Monthly Archives: August 2015

Mobile Home Finances

Mobile homes are housing units built in production facilities and transported to their owner’s location. As opposed to conventional homes that are constructed on site, mobile homes are usually far cheaper and are often associated with rural areas and high-density developments.

Although these houses are usually placed in a permanent location, as the names suggests, they do have the ability to be shifted. This ability to be moved is required in many areas, where such homes are popular.

The unique selling proposition of this form of housing has undoubtedly been its mobility. Initially these homes were mainly marketed to people who led a mobile lifestyle, such as construction workers. However, beginning in the 1950s, mobile homes began to be looked upon as a cost effective alternative by people who could not afford a traditionally constructed home.

Mortgages to finance the purchases of mobile homes are comparatively harder to obtain and a few restrictions are applicable. Institutions providing mobile home finance prefer not to finance any homes that are more than 20 years old. Mobile homes with structural modifications or alterations do not qualify for finance because these alterations tend to decrease the value of the homes, since they can no longer be compared with standard mobile homes.

Although mortgages for mobile homes are available from some lending institutions, banks don’t usually finance mobile homes because the current default rates or foreclosure rates for these kinds of homes is far in excess of traditionally constructed homes. The tendency of mobile homes to depreciate quickly in resale value makes loans that use these kinds of homes as collateral far more risky, compared to traditional home loans. The terms of mobile home financing gets limited to far less than the typical thirty year terms of traditional home finance and interest rates are usually higher. With the rates low and there being no lack of customers for traditional homes, banks prefer not to deal with properties such as mobile homes, which entail a higher risk.

Home Hunting and the Internet

So, it’s home hunting time. Where do you start? Who do you contact? Well, home hunting has been made much easier with the advent of the Internet. There are plenty of websites these days with huge numbers of real estate listings, which make the task of finding a home so much easier. You can now browse through home listings, compare prices, compare the specifics of each home before deciding on which home you wish to see. Not only do you save on a lot of time but you get to choose from among a variety of homes hence not missing out on any home you may regret not having seen earlier. In addition, you also stand to benefit when it comes to negotiating for your new home as you have access to details of other homes and their prices and these comparisons can be put forward to the home owner.

So where do you begin searching for a home? Which are the websites you should start with? Realtor.com is popular for its huge database of real estate listings by agents all over the country. However, you may want to check out a few “for sale by owner” websites first as homes being sold by owners may fetch you a better bargain, a much better bargain if you consider that owners have to shell out up to 6% of the final sale price in commissions. To name a few such websites, ChoiceOfHomes.com and ForSaleByOwner.com have a number of real estate listings of homes for sale by owner all over the country. So browse through these sites and hopefully you’ll find the home of your choice!

Happy Home Hunting!

The Home Inspection Report

No house is perfect. All houses have problems and blemishes (called defects in the industry). However, not all defects significantly affect the value of a house. A crack in a window pane is a defect but not a significant one. A leaking roof that is beyond the end of its useful life is a defect that will significantly alter the value of a house. Both defects should be reported. It is the job of the inspection report, and therefore the job of the home inspector, to identify and document the many defects and designate which significantly affect the value of the house and which do not.

The home inspection report performs five main functions.

1. It is a Guide for the Home Inspector:

The Home Inspector is paid by the prospective home buyer to carefully look over a home and report its condition. An inspector’s use of a premade reporting format serves as a checklist of areas of the home to be examined. A reporting format should have a predetermined group of sections by which the home is divided.

These sections have a list of criteria that must be examined. For example the Electrical System should be included as a section of any proper Home Inspection Report. The electrical system has many components that need to be examined. Some of these include the service type; overhead or underground? The outlets; grounded? GFCI protected? These sections have subsections with their own data points to check. Within the Electrical System one subsection is the main electrical panel; Is it properly rated? Is there a double tapped breaker? Are all the breakers protecting the proper sized wires? Is there aluminum branch wiring? And so on. The more criteria listed in the section the more thorough the report will be.

The Home Inspector needs to answer each one of the “Data Points” during the process. While filling in the data points the inspector will determine if any system or component is in poor condition, is unsafe, or does not operate properly. With a good reporting format the inspector merely has to follow the sections and the criteria step-by-step to complete the report. This report process is the guide for the entire Home Inspection.

2. It is a Record of Data:

The report records all the necessary data about the condition of a home. The report is a legal document that captures data for a particular point in time. Most homes are bought and sold over time and some may change hands many times. All homes deteriorate over time, and are subject to improvements and upgrades. Conditions that change over a 20 year period, both good and bad, will be easily discernible by looking back at a report. Things such as appliances, heating systems, floor coverings, etc. The Home Inspection Report provides a snapshot in time.

3. It provides guidance for the buyer and the bank:

Buyers will look at a prospective home from a particular perspective. “Location, location, location. How good is the school district? How many bedrooms? A garage?” The inspector, however, is not influenced by these types of criteria or wants. He or she will look at the home unemotionally and provide objective information about that home purely regarding its condition.

Often prospective home buyers find a home that they love, and seems to be “perfect” (according to the criteria they set as important). With the Home Inspection Report they can now see through the eyes of the Home Inspector, and may fall out of love with that house. The existence of conditions requiring expensive repairs or that present safety issues can bring the buyer back to reality or inform them in a way that helps them decide to buy the house despite the additional work that needs to be done.

The bank also wants that unbiased Home Inspectors’ guidance because the bank doesn’t make decisions about lending money based on the buyers’ “love” of the house. If the defects are such that the additional expense will be too much for the buyer to afford the bank wants to know.

4. It is a Marketing Tool:

A Home Inspector, in most cases, runs an individually owned small business. The inspector succeeds or fails on the impact of the Home Inspection Report. The client and the realtor judge the quality of the Home Inspector not by the inspector’s fancy tools, expensive marketing, or winning personality but, in general, they judge solely on the thoroughness, accuracy, and readability of the report. Ultimately it is the quality of their report that is the Home Inspector’s strongest asset toward growing his or her business.

When a home buyer clearly understands the Inspection Report and finds it informative and useful, the realtor will likely recommend that inspector to other prospective buyers. The realtor wants to look good by being associated with a competent Home Inspector.

5. It Protects the Inspector:

Home inspectors are guided by a set of standards that are called “Standards of Practice”. These Standards of Practice are set forth by the State; if the Home Inspector is doing business in a state that requires licensure; or by the National Professional Association or Associations to which the inspector belongs.

The Standards of Practice, or SOP’s, detail what elements must be included in a Home Inspection Report. If the report does not fulfill the requirements listed in the SOP’s the inspector could be found negligent in a court of law. A Home Inspection Report that covers all of the required standards is a document that can prove the home inspector was not negligent.

For example: A home owner might sue a home inspector because there is later found to be aluminum branch wiring in the home they purchased. The home inspector must be able to prove he or she removed the cover of the main panel and looked at the branch wiring and was unable to detect the presence of aluminum branch wiring within a reasonable expectation.

If the inspector can provide written (and hopefully photographic) evidence that shows he or she removed the main panel cover then the court likely cannot find the inspector negligent. (This is one good reason why many inspectors are currently using pictures in their reports). A good report is the best defense in a court of law.

The Home Inspection Report also provides different services to different people.

1. To the Client –

The client obtains an unbiased, objective and unemotional evaluation of the house and an overall view of the house that will either inform his purchase plans or change the decision to buy. The report also provides information useful to any homeowner about the systems of the house and a punch list of repairs to be made should the client buy the home.

2. To the Bank –

The bank is provided with a report that assures the house is not a bad investment because of hidden costs or safety issues.

3. To the attorney –

The attorney gets a legal document that ensures that proper due diligence was performed when regarding the condition and safety of the home. The report is the legal document that assures the client is protected.

4. To the Home Inspector –

The Inspection Report ensures that the Home Inspector has fulfilled the obligation to the client according to the Professional Standards of Practice and can help prevent loss in law suits that claim negligence.

A quality inspection report, by its ease of understanding and thoroughness, is a great marketing tool to generate new business.

Remember, even though the report holds critical information and provides service to several different parties associated in the process of home buying; the home inspection report and all of its contents belong solely to the client. This is not a public document and cannot be disseminated by anyone without the consent of the property buyer.

If there are significant defects found in a house it is typical for the buyer’s attorney or realtor to share only the selected pages of the report with the seller’s attorney. These pages will contain only the information on the aspects of the house that the Home Inspector found deficient. It is unusual for the seller’s agent to receive the complete report and only by the buyers’ permission.

In the Home Inspection industry there are currently multiple options of format by which to produce a Home Inspection Report. There is no Standard Report or report format, and no reporting system even considered the industry leader. The three basic report styles are; checklist, narrative, and combination of both.

Available within the Home Inspection Industry are paper reporting systems, computer programs and online reporting systems. Costs for these systems range from no-cost, to cost in excess of $2,000.00.

Home Inspectors have a lot of choices when it comes to reporting systems and no one particular system or style is the clear favorite. The main problem associated with this lack of Industry Standard or leading system is that it hurts the consumer. The consumer (or the prospective home buyer needing a Home Inspection Report) may have no idea what they should be receiving for a quality report; especially if they are first time home buyers.

The client who hires a Home Inspector has no expectations about the final product, except that a home inspection is a necessary step in the home buying process and the report will tell them ‘something’ about the house. They expect the Home Inspector will advise them about issues with the house, but from that point on there is no basis for expectation as to the quality of the product in the form of the report. Every home inspector has the option of using their own style of reporting. The buyers may never know whether they are receiving an inferior report because there is no Home Inspection Report Standard with which to compare at this point in time.

Home Inspection Reports are the cornerstone of the Home Inspection Industry, but even experienced inspectors cannot decide on a standard. The complex functions and myriad services a quality report performs deserve a careful selection as to the form an inspector chooses. Most Home Inspectors stick with the type of report they know and are comfortable with, despite superior systems that may be available. Home Inspectors should evaluate and choose their reporting style and system according to the best way to serve all the parties involved.

How to Save Thousands of Dollars when buying a home

Yes, I know just about no matter where you live in the USA the home you buy today has hefty monthly payments and huge fees to pay prior to purchase of the home.

A common way to save money is to find a cheap home inspector. While your can get lucky once in a while I have found there are few bargains in life.

After spending weeks, months or years looking for a home devote a little time picking your home inspector carefully. Even in the few states that require home inspector licensing it is a very minimal requirement that does little to protect consumers. If you wish to protect your self against the purchase of the money pit you must find out all you can about the qualifications of the home inspector before you hire them.

Just about every reputable home inspection company is proud of the reputation of their inspectors and will happily provide you with their resumes, if they will not that should be a red flag.

Beware of the cheap inspector the realtor knows. That inspector may be cheap because he lacks enough experience to charge more, he many also not have enough experience to find defects. Worse yet the inspector may be experienced but may feel that if tells you about defects in the home he may loose future referrals from that realtor or the real estate office.

When searching for a home inspector the most important qualifications are his or her experience in the field and independence from realtors. Independent inspectors are free to tell it like it is. Inspectors who depend on realtors for referrals may also feel pressure to down play defects or not tell you the whole story in order to avoid rocking the boat.

Recently I inspected a home listed as a four bedroom. When I got into the attic I knew it was not a legal bedroom due to the height of the windows above the ground. I told the buyer to go and check with the town. Needless to say the listing realtor is not happy because the buyer now knows she did not do her due diligence and check the tax records, besides now she got caught. The selling realtor is not happy because the buyer needs a four bedroom home and the home he was bidding on does not have four legal bedrooms. The buyer is not happy because he was about to pay for a home with one less bedroom than he thought it had and the home did not meet his minimum requirements.

Let’s put things in perspective: If you’re buying a $350,000 home and the inspection fee is $600, that’s .172% of the cost of the home! The cost of a New Jersey home inspection is a bargain! If the inspection turns up little wrong with the home (few do), you’ve bought some relatively inexpensive peace of mind. If the inspection finds serious problems (most do), then the few hundred dollars you invest in our home inspection could end up saving you many thousands of dollars.

Conditions Are Right For Buying The Higher Priced Home You’Ve Always Wanted

Higher interest rates and home prices in the past have kept home owners from purchasing larger homes. The current real estate market conditions, however, are encouraging for many home owners who want to “buy up” to higher priced homes with more to offer.

If you are considering trading up for a larger and more expensive home, conditions for doing so couldn’t get much better. Interest rates are the lowest they’ve been in two decades, and home prices in many regions are the most affordable they’ve been in years.

You should consider a few factors before reaching a decision to trade up:

  • Can you afford higher mortgage payments and property taxes?
  • Is your credit record solid enough to qualify for the probable higher monthly mortgage payments?
  • Do you plan to stay in your new home long enough to recoup your investment?

Obviously, you’ll need to sell your current home before getting serious about trading up to a new one. A healthy real estate market indicates that you’ll have little trouble selling your existing home. The national Association of Realtors reported in August that sales of existing single-family homes are rising steadily, especially among first-time buyers. Affordable home prices and low interest rates could make the starter home you purchase several years ago particularly attractive.

If you can afford the up-front cost, you may want to consider switching the fixed-rate mortgage on your old house for an adjustable rate on a new one. This could allow you to trade up without increasing your monthly payments.

The type of mortgage you choose also depends on how long you plan to stay in your new home. A good mortgage lender can advise you on whether a fixed-rate is an advantage is you’re planning on staying for more than 10 years. A fixed-rate may be better for long term owners who don’t want to worry about rising mortgage payments.

Trading up may not be worth the move if you’re planning on living in the new home for only a couple of years. You might have to stay three to five years for your house to appreciate enough to recoup the closing costs.

Conditions for a move-up haven’t been this good in many years, and you may not want to wait much longer to consider it. An experienced real estate broker can help you decide if buying a new house now is a good investment for you.

How Home Buying Works

What Happens When You Buy A Home?

On average, people who live in the United States move to new homes about every seven years. That means that every seven years, people just like you are driving around neighborhoods, checking out schools, walking through complete strangers’ homes, talking with bankers, and spending large amounts of money (i.e., keeping the economy rolling). The process is a long and sometimes difficult one, but also one that can bring with it a lot of excitement and joy if you find your dream home and can afford it. In this article, we’re going to go through the steps involved in a search for the perfect home. For instance, do you really need a real estate agent? Why do you need to be pre-approved by a bank? How do you negotiate the deal? And, how do you keep from getting a lemon?

Money Matters

Probably the most important step, and certainly the step you should take first, is to figure out how much you can afford to spend on a new home. If you haven’t set up a budget that shows you how much you’re spending on everyday things, now is the time to do it. A good budget will help guide you to the right price range of homes as well as prevent you from spending more than you should on your house. This can happen when the bank says you can afford a certain price range of homes based on your income and debt, but they haven’t taken into consideration all of your expensive hobbies, your monthly child care expenses, the fact that your car could die at any moment, or your love of international travel. You probably don’t want to have to change your lifestyle in order to buy a more expensive home. By having a handle on your personal budget, you can compare your own numbers with what the bank is willing to lend you to come up with a very manageable mortgage payment that will let you continue the same lifestyle you currently have.

Other Costs

In addition to the mortgage itself, you’ll also have to add property tax and insurance to your monthly payment. And, if you don’t make at least a 20% downpayment, you’ll also have to add Private Mortgage Insurance. Also, don’t forget the expense of closing costs. It can eat into the cash you have available for the downpayment. All of these additional costs add up, so make sure you are comfortable with the total amount of your monthly payment and know how much you can put into a downpayment before you begin your search and fall in love with a house you can’t really afford.

Need vs. Want Armed with a realistic price range, you can now start the process of finding that perfect home. Here is also where you have to keep a level head and think about what you “need” versus what you “want” in a home. Hopefully you can get both, but be prepared to give a little on some things that you don’t really need. Keep in mind that finding the perfect home isn’t always possible simply because it may not exist. Make a list of things you absolutely need, like three bedrooms, a backyard, a good school district, etc., as well as a list of the things you want, like hardwood floors, skylights, a “smart” house, or a large foyer. Then prioritize those things. If you find a house that comes close to having all of your NEEDS but doesn’t have everything you WANT, give it a second look. By keeping these distinctions in mind, you’ll prevent yourself from prematurely ruling out certain houses without seeing them first.

Location is Key

Location, location, location. We’ve all heard that the most important thing to look for in a home is its location. It’s true — location is very important, even if you don’t plan to be there many years. What to look for in the location of your home may also tie in with the list of priorities we discussed in the previous section. For instance, are you looking for someplace close enough to town that you could walk to shops and restaurants, or do you want the seclusion of a more quiet, rural setting? Do you want your kids to be able to walk to school, or is riding the bus okay? Even if some of these things aren’t important to you, when it comes time to sell, the location of the home will always have an impact. The other thing to keep in mind about location is that your preferences will change over the years. What’s important to you right now, may not be so important in 10 years and vice versa. For example, having no kids might make you ignore looking into the school district the home is in. Later on, if you do have kids, that will be an important consideration and can also mean moving from a home you love in order for your children to attend better schools. But, is it a good location? There are many reasons why a home’s location is so important. As you’re shopping for your new home, you may want to consider the following:

  • Proximity to town: How convenient will quick trips to the grocery store be? Do you care?
  • Proximity to schools: Is the school district a good one? Do you like the school your kids would attend? This is important for resale, even if you don’t have kids yourself.
  • Proximity to work: How long will your commute to work be?
  • Proximity to other amenities: If you have kids, will you be driving all over the county to take them to sports events and school functions? Would that bother you?
  • Crime rate: Does the area have a high rate of crime compared to other areas of town?
  • Tax rate: Do you have to pay both city and county property taxes?
  • Zoning: What’s going to be built next to you in the future? Or, what restrictions might there be on what you can do in your home. Some home businesses can be affected by zoning issues.
  • Restrictive covenants: Does the neighborhood have restrictive covenants, or will you have a chicken farm pop up on the property next to yours? If you want a chicken farm yourself, does the neighborhood allow it?!
  • Homeowners association: Is there an active neighborhood organization that will help maintain and improve the area?
  • Public transportation: Do you have transportation options? Is that important to you?
  • Noise: Go to the property at various times of the day. Is there a lot of noise from traffic? Are you in a flight pattern from the local airport?
  • Safety issues: Are you near a nuclear or other potentially dangerous facility? Is there a landfill nearby that lowers the property value?
  • Neighbors: Do the neighbors have similar values to yours? Go to the neighborhood at night and on weekends to get a taste of the types of activities that go on.

Realtor-Ready or Not When you begin the search for your home you have three choices:

    • You can go it alone and do all of the legwork of finding homes by looking in the newspaper, searching online, or simply asking around.
    • You can call a real estate agent and ask them to show you homes.
    • Or, you can sign a contract with a buyer’s agent.

If you’re like most people, you probably weren’t even aware of that third option. There are some very fundamental differences in these three options. In the first instance, going it alone, you may miss out on a lot of potentially great properties. You will also find that you’re not saving any money because the seller pays the commission to the agent based on a percentage of the sales price. In the next section we’ll discuss finding a real estate agent. Real Estate Agent When you call an agent and ask them to show you some properties, you have to remember that they are always working for the seller — not you — even if they are not the listing agent! (The listing agent is the agent who was hired by the sellers to list their home.) This ties in with the fact that the agent is paid a commission based on the selling price of the house. (Usually a 5-7% split between both agents involved.) So, the higher the sales price, the more money the agent makes. It may be hard to keep this in mind as you spend time with the agent and feel you know and have a relationship with that person.

Even though you trust the agent, it is very important to never reveal the highest price you are willing to pay, or other concessions you know you would be willing to make. Because the agent represents the seller, he/she must relay this type of information to the seller. The flip side of this is also true. Again because the agent is representing the seller, he/she is not allowed to divulge anything that would tip the scales in your favor — like why the seller is selling or how low the seller will probably go regarding the selling price. Remember, the agent is bound by contract to work to get the best possible deal for the seller. In the next section, we’ll discuss your third option, buyer’s agents. Buyer’s Agent Your third option, using a buyer’s agency, means the agent is working with your best interests (and wallet) in mind. A buyer’s agent will work to negotiate the best price, ensure the property is inspected, and make sure you have the representation you need. Things you tell a buyer’s agent remain confidential. Using a buyer’s agent also means that you will be shown homes that are For Sale By Owner (FSBO). It might seem like using a buyer’s agency means you are going to pay more — but that’s not always the case.

Although there are situations where agents charge an hourly fee, or a flat fee for the service, in most situations they are simply working for the same commission that is paid by the seller and split it with the seller’s listing agent. While there is still some argument that this method leaves the incentive for a higher sales price, buyer’s agencies counter that by pointing out that a $10,000 savings for the buyer only amounts to a $150 difference in commission for the buyer agent. They feel that the benefit of your satisfaction with their service and the word of mouth promotion they will get outweigh the loss of this small amount of money. The type of agreement you sign with a buyer’s agent will dictate how the arrangement works. A limited agency agreement may stipulate, specifically, for what the agent will be paid. For instance, the agreement might state that if you find a home on your own, then no commission will be paid. Basically, you can negotiate the terms of the agreement up front so both you and the agent know what to expect and are comfortable with the relationship. Typically, however, if the agent has been otherwise very helpful and attentive, most buyers still pay some type of commission even if the agent was not involved in finding the home they end up purchasing. If you do decide to use a buyer’s agent, be sure to read the next section.

Be on the lookout for: If you decide to use a buyer’s agent be on the lookout for:

    • Dual agency: This means the agent (or agents) are working on both sides of the fence. For example, an agent with XYZ Realty may represent the seller, while another agent (or the same agent) also with XYZ Realty represents the buyer. There are obviously arguments against this arrangement because of conflicts of interest, but nonetheless, it is still a common practice. In the dual agency situation, both the buyer (you) and the seller must be made aware of the arrangement and privileged information can’t be shared unless you agree to it.
    • Neglecting to specify: If you begin working with an agent and forget to ask for or sign a buyer’s agency agreement then the agent automatically represents the seller. In most cases, the agent will bring this up and offer you the choice. If, however, the agent is the listing agent for a house you are interested in then the relationship automatically becomes that of a “dual agency.”
    • Buyers’ Agency Clause: One potential problem with signing a buyer’s agency agreement may come with a blanket clause stating that the agent gets a commission on any home purchase. If you think it is likely that you will find something without the help of the agent then you may want to specify in the agreement that a home you find on your own (a FSBO, for example) will not require payment of the standard commission.
    • “In-house” Listings: If you’re working with a traditional agent (or listing agent) rather than an exclusive buyer’s agent, be aware that you might get a little harder sales pitch for their own listings, or the listings held by their brokerage firm simply because they make more money that way.
    • Release Clause: Make sure you have a “release clause” in your buyer’s agency agreement just in case you find out you just don’t like your agent. This will allow you to sever ties without any future problems. You may need to take advantage of this clause BEFORE you see any houses — or at least any houses you think you are interested in.
  • The Great House Hunt Once you’ve made the agent decision, you are ready to start house hunting. The agent will search the Multiple Listing Service (MLS) and give you a printout of houses that meet the criteria for your ideal home. If you are using a buyer’s agent, you may also get a list of For-Sale-by-Owner (FSBO) homes to look at in addition to the MLS list. Don’t forget to do some looking around of your own just in case the agent misses something. This is where your communication with the agent is critical. The agent needs to have a really good idea of what you want in order to make your search as efficient as possible.
  • Making an Offer When you’ve found the house and are ready to make an offer there are several steps you need to take and contracts that need to be drawn up. Here is where your real estate attorney or agent really come in handy. The first thing that happens is your official offer, or bid. When you make the offer, you have to keep in mind that it could easily become a legally binding contract if the seller accepts it. Because of this, you need to make sure the offer includes all of the contingencies, concessions, and other details you need it to cover. In the next section we discuss the items your offer should include. Your Offer Here are some examples of things that should be included your offer:
    • Your offered purchase price and the amount of earnest money you are putting down
    • Home inspection contingencies: Since the inspection may take place after the offer is accepted, you need to state that the entire deal is contingent upon an acceptable inspection report. If the house is on a well and septic system rather than city water and sewer, these should also be inspected.
    • Financing contingencies: You can also include a contingency for getting the mortgage you want (i.e., maximum interest rates, expected terms, etc.)
    • Items included in the purchase: This list can include things like major appliances (often the refrigerator goes with the seller), lighting fixtures, shrubbery, basically anything that isn’t nailed down and some things that are!
    • Title contingencies: Your attorney will do a title search to make sure the property does not have any other legal claims against it and that the seller holds clear title to it.
    • Timeline: A deadline for responding so you know when to consider the offer rejected

Conter Offers After your initial offer, the seller may counter with a price just slightly below their asking price. This back and forth dickering can go on a couple of times until you come to an agreement, or someone else steps in and offers the asking price! Your agreement may not be only about the money either, there may be other terms and demands that you have to deal with. Just remember that until you have a signed contract anyone else can step in and make another offer. Professional Inspection Required Since the entire deal could be riding on the professional inspection of the home, don’t cut corners when it comes to the house inspection — and never skip it altogether. Even with new houses, there can be hidden problems that only a professional inspector may find. These inspections cost anywhere from $200-$500 and are well worth it. The types of things the inspector looks at are defects that affect the value of the home, make it unsafe or less livable for whatever reason. Leaky appliances, damp basements, plumbing problems, and other defects are some of the problems that can be turned up by a good inspector.

Major Points of Inspection Here is a list of some of the major areas inspectors will cover:

    • Foundation: With either a basement or a crawlspace, is it simply damp or are there outright water problems? Are there any cracks in the walls or floor that might indicate structural problems?
    • Construction: Does the house have good quality construction? Is the flashing properly installed to protect wood, are there any rotting problems with the wood, is the roof in good shape or will it need replacing soon, etc. Ideal Construction LLC can answer questions like these.
    • Plumbing: Has the plumbing been properly installed? Is it in good shape? Is there any evidence of leaks?
    • Heating and cooling systems: Are the units in good shape? Will they need replacing soon? Are they rated for the amount of square footage they are heating?
    • Electrical: Do there appear to be any electrical problems or code violations?
    • Interior: Are the floors level? Do windows and doors function properly? Do the appliances in the kitchen function properly? Is there any evidence of leaks or mildew in the bathrooms?

Closing the Deal Assuming the inspection turns out well, the financing is going through to your satisfaction, and all other contingencies are met, you’re now in the home stretch. Your attorney will do due diligence, which includes a title search to determine if the seller does indeed hold the title to the property and there are no other legal claims against it. This along with the home inspection will complete the due diligence package If everything is clear, then you’re ready to sign what may seem like the largest stack of documents you’ve ever seen! It is at the closing that the title to the property will be transferred to your name, your home owners’ insurance (which you have to have already secured) begins coverage of the property, and you are officially committed to your mortgage. It is, unfortunately, also time for you to plunk down your cash for the downpayment and closing costs. You should be able to get a copy of the settlement statement that includes the amount of cash you’ll need at closing from your lender a day or two prior to the closing. Knowing these costs is important since you’ll need to pay your down payment (and usually your closing costs) with a certified check. You’ll be signing lots of papers, including:

    • The settlement statement
    • The sales contract
    • Title insurance
    • Homeowners’ insurance
    • The title or deed to the property
    • The down payment and closing costs

There may be additional documents to sign depending on the complexity of the deal, so be prepared and block out appropriate time for everything. More information can be found at http://www.landstarnorth.com/

Mobile Home Loans Give Concrete Shape to Your Mobile Home Aspiration

A mobile home is equipped with all the advantage of modern day living. It can give you a new experience away from the disturbances of towns and cities. Mobile home as the name suggest is a movable home that is equipped with complete plumbing, electrical, and heating facilities and are usually less expensive than site built homes. I think by now you must have made up your mind to get a mobile home. But do you have enough funds to finance the purchase of a mobile home? If no, then you need not worry. You can apply for a mobile home loan which will give concrete shape to your mobile home dream.

Mobile home loans finance the purchase of a mobile home. The loan is secured against the home loan. A mobile home loan is also known as manufactured home loan. Before applying for a loan, you have to decide which mobile home you want to buy, this will help you to find out the amount you want to borrow.

Features of a mobile home distinguish it from other residential homes. Mobile homes are housing units built in factories that are equipped with all the facilities. It is then moved to a site for installation on a relatively permanent site and used as a residence. Presently, there are three types of mobile homes available in the UK mobile home market namely caravan, motor home and a park home.

Once you decide the mobile home you want to purchase, the next step is to find a suitable mobile home loan for yourself. There are two types of mobile home loans available in the loan market – mobile homes with land and the other one is mobile homes without the land. A borrower can opt for the first option otherwise he can look for the second option.

The loan amount and the tenure of the mobile home loan depend on the location of the mobile home. Caravans can cost a few hundred pounds while park homes cost more than £20,000, depending on their conditions. Mobile homes are significantly cheaper than traditional “bricks and mortar” property. Mobile home loan tenure varies between 15 to 25 years.

An average mobile home loan ranges from 11% to 18%. There are various benefits of a mobile home loan. It provides innovative building options. A mobile home loan is fast and economical which makes it a cheap loan option.

Mobile home lending is considered to be a risky task even if you have a good credit rating. There is big risk involved for the lender; a borrower may fail to repay the loan amount or the monthly payments. Loan is secured on the mobile home but there remains a threat that the value of the home depreciates over the time.

Give due consideration to the cost involved in buying a mobile home such as transportation cost and set up cost. These costs may make your loan expensive. So, estimate these costs before you decide which loan to borrow.

Finance market is flooded with various loan options by infinite number of lenders. Online lenders are the latest entrants in the loan market which have made an initiative to overcome the shortcomings that borrowers used to face while borrowing from traditional lenders such as banks and financial institutions.

Online mobile home loans provide the convenience of applying for a loan. A borrower can apply for a loan by browsing various online lending websites. An applicant needs to fill up a small online application form with some personal information which is available at most of the lending websites. The lenders use these details to find out the most suitable loan option for you. Online lenders ensure the privacy of the personal details of the applicant, so you need not to worry about it. Collect loan quotes from various lenders and make a comparison among them to find the loan that matches your pocket to the best.

Owning a home is a privilege and that too a well furnished mobile home can be a dream true for some. Your dream to own a mobile home can be realized with a mobile home loan. Shop around! Search for the cheap and fast mobile home loan which will be beneficial making it easy for you to pay small monthly payments.

Home Sellers Warning for Young Families

If you’re thinking about selling your home and moving up, do your homework before offering your home for sale. Read the following story to see what can happen to home sellers who don’t do their math.

A young family sold their home in California, before they determined how to buy their next house. All they thought about was moving into a larger home for their growing family.

Two years before, after this young couple purchased their first home, they bought a minivan with payments and increased their credit card debt with home furnishings purchases. Then, the wife quit working to stay home with their baby. The family still had sufficient money to make all payments on time. They fell in love with a larger new model home in a nearby tract home development. The sales agent convinced them the new home would only cost them another $200 per month.

The family had no trouble selling their home. To qualify for the new home mortgage payment, they had to pay off the minivan, student loans, and the credit card debt. Out of their home sale proceeds, these payoffs left less than a 10% down payment for their new home.

Because of their changed income and low down payment, they didn’t qualify for the new home of their choice. With only 5% down, the couple had to pay higher interest rates on a second to avoid mortgage insurance. Without the wife’s second income, the total payment meant that they only qualified for a new mortgage for a home which cost less than the one they sold!

Before you put your home on the market, make sure you can buy the home you want.

Consider the following financial concerns:

Talk to a loan officer and check your credit. Don’t get caught after selling your home, when it’s too late, to repair any credit issues. Of course, you may have a great down payment from the sale of your home, but other bills like credit card debt, auto loans, and student loans may need to be paid off so you qualify for the new mortgage payments.

Find out how much of a monthly payment and the down payment amount you’ll need to buy the home of your choice.

Do the math. How much can you expect to net from selling your home?

1. Do you have a mortgage prepayment penalty that could eat up a significant amount of your equity?

2. Determine selling commission expenses. Can you sell your home effectively on your own or do you need to pay 6% of your selling price for a real estate agent’s expertise?

3. Estimate your closing costs. Ask a local closing or escrow company for an estimated closing cost amount for a home in your price range.

4. How much work does your home need to ready the property for a top-dollar sale? Which upgrades or redecorating expenses make sense financially?

Consider all the expenses of selling, determine your actual profit, match that amount to your down payment, and see how much of a home you can buy with your qualified monthly payment amount. After you do your math homework, you’ll be ready to think about selling your home. Don’t get caught like this young family and be forced into a lesser home.

Copyright © 2005 Jeanette J. Fisher – All Rights Reserved Worldwide.

Timing Your Home Sale and Purchase

It is always a dilemma whether to find the perfect home before you sell yours or after. Most people really do not want to make a double move, one in which they sell their home, move out and then find a home and move again. Timing this can be a tricky thing.

First and foremost if you cannot make a purchase financially before you sell your home then you absolutely need to get your home on the market first. This can be scary for many sellers because the worry that they will get their home sold and not have a home to move into. Some people are able to qualify for both homes and can actually find the home they want and purchase it while their home is still on the market. For most, this is not an optimal choice. In a buyers market this is especially true.

In most cases the smartest thing is to get their home on the market and start to narrow their home purchase search. Start looking at home and narrow your choices down. If you have picked a favorite with maybe a back up home as your second choice then as soon as you get an offer on your home you can put an offer in on one of your choices if the homes are still available.

Keep an eye on the availability of the homes you choose and continue your search for other homes that you like in case the home of your choice is no longer available.

Your continued search can be quite simple with the technology we have today. In most areas, your realtor can put you on a custom search that automatically sends you listings that match your criteria. You can narrow it by many different search criteria like number of bedrooms, baths, square feet, price, area, lot size and even down to type of roof. Then, once there are several homes that you would like to personally view, contact your agent for a viewing.

In some cases, if you find the absolute perfect home and you do not want to risk losing it, the seller may consider a contingency on the sale of your home if you submit a strong offer. What this means it they are accepting your offer contingent upon you selling your home and successfully closing so that you have the funds to close simultaneously. Most of the time, the seller will keep their home on the market and can entertain a new offer giving you first right of refusal to lift your contingency and purchase the home without successfully selling your home. This will then be your choice and you need to decide if you are willing to let the home go or to risk owning both homes for a period of time.

You may be willing to move forward at this point if you are getting a lot of traffic and it seems likely that you will soon get an offer on your home.

If you get an offer on your home and you started your search and have a home picked out you can easily coordinate the two to close in order to allow your move to go smoothly and without a delay in between moves.

Building Your Own Home in Shreveport Bossier City Louisiana Areas

What does it take to build your own home, to be your own contractor, to save money? In Louisiana an individual has the right to build their own home once per year. I’ve built several homes in the past, and each time was a learning experience. With this experience I have prepared for YOU a step by step guide to building a home from my point of view. This article is specifically taylored to building slab-on-grade homes in the Shreveport Bossier City area.

  1. Choose your home. Make a decision about which will be your next home. Once you decide what to build you’ll need to purchase house plans. One of my favorite places to look for house plans is W.L. Martin Home Designs. These guys have the most well constructed house plans I’ve ever seen, not to mention beautiful designs. Look above and check out the WL Martin home completed in 2005. If your framing crew ever complains about a WL Martin house plan, consider firing them for incompetency.
  2. Find some land. Now you have your house plans and you know what footprint your house will have the property. Shop around and find some land to build your new house on. Drive around, look in the newspaper, look on the internet. Find out what the restrictions are on the property. Many subdivisions have covenants (restrictions) describing what type of homes are allowed. If your house fits then great! If not, pick another house or another piece of land. Caution! Be on the lookout for contractors selling land requiring that you let them build the house for you. Not that there’s anything wrong with this; as a matter of fact I would require people let me build the house too. However, the focus of this article is building your OWN home.
  3. Finance the land. If you don’t have cash on hand find someone that will loan money for the land. If you are building the home immediately most mortgage companies have programs available. If it is months or years before you plan to build the home then contact David Ogletree at the Louisiana Land Bank. The Louisiana Land Bank has a program for future homesites which enables them to loan money for raw land. Their rates are competitive, and their service is fast.
  4. Get your costs together. There’s no skipping this step! Before you get a loan for building a home the bank will make you submit your cost estimate. I have provided a list for you which includes everything I bought for my last home project in 2005. I also provide you with names of people in the area who did a good job for me. Feel welcome to contact them and tell them I sent you. Please note that the purpose of this list is to provide you with a starting point and remind you of things that are often forgotten. You will need to edit this list to make it fit your requirements. These items are listed in the order I encountered them.
    • Land Cost – How much you pay for the land.
    • Land Clearing – You’ll need to hire a good dozer man to prepare your property for your home. For this task I recommend Roy McDowell from Webster Trucking. He has a laser level on his bull dozer that puts a nice grade on your site. His phone number is 318.949.4915.
    • House Plans – How much you paid for the house plans.
    • Permits – Be sure to obtain all required permits. These can be culvert permits, parish building permits, city permits, and more.
    • Builder’s Risk Insurance – Protect yourself against fires, theft, and a host of other unfortunate circumstances. Call Bobbie Smarr for Builder’s Risk Insurance at ICT Insurance Agencies 318.797.7400.
    • Portable Toilet service – When you gotta go, you gotta go. Keep your workers relieved at your job site.
    • Temporary Water Service – Contact the water service in your area and have them put a water meter in. There are several phases of construction that require water (ie. masonry).
    • House Pad – Find someone that can sell dirt and build the house pad for you. Don’t go too cheap here, or you’ll have a house sitting in a mud hole. For this task I recommend Roy McDowell from Webster Trucking. He has a laser level on his bull dozer that puts a nice grade on your site. His phone number is 318.949.4915.
    • Slab, Post Tension – Contact Drew Paschall with TBG, Inc. His phone number is 214.616.4841.
    • Driveway and sidewalks – Contact Drew Paschall with TBG, Inc. His phone number is 214.616.4841.
    • Temporary Electricity – Contact Bo Wilkinson at BW Electric at 318.949.8711. They have electric poles and will help you coordinate getting the temporary power on your job site.
    • Interim Loan interest – Be sure to remember this one. While it takes 3-12 months to build your home you’ll be paying interim loan interest on the money you have borrowed. I like to use 5% of the final borrowed amount to estimate how much interest I’ll pay over the life of the interim loan.
    • Framing & Lumber – Contact Drew Paschall with TBC, Inc. His phone number is 214.616.4841. Even if you use someone else for the construction of the slab make sure you don’t miss the pleasure of working with these people in framing your house. Their speed will save you money on your interim loan interest. They work in large crews and focus on YOU until they are finished with the job.
    • tape/float/texture/paint/stain – This process involves hanging sheetrock inside your home, preparing the sheetrock for texture, texturing the sheetrock, painting the house, and staining the cabinetry. For this task I have a strong preference for Mark Villarreal at Aim To Please. His home phone number is 318.949.8871. His cell phone number is 318.458.0079. Since this step in building a home is time consuming, Aim To Please’s painters work in large crews to complete your job in a shorter amount of time. This saves you money on interim loan interest.
    • Cabinets – Get your order in for cabinets at the same time you pour your slab. Doing it this way will prevent delays when it’s time to install them. Randy Peters and Tim Taylor build some beautiful cabinets. Contact them at 318.272.4598.
    • Cabinet knobs – Steer clear of fancy prices here. Get the cabinet knobs and stuff on Ebay! That’s what I did.
    • Countertops – Will it be formica, corian, granite, marble? Make the choice now. You need to know how much it will cost you.
    • Wood, tile, and carpet material and labor – Decide how the flooring will be laid out in your new home. For fair pricing and top notch workmanship contact BJ’s Flooring at 318.371.6823.
    • Electric/ethernet/security – Nobody does my electric work except BW Electric. Give them a call at 318.949.8711.
    • Air conditioning / Heating – Don’t cheap out here. Get a unit with a high seer rating and enjoy reduced electric bills. Look at the pictures above. The house completed in 2002 was 1,400 square feet with an average electric bill of $250/month. The house completed in 2005 is 4,000 square feet with an average electric bill of $160/month. Contacted Fertitta’s Air & Heat and let John come out and work his magic. Their phone number is 318.687.5966.
    • Masonry, labor, sand, mortar, lentils – Get with Jim Thomas at 318.377.3856 or Toby Whaley at 318.218.4803. Both of these guys have an excellent reputation in this area.
    • Plumbing, plumbing fixtures, tubs, faucets, toilets – Tommy Adkins’ phone number is 318.470.3490. He can provide you with a quote on your plumbing. I approve of their work, and I think you will too.
    • Trim Materials and Labor – This includes crown moulding, mantels, and anything else that might be fancy. Let Drew Paschall set you up. His phone number is 214.616.4841.
    • Insulation – Who else but Charles at AAA Insulators. His phone number is 318.949.3719.
    • Fireplace – Try Mike Cox at Bradley Brick. His phone number is 318.752.9933.
    • Garage doors – Whether your looking for the regular ones or the fancy insulated ones give Benny Cash a call at Overhead Door. His phone number is 318.865.7666.
    • Lighting fixtures and ceiling fans – No recommendations. Just find a place known for on-time delivery.
    • Dishwasher/stove/vent/microwave – No recommendations. Just find a place known for on-time delivery.
    • Refrigerator – No recommendations. Just find a place known for on-time delivery.
    • Exterior doors, interior doors – Contact Drew Paschall at 214.616.4841.
    • Stairway materials and labor – Contact Drew Paschall at 214.616.4841.
    • Windows – Contact Drew Paschall at 214.616.4841.
    • Roofing materials and labor – No recommendations.
    • Lawn Preparation for Grass – James San Angelo and his tractor can work wonders. Cell: 318.393.4923 Home: 318.746.9985.
    • Grass, mulch and labor – Now is the best time to add a layer of compost to compliment your lawn installation. Eco Mulch & Sod can make all this happen for you. Their phone number is 318.865.5200.
    • Landscaping -Richard Matthews at Avant Garde-ner has a love for landscaping and it certainly shows. Let him help you design your landscape, and you’ll feel he’s as interested in your project as you are. His phone number is 318.797.7183.
    • Mirrors and shower doors – Glass Doctor can make anything your heart desires. Give them a call at 318.221.3503.
    • Gutters – Harmon & Sons installed the gutters on the house completed in 2005. No matter how much of a handyman you think you are, you’re not going to equal the quality of this work with stuff you bought from the store. Their phone number is 318.671.9668.
    • Appraisal Fee – Don’t forget the appraisal fee. Once you finish the house the bank will want an appraisal so plan on paying one more time before you move into your house.
  1. Get Approved for a Mortgage. Contact your mortgage company and get preapproved for the amount calculated in your costs in Step 4. If your credit is good enough, try adding a 10-15% contingency on top of your total value. You can have this amount for “cushion” in case you run into unforeseen circumstances. Also it might come in handy if you see something you might want to upgrade along the way. Remember though, it’s much better to complete your project under budget rather than over budget.
  2. Get an Interim Loan. Commonly referred to as a “Construction Loan”, an Interim Loan allows you to build your home and only pay interest on the money you have borrowed to date. For example, if you are approved for $100,000 to build your home on a 7% interim loan and you spend no money during the first month of construction then your loan payment would be $0 for that month. However, if you spent $20,000 during your first month of construction then you’d pay $117. To arrive at this number all you need to do is multiply $20,000 by 0.07 (your APR, or interest rate). The result should be $1,400. Then divide $1,400 by 12 (because their are 12 months in the year). Bring your house plans from Step 1 of this article, your costs from Step 4, and your mortgage approval from Step 5. If you have done Step 4 completely then the bank is going to be impressed and give you consideration for thinking everything through so carefully. Keep in mind that while it is your right in the state of Louisiana to build your own home once per year, it is also the bank’s right not to loan you the money because you don’t have a licensed contractor building your home. It’s their money and their rules. Many of the banks have discontinued loans to owner construction because so many have found theirselves in cost overrun. You’ll need to find a bank that will finance to owner construction. One bank that I know of that still does this is Minden Building & Loan in Minden, LA. Give Greg Lee a call at 318.377.0523.
  3. Get Your Permits. For building my last home out of the city limits I had to get a culvert permit and a parish building permit. Go to your Assessor’s office in Bossier or Caddo Parish and tell them the address of your new construction. They should be able to set you up with all the permits you need. Nothing like good ‘ol taxation from the government.
  4. Get Builder’s Risk Insurance. Call Bobbie Smarr for Builder’s Risk Insurance at ICT Insurance Agencies 318.797.7400. Protect your investment.
  5. Prepare your Land. Call Roy McDowell at 318.949.4915. You’ll need to discuss with him where your house will be located on the property and where your driveway(s) will be. Roy has an excellent knack for determining house elevations. He’ll make sure your house is high and dry. He’s knowledgeable of soil compaction properties and will use only the highest quality material. His bull dozer with the integrated laser levelling system will make sure your home is sitting on a perfect foundation.
  6. Portable Toilet. Time to get the potty for all the workers!
  7. Temporary Electricity. Call Bo Wilkinson at BW Electric and tell him it’s time to install the electric pole. 318.949.8711.
  8. Foundation Preparation. Contact Drew Paschall with TBG, Inc. His phone number is 214.616.4841. They’ll set the foundation and dig all the beams for your home.
  9. Plumbing Rough-In. Call Tommy Adkins at 318.470.3490 so they can bring the Ditch Witch out and install water and sewer lines.
  10. Order cabinets. Don’t find yourself waiting later. Get those cabinets ordered now so you’ll have them when you need them.
  11. Pour Slab & Install Post Tension. Drew Paschall comes back again to install the post tension cabling and pour the concrete for your slab. Just after the slab dries they should do a “partial pull” of the cabling. This helps prevent premature cracking of the concrete.
  12. Framing. A day or two after the concrete dries Drew’s crew is back out again to build the frame for the house. This process will take several weeks. Once they are finished your house will have tar paper on the roof, windows and doors on the exterior, and any applicable siding. You can now brag to your friends using the lingo, “my house is in the dry” or “I got my home blacked in”.
  13. Put the Roof on. Bring out the roofers and put the shingles on so the house won’t leak. Remember the cheap shingles don’t last as long as the expensive ones!
  14. More Rough-in. It’s now time to rough-in your air conditioning, electricity, insulation and plumbing. Now is your chance to make any special requests for location of sockets, installation of surround sound, or anything else your heart desires.
  15. Install the Fireplace. Now is the best time to install the fireplace an all associated duct work.
  16. Install Cabinets. The painters are going to need to stain the cabinets while they’re painting the house so get them installed just before the guys show up with their paint brushes.
  17. Paint the house. This part takes the longest and quite frankly it is the most boring in my opinion. However, rest assured that lots of work is happening. At this stage you’ll get your sheetrock hung, your walls texturized, and your whole house painted! This stage could take well over a month if not two or three months.
  18. Masonry. Brick? How about some stucco? Bring that brick man out and let him put the brick on.
  19. Trim Work. All moulding, doorways, stairs, and other fancy stuff should be installed at this point.
  20. Install Fixtures. Bring the guys back again for final trim out of air conditioning vents and controls, electrical fixtures and switches, sinks, faucets, etc.
  21. Appliances. Time for the dishwasher, stove, range vent, and microwave.
  22. Insulation trim-out. Bring on the pump truck. The insulators will come out one last time. They’ll run hoses throughout the house and up to the attic to blow a nice coat of insulation to keep your house cool in the summer and warm in the winter.
  23. Contact your loan officers. You’re now about 1 month away from moving into your new home. Contact your loan officers and decide upon a target move-in date for your new home. Put your interim loan officer in touch with your mortgage officer and let them coordinate how they will handle the roll-over of your interim loan into a mortgage. Now is the time to lock in your mortgage interest rate.
  24. Flooring. Just when you thought you were almost through it’s now time to install the flooring. Expect another period of slow, intensive labor. This process takes a few weeks, but the end result is fabulous! After the flooring is done it’s okay to move in your refrigerator, washing machine and dryer.
  25. Install garage doors. This process only takes about a day. If you’re getting standard doors then the delivery time is fairly rapid. If you plan to have insulated doors you should order them about one month prior to the expected installation date.
  26. Mirrors and shower doors. All mirrors and shower doors are ready for installation around this date. Just make sure this is done AFTER the electrical trim-out or you could run into problems.
  27. Driveways and sidewalks. Bring Drew out for one last time. The installation of the driveways and sidewalks will only take a couple of days.
  28. You’re not finished, but Move In! At this point you have completed your house to the point where you can order an appraisal, close on your mortgage, and move in!
  29. Install grass, landscaping, and gutters. Now that you’re all moved in you’ll be ready to just enjoy your new house. Make one final push and get your lawn, landscaping, and gutters installed.

Thank you for reading Building your own home in Shreveport Louisiana. I hope you have found this article both informative and interesting. It takes a great deal of planning and effort to build a home, but the rewards are money savings and satisfaction through piece of mind. I welcome any of your comments or suggestions.