First-Time Home Buyers: Closing Costs

Buying your first home can be one of the most exciting, yet stressful, experiences of your life.  

After getting pre-approved you’re finally ready to start your search. You know how much house you can afford and you’ve saved enough to make a large down payment. However, along with your pre-approval letter your lender also sends you a loan quote summary and it has a lot more than just a down payment amount on it. 

What are are all those additional numbers and fees?

When most of us think of buying a home, we think of the down payment we will need and the highest monthly mortgage payment we can afford. But if you are a first-time homebuyer, you may not realize that other up-front costs need to be paid when you buy a home. These are called closing costs.

Here’s a quick rundown of most of the closing costs you will potentially see when you go to sign on your new home.

Closing Costs

Loan Origination Fees

These are all the costs to get your loan set up. These include fees for document preparation and processing and underwriting your loan. What is underwriting? It’s part of the approval process your lender will use to make sure you are financially able to pay back your loan. This includes analyzing your credit history as well as other factors.

The Appraisal

The appraisal is when a professional assessment is done on the home you are purchasing to ensure the home is valued at least equal to or higher than your mortgage. The sale of the home is generally contingent on the appraisal meeting the purchase price. Typically, any difference in the amount the home appraises for and the purchase price will not be covered by the loan. 

A survey will also be completed to ensure that the size recorded on the title is the actual size of the property. Appraisal and survey fees are usually several hundred dollars.

Title Insurance 

Policies for the buyer and lender are calculated based on the purchase price of the property. This protects the lender from any problems with the title after the transfer of ownership.

Home Owner’s Insurance

The first year is usually paid at time of closing. 

Private Mortgage Insurance (PMI)

If your downpayment is less than 20% on a conventional loan, or if you are using an FHA or USDA loan no matter the downpayment amount, you will most likely need private mortgage insurance. This protects the lender incase you are unable to repay your loan. Mortgage insurance can be paid either up-front during settlement, rolled into your monthly payment, or a combination of both. 

Mortgage Discount Points

These are points paid at closing to your lender to lower your interest rate. You may not have any mortgage discount points, and if so, this should be $0 on your loan estimate.

Property Taxes

At time of closing you are usually required to pay six months of advance tax. These will vary by location and it is possible they will be reassessed after the loan closes.

Escrow Fee

This fee goes to the escrow agent who helps you close. It can vary based on the purchase price of the home. Escrows are items that are due to a third party that your lender will pay the third party for you. While you pay into your escrow account each month as part of your mortgage, you have to put in funds upfront at closing to ensure your escrow account starts with positive funds.

Other Fees

Depending on your loan amount, type of loan, location and other factors there can be other fees associated with your loan. These can include inspection fees, transfer tax and recording fees, any reimbursements to the sellers, and potentially other costs.

While there are a lot of fees due at closing it doesn’t mean you’ll be responsible for them all. Talk to us to learn which fees we may be able to negotiate that the seller pays instead. Buying a home is a big step, especially for first-time home buyers who are new to the process. Sisters Real Estate Services will be with you every step of the way so that you have the smoothest experience possible. 

Have questions? Ready to start your search? Call Sisters Real Estate Services today at 813.695.3166

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Staging Your Home to Sell on a Budget

You’ve heard it again and again – first impressions matter. If you’re getting ready to take the plunge and sell your home, this lesson is more important than ever. When potential buyers walk through the doors of your home you want them to imagine themselves living there. What you don’t want is them focused on your clutter or feeling like your home is too small because it’s been overpacked with furniture. 

Staging your home is a great way to get buyers intrigued when they are browsing online, and to keep them interested once they’ve come to see your house. While you might not be able to afford having your house professionally staged, there are some simple ways you can stage your home to make it more appealing during your next showing (and they’re either free or extremely cheap).

Tips for Staging your Home to Sell On a Budget

1. Clean everything

This is one of the simplest (but most important) ways you can make a good impression at showings. Give your house a good scrubbing inside and out. Mow the lawn, weed the flowerbeds, mop the floors, vacuum, put the dishes away and take out the trash. Clear off the counters in your kitchen. Pack all the personal items away that you can. Even toothbrushes and bathroom trash cans should be out of sight during a showing. The idea is to make it look like no one actually lives in your home (like that vacation rental you keep dreaming about booking).

2. Keep your house smelling fresh

You want your house to smell nice but not overpowering. If there are bad odors from pets, smoking or garbage they can be a big inhibitor for people to put in an offer. Strong air fresheners can also turn off buyers. If you’d like to go a step above just cleaning your home and letting it air out, try these ideas to make your house smell good instantly. 

3. Keep the colors neutral

It’s harder for people to picture themselves living in a home when the current style clashes with their own. Potential buyers are less likely to make an offer if they have a huge list in their minds of things they’ll need to change when they move in. Your kids may love their neon painted walls but that could hinder the sale of your home. Painting the walls a neutral color makes them a blank slate for new owners to make their mark on the home. If you need some inspiration for paint colors, check out what HGTV had to say.

4. Take down your family photos

This step makes it easier for buyers to picture their own family pictures hanging on the wall. Need to keep the frames up because you have nail marks you don’t want to deal with? Replace your photos with art prints that match the room.

5. Remove unnecessary furniture and clear out those closets

When people come to your showing they are trying to see if your house is going to be a good fit for their family. While we mean that figuratively it’s also true in the literal sense. Potential buyers need to know if all of their stuff will actually fit in your home. It’s a good idea to remove any unnecessary furniture and personal items. Keep linen closets empty and your bedroom closets only up to half full.

That gives the appearance of more space and lets buyers get a good idea for if their own items will fit well. Try to pre-pack everything you can before showing your home. If you need to store items or furniture, keep them in the garage if you have one or ask friends and family if you can store items with them for a while. If you have a little extra money it might also be a good idea to use a storage unit.

6. Decorate with what you have (or add a little for cheap)

Once you’ve decluttered and packed away all that you can, pull out a few decorations and start making each room pop. Try to make sure that the furniture in each room matches or creates a cohesive picture. If something isn’t a fit for one room, try putting it in another room. 

Some ideas for decorating include: 

• Use an accent color to tie different rooms together
• Add a touch of greenery (it’s ok if it’s fake)
• Hang a wreath on the door 
• Group small trinkets in sets of three and art prints on shelves or walls
• Add throw pillows to couches and beds
• Pack up most electronics and wires
• Add a jar to your kitchen counter and put wooden utensils in it
• Replace shower curtains and busy window curtains with white to let light in
• Organize your pantry and drawers
• Plant fresh flowers in the front yard or around the mailbox
• Add a new doormat or house numbers 

Selling your home can be scary. You’re starting over somewhere new and saying goodbye to the place you’ve made memories in. While the process can be daunting, getting your house ready for showings doesn’t have to be (and it doesn’t have to break the bank either). Follow the tips listed above and you’ll have potential buyers flocking to your house in no time.

If you are still in need of a real estate team you can trust to sell or buy a house in Brandon, Florida or the surrounding areas, call us today at 813-695-3166 or visit our site at www.mysistersrealestate.com.

How To Save Money When Buying New Construction

Congratulations, you’ve taken the plunge to build a new construction home! Now that you’re ready to get started it’s important to remember that even though this is an exciting time, not every builder is the same. You’ll need to do a little research to make sure you have the smoothest (and most cost effective) building experience.

Here are some money saving tips that will save you from a major headache later:

1. Use a Real Estate Agent

This is a crucial step in making sure you get the best deal on your new home! As a buyer (even when buying new construction), using a real estate agent is completely free for you. All commissions will come from the builder.

Having an experienced realtor with you when you visit the sales office could potentially save you a ton of money. They’ll help you navigate the process, decide which house upgrades will bring you the most return on investment and help you negotiate any incentives. Most of all, they will be there to make sure the contract is in your best interest – not the builder.

2. Compare. Compare. Compare.

Not all builders are created equal. This is where the most research will come into play. When deciding which builder to go with read their reviews to determine what their reputation is. You don’t want to be in the middle of building your house and discover that a builder is completely unreliable, using poor quality materials or overcharging you.

Even if a builder has a solid rating online you need to know what’s included in your new home purchase. Ask questions such as:

• What does their warranty cover?
• What appliances are included?
• What construction materials do they use?
• What are the standard features included in their homes?

When you’ve compared what each builder offers you can make a more well-rounded decision on what will get you the most for your money.

3. Don’t Fall in Love with the Model Home

We know it can be hard not to get wrapped up in all the bells and whistles of a model home. However, if you don’t want to spend thousands of dollars on upgrades, don’t fall in love with everything you see when you walk in the door. Most model homes have a mix of standard features and upgrades. To avoid disappointment, make sure you’ve been told all the standard features that will be included before visiting the model home. That way, you can see which upgrades really are the most important to you.

If you’re a little more handy, go with standard features (that are included in your base price) and upgrade them yourself after moving in. Buying and installing small features like your own lighting fixtures and cabinet pulls can save you hundreds of dollars in markups and labor costs.

4. Get a Home Inspection

Just because it’s new construction doesn’t mean there’s not going to be issues with your new home. This can help ensure that everything is up to code and the builder hasn’t made any mistakes. Your real estate agent will be able to provide you with recommendations.

5. Get it in Writing

Finally, make sure you get everything in writing. If you make any changes to the original contract you need to get it in writing. If you make additional upgrade changes, get it in writing. If the builder says they need to make a change, get it in writing. Did we mention you should get it in writing?

This will help ensure that you don’t find yourself in a costly mix-up.

Buying a new house is an important milestone and going with new construction allows you to have a bigger influence on the design of your home. Remember the tips listed above, hire an experienced real estate agent and make sure to do your research before choosing your builder.

If you’d like to discuss purchasing new construction, call Sisters Real Estate Services today at 813-695-3166.

6 Questions To Ask As A First-Time Homebuyer

Buying a home for the first time can be incredibly daunting. First you have to go through the process of getting pre-approved so you know how much you can afford. You send in your documents and then you send in even more documents. Because let’s face it, they always ask for more. 

Once you’ve tackled all the paperwork it’s time to find a real estate agent to finally start looking for your dream house (don’t worry, with over 30 years combined experience and a dedicated team to help you through the process, we’ve got you covered). 

Chances are though, as a first-time homebuyer, your budget isn’t going to match your Pinterest dream board. 

While you may need to alter your expectations a bit to match your bank account, there are some aspects of a house that can be absolute deal breakers for you and your family. After your realtor narrows down the list of houses you want to go see, it’s finally time for some showings!

Realtors are going to highlight the best features of their listings. While they are required to disclose any known major issues with a house, it’s important that you know these questions to ask so you can get a feel for if it’s the right house for you.

Here are 6 questions you should ask when viewing a house:

 1. When was the roof/HVAC/water heater last replaced?

If these items are at the end of their lives it could be a major expense for you right after moving in. If they’re old and worn out they could also affect getting approval on a loan (such as FHA loans that have stricter requirements). That’s not something you want to be surprised by after you’ve already committed to a house.

2. What fixtures and appliances are the sellers taking?

Every seller is different. Sometimes they leave everything you see in the house. Other times they take everything they can pull up. Make sure you know what the seller plans on leaving behind so you don’t end up having to shell out money for a new refrigerator and washer/dryer set that you never planned on needing.  

3. Does the property have a septic or sewer connection?

Is the property connected to a public water source, or does it rely on a private well? While this information will be disclosed on the MLS listing, it’s important to keep it in mind when viewing a house. It’s the difference between you being responsible for fixing major issues or the public entity. It will also affect how much your utilities cost each month. 

Additionally, a septic system or well may require additional inspections, which can increase your out-of-pocket expenses prior to closing.

4. Is there an HOA or Community Development Dues?

Some people prefer to have a Homeowner’s Association while others avoid them at all costs. An HOA can be great at maintaining neighborhood common areas and assuring that home values don’t plummet thanks to ‘that one neighbor,’ but they also require you to adhere to restrictions as well as pay continual fees. Keep this in mind when looking at how much house you can actually afford.

If you are buying new construction keep in mind there could be community development dues. Builders take out bonds to pay for the infrastructure and amenities of a new community. These bonds are paid back by homeowners through their real estate taxes each year.

5. How is the internet connection in this area?

This is important to consider if you often work from home or regularly use your entertainment system. A rural property is quiet and serene but it won’t work for some people who need a strong internet connection. 

6. Is there a lot of noise?

If a busy street or nearby airport is going to bother you, it’s nice to know ahead of time if it will be a concern. Walk around outside and really listen to get a feel for the area. 

These are just some of the essential questions you need to ask when looking to buy your first home. If it seems like a lot to keep in mind, don’t panic! A good real estate team will be with you every step of the way and guide you through the process. 

Sisters Real Estate Services will help you navigate and understand every potential pitfall of the houses you consider. We’ll work tirelessly to ensure that you end up in the right house for you and your family. Call us today or email us at Carol.Givens@MySistersRealEstate.com to learn more about purchasing your first home!