Tag: #homesandrentalrichmondTX

Happy Clients Realty Group - Ali Palacios > #homesandrentalrichmondTX

Concerned about mortgage rates going up?

Posted on by Ali Palacios - Broker

You might have heard that mortgage interest rates are going up.

Most of the time, the question is asked by people who are thinking of buying a home. It makes total sense that they would be concerned about whether the rates are going up or not.

But what most people don’t consider is the effect it can have on someone considering selling their home.

Before we go further…

Whether or not interest rates are going to rise is kind of a constant topic in real estate. They go up, and they go down constantly. But not by all that much usually. But the buzz lately is whether they are about to go up considerably.

The fact is, rates have been historically low for so long now. And at some point, yes, they probably will go up a good amount. With that said, people have been expecting it to happen for years.

So, the only real answer to whether rates are going up is… maybe… maybe not. Only time will definitely tell.

But the concern is valid. Yes, for buyers. But also for sellers…

Because:

  • It could lower the amount buyers are willing to pay for houses.
  • It could lower the amount buyers are able to pay for a house.
  • It could slow the market down…buyers could decide to stop buying as readily.
  • It could knock buyers completely out of the market.
  • It could affect you as a buyer once you sell your home and purchase your move-up, or downsize home.

This is not to say that you should base your decision to sell your home solely on the possibility of interest rates going up. There is certainly more to consider.

But if you’ve been considering selling, and you have been concerned with the chatter about interest rates, let’s just talk.

These are general thoughts…

Everyone’s situation is different. Maybe interest rates going up would affect you…but maybe not.

Feel free to give me a call, or simply reply to this e-mail.

Will higher mortgage rates affect your ability to purchase?

Posted on by Ali Palacios - Broker

Recently, people have been asking if mortgage interest rates will be going up.

That’s a good question. And it’s good to be concerned about it if you’re considering buying a home in the near future.

There’s no way to definitely answer this, let alone how much the rates will go up. They go up and down constantly. If they go up (or down) a little bit, that won’t really affect you all that much.

Deep down, the concern is of course whether the rates will go up a lot… enough to impact how much home you can afford, or to even be able to qualify for a loan at all.

The one thing we can say for sure is that mortgage rates have been historically low for quite some time now. Literally for years and years.

At some point, they will probably go up a good amount. One could even argue that they need to go up. But let’s not get into that debate…

So let’s get into what the core fears are when people are asking about this…

If rates go up, a buyer could:

  • Pay more for the same house they could have gotten for less per month if they had bought before the rates went up.
  • Not be able to afford the same homes on the market they could have afforded before rates went up.
  • Possibly not even qualify to buy a house at all, depending on their financial situation.

So, what is an agent to advise?

To say that, “You should buy now, or you will miss out due to interest rates rising…”, can lead to fear-based decision making. That isn’t something a good real estate agent makes a habit of doing with their clients. Or at least shouldn’t.

Besides, the interest rates may not go up enough to affect you, if at all.

So, the best way to look at it is this…

If the thought of interest rates going up concerns you…buy now. Or at least sooner than later. Not because of fear that rates may go up. But because you are dealing with a known quantity, as opposed to the unknown. And because the mere fact that you are concerned speaks volumes about what you want to do deep down inside.

This is all pretty general advice…

If this has been concerning you, give me a call, or just reply back. I’d be happy to hear more about your situation and needs, so that I can advise you more specifically.

P.S. If you’re thinking about buying sooner than later, it might make sense to lock in an interest rate now. If you have a mortgage advisor, consider discussing this with him or her. If you don’t, just ask me and I am glad to recommend a great mortgage lender.

Would you please bother me?

Posted on by Ali Palacios - Broker

“I didn’t want to bother you. I know how busy you are…”

I hear that from past clients, friends, and even family, all the time.

But, at that point, it’s too late. And I’m not talking about it being too late for me to make money…

I’m talking about mistakes having been made, and regrets seeping in. And, at that point, there is nothing I can do to help.

So, it just occured to me that it would probably help if I just reached out to you, to let you know that you can and should call me. Anytime. For any real estate need or question. Before you find yourself in the same position as some other folks.

I know how busy you are, so I won’t go into every detail, of every scenario I’ve seen happen in this e-mail.

Here’s a short list, just to give you an idea…

But please, if you want more insight on any of these, give me a ring, or reply to this e-mail, and I’m happy to get into more detail with you.

1. You just want to go see a house that is on the market…

(Yes, even if you aren’t serious about buying it. I won’t be pushing you to buy the house. I will be protecting you from making any regrettable decisions. Unfortunately, I hear from people after they got swept up in the moment and bought a house, and they are feeling regret, or have questions about the process or their decision. At that point, I can’t chime in. Because another agent represents them.)

2. You want to know how much your home is worth.

(Yup, I know all about all of those websites that show you the value of your home. And I know how inaccurate they are. Whether you are just curious, are wondering if it makes sense to sell, or need to get a handle on your net worth…just call me. I will give you an accurate value of your home. My pleasure. Not a bother at all.)

3. You are considering a home improvement project.

(Almost any project you choose to do will certainly raise the value of your home. But, will it raise the value more than it cost you? Better to know whether or not it is money worth spending before you even start.)

4. You are thinking of refinancing.

(Being in the business, I get to know who the good lenders are, and who the not-so-good ones are. I hear way too many horror stories from people about the process being horrendous with such-and-such bank. Or that they felt duped because they were quoted one rate, and were ultimately given a higher rate. Just call me, and I’m glad to give you the names of some people I would trust handling your needs.)

5. You don’t even work in my area.

(Even if you live hundreds of miles away, I can help… before you decide to buy or sell a house. I can’t chime in once you are represented by an agent. But if you call me before, I can remain involved and add my two cents, as long as I have referred you to the agent you use. And I can really help find you a great agent in your area. It’s not always the one with all the signs and sales! Let me do some digging before you just hire anyone.)

————-

Like I said, this is not a thorough list. I just wanted to give you a sense of some things you may not have wanted to “bother” me with, that I would never consider to be bothersome.

So, would you please “bother” me? It will only bother me if you don’t!

Avoid These Mistakes Before Your Closing Day

Posted on by Ali Palacios - Broker

Don’t let a small mistake ruin your chances to close on your home. Lenders are checking employment and credit up through the day of closing. You spend days going through the finance procedure and you finally received approval for a mortgage loan. It’s time to celebrate, right?

Not yet! Your lender will recheck your credit right before closing. Don’t give them a reason to deny your loan. Nothing is official until everything is signed and funded. Avoid these most common mistakes:

1. Changing jobs

Changing employers could mean delays due to employment and salary verifications or possibly cause your lender to deny your loan. If you can wait, wait. It’s not worth the risk.

2. Making a big purchase

You need new furniture, a new car, a boat etc. Your debt-to-income ratio is an important factor when being considered for a loan. If you add to your debt by making a large purchase, you risk exceeding the ratio that your lender finds acceptable.

3. Opening credit accounts

You might apply for a credit card so you’re ready to buy furniture for your new house. But similar to taking on new debt, applying for a new credit account can harm your mortgage approval. The credit inquiry necessary for the new account will ding your credit score a few points.

 

When in doubt it’s best to consult your lender before making any changes to your finance.

Lentil Soup a la Fadi’s

Posted on by Ali Palacios - Broker

Lentil Soup a la Fadi’s

I’ve been trying to replicate Fadi’s lentil soup for a while. I’ve tried lots of recipes. This seems to be a winner. Give it a try!

  • 2 tbsp oil
  • 1 large onion, chopped
  • 1 cup diced or shredded carrots
  • 1/2 cup diced or shredded celery
  • 3 cloves of garlic, finely chopped
  • 1/2 cup of white rice
  • 1 1/2 cups of red lentils
  • 8 cups of chicken/vegetable stock
  • 1 tsp turmeric
  • 1 1/2 tsp ground cumin
  • Handful of chopped flat-leaf parsley
  • Juice of half a lemon
  • salt and pepper to taste

Saute veggies in olive oil until tender. Add everything else except lemon juice. Cook until lentils and rice in tender. I just threw everything in a slow cooker on low for 6 hours. If you cook it on the stove they can be ready in less than 1 hour. They cook super fast. Add lemon juice at the end.

Wire and mail fraud

Posted on by Ali Palacios - Broker

Unfortunately there are scammers everywhere and there are many that involve real estate transactions. Here are a few to avoid:

Wire Fraud

Hacker will send you an email acting as your Realtor® or title company. They will provide wire instructions for your down payment and closing costs. These emails look very real.

The hacker will provide their bank information and the buyer/seller will send the funds to the hacker’s account. A Realtor® (including myself) will never send you wire information.

One of the way to avoid this is by calling the title company and confirming the banking information before you initiate a transfer. Alternatively, you can bring a cashier’s check to the closing.

Get verification of the transfer ASAP. If you suspect a scam, have the  receiving bank freeze any withdrawal attempt of the newly deposited  funds—if you’ve reached the bank in time, that is.

Mail Fraud

You will get lots of mail from different people offering to submit your homestead application or offering you copies of deed or other documents.

Scammers are contacting new home buyers with a seemingly legitimate solicitation offering to send a copy of their property deed and other information for a fee. Those documents are mailed to you free after a sale or transfer. And if you need another copy, you can order one through your county clerk’s office for a few dollars

You might get an offer for a property profile, which comes with information such as transfer histories, property lines, county tax amounts, even the number of rooms … basically everything you need to know about your house.  It’s all information that is either not needed, or already known.

Generally, if you receive a solicitation asking for more money after your closing, it isn’t legitimate. But if you aren’t sure or want more information, contact your county clerk’s office or your real estate agent.

Moving Check List

Posted on by Ali Palacios - Broker

It’s Finally Time to Move!

Below you will find a moving checklist

2 months before

  • Start sorting your belongings into “what to donate” and “what to keep” piles. Start getting rid of items you don’t plan on taking to your new home.
    • Sell/Donate to your friends
    • Hold a garage sale
    • Sell items online (Craigslist, Facebook, eBay etc.)
    • Donate to charities (get a tax receipt)
  • Avoid the last-minute pile of trash on the curb—start throwing away anything that can’t be donated, sold or gifted.
  • Make a room-by-room inventory of your home. Note and photograph any existing damage to your furniture, so you know who’s responsible for what on delivery day.
  • Research your moving options, and request on-site quotes from at least three moving companies**
  • Make a “moving” binder, which will include all your important contact info, estimates, receipt and other important documents.
  • If school districts are being switched, make sure you make the appropriate arrangements to transfer the records to the new school.

6 weeks before

  • Purchase bubble wrap, boxes, packing tape, and other necessary supplies.
  • Start using up existing stock of cleaning supplies, frozen foods, and any other items that cannot be moved, particularly on a long-distance relocation.

1 month before

  • Pack occasionally used items, number and label each box with the intended room and its contents.
  • Put important files and jewelry in a box, which you will move yourself personally.
  • Set aside a box with all the items required on moving day, such as small pieces needed for re-assembling furniture, tools, etc.
  • Request a copy of your family’s dental and health records  from your current provider(s).
  • Collect things you have loaned out and return borrowed items.

2 weeks before

  • Choose your preferred moving company and confirm the arrangements.
  • If you are changing banks, do not forget to close out safety deposits.

1 week before

  • Switch to another pharmacy and/or refill prescriptions.
  • Finish your general packing a few days before moving day.
  • Pack suitcases with clothes enough to wear for a number of days.
  • Let your credit card companies, employer, banks, insurers, and utility companies know about your move.
  • Transfer or start and stop utility service at your new and old addresses for the following:
    • Electric
    • Water
    • Gas
    • Telephone
    • Cell phone
    • Cable/Satellite and internet
    • Sewer
    • Trash collection
  • If you are using a moving company remember to discard aerosols, flammables, ammunition or bottled gas. Be sure to check with your moving company for other prohibited items
  • Make arrangements to rent a storage unit, if necessary
  • Schedule/hire a cleaning company for the week of your move.

A few days before

  • Empty and clean your refrigerator.
  • Once again, call the moving company and reconfirm the arrangements.
  • Keep cash in hand if you plan to give the movers tips.
  • If you’re switching banks, remember to clean out your safety deposit box.
  • Fill out the change of address form either at the post office or online at usps.gov.
  • Pack a bag of essentials for moving day and your first night, including a change of clothes, toiletries, napkins and towels, soap, shower curtains, important documents and electronic devices.

Moving day

  • Remove the beddings
  • Leave a forwarding address and other contact information for the new residents; after all, they could have a few questions.
  • Walk through your home one last time, before the moving truck heads out, to ensure nothing has been missed.

**It’s important to research movers and ask the right questions before you decide in a company.

Questions to Ask:

  • Insurance? – Basic insurance for most companies is 60 cents a pound. You can buy your own insurance as well.
  • Binding Quotes? – Is this quote binding? Is it a “not to exceed” quote?
  • Transfers? – Will my goods be on the same truck for the whole trip or will it be transferred to another truck at some point?
  • Extra Charges? – Does the quote include awkwardly sized objects, parking, storage, fuel, etc.?
  • What payment forms/terms do you accept? – Be leery of cash-only companies.
  • Mover or Broker? – Are you talking to the mover or to a broker working for moving companies?
  • Who’s Responsible? – If anything is damaged, who is accountable for the damage?

Many moving company tend to have bad reviews. The most common complaints include hefty price increases over original estimates, missing items, and goods held hostage until additional payment was made.

 

Here are the most common moving scams:

1. Low Estimate, Inflated Price

The most common scam is the bait-and-switch tactic. Movers will offer a low-ball estimate then on moving day you are told the load is larger than expected and they will need to increase the price. Some movers will keep your items hostage until additional funds are paid.

Ask what the quote covers. Movers can inflate the price by charging you extra for packing supplies or moving blankets.

Research the company and ask for referrals. Ask the mover to come by and review the items to be moved so there are no misunderstandings. Do not rely on over the phone quotes.

2. Lost or damaged items

During a move, valuables like jewelry and antiques might “disappear.” Its best for you to pack your valuable items in a box you can personally move.

Items also could get damaged. You can acquire insurance to cover damages or loss.

3. Hourly Estimates

When getting hourly quotes, ask in advance how many men will be present and how many hours are expected. You might get one company that will send out 4 movers and it might take 2 hours; another company might send 2 movers and it can take 7 hours.

Remember if it sounds too good to be true, it probably is.

4. Large Deposit

A mover may ask for a small amount of money in advance but if they request a large deposit, be concerned. The best company will require payment once your items have been delivered.

If you have anything else to add let me know :)

What is an option fee?

Posted on by Ali Palacios - Broker

In Texas an option fee is money paid by a buyer to a seller for the option to terminate a real estate contract. Option fee funds are not earnest funds. The option fee and the time allotted to terminate is discussed in section 23 of the resale contract. sample 1-4 resale contract

The termination option period gives the buyer are given time to fully evaluate the condition of the property and perhaps renegotiate the initial offer based on inspections, needed repairs, or other considerations. During the option period, buyers may either terminate the contract or proceed to purchase the home.

This fee is due within 3 days of the effective date of the contract. The payment is made out to the seller and should be delivered to the seller within the allotted time or the buyer WILL NOT have a termination option period. If the buyer does not have a termination option period and they choose to cancel, the buyer might lose their earnest funds.

 

The option fee and numbers of days allotted for termination are negotiable. Typically you will see an option fee of $100-$300 for 7-10 days.

To avoid problems:

  1. Make your option fee payment by personal check or cashier’s check. Do not pay cash
  2. Make the check out to the seller on record. Do not make it out to anyone else, including the real estate agents involved.
  3. Deliver the payment within the 3 days allowed
  4. Request a receipt reflecting delivered.

The option fee will or will not be credited towards the buyer’s purchase if they proceed with the purchase. If the buyer should cancel the contract, they will lose this fee.

Can the option period be extended?

Possibly. Both the seller and buyer have to agree. The extension should be completed in writing and will involve an additional fee to be paid upon execution of the extension. Usually this occurs if additional inspections need to be completed or if inspections were not completed within the set amount of time due to a delay in utilities being installed. If you feel that you need an extension, speak to your Realtor® and discuss your options.

During the option period, the seller can continue to negotiate and accept back-up offers from other potential buyers.

What expenses will I incur out of pocket before closing?

Posted on by Ali Palacios - Broker

The first step in purchasing a home is to get pre-approved for a loan. The lender should disclose and review all the typically closing cost, down payment and other common fees. Most of these are disclosures in your Loan Estimate (see sample copy below). Some of these fees are paid after a contract is executed (agree upon and signed) but prior to closing.

Sample Loan Estimate

The following is a list of the typical fees a buyer will incur prior to closing:

 

Earnest Money Deposits: This is a cash deposit attached to you purchase offer. The amounts of this deposit varies but expect to pay at least 1% if you are financing the balance and maybe as high as 10% if you are paying cash. Although earnest funds are not required they are expected. If your offer is accepted and you proceed with the purchase, this deposit is applied towards the purchase of your property.

Home Inspections: Every buyer should have their home inspected. This is usually done within 7-10 days of the executed contract. The cost will vary based on the inspection completed and the size of the home. The most common inspections are a general inspection that may run approximately $450 and pest inspections will typically cost $75-$150.

In some cases you might have to inspect the foundation, a water well, a septic tank, etc. and these all have a separate cost.

Option Fee: This is a fee that is paid to the seller for the ability to have your inspection period. This fee will allow you to inspect the home within a given amount of time and back out of the agreement if you do not like the results. The fee varies but typically runs $100-300 for a 7-10-day period. Money well spent if it allows you to back out of the contract as a result of a bad inspection.

These funds can be credited to the purchase of your home if you proceed with the contract; if you decide to back out, you forfeit the funds.

Appraisal: If you are financing your home purchase, the bank will want to appraise your home. The purpose of an appraisal is to make sure the home you are purchasing is worth the amount you agreed to pay. The bank will not want to finance 100K for a home that is valued at 80K.

Appraisals typically cost approximately $450-$550. Your agent should coordinate with the lender so that this is ordered after the inspection period has passed.

 

What are earnest funds?

Posted on by Ali Palacios - Broker

Earnest funds are one of a few funds you will need before you close on your home. It can be found in section 5 of the sales contact.

Earnest money is a deposit made to a seller showing the buyer’s good faith in a transaction. Typically it’s equal to 1% of the sales price. These have to be deposited with the title company within 3 days or less of an executed contract. These funds are held by a title company in an escrow account.

Once a buyer and a seller enter into a contract. The buyer may or may not be able to reclaim his or her earnest money, depending on how the contract is phrased. Contracts will typically have contingencies written in to protects the buyer and allows them an out if the home’s inspection is unacceptable or if the home does not appraise for the agreed upon sales price.

The contract does not protect the sellers from these unknowns but they take the home off the market while the home gets inspected and appraised. To prove that the buyer is serious, they will offer earnest funds, in good faith for the time the home is off the market. If the seller terminates the deal, the earnest money will be returned to the buyer.

These funds are not in addition to your sales price; The buyer receives a credit for these funds at closing. 

  • Never give an earnest money deposit directly to the seller. The check should never be made out to the seller. It should be made out to the title company.
  • Get a receipt.
  • Don’t pay the earnest funds in cash. These need to be paid by personal check or cashier’s check

There are ways that you can lose your earnest money deposit.

  1. Default of contract. Are you trying to cancel the contract outside your options? This might be default and could cost you the earnest funds
  2. You waived your contingencies –  If the buyer waives their contingencies, they will lose their earnest funds if they should cancel or not be able to obtain financing.
  3. The buyer does not meet the deadlines specified within the contract and the seller and buyer can’t reach an agreement for the contract expires. Extension must be made in writing and signed off by both the seller and the buyer
  4. The buyer gets cold feet and he/she cancels the contract outside of their option period.
  5. The buyer wasn’t able to get financing due to reasons that could have been avoided:
    1. An increase in buyer’s debt (purchase a new car, purchased furniture, made any large purchase before closing)
    2. Quits his/her job
    3. Make a mystery deposit into their account and won’t explain why
    4. Co-signs a loan
    5. Opens new credit cards
    6. Spend the funds earmarked for your down payment and closing costs

When in doubt speak to you lender!

Upon cancellation, the sellers and buyers are asked to sign mutual earnest funds release form. If an agreement cannot be reached, the party holding the earnest money deposit will continue to hold it until an agreement is reached.

Remember before you sign a contract, chat with your agent and make sure that you cover all your options.

sample 1-4 resale contract