home buying

Beneficios de ser dueño de su propia casa.

October 18, 2019 by khproperties Leave a Comment

Felicidad: No hay nada que se compare a la sensación de tener su propio hogar. Puede arreglarlo, darle su propio estilo, tener un perro o un gato, e incluso plantar un árbol si lo desea. ¡Solo imaginarlo causa alegría!

Ahorro de impuestos: el gobierno recompensa a los propietarios de viviendas proporcionándoles excelentes beneficios en los impuestos. El interés pagado por su hipoteca y otros gastos relacionados con el hogar generalmente se pueden deducir de sus ingresos.

Apreciación: Hay un crecimiento de valor en las viviendas con el paso del tiempo; este aumento se convierte en ganancia cuando sea el momento de re-financiar o vender la propiedad.

Renta variable: tanto rentar como alquilar se puede comparar a pagar 100% de interés, pero cuando usted es dueño de una casa y cuenta con una hipoteca, una parte del pago se destina al saldo principal de su préstamo. Esto construye su capital y actúa como una cuenta de ahorros.

Vida en comunidad: quienes son dueños de sus casas son más propensos a permanecer en sus hogares 4 veces más que quienes rentan propiedades. Esto brinda la oportunidad de conocer a sus vecinos y conectarse con su comunidad.

Educación: las investigaciones muestran que los hijos de los propietarios de viviendas obtienen puntajes más altos en exámenes y se gradúan en un porcentaje más alto que los hijos de inquilinos.

¿Necesita un agente de bienes raíces que hable español?

Loan Underwriting Doesn’t Need To Be A Complete Mystery

December 22, 2015 by khproperties Leave a Comment

If you’ve ever bought a house, you’re probably familiar with hearing “your loan is in underwriting” and then playing the waiting game until it “comes out of underwriting.” It’s one of the steps in the process of getting a loan and often one of the most frustrating. But what exactly is underwriting?

Underwriting is viewed as a mystical place where loans go somewhere between the time of preapproval and final issuance of the loan documents. Underwriters are kept in secret and you’d be surprised to know that many real estate agents have never met an underwriter face to face (or if they did, they didn’t know it). Loan underwriting is truly a world shrouded in mystery and for good reason – if we all knew our underwriters, it would be very easy for agents to poke and prod an underwriter to get things done. Underwriters would be under a daily assault of phone calls from agents trying to find out where they were in the process and in effect, would be rendered unable to do much more than answer the telephone. This is why lenders keep them locked away in dark caves in highly classified locations.*

Merriam-Webster Online Dictionary defines underwriting as follows:

underwriting – transitive verb
4 a : to agree to purchase (as security issue) usually on a fixed date at a fixed price with a view to public distribution b : to guarantee financial support of (underwrite a project)

What’s Taking So Long? Underwriting.

To put it simply, the underwriter looks at all the supporting documents and says “yes, I think this is a safe loan to make, let’s do it.” Of course they can say the opposite too. This is how some people get preapproved, yet wind up getting turned down for a loan. The underwriter is pretty much all powerful when it comes to you getting your loan. Because of their ultimate power, you and your real estate agent need to pay special attention during the underwriting process.

It all boils down to this: if the underwriter asks for something, you as a homebuyer, better do it. They will ask for ridiculous things at times. Doesn’t matter. They’ll ask for copies of things you’ve sent them four times already. Doesn’t matter. They’ll ask you to move a comma in a sentence in a document you have sent to them. Doesn’t matter. They’ll ask for more information on something you’ve already documented to death. Doesn’t matter. Underwriting is about the lender covering all their bases – all that documentation you send in stays in a file and if something ever goes wrong (you default on your loan), the investor will want the lender to justify their underwriting of the loan.

Underwriting can be a nightmare for a homebuyer (and a seller as well – the longer underwriting takes, the more nervous they become), but by being proactive and jumping through the hoops, you can get your loan in and out much faster and save some of the headaches caused by underwriting. Typically, your agent will also know what the underwriter needs to complete their job, so they may bug you about it too – the key? Get it done. Right away. Don’t put it off and don’t frustrate yourself with trying to find the answer to “why are they asking for this?,” they have their reasons and it doesn’t really matter what they are (although we can discuss them to death, the underwriter will still want them).

Of special note: it pays to have a local lender for your loan, because they often have better, more direct contact with their underwriting departments and can often help a file through the process by being able to have direct access to the underwriter should a problem arise. With some of the larger banks, their loan processing centers might be halfway across the country and you lose that personal one-on-one interaction between your loan officer and underwriter that can help get things done.

* We have no actual proof that lenders keep underwriters locked in caves or that underwriting is actually an ancient mystic art involving a combination of wizardry and voodoo.

image courtesy of GotCredit

Closing on a Home While You’re Out of Town?

July 12, 2013 by khproperties 2 Comments

Tips for Closing on a Home When You’re Away

As much as we in the real estate industry like to believe that each real estate transaction is everyone’s top priority at all times throughout an entire transaction, the reality is that life does not stop just because you’ve signed a contract and will soon be closing on a home. What this means at times is that coming together at the closing table at an agreed upon date and time is not always possible. Many customers, both buyers and sellers alike, face time or distance constraints that prohibit them from being at a specific title company at a specific time on a given date for their closing. Whether it is a business trip, family vacation, delayed move-in plans, tight work schedule, or simply some unforeseen emergency; there are plenty of reasons why scheduling a closing on a home can get complicated in those last days. But fear not – all hope is not lost. There are several very sound options available should you not be able to make the prescribed date and time of your closing.

Mobile Notary

Basically, once the lender sends all of the loan documents to the title company, the title company can find a notary in a location where you will be on closing day. This authorized notary will come and meet you practically anywhere and will attest to your signature on all relevant documents. The originals of those documents must then be sent (generally by overnight shipment) back to the title company before a file can fund and the closing is officially done.

Why it’s a good idea:

They come to you
Work on your schedule
Not restricted by business hours

Why you might want to think twice:

You have to know in advance a designated place and time for the notary to meet you
There is generally an additional charge for this service
It can delay actual transfer of ownership because of the time required for the documents to make their way back to the title company
This may not be possible in foreign countries except at consulates or with extreme restrictions
Notary works only as a notary and cannot answer any questions you may have about specific forms or documents

Power of Attorney

You sign a legal document giving another person full legal authority to sign on your behalf. This is typically a spouse, trusted friend, or advisor.

Why it’s a good idea:

Generally no additional fee required
You only have to work with one person’s schedule

Why you might want to think twice:

You must trust the person to whom you give the power of attorney
Original Power of Attorney document must be provided to title company at closing
You must be accessible by phone so that the title company can do an “alive and well” phone call to make sure you are 1) alive and 2) have not revoked the Power of Attorney
Verbiage on the Power of Attorney form should be cleared with your lender and the title company in advance

Courtesy Closing

Many title companies are large enough to operate on a national level or to have office partnerships between branches or other companies. As a favor, one title company can ask one of their sister or partner offices to do the closing at that location.

Why it’s a good idea:

Conveniently go to a location in the city near you
Have title experts on hand to answer any questions because they are familiar with the documents/industry
No additional fee

Why you might want to think twice:

Person helping with the transaction won’t be familiar with your file
Not available in every area
Not available with every title company
Could still result in delays with original documents making it back to the main office

Mail-Out

Title company sends closing documents to you via email, overnight mail, or courier. You find a notary and then return the documents back via overnight mail.

Why it’s a good idea:

Minimal fees
Sign at your convenience
Electronic receipt of documents for reference later
Advanced time to review documents and read through everything before signing

Why you might want to think twice:

Notary required and you may have to seek that out
Requires advanced preparedness by all parties, especially the lender
Can delay funding as original documents must be returned in most cases before funding can occur
Technology (computer, email, printer) may be required

As you can see, there are several options for closing on a home while you’re out of town. To ease the process, be sure to notify your agent immediately after finding out your plans. If they know in advance they can help plan out how you will close on the home and make sure all the pieces to the puzzle are in place to keep everything running smoothly while you are away.

image courtesy of the fabulous Ines Hegedus-Garcia who writes the excellent Miami real estate blog, www.miamism.com

Am I Ready To Buy A House? Five Questions To Ask Yourself First

April 30, 2013 by khproperties Leave a Comment

The Big Question.

While the market has been heating up and interest rates have remained low, many people are asking the question; “Am I ready to buy a house?” Buying a home is (obviously) a big decision in anyone’s life and certainly not to be taken lightly. The question is important not just for first time home buyers, but move-up buyers as well. Is now the right time? Have I prepared sufficiently? Is the home of my dreams out there waiting for me? Can we sell this house and buy a new one? So many questions. Hopefully, the following thoughts will help you prepare and decide whether you are ready to buy a house or not.

Am I Ready to Buy a House?

Money, money, money. – The biggest questions, hands down, in determining if you are ready to buy a house are the questions of money. Buying a house takes money. There is no other way. Whether you pay cash or get a loan, you will still need money to buy a home, but there’s more to it than just what you spend at the closing table.

Down payment and closing costs are the big chunks of money you’re going to spend before you even get the keys to your new home. Whether you choose an FHA, VA, or conventional loan, you’re still going to need some cash. Even after you’ve considered the down payment, there are also closing costs. These range from the cost of getting the loan (lender’s fees) to the actual cost of the closing (title companies don’t work for free). Once a home is located and decided on, a much more detailed analysis of closing costs can be done and you can see the numbers and decide if you’re ready to buy this house.

Am I (credit) worthy? – Ahhh, the dreaded credit score. No one likes them. We’ve had people with excellent credit tell me their scores were terrible and we’ve had people with poor credit tell me their scores were amazing. There’s a lot of confusion surrounding credit scores. Your best bet? Sit down with a qualified, local lender (not an online source like LendingTree). They will review your basic finances, run a credit report, and if they can pre-approve you, they will give you a price range you can afford and estimates of what your monthly payment will be.

Many buyers we speak with are worried about visiting multiple lenders as they don’t want their credit score to go down (each credit inquiry in your file negatively impacts your score). In the case of home and car loans, as long as the queries are based in a short amount of time, you do not get penalized for multiple inquiries. You can review your credit report prior to visiting with a lender by visiting AnnualCreditReport. This site (unlike many others) is absolutely free. You can use it every year to keep track of what’s in your credit file. We suggest you take one report from one of the credit bureaus (Equifax, Experian, and TransUnion) once every four months. By rotating who you take the report from, you’ll be able to view your info three times each year. Knowing what’s in your credit report can help you know what needs fixed in advance.

Rent vs. buy. – One of the easiest things you can do if you’re renting and have begun to think about whether or not you’re ready to buy a house is to take a look at your current rent. First, when does your lease expire? If you just signed a new two year extension on your lease, you might want to stay put for awhile. A lease is a legal contract and breaking your lease often has negative monetary consequences. If you’re a few months away from the end of your lease, you might want to start thinking about it. The better you can time the switch, the less problem you will have when you tell our landlord you’re moving.

How much do you pay a month in rent? Do you scrape together each month’s rent by looking under the sofa cushions? Or do you pay it and still have money to save? If your budget is tight with your current rent, the goal of buying a house should be to pay less than you currently do. If the money is good and you’re actually able to save money each month, you might want to think of targeting that area as a monthly payment. Your lender will help you see the difference between rental and home ownership (there are advantages to owning a primary residence such as mortgage interest deductions).

Are you mentally (and financially) prepared for the challenge? – Ask any homeowner about their first home (or their current home) and they will tell you the same thing – “expect the unexpected.” This is why lenders push for cash reserves as part of their agreement to loan you the money to buy your house. Other homeowners will tell you of all the things they never thought of before buying a house. Although owning a home can be a lot of fun, it can also be frustrating at times – when your water heater blows in the middle of the night, when your sink or toilet backs up, when the appliances pass their useful life span and simply die on you – no matter what it is, there will be more costs associated with owning a home then you plan out. Being prepared is always a good thing.

“Now is a great time to buy.” – You’ve probably heard this phrase before. Sometimes we as Realtors overuse this phrase, even though the true question should be, “Is now a good time to buy for me to buy?” Although there are many excellent factors affecting the potential for a buyer to purchase a home right now, the simple fact remains, that you have to be comfortable with the purchase. Buying a home that you can’t afford or doesn’t suit your needs solves nothing. It will only hurt in the long run if you buy when you’re not ready.

image courtesy of Kansir

7 Steps To Buying A Home

March 27, 2013 by khproperties Leave a Comment

What goes into buying a home?

This post could be a mile long (and probably will be) as there are so many details that go into buying a home. The general idea was to give you a basic outline of the seven steps involved in buying a home. As always, we recommend you connect with a Realtor first, as they can help guide you through everything from the first initial stages of figuring out how much you can afford and getting you pre-approved for a loan to the final steps of receiving the keys to your new home.

After meeting with your agent, they will ask you to sign a “Residential Buyer Representation Agreement,” this document officially begins the agent-client relationship and defines your agent as your sole representation in the process of buying a home. This is an important step, as without that, in Texas, the agent technically represents the seller without that agreement – and who would want to look at houses with someone who technically must represent the seller?

7 Steps To Buying A Home

Search – Now that you’re working with a Realtor, we need to get down to business and find you that perfect home. We’ll perform searches of the San Antonio MLS based on the criteria you give us (and you can use our San Antonio home search as well) and send you homes that match what you’re looking for. This is the fun part. You’ll start to think about the details of homes and what is really important to you. Much of this step is done through email and phone calls until we’ve identified a handful of properties you’d like to investigate further. At that point, we begin setting up a schedule to view the homes and we’re off on our house hunt.

The Showings – This is what most people remember the most about the process of buying a home. Going out and looking at the homes we’ve identified as potential matches. We recommend comfortable shoes, an open mind, and a camera. We’ll give you the MLS printout for each property so you can take notes as we go along and we do recommend you take them. After you’ve seen a few houses, the details tend to blur together so those notes will help take you back to the home later when you’re trying to remember if you liked it or not. As we find homes you like, you’ll start to get a picture in your mind of the top few choices…we may need to go out once, we may need to go out several times, but somewhere out there is your new home and we’re going to find it.

The Offer – When we find the home you’re ready to buy, it’s time to make an offer on the home. We’ll take a look at what’s been selling in the neighborhood to get a good picture of the fair market value of the home and discuss a price. Making an offer is more than just price though. When do we want to close? Do we want them to leave the pool table behind? Who pays for the survey? What title company will we close at? Do we need them to fix anything before we agree to purchase the home (and before we get an inspection)? Do we need help with closing costs? Each detail needs to be weighed into the overall offer. Asking for the home at half the listing price with $50,000 in closing costs, is probably not going to get us the house. We need to look at your needs as well as what will look best to the seller (our job is to get you the best possible terms in the contract, but we need to be mindful that the seller and their agent will be doing the exact same thing). We not only want the best terms for you, but we want to make it a good solid offer so that we can get it accepted.

During this time, we will also more than likely have some additional paperwork to sign off on. Some will be Addenda to the contract – Third Party Financing, Seller’s Disclosure, Lead-Based Paint Addendum – there is a form for just about everything you can imagine.

Negotiation – Unless the sellers accept your offer as is, the next step to buying a home is the back and forth of negotiations. If the seller makes a counter-offer, we will discuss the pros and cons of their offer and decide what to do next. We can accept or go back to the drawing board and counter their counter-offer. The idea is to get everyone to come to an acceptable agreement, but of course, since we work for you and not the seller, our goal is to keep the offer as close to the original as possible. This part can be frustrating for buyers (and sellers too) because some people get stuck on one thing in an offer at this point and won’t let go. Our job is to make it as easy on you as possible and we will be in constant contact back and forth until we come to an agreement. When all parties are in agreement, we’ll get all the signatures and turn it into the title company. We now officially have a contract.

Option Period – Now that we have a contract, it’s time to get working. When the house was on the market, it was considered an “active” listing. The home now moves to “active option” (as long as we provided for that in the contract – which we always suggest is the best way). I see a lot of questions about “AO” and what it means, so please check out “Real estate abbreviations in the MLS” for more info on the abbreviations Realtors use in the MLS to define what the status of a property is. During the option period, the buyer has the right to terminate the agreement for any reason. Because of this, we do our inspections during this time. After the inspector does their work, we decide if we’re going to ask for any repairs or not. If we do ask for repairs, we will need to negotiate the terms with the sellers once again and come to an agreement.

Pending Status – This is typically the period where most buyers and sellers feel like nothing is going on. It feels like you’re waiting forever, but there is a lot of work going on behind the scenes. Lenders are preparing to make the loan, the title company is making sure no one else has a claim on the house, property insurance quotes are being looked at, appraisers are coming out to the home to make sure the price reflects the value of the home…even though it may not seem like it, there is actually a flurry of activity going on behind the scenes. During this time, you’ll receive a lot of paperwork and phone calls asking for more information or documents to support the loan. We need to stay on top of all of these details. If something arrives in the mail or email that you have questions about, call your agent. Don’t let anything sit unopened on your kitchen table – some of the documents you receive may need a response and we need to act right away in order to make sure everything runs smoothly.

Closing – The day is finally here! The house is about to become your home. We’ll need to do a final walk through of the house to make sure it’s in the condition we expected it to be. If the movers dropped the Steinway Baby Grand down the steps while packing up and left huge holes in the wall, we’ll need to address those with the seller and their agent. Once we’re satisfied, we head to the title company. The enormous stack of papers on the table is waiting for you. You’ll sign your name a lot today. The escrow officer at the title company will explain each document and ask you to sign or initial where appropriate. Do not be afraid to stop them and ask questions. You are signing legal documents, so it’s best you understand them fully. When you’re done, you’ve officially bought yourself a new home. However, here in Texas you may not be handed the keys. Possession of the home typically takes place upon closing and funding. This means the bank has to wire the money to the appropriate places to get everyone their funds. At times, this can take another day or two. We try our best to get the bank to move quickly, but in my own experiences I have walked out of a title company with less money, a sore hand from signing, and no keys. As soon as the funding occurs the title company will contact us and we can get your keys and you can enter your new home. Congratulations!

When should I start the search for my new home?

February 22, 2013 by khproperties Leave a Comment

Today, tomorrow, next month?

You know you want to buy a house. You think you’re ready, you have enough saved, you have your credit and debt in line, and you have calculated that now is the time for you to make the leap to home ownership. You’ve started looking around online and thinking about what you like and don’t like in homes. You think it’s time to get serious and contact a Realtor to get your home search started. Or is it? That’s the part you’re uncertain of – when exactly should I start searching for my new home? How far in advance should you stop perusing online real estate search sites and get down to business and start looking at them in person? When should you contact a Realtor and choose an agent? When do you contact a lender and figure out how much you’re pre-approved for and what you can comfortably afford?

Ready? Set? Go!

Typically, I wouldn’t recommend you begin your physical search for a new home until about three months before your projected move date. There are exceptions to this, but overall it’s a good rule of thumb. (Exceptions would include if you’re looking for foreclosures or short sales, as these sales can often take months from offer to closing.) Although many people like to begin their planning far in advance, the three month time period is when you’ll be actually be looking at homes in person with your real estate agent, speaking with a lender and getting pre-approved, choosing a home to make an offer on and once accepted, working through the process of closing on your new home and finally…picking up the keys and moving in.

Why three months?

Most lenders’ pre-approvals are only good for three months. Many lenders will lock-in your interest rate during this time and some will even allow for a change in the rate if they go lower (typically, you’re only allowed to do this once during the lock-in period). With interest rates as low as they have been, they will more than likely rise at some point. With an interest rate increase you may not be able to afford as much home as you thought you could, throwing all that searching out the window.

Homes you look at today, might not be available tomorrow. If you’re looking at homes many months in advance, they are often no longer on the market when you’re ready to buy – whether they’ve sold, been taken off the market, or in some cases, foreclosed upon. There is nothing more disappointing than seeing a home, falling in love with it, waiting for a few months until you’re ready to make an offer, and finding out the home is no longer available.

The real estate market is constantly changing. There are many factors that influence the housing market and each one could put the home you love out of your reach. Even if prices fall, it could change a neighborhood drastically and change your mind about where you want to live. A good example? When prices decline and homeowners find themselves underwater with their mortgage, foreclosure rates have a tendency to increase. Imagine you found the perfect home in a neighborhood, but that neighborhood suddenly faced a rash of foreclosures. Would you still want to live in an empty neighborhood that looked more like a ghost town than the friendly community you fell in love with?

Every buyer has different needs.

While we think the three month guideline works for most home buyers, there are times when a lengthy search period makes sense. Sometimes, it makes sense to find a home in an even shorter period of time. Every home buyer is different and their needs vary. The best bet? Contact us and let’s discuss your goals. We’ll take a look at where you want to be and when you want to be there. If it’s a year from now, we probably won’t hop in the car and start looking at homes, but we can begin planning and preparing for the future. Much like buying a home is more than simply saying “I want it,” being a real estate agent is much more than just opening doors and filling out forms. Together, we can build a plan to satisfy your home buying needs and work to make your dream become a reality with a solid plan that prepares you, educates you about the process, and guides you through every step of the way.

image courtesy of dreamsjung