Many fear arise about buying a home.  Some of these may include questions like:

• Can I afford to buy a home right now?
• Should I wait until the market gets better?
• What if I don’t have a lot of money for a downpayment?
• What if I can’t afford to buy my dream home?
• Why does buying a home seem so complicated?

Let’s take a look at these questions:

“Can I afford to buy a home right now?”

The first step in buying a home is to get connected with a mortgage lender to get pre-approved for a loan.  Doing so, before you even start to look for a house, will get you looking in the right price range for your budget.

Too many times I have worked with buyers who have assumed they could afford a certain price range and then ended up being disappointed when they finally get their pre-approval because they have fallen in love with a house they have seen, and it’s not in their budget.

“Should I wait until the market is better?”

Another concern is whether or not the market is right to buy in.

Buying when the market is at its peak is not the best decision, if you can afford to wait.  Many people have purchased when the market has been at a high, and are then disappointed later when the market drops, and the home loses appraisal value.

Of course the best time to buy is when the market is at a low, because the value will increase when the market picks up again, creating a great return on your investment.

This also helps when you don’t have the 20% or more to put down on the loan, and have to pay mortgage insurance.  The faster the home appreciates in value, the faster you can drop the mortgage insurance because the value in your home makes up the difference.

A Full-time Real Estate professional can help you determine if the market is at a high or low.

“What if I don’t have money for a downpayment?”

Many people are under the impression that they have to have a large amount of money for a down-payment to get a loan.  While it’s great to be able to put down 20% or more, son you won’t have to pay mortgage insurance, it’s not always required.  There are a lot of great financing programs out there that allow the buyer to put as low as 3% down.

The amount required for a downpayment will all depend on the program your lender can put you into, which will be determined by factors such as income level, debt-to-income ratio, etc.

This is another reason to get pre-approved for a loan, so you know how much money you will need to bring to the closing table, and whether or not you are going to have the right amount of money to buy a home.

“What if I can’t afford my dream home?”

Very few people are able to buy the home of their dreams when they purchase their first home.

According to the National Association of Realtors (NAR), 69% of all first-time home buyers in the United States have to compromise on some of the feature of their first home.

What you need to focus on is finding a home that will satisfy your core needs (location, price, schools, etc), and will be a good investment to build equity over time.

This approach will actually take you down the road faster to being able to afford your dream home, because (in a normal market) the house will usually gain value faster than the time it would take most people to save the same amount of money.

You need to think of your first home as a stepping-stone to get you where you want to go.  Choosing a good home in your price range, that will have a good chance of appreciating in the near future, will give you the leverage you will need to eventually get that dream home you always wanted.  An experienced Real Estate professional can help you find a home in an area that is bound to appreciate in value.

“Why does buying a home seem so complicated?”

Buying a home IS a complicated situation, because there are many factors to consider.  That’s why it’s important to have a full-time Real Estate professional consulting you to help you make the right decisions, and handle the process for you.

Having a team of professionals to guide you through every step of the process (your Realtor®, your loan officer, your home inspector, your title company, etc) will make what is normally a complex system into a simple and pleasant experience for you and your family.

Thinking of buying a short sale property?

Then you’d better understand what a short sale is, and what it will take to close that deal.

My buyer was looking for a good buy — not merely a good deal — but a good buy. Based on his criteria, I told him about several listings that may be suitable. The best one in terms of location, condition, amenities and price was a short sale.

Before writing an offer, I had to set expectations by first educating my buyer on short sale basics from a buyer’s point of view.

What’s a short sale?

Generally, it’s a sale wherein the seller is selling the property for less than what is owed. And as such, the seller’s lender will have to approve the sale, price, terms and conditions.

Who accepts the offer

The seller still decides whose offer to accept. Most lenders will only want to look at the best and highest offer. In multiple offer situations, highest offer doesn’t always win — which may be true with regular sales and foreclosures, too. The onus is on the seller to choose/accept the offer which has the best chance of getting approved by the short sale lender.

What are the terms and conditions that a short sale lender is likely to approve/disapprove?

Every short sale lender is different. But there are certain elements that are quite common.

Price. An offer that is too low or below the investor guidelines is likely to be rejected or countered. Just because it’s distressed or a short sale doesn’t mean the buyer can get it with a significantly low-ball offer.  You can deal, but not steal.

Find out how much is owed and to whom, check the comps in the area. Then go from there.

Close of escrow: For example, when the short sale lender grants approval, the lender typically sets an aggressive closing date, usually within 30 days. This makes it challenging for an offer with FHA loan and its 45 days or longer escrow period.

HOA: The lender may also refuse to pay for HOA documents, fines and delinquent fees. If the seller is delinquent, buyer (and seller) may be requested for a contribution to satisfy these demands.

Credits: The lender may also refuse to give credits for closing costs, repairs, replacement and/or warranty.

What does the buyer need to know?

Who is the lender? Some lenders are a lot harder to work with and may take longer than others to approve a short sale, while other lenders (like Wachovia) have a good track record of closing short sales.

How many liens are there, and are they by the same lien holders? Having one lien holder is tough enough. Having two is tougher. But when there are different lien holders, it can become extremely difficult to negotiate the short sale.

Liens against the property can be by anyone besides the banks: utility companies, the IRS, mechanic’s liens. Each one of these has a claim against the property and has to be satisfied. If the seller is totally insolvent, the bank may need to offer payouts to these lienholders who may refuse or negotiate for more.

DOES THE AGENT HAVE SHORT SALE EXPERIENCE?

It makes a world of difference to work with a listing agent who has a track record of successful short sales. That agent knows what to do, and can avoid pitfalls and delays in the process.

By the same token, the buyer’s agent must also have short sale experience to guide the buyer how to write an offer with a good chance of getting the short sale accepted and approved.

What notices has the seller received?

Notice of Default?

Notice of Trustee Sale? If the seller is just days away from being foreclosed, there may not be enough time to do a short sale.

Inspections and reports. If there are none, by all means, get them during your buyer investigation contingency period. With so little room to negotiate, the buyer must have all pertinent information to determine if he is getting a good value with the purchase.

Condition of the property. If there are safety hazard issues, the buyer may be able to justify asking for credits or repairs for a loan to be approved. For example, lenders and their appraisers may look for a functional kitchen which generally means having a working stove. There must also be a functional heating system.

How long will it take to get a short sale approved?

There is no one answer to this question. It’s not unusual to wait 3-6 months, or even longer. It all depends on the lender, the situation, the market, the completeness of the short sale package, the willingness of all parties to negotiate and/or contribute. This where one must have patience, persistence and perseverance.

Can a buyer continue to look and write offers on other properties?

A buyer can…but this could also mean that the buyer was not acting in good faith when he wrote the offer on the property.

Good faith is defined as: Effort made, information given, or transaction done, honestly and without a deliberate intention to defraud the other party. However, good-faith does not necessarily mean “without negligence:. Also called bona fides, it is implied by law into commercial contracts.

Can a buyer walk away?

After offer acceptance: Like any sale, there are contingency periods after acceptance (or approval by the short sale lender) during which time the buyer is expected to do his due diligence in terms of buyer investigation, loan appraisal and loan approval.

Before offer acceptance: In several states, a buyer can stipulate how long his offer is good for.

For example, in California and per our short sale addendum, the buyer can specify that his offer is good for 45 days or longer from the time the seller accepts his offer until the time the short sale lender approves the short sale. If no approval is forthcoming, the buyer’s offer expires.

There are NO guarantees.

BOTTOM LINE

If a buyer doesn’t have the patience, perseverance, motivation and/or the time to wait…

Then the buyer should NOT buy a short sale.

By: Pacita Dimacali – ePRO, SRES, CDPE, Alain Pinel in Northern California

This past Monday, Dean Graziosi released what I believe may be the greatest training video I have ever seen.  I’m not alone on that thinking. By Wednesday afternoon, over 5,500 glowing, raving comments on the video had come in.

And just when I thought nothing could top it, he did with the release this morning of Video #2… Can you say NEXT LEVEL!?!

Here, Dean explains what SIGNS are showing that the real estate market has hit bottom, and he also describes techniques you can use to start, part-time or full-time, to invest in real estate TODAY:  http://picayunehomefinder.com/invest

This video speaks for itself.. I’m humbled, impressed and driven to do everything in my power to get you to watch this.  Dean has just set the bar. What he is sharing, changes the game and it’s something you can’t miss.

Seasoned pro, newbie on the fence, OR never thought even once about making money from real estate before, it doesn’t matter, you need this video.  You will kick yourself in the backside if you miss it.

Go check out this video series.  He’s even giving away an investment property, valued at $60,000, and to be qualified, all you have to do opt-in with your first name and email address, and watch his series of videos:

http://picayunehomefinder.com/invest

Extremely large home has 6 bedrooms upstairs and a full guest house at ground level, with it’s own kitchen, bedroom, and family room. Huge master bedroom with cathedral ceiling, whirlpool tub and two walkin closets. Granite counters in upstairs kitchen. Very open floorplan. Above ground swimming pool partially submerged. Large decks around the house with a great view of pond next door.  For more information, or to see this home, be sure to contact Michelle Fradella at Pinnacle Real Estate Services – 601-569-0075.

Most rentals in Picayune, Carriere and other areas of Pearl River County, are at least $800/month or more (depending on condition, age, and location).  To purchase your own home would be a savings!  There are currently over 108 homes for sale in the $50,000-$120,000 price range in Pearl River and Hancock County.

Interest rates are still low, but they are starting to creep up.  Now is the time to find that home you need, at an affordable price, before the market heats up again!  Call Michelle Fradella at 601-569-0075 to find out what homes are available!

The homebuying process can be overwhelming, but if you go into it prepared, your first purchase can be a good experience. Here are some things to consider before making the plunge.

• Getting a mortgage-Fear of being rejected for a home loan is one of the main concerns for first-time homebuyers. To lessen the stress, you may want to get pre-approved for a loan before looking at prospective homes. This will not only help you feel more confident, it will also give you an advantage when there are multiple offers for a specific home. The fact that your loan has already been approved is of great value to the seller: because it shortens the purchase process and there is less of a chance that the buyer will back out of the sale.

• Mortgage Payments-The costs involved in the purchase of a home can be overwhelming to first-time buyers. However, with the help of a real estate professional, you can calculate out how much they you be able to pay each month in mortgage payments, and from there, what prospective homes offer a feasible payment plan.

• Down-Payment-The down-payment amount varies depending on the value of the home you choose and your mortgage lender. And in some cases, first-time home buyers can purchase a home with no money down. Although it varies from state to state, most offer government-funded programs for first-time buyers that help people buy a home with no down-payment. Your real estate professional will be able to explain the different options available to you.

• Closing Costs- First-time buyers often forget to consider the closing costs when making an offer on a home. Paying closing fees of up to 10 percent of the home sale amount is not unusual. Add that to the down-payment and you’ll have quite a sum to raise before the final papers can be signed. However, a smart first-time buyer takes this into account before making an offer, and with some professional help, the costs can be estimated in advance.

• Making offers- Don’t feel pressured into making an offer on the first home you see. This is a common mistake of many first-time homebuyers. Make sure you view different homes to get a feel for the marketplace. When you do decide on a home to make a bid on, work with your real estate professional to get all of your questions answered first before making an offer. But don’t wait too long to make an offer. The longer you wait, the greater the chance other prospective buyers may place offers, making it harder for you to negotiate a good deal.

• Condition of the Home- Buying a “problem” home is another fear of first-timers. A home that needs major repairs can become a costly venture. And, unless the asking price is adjusted to reflect the hidden repairs needed, chances are the home is not worth as much as the seller is asking for it. To avoid unfortunate surprises, your real estate professional may advise you to hire a home inspector before making a serious offer. That way, you know what you are getting into.

Above all, remember that there are no silly questions. Make sure you understand and are comfortable with every aspect of the transaction. Your real estate professional can be an invaluable asset in helping you make educated decisions so that your first-home purchase is a rewarding experience.

Michelle Fradella has extensive experience in working with First-Time Homebuyers.  Call Michelle, with Pinnacle Real Estate Services, to start the home buying process.  601-569-0075

For a list of many of the neighborhoods in Pearl River County including Picayune, Carriere, McNeill, and Poplarville, be sure to visit PRC Homes for a list of Neighborhoods.

According to the Kiplinger Retiree Tax Guide to Mississippi, “It not only exempts Social Security benefits from state income taxes, but it also excludes all qualified retirement income — including distributions from IRAs, 401(k)s, 403bs, and qualified public, private and military pensions — from state income taxes. Remaining income is taxed at a maximum 5%. Mississippi is home to some of the cheapest property taxes in the nation. Residential property is taxed at 10% of its assessed value. Motor vehicles are taxed at 30% of their value. Homeowners 65 and older qualify for a homestead exemption on the first $75,000 of value. The state has a 7% sales tax, but prescription drugs, residential utilities and health-care services are exempt. County and city taxes may add an additional 3% to the state sales-tax rate. There is no inheritance tax.”

Combine that with the fact that Picayune is in the center of tourism opportunities, being central of a 50 mile radius of New Orleans, Hattiesburg, and the Mississippi Gulf Coast, and you have a great place to retire to, while being able to enjoy a warmer climate, and lots of entertainment opportunities.

For more information about retiring in Mississippi, please contact Carol Fitzwilliam at the Pearl River County Tourism Council.