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Don’t Forget These Home Buying Costs

When buying a home, it’s sometimes easy to forget about certain other costs that come with it. Here are five such costs that you need to remember to budget for.

As a homebuyer, here are five costs that often get forgotten about that you need to remember to budget for: 1. The down payment. Most people don’t actually forget the down payment, but they forget about what kind of difference how much you put down makes. In our area, you can put down as little as 3% for any property up to $700,000. Above that price, you usually have to put down a minimum of 10%. To get the best interest rate from your lender, you’ll have to put down 20% or more. 2. Your financial reserves. You’ll need at least six months’ worth of mortgage payments and property tax payments saved up when you buy a home. 3. Moving expenses. Unless you’re doing it all yourself (which I don’t recommend), moving isn’t cheap. A good moving company usually costs between $2,500 and $4,000, and we can refer you to several movers who will take great care of you.

Unless you’re doing it all yourself, moving isn’t cheap.

4. Furniture. Buying a new home is exciting, and once you move in, odds are you’ll want to fix it up exactly the way you want it. This usually means buying new furniture. Also, don’t forget about the essential items you might need to buy, like a new broom. 5. Home updates. If your new home has an old bathroom that you want to fix up, you’ll have to budget for that. How much this will cost you can vary, so we’d be happy to come to your home, give you an estimate, and recommend some excellent contractors. If you have any more questions about these costs or you have any other real estate needs, feel free to give me a call or shoot me an email. I’d be happy to help you.

How to Sell Your Home for 18% More Money Part 5: Negotiations

In today’s fifth and final installment into our latest series, we’ll be discussing the last component of earning more money for your home: Negotiations.

Welcome back to our series on how to sell your home for 18% more money. Today’s episode is the last in this series, so be sure to check out our previous episodes: Episode One: How to Prepare a Home for Sale Episode Two: How to Present a Home on the Market Episode Three: How to Strategically Price a Home Episode Four: How to Promote a Home Now let’s move on to our fifth and final topic: Negotiation.

Having a skilled negotiator who can think outside the box will be very helpful for you in any real estate scenario.

There are four strategies that I recommend all sellers employ when it comes time to negotiate a deal for their home sale. These strategies are the last piece of the puzzle in earning 18% more for your property when it comes time to sell. 1. Encourage preemptive offers. This strategy entails capturing interested buyers before your home technically hits the multiple listing service by marketing it as “coming soon.” Typically, it’s advisable to put a list price that’s higher than your expectation at this point in the process. I can tell you from experience that because of our low inventory, buyers are tired of getting beaten out and will be willing submit a preemptive offer that is at or above your price expectation when you follow this strategy. 2. Price for multiple offers. If you didn’t earn the price you’d hoped for during the “coming soon” phase of your listing process, it’s time to price your home in a way that represents a great value and encourages multiple offers. When buyers see your listing as an exceptional deal, they will be more likely to compete over it. This will ultimately drive up the price and help you net more for your home. 3. Determine your best alternative to a negotiated agreement (BATNA). More simply put, this strategy essentially serves as the “Plan B” you should fall onto in the event that your original negotiated agreement is somehow compromised. This will ensure that if anything unexpected happens during the course of the deal, you will still have an idea of how you’d like to proceed. 4. Be creative. If you’re close to getting the results you want but just aren’t there yet, you should consult with your agent about possible solutions. As an example, we had a seller recently whose minimum bottom line for their home was $1 million, but whose buyer had a loan approval that was maxed out at $990,000. To compensate for this $10,000 disparity, we advised the seller to credit the buyer with $5,000, with the understanding that the credit was to be explicitly dedicated toward lowering the buyer’s interest rate on their loan. The buyer was able to lower their interest rate from 4.25% to 4%, which raised their mortgage approval up to just over $1 million. As a result, the buyer was able to secure the home and the seller was able to net their desired price. Having a skilled negotiator who can think outside the box will be very helpful for you in any real estate scenario. Ultimately, the bottom line is that doing many little things right throughout a transaction can make a big difference in your success. If you have any other questions or would like more information, feel free to give us a call or send us an email. We look forward to hearing from you soon.

How to Win a Multiple Offer Situation: Part 1

Having the right financing is essential to winning a multiple offer situation, and today we’ll discuss three pieces of advice related to this point.

Today’s market is extremely competitive for buyers. So when they're up against multiple bids from other buyers on the same house, what can they do to make their offer stand out? Today's topic marks the first installment of my series that addresses that very conundrum.

Our team’s preferred lender, Michael Treon, is going to help me cover the answer to this. Let’s kick off our discussion with three things buyers should do to set themselves up for success.

1. Get fully approved. Winning in a multiple offer situation starts with getting the right financing in place. Getting fully approved and underwritten, not just pre-approved, is essential. A full approval will allow you to be competitive in the marketplace because it eliminates the need for you to include a loan contingency on your offers. Today’s sellers are looking for the cleanest possible offers because they want to close quickly and without issue. 

Winning in a multiple offer situation starts with getting the right financing in place.

2. Select a lender who can provide financing the performs like cash in the market. Over 30% of buyers in today’s market are submitting all-cash offers. These offers easily win out against those with conventional loan financing because they allow a shorter close of escrow. Therefore, it’s very important that the offer you submit can stack up against ones such as this. Michael Treon and his team are able to provide buyers with financing that allows for an exceptionally fast close of just 17 days.

3. Consider all loan options. Don’t limit yourself by looking exclusively at 30-year fixed mortgages. The reality is that most homeowners won’t stay in a property for the full 30 years, so it’s critical to consider alternative loan options. There are a lot of opportunities to secure a home with a loan product that makes sense for your personal circumstances.

Now that you understand how the right financing can boost your success in multiple offer situations, be on the lookout for part two of our series. Next time, we’ll talk about how to access off-market properties, and how doing so can help you find a home in today’s competitive market.

If you have any other questions or would like more information, feel free to give me a call or send me an email. I look forward to hearing from you soon.

To view Michael Treon's mortgage pre-approval process, click here.

Michael Treon
Senior Mortgage Loan Officer
PNC Bank
NMLS ID: 339550
(Office) 415.505.7558 | (f) 844.274.9911