Archives for December 2010

Lender Prequalification by Joe Szabo, Scottsdale Real Estate Team

December 31, 2010 szabogroup

By Joe Szabo, Scottsdale Real Estate Team

When you begin to look at homes to decide what to buy, you and your realtor will need to know how much you can afford; more importantly how much a bank will give you to purchase your home. Having a no-obligation meeting with a mortgage professional and getting ‘Pre-qualified’ will determine this amount. Not only will this save you time and energy because you will only look at homes in your price range, most realtors will not want to show you any homes until the know what ball park you are in.

Friends and associates can refer a lender who they used when purchasing their homes and you are allowed talk to more than one lender. First, set up an appointment and have as much information about your finances as possible. Bring information about your income and your current debts as well as the amount of cash you will have for a down payment. You will want to be as honest as you can with your lender because with all the documentation that will follow during the actual loan process, they are going to find everything out anyway. If you have had credit card trouble or even a bankruptcy it is best to reveal it in the beginning. The last thing you want is to find that perfect home only to be turned down later because you held back the fact that you were fired from your job last week and now have no income.

The lender will also run a credit check, which will cost you around $25 to $50. The credit report will show where you have been late with payments or other derogatory items, many of which can be explained and possibly removed form the report. It is best to check your credit yourself before you go to a lender because cleaning up bogus or derogatory items can take 30 to 60 days.

The lender will then write you a letter stating that you are pre-qualified for a certain amount of money. You can take that letter to your real estate agent and know that you are looking at homes you can afford.

The Szabo Group offers first class real estate services to clients in the Scottsdale Greater Phoenix Metropolitan Area. Award winning Realtors and Re/MAX top producers, The Szabo group delivers experience, knowledge, dedication and proven results. Contact Joe Szabo at 480.688.2020, [email protected] or visit www.scottsdalerealestateteam.com to find out more about Scottsdale Homes for Sale and Estates for Sale in Scottsdale, Arizona.

The Final Walk Through By Joe Szabo, Scottsdale Real Estate Team

December 27, 2010 szabogroup

By Joe Szabo, Scottsdale Real Estate Team

We know how important a final walk through can be. Most home purchase contracts include a clause that gives the Buyer the right to complete a walk-through inspection before closing. Often times Buyers feel that there is no need to do a final walk through, but the last thing you want to do is have to clean up a mess or fix some last minute thing yourself, before you can move in. The best time for a Buyer to do this would be during the last week before the closing, in order to ensure that the property is in substantially the same condition it was when you agreed to purchase it.

The final walk through also allows the Buyer to make sure that any items or appliances that the Seller agreed to leave have not been removed, and that any repairs the Seller agreed to are either completed or in the process of being completed. However, if the Seller has not yet moved out during the final walk through, it is impossible to know how the home will look once the Seller is gone. For this reason, most contracts require that the Seller remove all debris and personal property except those specifically included in the contract agreement. However, while a huge mess may not be left behind, most contracts only require the property be swept. Therefore, you may also want to ask if the Seller is planning on having the property professionally cleaned, and if not, you may want to arrange for this before you move in.

Also, while buying property in Scottsdale, Arizona, it is always a good idea to use the final walk through to ask the Seller any final questions. It is helpful to compile a list prior to walking through, in order to make sure all questions are answered. Make sure to ask if there are any idiosyncrasies of the property that you should be informed about, perhaps how to operate an alarm or pool system. Also, find out if there are any routine home maintenance tasks other than the obvious; maybe there is a gutter drain that clogs periodically, or a sewer pipe that needs clearing every now and again.

Find out, also, if the Seller can give you the contact information for any contractors that have done previous work on the house. Good contractors are often hard to come by and recommendations, or even who to stay away from, will come in handy. It is helpful to use this final walk as and opportunity to decide where furniture will go as well; this will make process of moving in go much faster. Make sure to transfer utilities from the Seller’s to your name in order to assure they do not get shut off, and ask the Sellers if they plan to leave any kinds of instruction manuals, spare keys, or garage door openers.

Ensuring Good Title by Joe Szabo, Scottsdale Real Estate Team

December 24, 2010 szabogroup

By Joe Szabo, Scottsdale Real Estate Team

You never know who or what is on title when you are purchasing a home. An encumbered title can slow down and even stop a loan from closing. Always use a title company or real estate attorney to search and examine your property’s title before you purchase. A thorough title search can reveal the real owner, how title is held, legal property description, restrictions, judgments or liens.

There are many different liens and sometimes the seller is unaware of them. There are mechanic’s liens, IRS liens, or owed property taxes. Restrictions may include a shared driveway or fence, a utility easement, or other items that may have remained dormant through one or two previous owners. The last thing you want to have happen is to move in and your neighbor remove what you thought was your retaining wall on your property.

Do not assume that the seller has the right to sell their property. Just because they live in the house does not mean they are on title or don’t have a partner that needs to be involved in the sale. If you are getting involved in a probate sale be aware that the surviving owner may not be free and clear of pending court cases brought on by angry heirs of the deceased. Always have a contingency clause put in your purchase contract so you can look at the title before the sale becoming final. If the title has a ‘Cloud’ or defect, then you should be allowed to back out of the deal and get your earnest money back if the cloud cannot be remedied in a timely manner.

Lenders require title insurance to protect the loan amount and this insurance only covers the lender. You can purchase additional title insurance, but it is usually at a higher rate than the lender’s insurance. For instance in California a home costing $500,000 may cost you about $1600 while the lender’s insurance may only cost $500. Sometimes there are discounts, called a ‘Short Rate’ if the title has been searched within the past two years. As with everything these fees as well as who pays for title insurance is negotiable.

Non Recurring Closing Costs by Joe Szabo, Scottsdale Real Estate Team

December 20, 2010 szabogroup

By Joe Szabo, Scottsdale Real Estate Team

Buying and selling Scottsdale, Arizona Real Estate often includes nonrecurring closing costs, which are one time costs such as transfer taxes, title insurance, and points (a point meaning one percent of the purchase price used to offset interest or as a loan organization fee). Often times the Seller can be persuaded to give a credit towards some or all of these one time fees, especially since lenders will not allow anyone to help the Buyer with the down payment. Remember that everything is negotiable and covering some of these fees can help save thousands.

Perhaps you fall in love with a beautiful home here in Scottsdale, Arizona and the asking price $1,600,000. You might put an offer on this home with $25,000 credit at closing. The home will, of course, need to be appraised at this higher amount for this to work, but this cash at closing is typically used to help with some of the closing costs, or for things such as renovations. Often times in a Buyers market, Sellers and lenders will offer this credit at closing as an incentive, however, the price of the home will then usually be raised to cover these costs.

The amount of credit that can be offered varies among different lenders; however three to six percent of the purchase price is typical. For instance, if Whitney and Associates is helping you purchase a $1,500,000 home, then at three percent the Seller or lender can offer $45,000 towards nonrecurring closing costs. Some lenders will even pay all closing costs, but always remember that this money is still coming from somewhere. Therefore, instead of paying a higher interest rate or financing at a higher price, sometimes it is better to make the best deal and pay all of your own costs.

Let us help you when you are ready to invest in Scottsdale, Arizona Real Estate; after all, we are the experts. The Szabo Group offers first class real estate services to clients in the Scottsdale Greater Phoenix Metropolitan Area. Award winning Realtors and Re/MAX top producers, The Szabo group delivers experience, knowledge, dedication and proven results. Contact Joe Szabo at 480.688.2020, [email protected] or visit www.scottsdalerealestateteam.com to find out more about Scottsdale Homes for Sale and Estates for Sale in Scottsdale, Arizona.

Myths about Pricing by Joe Szabo, Scottsdale Real Estate Team

December 17, 2010 szabogroup

By Joe Szabo, Scottsdale Real Estate Team

Pricing your home can be tricky. Many Sellers price too high initially, and then the home sits on the market. However, it can be very difficult to know what price it too high, and what is too low. There are many misconceptions that affect why a Seller prices wrong. This is why pricing requires an expert like Joe Szabo.

Many people believe that because they put so much into there home, it is now worth more then others on the market. While this may be true, pricing too high initially will cost you in the long run. Your home is the most marketable when it is first put onto the market; however homes that are priced too high will be shunned by Buyers who do not want to deal with an unrealistic Buyer, and agents are unlikely to show an over priced home. Therefore, after your home has been on the market for some time, even after you lower the price, it will be hard to generate enthusiasm. Once there is finally a Buyer interested, the price is often discounted even further because of the time it sat on the market.

It is very important to be as objective as possible when selling your home. Your aim is to price your home so it will sell for the most money in the least amount of time. Although selling quickly makes many people uncomfortable, it is usually the homes that sell quickly that sell for the most amount of money. Typically, a Seller should price within 2.5 to 5 percent of what the ultimate selling price would be. Within this guideline, a home should be priced in accordance with how much price discounting is currently occurring in the area. When there is little discounting, this means that homes are selling close to there listed prices. To determine the probable selling price, we can complete a comparative market analysis (also known as a CMA). This will provide you with information on properties similar to your own that have sold recently. Often in higher price ranges, the deviation between the list price and the sale price is higher, say ten to fifteen percent.

Although it is important to pay attention to the current market, always remember pricing strategies change with the market. People often make mistakes when the market is on the rise, and yesterday’s comparables are out of date. It can be risky to anticipate appreciation, and instead of under pricing, you are now over pricing. However, to protect yourself from this, find a realistic price and expose the listing to the market before you listen to any offers with the help of experts like the Szabo Group. Usually if your price is too low, Buyer may compete in a multiple bit and push the price up. A Seller must have a different approach in a soft market where prices are on the fall. In this case, it is best to undercut your competition. Again, remember that yesterday’s comparables will be out of date, and often too high for the current market. You do not want to end up continually lowering your prices, trying to catch up with the declining market values. This is called chasing the market down.

Joint Investments in Scottsdale and Phoenix by Joe Szabo, Scottsdale Real Estate Team

December 13, 2010 szabogroup

By Joe Szabo, Scottsdale Real Estate Team

When the home of your dreams is out of your price range, why not buy it with someone else and share the equity. This may sound like college roommate fun, but there are many items to consider when entering into this type arrangement.

The term for co-ownership is called ‘Equity Sharing’. This is when two or more non-married people invest in a house. Sometimes one of the people does not live in the house and merely uses the property as an investment and/or to help out the other person. Sometimes both people are equally sharing the mortgage and up keep as well as living together. Regardless of the situation you will want an ‘Equity Sharing’ or ‘Partnership Agreement’. This will determine who will pay for each item from the down payment to on going repairs and upkeep the co-ownership. There are also tax benefits to coordinate. The IRS will frown on both of you writing off all the interest on your mortgage. You will need to decide how you want the title to be held, (see article called “How to Hold Title”) and what to do when one partner wants out of the property, or worse yet, dies. There are many rules already in place for spouses, but a partnership agreement is akin to a business contract and everything is negotiable.

One benefit to co-ownership is that both incomes and joint cash for a down payment can be considered in getting your loan. Make sure you have discussed at length the future possibility of one of you getting married and wanting to live in the house. Try to think of as many scenarios as possible and have as many clauses to you agreement as you need. A good real estate attorney can help you through this process.

Something else to consider is the style of home since it is being shared. There are many horror stories of good friends never speaking to each other again after they live together. Look for a home where the bedrooms are possibly in different parts of the house and that there are enough bathrooms to go around. A little privacy goes a long way. With a little thoughtful planning shared equity could give you both more home than you could individually afford and be building equity for your futures.

Outdoor Living Rooms by Joe Szabo, Scottsdale Real Estate Team

December 10, 2010 szabogroup

By Joe Szabo, Scottsdale Real Estate Team

An outdoor dining area is a great place to host summer dinners, or winter marshmallow roasting. From a simple bar-b-q, to a built in stove, it can be a great place to entertain or simply relax. And living in Scottsdale, Arizona, you can expect to spend a lot of time in your outdoor rooms.

Converting an outdoor patio to an indoor one is a great way to make an outdoor dining area more enjoyable in harsh whether. It can also help when trying to keep coals lit in high winds, or keep dirt and leaves from blowing onto food. Decorating these spaces with cool colors will create a more relaxed environment, while warmer colors will offer an active, energized space.

Consider different types of furniture, such as wicker, wood or iron. This will add character to the room and help set the atmosphere. Also, when planning space, make sure that the dining or sitting area around a table is proportioned correctly. There should be 32 inches of space to allow for getting in and out of a chair, and 22 inches space to allow for passing behind a chair (32 inches for a handicapped space). Also, tables with extendable leaves will adapt better to your needs, and provide a more intimate setting when there a less people to entertain.

Many people will choose to hire a designer when planning the outdoor patio, and for the many beautiful nights you will enjoy living in the Scottsdale area, it make sense to make your outdoor rooms as beautiful as your indoor rooms.

Planning a Patio by Joe Szabo, Scottsdale Real Estate Team

December 6, 2010 szabogroup

By Joe Szabo, Scottsdale Real Estate Team

When planning how to design the different aspects of your patio, it is important to keep in mind both your personal needs, and the needs of anyone else that might make use of the patio. Do you like to entertain? Would you prefer a formal or casual setting? Do you have any pets? Is the patio in constant sunlight that will fade fabrics? These are some important questions to keep in mind when deciding what kinds of furniture to buy, or the way to arrange the different aspects of a patio.

Flexibility is a very important part of a patio. There is no use in having a patio filled with delicate furniture and flowers, if the kids and dog with destroy them in a day. Make sure your patio accommodates all the needs of you and your family.

Safety is another important aspect to keep in mind. If you have a beautiful patio with sharp, stone flooring, but you also have small children who like to play outside, this is probably not the best atmosphere. Make sure you know if the flooring you choose becomes slippery when it gets wet, and check to see if major traffic patterns are well lit.

Privacy is something most prefer to keep when going from indoors to outdoors. Maybe try planting ivy on fences or large shrubbery. Also, fountains will create a soft, constant noise that will help murmur conversations, and muffle sounds.

Comfort is a combination of many things, but mainly, keep in mind that a patio will be most comfortable and enjoyable when it is designed around its climate. An awning may work well for very sunny areas, but will not hold up through constant high winds.

Beauty is usually a balance that is unique to each home and individual. The different aspects of a patio should blend with those of the house, and display a color scheme that can blend with the outside of the house. These colors and textures should also harmonize with the surrounding gardens and landscaping.

10 Great Questions to ask before hiring an Architect by Joe Szabo, Scottsdale Real Estate Team

December 3, 2010 szabogroup

By Joe Szabo, Scottsdale Real Estate Team

Before deciding to go with one architect specifically, it is important to take the time to make sure you interview a few first. However, when the time comes to the actual interview, many people ask questions that are not necessarily relevant. To ensure that you hire the right architect, keep in mind the following questions.

1. Does the architect have a specific design style? Ask to see examples of his/her past work.

2. Ask to see a list of past clients the architect has worked with. If he/she cannot, maybe it is best that you don’t go with them.

3. Will you be dealing directly with that architect, or will you deal with someone else in the firm? Who will be designing your project? If you will be dealing with a different person, make sure to talk previously with them as well.

4. What does the architect expect you to provide, in order for the project to get started?

5. How will priorities about your project be distinguished, and decisions made?

6. How long can the architect anticipate his/her part of the project to take?

7. How will the architect establish fees, and at what point will he/she expect them by?

8. What can the architect anticipate in the way of how much the total project will cost?

9. Can the architect anticipate a change in the scope of the project, and if there is such a 10. What services will the architect provide during construction?