Question: WHY SHOULD I BUY, INSTEAD OF RENT?
You’ll love the feeling of having something that’s all yours – a home where your own personal style will tell others who you are. A vegetable garden in the backyard, a bricked entryway, a white kitchen…when you own, you can do it your way! But there’s more: You can deduct the cost of your mortgage loan interest from your federal income taxes and from your state taxes. And, interest will comprise a majority of your monthly payment! This adds up to hefty savings at the end of each year. You’re also allowed to deduct the property taxes you pay as a homeowner! If you rent, you write a monthly check to the landlord and it’s gone forever. Another financial plus in owning a home is the possibility that its value, and your equity, will go up through the years.
Question: WHY SHOULD I USE A REAL ESTATE BROKER?
Using a real estate broker is a very good idea. All the details involved in a real estate transaction can be mind-boggling. A good real estate professional can guide you through the entire process and make the experience much easier. We will help you figure the price range your property should sell for when selling. And for buyers, help you figure the price range you can afford and search for homes you’ll want to see! With immediate access to homes as soon as they’re put on the market, we can also save you hours of wasted, driving-around time. We will guide you through the maze of the paperwork, negotiations, inspections, and be there to hold your hand and answer last-minute questions at closing.
Question: WHAT’S THE ADVANTAGE OF HAVING A BUYERS’ AGENT?
If you were in an auto accident, would you use the “other side’s” attorney to negotiate on your behalf? Of course not! Remember – if an agent has the listing on a property you have interest in, or if the home seller is selling on his own, he or she has the Seller’s interest first and foremost in their mind when you walk in through the door! Enlisting the help of an Askew Associate to act as your Buyer’s Agent can help prevent you from making a bad purchase decision. As Buyer’s Agents, our job is to be YOUR advocate, researcher, advisor, confidant and negotiator.
Question: WHAT IS A DUE DILIGENCE PERIOD AND HOW LONG IS IT?
In the Atlanta area, most brokers utilize the contract-related forms created by the Georgia Association of REALTORS® (GAR). The GAR Purchase & Sale Agreement has a provision that allows for the Buyer and Seller to negotiate a time frame wherein the Buyer is given the opportunity to inspect the property and its surroundings for conditions the Buyer may find objectionable. This time frame is known as the Due Diligence Period. The length of time a Buyer is given for their Due Diligence Period can be negotiated anywhere, on average, between 0-to-30 days. However, most commonly, you will see a Due Diligence Period of 21 days or less. Also - a Due Diligence Period is also the time frame within which a Buyer must satisfy themselves that they can obtain desired financing.
Question: HOW MUCH MONEY WILL I HAVE TO COME UP WITH TO BUY A HOME?
Well, that depends on a number of factors, including the cost of the property and the type of mortgage you get. In general, you need to come up with enough money to cover three costs: earnest money, the deposit you make when you submit your offer; the down payment, a percentage of the cost of the property that you must pay when you go to settlement; and closing costs, the costs associated with obtaining a mortgage and processing the paperwork to close on your purchase. When you make an offer on a property, we will put your earnest money into an escrow account. If the offer is accepted, your earnest money will be applied to the down payment. If your offer is not accepted, your money will be returned to you. The more money you can put into your down payment, the lower your mortgage payments will be. Some types of loans require a down payment amount equal to 10-20% of the purchase price. That’s why many first-time homebuyers turn to HUD’s FHA for help. FHA loans require approximately 3.5% down. Closing costs average 3% to 4% of the amount of your loan. These costs cover various fees your lender charges and other processing expenses. When you apply for your loan, your lender will give you an estimate of the closing costs so you won’t be caught by surprise.
Question: DO I NEED INSURANCE? IF SO, WHAT KIND?
If you obtain a mortgage, the lender will require that you get Fire/Hazard Insurance that would be in effect at the time of closing, identify the lender as an insured party, and be pre-paid for twelve months of continuous coverage. If you do not obtain a mortgage, while there is no legal requirement for you to get a Fire/Hazard Insurance Policy, it would be utterly foolish not to secure this valuable coverage. Another type of Insurance we encourage all Buyers to obtain is Title Insurance. Again, if you obtain a mortgage, part of the loan closing costs paid go to secure Title Insurance for the Lender. Title Insurance protects the lender should a title defect be found after the closing. One such defect that cannot be found during a title search is forgery which leads to fraud. Title Insurance would be there to satisfy any title claim made by a party that was harmed by a fraudulent act. But – as stated, closing costs only buys lender’s coverage. To protect you and your equity, you need to obtain Owner’s Title Insurance at time of closing.