $25,000 for personal property and $100,000 for personal liability. This is greater financial coverage than most tenants will need. Best of all, the annual cost to the tenant will be around $100. For the relatively low cost, tenants receive financial protection and at the same time strengthen their image with the landlord as an individual responsible for their actions.

This improves the relationship between landlords and tenants, as landlords are more comfortable renting property to tenants who are insurable and forward-thinking enough to invest in an insurance policy, and who display a measure of concern for the care and protection of the property.

Renters insurance protects the landlord, protects the tenant and his security deposit, and creates a cooperative and peaceful relationship between the two parties. Is it worth the trouble to include an additional lease provision at around ten bucks a month paid by the tenant? Definitely.

                                                                                             Information provided by FirstTuesday

Thinking about buying? Let me help make your home buying success or if you’re ready to begin the buying process, give me a call today!

Stella Bonin
Associate Broker

480.797.4884 / 619.250.6214

stella.bonin@yahoo.com

Coldwell Banker Residential Brokerage (Arizona)
Burke Real Estate Consultants (California)

http://www.CallStellaBonin.com (AZ MLS Search)

Follow me on Twitter: @StellaBRealtor

Join my Facebook International Real Estate Group: https://www.facebook.com/groups/irealestate/

https://www.facebook.com/myrealestateservices/

I am licensed in California and Arizona and we have a great team to serve you with members around the world.

California Bureau of Real Estate Lic. # 01222569
Arizona Department of Real Estate Lic. # BR550696000

“Equal Housing Opportunity”

Sun protection 101

Follow these tips to soak up the sun without letting the harsh UV radiation damage your skin:

  • Avoid direct exposure to sunlight between 10 AM and 4 PM when UV rays are most hazardous. Stay indoors or remain shaded under a tree, umbrella or other shelters.
  • Apply sunscreen with an SPF of 15 or higher. Be sure the sunscreen is broad spectrum, providing protection against both UVA and UVB rays.
  • Reapply every two hours, especially after swimming or sweating.
  • When possible, wear clothing that covers your arms and legs, and a hat with a wide brim.
  • Don’t forget about your eyes – wear sunglasses, preferably the wraparound variety, to keep your eyes and the sensitive skin around them safe from UV rays. Check for labels that say the lenses meet ANSI UV requirements or provide UV absorption up to 400 nanometers.
  • Avoid tanning beds and sunlamps, which expose the skin to harsh UV rays and contribute to long-term skin damage.
  • Take steps to protect your skin from the sun year-round in all weather types. UV rays are still harmful on cloudy and overcast days.

Ready to shade yourself from the sun in a new home? Call me to make an appointment!

Stella Bonin
Associate Broker

480.797.4884 / 619.250.6214

stella.bonin@yahoo.com

Coldwell Banker Residential Brokerage (Arizona)
Burke Real Estate Consultants (California)

http://www.CallStellaBonin.com (AZ MLS Search)

Follow me on Twitter: @StellaBRealtor

Join my Facebook International Real Estate Group: https://www.facebook.com/groups/irealestate/

https://www.facebook.com/myrealestateservices/

I am licensed in California and Arizona and we have a great team to serve you with members around the world.

California Bureau of Real Estate Lic. # 01222569
Arizona Department of Real Estate Lic. # BR550696000

“Equal Housing Opportunity”

Don’t Leave Home Without…

You have been planning this trip for some time and almost every detail has been considered…or has it?  Have you thought about how to protect your home while you’re out of town?  What’s going to make sure that everything you left is still there in your return?

Nothing could ruin a trip more than coming back to find out your home has been burglarized or worse.  It makes sense to spend a little time before you leave on making sure your home is as safe and sound as it can be.

There are a host of devices to use across the Internet including camera doorbells, video cameras, door locks, garage door openers, light and thermostat controls.  You can monitor your home whenever you have an Internet connection.  The question is whether you want the distraction from your trip.

Consider these low-tech suggestions along with your other normal efforts:

  • Tell your neighbors you’ll be out of town and to be aware of any unusual activity.
  • Notify your alarm company
  • Discontinue your postal delivery
  • Use timers on interior lights to make it appear you’re home as usual.
  • Don’t make it easy for burglars by leaving messages on voice mail or posting on social networks.
  • Post on social networks after you’ve returned about your vacation.
  • Remove the hidden spare keys and give it to a trusted neighbor or friend.
  • Lock everything, double-check and set the alarm.
  • Take pictures of your belongings in case you need them.
  • Disconnect TVs and other equipment in case of unexpected power surges.
  • Adjust your thermostat.
  • Arrange for lawn care.
  • Consider disconnecting the garage door opener.
  • Put irreplaceable valuables in a safety deposit box.

It’s nice to go out of town on a well-deserved trip and it’s always nice to get back home…especially when it is just the way you left it.

Thinking about selling or buying? Let me help make your home selling/buying success or if you’re ready to begin the selling or buying process, give me a call today!

Stella Bonin
Associate Broker

480.797.4884 / 619.250.6214

stella.bonin@yahoo.com

Coldwell Banker Residential Brokerage (Arizona)
Burke Real Estate Consultants (California)

http://www.CallStellaBonin.com (AZ MLS Search)

Follow me on Twitter: @StellaBRealtor

Join my Facebook International Real Estate Group: https://www.facebook.com/groups/irealestate/

https://www.facebook.com/myrealestateservices/

I am licensed in California and Arizona and we have a great team to serve you with members around the world.

California Bureau of Real Estate Lic. # 01222569
Arizona Department of Real Estate Lic. # BR550696000

“Equal Housing Opportunity”

15 Common Home-Buying Mistakes

Congratulations! You’re buying a home! It is the happiest moment of your life having your own home. Are you thinking about inviting your family and friends for wonderful times together? Those will be great times with memories that will last forever. But you need to beware of a few home-buying mistakes.

Buying a home is one of the largest purchases you’ll ever make if not the largest one, and you cannot afford to make any mistakes and rob you of your other financial goals. You need to protect yourself and your family by knowing what not to do.

The following is a list of typical home-buying mistakes and how to avoid them.

Mistake #1: Buying a House When You Have Debt

Being in debt when you want to buy a house can be overwhelming. If you are comfortable meeting all your monthly financial obligations without stress or hardship, you might be in a good position for a larger commitment. That would include comfortably managing current debt payments, perhaps in the form of a car or student loan or small credit card balance, but if you’re just barely able to afford the monthly mortgage payment, you’re not ready to buy a home yet, and adding a mortgage on top of monthly debt payments will put you just one emergency away from foreclosure.

Instead, push pause on the house for now, and dump the debt that’s holding you back. Then build and maintain a full emergency fund to protect yourself from ever going back into debt.

Mistake #2: Buying a House You Can’t Afford

1. It’s outside your budget. A budget exists for a reason! Going beyond the budget means you are stretching yourself past where you previously felt financially comfortable.

2. You’re making assumptions about future income and expenses. “We’re getting a larger and more expensive house because we’ll probably make more money in the future.” This thinking is foolish and possibly disastrous.

3. You’re unable to put 20 percent down. If you couldn’t save 20 percent for a down payment, ask yourself why you think you’d comfortably make the mortgage payments now.

4. Your interest rate is high. If banks think you are a risky borrower.

5. Your decision is heavily guided by emotion. It’s perfectly fine to have certain criteria in mind when searching for a home. But affordability should be a big part of that criteria.

6. You have unusual mortgage terms. You may not qualify for a fixed-rate mortgage. When this happens, banks will often offer different kinds of loans. These can include adjustable rate mortgages, in which interest rates may start low but increase later. Or they may be negative amortization loans, in which the amount owed grows larger over time instead of shrinking.

7. You are nearing the maximum mortgage that you qualify for. When you are applying for a mortgage, banks will often tell you that you’ve been approved for a mortgage up to a certain amount. It’s important to remember that this is the maximum amount that you can borrow, not a guideline of what you should spend. In fact, the actual amount you borrow should never be close to that maximum.

8. Your payments exceed 30 percent of your monthly income. For nearly 50 years, the U.S. government has suggested that renters and homeowners pay no more than 30 percent of their income in housing costs. This is not a requirement or law, but it is a helpful guideline for determining if you may be overburdened by a mortgage or rent payment.

9. Your debt-to-income ratio is approaching 43 percent. In addition to the 30 percent guideline, the federal government also looks at another figure to determine your worthiness for a loan. When banks examine whether to approve you for a loan, they will add up all of your debt (including credit cards, auto loans, etc.) and compare it to your income. If that ratio is more than 43 percent, you may not be approved for the loan.

So, before you go looking for your dream home, figure out how much house you can afford, and ask for the professional help of your real estate agent and your loan officer.

Mistake #3: Not Saving Enough for a Down Payment

If you’re getting a mortgage, one of the worst home-buying mistakes you can make is not saving enough for a down payment. The more time you give yourself, the more you can save. And the more money you save, the less your mortgage loan will cost in the long run. Stay focused and you should be able to save a nice down payment in two to three years. Try not to take much longer than that to save for a down payment, though. Any amount less than 10% is way too low! Yet, government-insured programs (FHA, VA, USDA) are making it easier to buy a house with little to nothing down. Sounds nice, right? The problem is that you’ll be charged so much extra in interest and fees that you’ll feel like you’ll never pay off your home.

So how much should you save for a down payment? It is recommended saving at least 20% of the total house price to avoid paying PMI (Private Mortgage Insurance) a type of insurance that protects your lender from losing money in case you can’t make your mortgage payments. You are responsible to check the value of your home to get rid of this insurance and order an appraisal, the lender will continue charging if not.

Mistake #4: Forgetting About Closing Costs and Moving Expenses

Another mistake is to focus so much on saving for the down payment that you forget about other home-buying expenses.

1. Earnest money – If you’re a first-time buyer, earnest money may be one of the first unexpected homebuying expenses you encounter. This is a good faith deposit made after your initial offer is accepted.

2. Appraisal fee – Before your lender can approve your mortgage, they’ll need a professional appraisal showing how much the home is worth. As the buyer, you’re responsible for paying the appraiser’s fee. This adds to the tally of unexpected home buying expenses.

3. Inspection fees

Although an inspection is not required, it’s a good idea to have one. Like the appraisal, you’ll bear the cost yourself, so this fee should be on your list of expenses not to forget when buying a home. Every homebuyer should consider at least two types of inspections (home & termite inspections).

4. Closing costs

While having to pay closing costs may come as no surprise, the amount you must pay can easily be one of the largest unexpected expenses when buying a home.

The closing costs are typically around 3 percent of the purchase price, but you may not have to pay that much out-of-pocket and you can ask the seller to offer a credit toward closing costs. The amount of seller credit may be limited based on the type of mortgage

5. Moving expenses

After closing you are moving your stuff from your old home to your new home. While you may be anticipating a move, the cost may take you by surprise and is an expense not to forget when buying a home.

Are you using a moving company? Are you renting a truck? Do you need helping hands? How much furniture do you have? How far will it need to be moved? These are all important questions to ask.

6. Utilities

You’ll need basics like electricity and running water at your new home, and you may want extras like cable TV or Internet service. Don’t forget these costs when buying a home.

Homebuyers should be aware that they may have to pay deposits for utilities if they’re establishing services for the first time. If you have poor credit, some companies may require a larger deposit, so plan for these unexpected homebuying expenses.

To avoid any service interruptions, remember to have your services transferred into your name on or before the day of closing, even if you aren’t moving in right away. Sellers will not leave these services on, so you need to plan to make sure you’re not spending a dark first night in your new home.

7. Furniture and household items

You may think you have everything you need but you might need a new microwave or other appliances if the seller decided not to leave them behind. Then there are smaller things like blinds, new light bulbs or extra cleaning supplies.

These are all important expenses not to forget when buying a home. You should also consider the costs of adding personal touches.

8. Upgrades and repairs

One final category of expenses not to forget when buying a home is renovations and repairs. An inspection can catch major flaws such as a leaky roof, but it doesn’t account for livability.

Mistake #5: Not Getting Preapproved

You found the perfect house that you love, in the perfect neighborhood and fits your budget! You shared your excitement with your family, friends, social media, and anyone that want to listen to you that you are making an offer for the full price. You hire a real estate agent to write an offer, and for your disappointment, the seller has chosen another buyer. Why? Because the other buyer included a mortgage pre-approval letter with their offer. A mortgage pre-approval letter not only tells the seller the other buyer was a serious buyer, but it also says choosing him because he was pre-approved process will move faster and you were only pre-qualify for the loan. Getting pre-approved (not just pre-qualified) gives you a leg up on the competition. It’s worth spending the time to get pre-approved. We have a mortgage broker to help you!

Mistake #6: Getting the Wrong Mortgage

There are many types of mortgages. Most of them (ARM -Adjustable Rate Mortgage, FHA – Federal House Administration, VA- Veterans Administration, USDA – United States Department of Agriculture) are designed to get you into a house no matter your financial situation. With these loans’ types cannot best the best choice in the long term as you will pay thousands of dollars more than in a conventional loan in interest and fees.

So, what’s the right kind of mortgage? The answer is a 15-year fixed-rate conventional mortgage. It saves you the most money in interest and fees overall compared to the other mortgage options. But it depends on you and your financial situation as most of the buyers would prefer 30-year-fixed-rate conventional mortgage and make double payments when they are able to. Lots of lenders will say you can afford more but stay conservative.

Mistake #7: Cosigning Your Mortgage

Getting someone to cosign on your mortgage is a serious home-buying mistake. If you can’t buy a house without a cosigner, protect your financial future by postponing your purchase.

Mistake #8: Buying Mortgage Points

Paying points to get a lower rate on a mortgage is almost always a losing proposition.

That’s because most homeowners don’t keep their mortgages long enough to do more than recoup the up-front cost of paying points.
A point is 1% of your loan amount. If you take out a $250,000 mortgage, 1-point equals $2,500.
In the mortgage world, there are two types of mortgage points:
Origination points are a fee you must pay a bank or mortgage company to give you a loan.
Discount points lower the interest rate on your loan and reduce your monthly payments.
Borrowers get a lower rate for paying discount mortgage points because they’re prepaying a portion of the interest on their loan.
Indeed, discount points are tax-deductible, just like the interest you pay with each monthly mortgage payment.

Mistake #9: Not Using a Real Estate Agent

Every home buyer is legally allowed to purchase a home without a real estate agent. A better question might be whether you want to use an agent or not. With all the high-tech real estate apps and websites available, you might think no one needs a real estate agent to buy a house these days.  That it is not the case! In fact, nearly 90% of buyers who purchased a home last year used a real estate professional.

That’s because an experienced agent helps you to:

You may think that I was a real estate agent merely looks at a list of homes, picks out a few, shows them to you and sells you on one of them. In a broad sense, that’s true, but there is much more. Besides looking through the Multiple Listing Service (MLS) for available homes that fit your needs, as an agent, I will pre-inspects each home, discusses the home with the listing agent to find out what is motivating the seller, reviews the neighborhood and schools and much more. As your agent, I will do everything you would do to responsibly investigate the home but do it much faster and more effectively than you can, because I know the neighborhood and have played the game a many times before.

As your real estate agent, I am here not just to find your new home, but to protect your interests in the transaction as well, and in most cases, the seller covers the commission for your agent. So you get all the benefits for free! I know what a loss it can be to try and buy a house without an agent.

When your agent in this case me if I represent you make an offer, I know exactly what to include in the offer and what to exclude. I know what terms you must include to protect yourself, and what disclosures the seller must provide.

As professional real estate agents we know the area where you are buying very well and understands the nuances of the neighborhood and the quality of the schools. The person should know every home that has been listed and sold in the neighborhood recently, and everything important about each one.

Real estate agents, we have relationships with the professionals whose help you will need to complete your transaction and maintain your home. These professionals include title insurance officers, escrow officers, property and pest inspection companies and home warranty companies, among others.

As your real estate agent, I am here not just to find your new home, but to protect your interests in the transaction as well.

The listing broker has an agreement with the seller and is paid by the seller. If I am representing you as your real estate agent (I will be called the “selling agent”) and I will find a home for you that is listed by another agent, then the listing agent splits his commission with my brokerage. The money comes from the seller’s proceeds in escrow.

Mistake #10: Focusing on Style Over Structure

Picky buyers may turn up their noses at less attractive homes, which may cause them to overlook a diamond in the rough. So-called problems you should ignore when house-hunting, including an ugly paint color (either on the exterior or interior of the home), dated furniture or style (unless you’re buying the home furnished, you’ll be decorating it to your own taste), and even certain easily altered architectural details, like a lack of crown moldings.

While minor cosmetic issues shouldn’t cause you to automatically say no to a home, be wary of superficial problems are also paired with signs of neglect, like a lawn that hasn’t been cared for, unusual odors, or mold.

Mistake #11: Ignoring Resale Value

Good resale value is never a promise. It is almost impossible to guarantee that a home will retain its full resale value, as the local market and economic factors have a large effect on the housing market.

Resale value is anybody’s guess if the economy tanks. But there are some indicators to watch for that could be the difference between barely squeaking by or coming out ahead. As you hit the house-hunting trail, look for these promising signs that suggest your investment will be a smart one.

1. Pay attention to your surroundings when house hunting. Is the neighborhood walkable? Or is a trip to the grocery store so onerous it requires snacks for the road? Meanwhile, are there restaurants nearby for those nights you simply just can’t? If you buy in an area that is not well-developed and doesn’t have good infrastructure, you will not have a high rate of return on the home. The more amenities, the higher the chances the home will sell faster and for more money.

2. You want a gorgeous kitchen, you need five three or more bedrooms, and amenities as a car repair place, small hotel for in-laws, and other amenities close by but not in your backyard.

I will recommend not buying on a busy street or purchasing a home surrounded by commercial properties nearby as it will be more difficult at the time of selling.

3. Will the home sell for more than you paid? You must factor in how much you’ll spend on the home while living there. If the home’s vital components are falling apart, you’ll be spending a lot.

Your inspector can give you a rundown of your future home’s health, but keep a close eye on the roof, water heater, HVAC system, windows, and foundation. Pay attention to the plumbing and electrical, too. A problem with any one of these major systems can require a costly repair—and take a bite out of your payday.

4. The schools are great. Even if buyers personally don’t have children, for resale it is imperative that they buy in a great school zone. Just make sure to do your research and determine where the home sits in relation to the school district boundaries.

5. Whether you’re shopping for a condo or house, visit the property at different times of the day to see how the light affects the space.

6. Look for a home with a floor plan that will appeal to families. And always pay attention to the number of bathrooms. You want enough to avoid fights in the morning.

7. The community is restrictive. Homeowners associations can be expensive and very difficult to deal with and many buyers need to review the CCR’s before to consider putting an offer in that neighborhood. But an HOA can be helpful, at least when it comes to resale value. That’s because HOAs usually keep everyone in line, preventing your neighbors from letting weeds take over their lawn, painting their houses bright pink, or permanently parking an RV in the middle of your street all things that could ding the value of your home.

Of course, purchasing an HOA-regulated home isn’t for everyone. But if you’re seriously concerned about the resale value of your new home, covenants and restrictions could keep you flush.

Mistake #12: Buying Without a Home Inspection

It is one of the biggest mistakes a homeowner could possibly make.  A buyer NEEDS to learn about the home they are buying. Good inspectors promote themselves to their clients by investing in education. The more you learn about the home, the more information you will have in the end to make a conscious decision if you continue with the purchase.

I would recommend to any and all my clients to hire a home inspector as soon the offer is accepted. The money that you will spend on the home inspection it is money well-spent if it helps you to avoid potential disasters after closing. An inspection includes a thorough review of the home’s structural elements and electrical, plumbing, heating, and cooling systems. The inspector’s report gives you the information you need to decide to buy the home as-is or to negotiate with the seller to fix the problems or reduce the price.

Mistake #13: Not Walking Away from a Bad Deal

Sometimes is recommendable that a new home buyer walks away from a bad deal.

A few examples are:

How Much of a Fixer Up? If you don’t have a comfort level dealing with renovation or the renovation doesn’t make the purchase economical, you may want to walk away.

Were there Issues with the Home Inspection?
No matter the cost of a home, experts always advise getting a home inspection. To protect your interests, any offer should be contingent on a satisfactory home inspection. That way, if there are issues, you can go back to the seller and negotiate. If you’re starting to get into something where it’s more than 2% to 3% of the purchase price, you should think about it. If you’re dealing with structural things, consider how much you want to do. Anything that’s not fixed can affect your resale value.

Do-it-yourself additions.
It is economical to convert a garage to living space yourself, work that’s not done to code can be expensive to fix and lower the value of the home since there’s no car shelter. One way to know if the addition was done with permits is to check the city tax records.

Decks. 
Always ask who built a deck and when. A freestanding deck can be impossible to fix and may have to be rebuilt so it can hold all the weight and be safe.

Noticeable structural problems.
If doors and windows don’t open and close properly or crack along the outside of the home don’t follow the mortar, there could be structural settling in the house. Check for cracks on concrete floors if one side is lower than the other as well. Issues with the foundation can be very costly to fix.

Excessive termite or pest damage.
Insect damage can be hard to find and may require opening the walls. If the studs have been chewed through, that’s compromising the structure.

Water damage.
Moisture or water stains in the basement may be signs of a drainage issue. If you find any worrisome evidence, an inspector should be able to tell you the extent of the damage. Since water can cause some failure of the foundation, be sure to determine if the home is in a flood zone and whether it’s ever been flooded.

Faulty electrical work or old wiring.
The home may not be designed to handle the additional electrical work that’s been added over the years. Knob and tube wiring or aluminum wiring found in older homes can be very expensive to replace.

Asbestos and mold.  
It is not recommendable purchasing a home with asbestos or mold issues. These are expensive to remedy as they must be removed by companies specializing in mold or asbestos removal. Once removed, the homeowner must show proof that the home is mold free.

Mistake #14: Taking on Credit While Closing

One day, you apply for a mortgage. A few weeks later, you close, or finalize, the loan and get the keys to the house. The period between is critical: You want to leave your credit alone as much as possible. It’s a mistake to get a new credit card, buy furniture or appliances on credit, or take out an auto loan before the mortgage closes.

Wait until after closing to open new credit accounts or charge big expenses to your credit cards.

Here’s why: The lender’s mortgage decision is based on your credit score and your debt-to-income ratio, which is the percentage of your income that goes toward monthly debt payments. Applying for credit can reduce your credit score a few points. Getting a new loan, or adding to your monthly debt payments, will increase your debt-to-income ratio. Neither of those is good from the mortgage lender’s perspective.

Within about a week of the closing, the lender will check your credit one last time. If your credit score has fallen, or if your debt-to-income ratio has gone up, the lender might change the interest rate or fees on the mortgage. It could cause a delay in your closing, or even result in a canceled mortgage.

How to avoid this mistake: Wait until after closing to open new credit accounts or to charge furniture, appliances or tools to your credit cards. It’s OK to have all those things picked out ahead of time; just don’t buy them on credit until after you have the keys in hand.

Mistake #15: Forgetting About Insurance

You will need two types of insurance

1. Owner’s title insurance

Owner’s title insurance provides protection to the homeowner if someone sues and says they have a claim against the home from before the homeowner purchased it.

When you purchase your home, you receive a document most often called a deed, which shows the seller transferred their legal ownership, or “title” to their home, to you. Title insurance can protect you if someone later sues and says they have a claim against the home from before you purchased it. Common claims come from a previous owner’s failure to pay taxes or from contractors who say they were not paid for work done on the home before you purchased it.

Most lenders require you to purchase a lender’s title insurance policy, which protects the amount they lend. You may want to buy an owner’s title insurance policy, which can help protect your financial investment in the home.

You can usually shop for your title insurance provider separately from your mortgage. If you shop for title insurance, you may be able to save money. If you choose to buy owner’s title insurance, the total cost will usually be lower if you use the same provider for both the lender’s policy and the owner’s policy, compared to buying them separately.

2. Homeowners’ Insurance

You’re a first-time homebuyer, and you’ve searched for the perfect house for months. The homeowner accepts your offer, and now you must learn about a topic that might not be as fun as home-shopping, but it is vital – home insurance.

Your mortgage lender will likely require you to carry some level of home insurance. Don’t rely on the most basic coverage. Make sure that your home insurance protects you from financial disaster.

If you’re buying your first home, you may have experience with condo or renter’s insurance. There are some similarities with home insurance, such as personal property coverage, but there’s a lot more to home insurance. That’s because there is a lot more to lose when you own a home.

What homeowner’s insurance covers

The most basic home insurance policy usually covers at least five coverage areas:

Dwelling coverage — this is what covers your home.
Other property
— this is what covers detached structures on your property.
Personal property coverage
— this is what covers the property within your home
Liability coverage
— this is what covers you in case a visitor suffers a serious injury and sues you.
Additional living expenses
— this is what covers you in case your home is uninhabitable, and you need to live elsewhere.

Other important information to know about homeowner’s insurance policies:

Home’s replacement cost
What your policy doesn’t cover
Home insurance discounts
How your credit score affects your rates
What is a CLUE report? (claims’ history)
Homeowners insurance deductibles
Does home insurance cover flooding?
Do you need earthquake insurance?
Trusted homeowner insurers
Shopping for homeowner’s insurance
Homeowners insurance rates by company and state

Thinking about buying? Let me help make your home buying success or if you’re ready to begin the buying process, give me a call today!

Stella Bonin
Associate Broker

480.797.4884 / 619.250.6214

stella.bonin@yahoo.com

Coldwell Banker Residential Brokerage (Arizona)
Burke Real Estate Consultants (California)

http://www.CallStellaBonin.com (AZ MLS Search)

Follow me on Twitter: @StellaBRealtor

Join my Facebook International Real Estate Group: https://www.facebook.com/groups/irealestate/

https://www.facebook.com/myrealestateservices/

I am licensed in California and Arizona and we have a great team to serve you with members around the world.

California Bureau of Real Estate Lic. # 01222569
Arizona Department of Real Estate Lic. # BR550696000

“Equal Housing Opportunity”

Who pays to cure any safety hazards on the sale of a home?

Who pays to cure any safety hazards on the sale of a home?

Safety hazards are an important aspect of ownership a buyer needs to consider when looking into purchasing a home.

Safety hazards typically include:

• automatic garage doors that do not have a reverse safety device;

• garage door openers that are not installed with a sensor which, when interrupted or misaligned, prevents the door from closing;
• a water heater that is not anchored, braced or strapped;

• window security bars that do not have emergency release mechanisms;

• the absence of a carbon monoxide detector in a home that contains a fossil fuel-burning appliance, heater or fireplace;

• a lack of properly placed smoke detectors; and

• a pool which does not include any of the following:

◦ a surrounding fence at least 60 inches tall;

◦ removable mesh pool fencing with a self-closing and self-latching gate that is key lockable;

◦ an approved safety cover installed for the pool;

◦ an up-to-code swimming pool alarm that sounds when it detects accidental or unauthorized water entrances; or

◦ doors of the residence providing access to the pool that is equipped with exit alarms or a self-closing, a self-latching device with a release mechanism placed no lower than 54 inches above the floor.

As with any property defect, sellers are mandated to disclose safety hazards to prospective homebuyers. Sellers make these disclosures when preparing a Transfer Disclosure Statement (TDS).

The seller’s agent also conducts a mandated visual inspection of the property and notes any property defects they observe, including safety hazards, on the TDS.

The seller’s agent hands the TDS and all other seller’s disclosures and property reports to prospective buyers who show an interest in purchasing the property.

When a buyer submits an offer to purchase, they acknowledge receipt of the TDS and each additional disclosure they have received in the offer. Through the purchase agreement, the buyer negotiates to have the seller correct or pay the costs to bring the safety hazard conditions up to building codes.

If the prospective buyer chooses not to negotiate for the seller to cure any disclosed defects as a condition of paying the price offered in the purchase agreement, the buyer has agreed to acquire the property “as disclosed” by the seller.

Here, the buyer assumes responsibility for curing safety defects.

However, when the seller and the seller’s agent fail to disclose the safety defects prior to entering a purchase agreement with a buyer, the buyer has several remedies:

• demand the defects be eliminated by the seller before closing;

• call for the seller to provide a monetary concession in lieu of the repairs;

• renegotiate the purchase price; or

• cancel the purchase agreement.

Thinking about selling? Let me help make your home selling success or if you’re ready to begin the selling process, give me a call today!

Stella Bonin
Associate Broker

480.797.4884 / 619.250.6214

stella.bonin@yahoo.com

Coldwell Banker Residential Brokerage (Arizona)
Burke Real Estate Consultants (California)

http://www.CallStellaBonin.com (AZ MLS Search)

Follow me on Twitter: @StellaBRealtor

Join my Facebook International Real Estate Group: https://www.facebook.com/groups/irealestate/

https://www.facebook.com/myrealestateservices/

I am licensed in California and Arizona and we have a great team to serve you with members around the world.

California Bureau of Real Estate Lic. # 01222569

Arizona Department of Real Estate Lic. # BR550696000

“Equal Housing Opportunity”

Are you a responsible pet owner?

Responsible Pet Owner Tips:

  1. You know the signs of a healthy pet and monitor them for any changes: Fresh breath, shiny + clean coat, consistent lean weight.  If anything changes, contact your vet as they can be signs of something else that needs medical attention.

  2. You take your pet for annual checkups (bi-annual for senior pets).

  3. You feed your pet a healthy diet.

  4. Your pet is exercised regularly and is kept at a healthy weight.

  5. Your home is pet-proofed and safe for your pet: no poisonous plants, no unattended candles, no wires to chew.  Pet-proofing is often species appropriate and seasonal, so keep a safe environment in mind year-round!

  6. Your pet is leashed and under your control and supervision when you are out.
  7. Your pet is microchipped or has an ID tag 24/7 with your phone number on a collar (never removed it).

 

I am always available for your Real Estate questions or needs.

Stella Bonin
Associate Broker

West USA Realty (Arizona)
Burke Real Estate Consultants (California)
480.797.4884 / 619.250.6214
stella.bonin@yahoo.com

Follow me on Twitter: @stellabonin1

Join my Facebook International Real Estate Group: https://www.facebook.com/groups/irealestate/

https://www.facebook.com/myrealestateservices/

I am licensed in California and Arizona and we have a great team to serve you with members around the world.

California Bureau of Real Estate Lic. # 01222569
Arizona Department of Real Estate Lic. # BR550696000

“Equal Housing Opportunity”