Real Estate Information Archive

Buying a home can be a tricky process, and there are plenty of little costs that can add up. How can you prepare to cover these costs?

Since most people focus on the larger costs, such as the down payment and mortgage payments, they tend to overlook the smaller fees that come with buying a home.

Here are a few of these lesser known fees and what they could cost you.

Home Inspection

A home inspection is critical to protecting you from buying a home with hidden issues that could ruin your finances. The inspector looks for structural and general issues with the home. Inspections cost between $300 and $500, and whether or not you end up purchasing the property, you still need to pay this fee. You may also have to hire a specialist if specific issues are found, such as foundation issues or termites.

Appraisal Fee

This appraisal report goes to your lender to assure it that the property is worth what you’re paying for it. If you’re selling, review the appraisal thoroughly for any oddball numbers or descriptions that could affect the value of your home. An appraisal can take about 2 hours and costs between $200 and $425.

Application Fees

Before ever approving you for a loan, the lender is going to run your credit report and charge you an application fee, often lumping the credit report fee in with the application fee. This can run $75 to $300. Be sure to ask for a breakdown of the application fees to understand all costs.

Title Services

These fees cover a title search of the public records for the property you’re buying, notary fees for the person witnessing your signature on documents, government filing fees, and more. These can cost between $150 and $400, and it’s important to get a line item for each cost.

Private Mortgage Insurance (PMI)

When you put down less than 20% on your new home, the lender requires that you purchase PMI once you reach 78% of your loan-to-value ratio or you have 22% equity. So PMI is a policy that you have to buy to protect the lender from you. PMI rates can vary from 0.3% to 1.5% of your original loan amount annually.

Tax Service Fee

This is the cost (about $50) to ensure that all property tax payments are up to date and that the payments you make are appropriately credited to the right home.

Always ask questions when it comes to understanding the fees you’re paying. If possible, print out documents and go through them with a highlighter to indicate any areas you have concerns about. Discuss them with your lender or real estate agent and determine if you can negotiate any of them down.

Don’t be afraid to price shop to ensure you’re getting the best value. Just because you’re spending hundreds of thousands on a home doesn’t mean you should be comfortable throwing thousands of dollars at fees.

If you have your home on the market, you'll soon be getting offers. When that happens, you'll need to decide which offers are best for you.

Your real estate agent will be a huge help with this. Agents know how to determine the pros and cons of an offer, since there's more to it than just dollar signs. They have a sense of your financial and personal goals, so they can help you decide if the offer being made matches those goals.

Before the first offer rolls in, here’s what you need to know about the offer evaluation process, including the main factors that should go into making a decision with your agent.

When vetting offers, evaluate these areas in addition to price:

The earnest money deposit.

An earnest money deposit, or EMD, is the amount of cash a buyer will pay when the agreement is signed to show they're serious about buying your home. This money is usually held by the title company and goes toward the down payment at closing.

A standard EMD is 1% to 3% of the cost of the home. If a buyer tries to back out of an offer for no good reason, the seller typically keeps the EMD. Therefore, the higher the earnest money, the stronger the offer.

The down payment. 

In most cases, a mortgage requires some down payment. The size of a down payment can determine the strength of an offer. As a seller, your main concern is for the transaction to close. And for that to happen, the buyer’s mortgage has be approved.

In most cases, a larger down payment indicates that a buyer has the cash to make sure the sale goes through. This means that if the appraisal comes in higher than your contract’s sale price, the buyer with a higher down payment would more likely be able to cover the difference with the large amount of cash they have available.

The closing date. 

Closing is when the final paperwork is signed and the sale is final. The entire process, from accepting an offer to closing, takes between 30 and 60 days.

Three days before closing, the buyer receives a closing disclosure from the lender, which he compares with the loan estimate he received when he applied for the loan. If there are material differences between the buyer’s loan estimate and closing disclosure, the closing can’t happen until those amounts are reviewed and approved. But this is rare.

Some transactions can take more time, depending on the buyer’s financing. For example, the average closing time for a Federal Housing Administration (FHA) loan is 43 days, according to Ellie Mae.

Whether you want a slow or quick settlement will depend on your circumstances. If you’ve already purchased your next home, for instance, you probably want to close as soon as possible. On the other hand, you may want a longer closing period if you need the proceeds from the sale to purchase your new home.

The Sandi Pressley Team has taken great care in making our website, www.albuquerquehomesolutions.com, a useful and powerful tool for anyone looking to buy or sell a home in Albuquerque. Our website is full of useful features and tools that will help you start your home buying or selling journey. If you plan to buy or sell a home soon, why not a take a few moments to see how our website can be a valuable resource.

Here's a few main features to look for on our website.

For Home Buyers

Featured Properties

Our Featured Properties page showcases our own premium listings in the Albuquerque area. You can sort listings by a number of factors, such as price, type, and open houses.

Property Search

This powerful property search tool lets you find the perfect home in Albuquerque that fits your exact needs. You can refine your search using a wide range of parameters, such as price range, sq feet, construction, schools district, and much more. By clicking on the Map Search tab, you can even draw a map around the area you want to search in.  It makes find the right home in Albuquerque even easier!

There is also a list of neighborhoods in the main menu under "Search MLS" which will let you search for homes in that specific neighborhood, along with information about that neighborhood.

Property Detail Pages

Selecting any property in the Featured Properties or Property Search pages will bring you to a comprehensive detaile page for that property. In addition to detailed information about the property itself, you can also view information about local schools, walks scores, and use a convenient mortgage calculator.

Email Listing Alerts

Be the first to know of new homes that meet your search criteria as soon as they hit the Albuquerque real estate market. It's a free, no obligation service that will help you stay in tune with the local real estate market.

Community Pages

Want to learn more about the communities that make up the Albuquerque area? These community real esatet and information pages will give you the run down on each community, along with being able to search homes for sael in those communities.

Buyer's Resources

This section features a number of useful articles to help home buyers with a variety of topics.

For Home Sellers

Home Valuation

Get an instant market valuation for your Albuquerque or surrounding area home. It's free, and no obligation.

Seller Resources

Just like the Buyer's Resoruces section, this section also features a number of useful articles to help home sells with a variety of topics.

These are just a few of the helpful tools and resources avaiable to our current and future clients. If we can offer any additional help in buying or selling your home, please feel free to conatct us.  We're always happy to help.

HOT HOME LISTING OF THE WEEK!

3620 Monte Vista Boulevard NE, Albuquerque, NM  $330,000

3 Bedrooms/ 2 Bathrooms (2 full, 0 partial) / 1590 Square Feet

Vintage beauty in the heart of NOB HILL!! Vintage feel in harmony with modern elements. This updated and remodeled classic home features a versatile floor plan with 3BDRs/2BAs plus two living areas, an office/study, second kitchenette and second entrance. Desirable URBAN location is close to shopping, restaurants, parks, Nob Hill, UNM and transportation!

Contact the Sandi Pressley team for additional details! 

Get your Morning Inspiration with the Sandi Pressley Team

Have you checked your credit score lately? Having good credit is important in this world, particularly if you plan on buying a home. Even though there are mortgages available to those with lower credit scores, it's always a good idea to raise your score as high as you can before you apply for a mortgage. A higher score will yield a lower interest rate and less money you have to put down.

What are some basic ways to get your score higher?

1. Pay Bills on Time

Of course we always hear this. But it can't be stressed enough how critical it is to you overall score. In fact, it makes up 35% of your score. If you have trouble remembering due dates, try setting up automatic payment, or use a bill pay service from your bank.

2. Correct Errors on the Credit Report

Check your credit reports for errors, even minor ones. You may be surprised how many can slip through. If you find any, call the creditor that's reporting the error and follow up with a letter with the same request. Then notify all of the credit bureaus of the changes and let the creditors know you've done so. This will help motivate them to make the needed corrections.

3. Raise Your Available Credit

If you ask an existing creditor for a higher limit, this can help raise your score.

4. Keep Old Credit Cards Open

Do you have an older card that you're thinking of closing? Keeping the card open can help your score. 10% of credit scores are based on history.

5. Consolidate Cards

Try not to have smaller debts spread among several cards. This will not help your score. Try to consolidate smaller balances onto one card, or at least fewer cards.

6. Don't Rack Up Balances

Keeping a lower credit utilization ratio will also help your score. 30% of your limit is a good goal. That means, for example, if you have a $1000 limit, then you would keep your balance below $300.

7. Negotiate

A defaulted card can cause a lot of damage to your credit score. Try to work with the creditor to accept a partial payment for a debt in collections in exchange of reclassifying the debt as paid.

8. Don't Keep Applying for New Credit

10% of your score is affected by new credit applications. Don't apply for a new card unless you absolutely have to.

Of course there are other ways to maintain a great credit score. But if you start with these points, you will be on your way to a better score in no time.

Check back on our blog every week for more real estate advice and local articles about living in Albuquerque. And make sure to follow us on Facebook for up to date real estate news for Albuquerque and surrounding areas.

HOT HOME LISTING OF THE WEEK!

3620 Monte Vista Boulevard NE, Albuquerque, NM  $330,000

3 Bedrooms/ 2 Bathrooms (2 full, 0 partial) / 1590 Square Feet

Vintage beauty in the heart of NOB HILL!! Vintage feel in harmony with modern elements. This updated and remodeled classic home features a versatile floor plan with 3BDRs/2BAs plus two living areas, an office/study, second kitchenette and second entrance. Desirable URBAN location is close to shopping, restaurants, parks, Nob Hill, UNM and transportation!

Contact the Sandi Pressley team for additional details! 

Get your Morning Inspiration with the Sandi Pressley Team

Moving into a new home is an exciting time.  But it can be frustrating.  As you're getting to know your new place, you're going to be running into things that you didn't know about before you moved in.  But many surprises can be avoided if you ask the right questions of the seller. Sure, you may get details from the home inspection and disclosure, but why not talk to the people who have lived there already? Just make sure to ask these questions at the end of the selling process, as the seller might think their answers would make the sale not go through.

What Are Past Problems That Were Fixed?

Even though existing problems are disclosed in the seller's statement, it doesn't reveal what past problems may have been fixed.  Use the disclosure as a place to start when asking to learn what wasn't listed.

Switch and Valve Locations

The home inspector may not always show you where all the valves and circuit breakers are.  Especially if it's an older or larger home, just ask the seller where everything is and if there's anything special about their operation.

Ask About the Neighborhood

This may be a loaded question, but you'll usually get the best of both worlds and everything in between.  That's OK, because it can help you keep your move-in experience more enjoyable.  You'll know what to expect and hopefully help make new friends with your neighbors. 

HOT HOME LISTING OF THE WEEK!

10 Caminito Trail, Placitas   $395,000

3 Bedrooms/ 2 Bathrooms/ 2580 Square Feet

This amazing culdesac property features unobstructed views of the mountains and open floorplans with stunning raised ceilings.

Contact the Sandi Pressley team for additional details! 

Get your Morning Inspiration with the Sandi Pressley Team

Buying a second home - many people dream of it.  Buying a second home is something of a rite of passage, like buying a car or getting married. It’s a great investment as well. It shows that you’re doing well financially and can afford to reward yourself. And since mortgage rates are still low, now may be a good time to take the leap.

Before you jump into buying a second home, it’s important to ask “why?” Answering this question will help you see where your priorities are.

You Can Afford It

Of course, your finances are the first thing to look at when deciding to buy a second home. Most 2^nd home buyers are in their 40s or 50s and their children have left the house. They no longer have to stay in one place because of school, or work if they’ve retired. People tend to earn more or have more saved up by this point in life, giving them more financial freedom.

A Good Investment

A second home can be a great investment, but you have to do it right, as there are still risks. You should try to buy a home in an area that’s growing, which could improve the property value over time.

Comfortable Retirement

As we’ve noted, usually its individuals in their 40s – 50s that tend to buy 2^nd homes. By that age, many are thinking about retirement.  Buying a 2^nd property is an ideal way to plan for that phase of your life.

Let’s say you want to retire to a sunny and artistic city such as Albuquerque (assuming you don’t live here already). Why not search for a home in the area you want to retire? That way you’ll already have the home and it will have increased in value until then.

Tax Benefits

Paying taxes are a big part of owning a house, so it’s only logical we should talk about the tax benefits. And the good news is that you can write off the property taxes on a second home. And it doesn’t matter if it’s an investment, rental, or for your own use. You can also deduct interest, insurance, and depreciation against your home’s value.

Buying a second home may not be for everyone. But if it’s something you can do, take time to consider the advantages and disadvantages before you make the big move.

Check back on our blog every week for more real estate advice and local articles about living in Albuquerque. And make sure to follow us on Facebook for up to date real estate news for Albuquerque and surrounding areas.

HOT HOME LISTING OF THE WEEK!

2228 Cebolla Creek Way NW, Albuquerque, NM  $399,000

3 Bedrooms/ 2 Bathrooms (1 full, 1 partial) / 2345 Square Feet

UPGRADES GALORE! Fantastic Del Webb gated community! Premium lot, wood tile flooring, plantation shutters, garage door screens, artistic landscaping, upgraded light fixtures & appliances, private courtyard w/OJstom gate & stucco wall are just a few! State of the art clubhouse, resort style pool, fitness center & sport courts!

Contact the Sandi Pressley team for additional details! 

Get your Morning Inspiration with the Sandi Pressley Team