Can you buy homes below market?
While a typical buyer may look at five to 10 homes before making an offer, an investor who makes bargain buys usually goes through many more. Most experts agree it takes a lot of determination to find a real "bargain." There are a number of ways to buy a bargain property:
*Buy a fixer-upper in a transitional neighborhood, improve it and keep it or resell at a higher price.
* Buy a foreclosure property (after doing your research carefully).
* Buy a house due to be torn down and move it to a new lot.
* Buy a partial interest in a piece of real estate, such as part of a tenants- in-common partnership.
* Buy a leftover house in a new-home development.

What is the difference between list and sales prices?
The list price is how much a house is advertised for and is usually only an estimate of what a seller would like to get for the property. The sales price is the amount a property actually sells for. It may be the same as the listing price, or higher or lower, depending on how accurately the property was originally priced and on market conditions. If you are a seller, you may need to adjust the listing price if there have been no offers within the first few months of the property's listing period.

Are low-ball offers advisable?
A low-ball offer is a term used to describe an offer on a house that is substantially less than the asking price. While any offer can be presented, a low-ball offer can sour a prospective sale and discourage the seller from negotiating at all. Unless the house is very overpriced, the offer will probably be rejected. You should always do your homework about comparable prices in the neighborhood before making an y offer. It also pays to know something about the seller's motivation. A lower price with a speedy escrow, for example, may motivate a seller who must move, has another house under contract or must sell quickly for other reasons.

What is the difference between list price, sales price and appraised value?
The list price is a seller's advertised price, a figure that usually is only a rough estimate of what the seller wants to get. Sellers can price high, low or close to what they hope to get. To judge whether the list price is a fair one, be sure to consult comparable sales prices in the area. The sales price is the amount of money you as a buyer would pay for a property. The appraisal value is a certified appraiser's estimate of the worth of a property, and is based on comparable sales, the condition of the property and numerous other factors.

Is a low offer a good idea?
While your low offer in a normal market might be rejected immediately, in a buyer's market a motivated seller will either accept or make a counteroffer. Full-price offers or above are more likely to be accepted by the seller. But there are other considerations involved:
* Is the offer contingent upon anything, such as the sale of the buyer's current house? If so, a low offer, even at full price, may not be as attractive as an offer without that condition.
* Is the offer made on the house as is, or does the buyer want the seller to make some repairs or lower the price instead?
* Is the offer all cash, meaning the buyer has waived the financing contingency? If so, then an offer at less than the asking price may be more attractive to the seller than a full-price offer with a financing contingency.

What contingencies should be put in an offer?
Most offers include two standard contingencies: a financing contingency, which makes the sale dependent on the buyers' ability to obtain a loan commitment from a lender, and an inspection contingency, which allows buyers to have professionals inspect the property to their satisfaction. A buyer could forfeit his or her deposit under certain circumstances, such as backing out of the deal for a reason not stipulated in the contract. The purchase contract must include the sellers responsibilities, such things as passing clear title, maintaining the property in its present condition until closing and making any agreed-upon repairs to the property.

Who gets the furnishings when a home is sold?
It depends. Fixtures, any kind of personal property that is permanently attached to a house (such as drapery rods, built-in bookcases, tacked-down carpeting or a furnace) automatically stay with the house unless specified otherwise in the sales contract. But anything that is not nailed down is negotiable. This most often involves appliances that are not built in (washer, dryer, refrigerator, for example), although some sellers will be interested in negotiating for other items, such as a piano.

Whose obligation is it to disclose pertinent information about a property?
In most states, it is the seller, but obligations to disclose information about a property vary. Under the strictest laws, you and your agent, if you have one, are required to disclose all facts materially affecting the value or desirability of the property which are known or accessible only to you. This might include: homeowners association dues; whether or not work done on the house meets local building codes and permits requirements; the presence of any neighborhood nuisances or noises which a prospective buyer might not notice, such as a dog that barks every night or poor TV reception; any death within three years on the property; and any restrictions on the use of the property, such as zoning ordinances or association rules. It is wise to check your state's disclosure rules prior to a home purchase.

How do you determine the value of a troubled property?
Buyers considering a foreclosure property should obtain as much information as possible from the lender, including the range of bids expected. It also is important to examine the property. If you are unable to get into a foreclosure property, check with surrounding neighbors about the property's condition. It also is possible to do your own cost comparison through researching comparable properties recorded at local county recorder's and assessor's offices, or through Internet sites specializing in property records.

What are some tips on negotiation?
The more you know about a seller's motivation, the stronger a negotiating position you are in. For example, seller who must move quickly due to a job transfer may be amenable to a lower price with a speedy escrow. Other so-called "motivated sellers" include people going through a divorce or who have already purchased another home.
Remember, that the listing price is what the seller would like to receive but is not necessarily what they will settle for. Before making an offer, check the recent sales prices of comparable homes in the neighborhood to see how the seller's asking price stacks up. Some experts discourage making deliberate low-ball offers. While such an offer can be presented, it can also sour the sale and discourage the seller from negotiating at all.

Do I need an attorney when I buy a house?
In some states, you do need an attorney to complete a real estate transaction, but in others you do not. Most home buyers are capable of handling routine real estate purchase contracts as long as they make certain they read the fine print and understand all the terms of the contract. In particular, you should be clear on the terms of any contingency clauses that will allow them to back out of the contract. If you have any questions at all, it may be advisable to consult an attorney to avoid future legal hassles. In looking for an attorney, ask friends for recommendations or ask your real estate agent to recommend several. Call to inquire about fees and to check on their experience. In general, more experienced attorneys will cost more, but real estate fees as a rule are small relative to the cost of the property you are buying.

What are the standard contingencies?
Most purchase offers include two standard contingencies: a financing contingency, which makes the sale dependent on the buyers' ability to obtain a loan commitment from a lender, and an inspection contingency, which allows buyers to have professionals inspect the property to their satisfaction. As a buyer, you could forfeit your deposit under certain circumstances, such as backing out of the deal for a reason not stipulated in the contract. The purchase contract must include the sellers responsibilities

The National Association of Realtors reported Monday that existing home sales slipped by 0.5 percent to a seasonally adjusted annual rate of 6.30 million units.

The slowdown in sales was weighing on home prices, with the median price of an existing home sold in August dropping to $225,000, 1.7 percent below August 2005. It marked the first year-over-year price decline in more than 11 years.

The weakness in existing home sales followed a report last week that construction of new homes and apartments plunged by 6 percent in August, pushing building activity to the lowest level since early 2003.

The housing sector, which had enjoyed five boom years of record sales, has been slowing sharply this year under the impact of rising mortgage rates and a slowing economy.

David Lereah, the Realtors' chief economist, said the drop in prices had been expected, indicating that sellers are finally starting to lower their asking prices in the face of weaker sales and soaring inventories.

The inventory of unsold homes rose 1.5 percent to an all-time high of 3.92 million units. At the August sales pace, it would take 7.5 months to sell the backlog of unsold homes, representing the longest period since April 1993.

Deferring taxes on your investment properties is a smart way to go with a 1031 Tax Deferred Exchange.

Here are 5 Rules You need to Follow in order to have a qualified exchange:

Must have these 5 Rules to Follow in order to have a tax deferred exchange:

1.  Intent-Must intend to sell it as an exchange-specific verbiage in the contract for both the sale of relinquished property and purchase of replacement property.
2.  Form-The need to follow IRS regulations for an exchange & to document the exchange   process
3. Control of Funds-Use qualified intermediary. Disqualified persons include:  Family members of seller, agent of seller (attorney, real estate broker, anyone who acts on the seller’s behalf)
4. Like-kind property-Property used for business or investment is considered like-kind.  Property outside the US cannot be used for tax deferred exchange with property in the US.
5. Time Limits--Identification Period—45 days to identify property--a written list of up to 3 properties to be given to your attorney to give your QI (qualified intermediary).  IF you wish to identify more than 3 replacement properties there are  couple of ways to do this and I can go into more detail if this happens to be case.  The Exchange Period—180 to acquire replacement property . Both periods start when the original property is settled (closed)

180 DAY RULE: You must ACQUIRE your replacement properties within the EARLIER of 180 days from closing of the first sale, or, the DUE DATE FOR THE TAX RETURN (including extensions) for the year of the sale.

For more information on your personal situation, contact Liz Schuyler at Teammaxx: 757-235-0274 ! :)

Residents are drawn to Virginia Beach for a variety of reasons including an outstanding water-oriented high quality of life and an ideal location with 38 miles of shoreline on the Atlantic Ocean and the Chesapeake Bay, 28 miles of public beaches, 79 miles of scenic waterways and 60 miles of biking trails. Virginia Beach is known as one of the largest resort cities in the country with excellent beaches and water sports, tennis, golf, boating and sailing, fresh and salt water fishing, hunting and camping facilities, as well as numerous other recreational activities.

• Climate: Virginia Beach's temperate maritime climate is influenced by the nearby Gulf Stream. Mild winters rarely below freezing and summers with great beach weather extend from spring through fall.

 

• Safe City: For the tenth consecutive year, Virginia Beach has had the lowest crime rate in the nation for a city of its size.

 

• Cultural Amenities: Virginia Beach offers many cultural amenities including the symphony, opera, performing arts and museums. More than 200 arts and cultural organizations are located in the city. The Virginia Aquarium in Virginia Beach recently completed a $35 million expansion and is one of the top most attended aquariums in the nation. Preserved 17th, 18th and 19th century homes, churches and shrines can also be toured. Virginia Beach's commitment to the arts is evidenced by the 95,000 square foot Central Library, a 32,000 square foot $7.5 million Contemporary Art Center of Virginia, the 20,000-seat GTE Virginia Beach Amphitheater, and a newly renovated oceanfront resort strip.

• Recreation: There are three major state and regional parks and three large national wild life refuges in the city making Virginia Beach a hot ecotourism destination. In addition, the city has 11 public golf courses, 18 marinas with public access, three fishing piers, and the new Virginia Beach Sportsplex.

• Medical: The Virginia Beach area enjoys an outstanding reputation as a leader in innovative health and medical care. Hampton Roads has a well-coordinated regional health care system with state-of-the-art equipment and facilities and specialists in every field.

• Education: The Virginia Beach Public School System enjoys an excellent reputation throughout the Commonwealth of Virginia and across the country. The MSA also has top notch higher education programs with 11 colleges and universities and two community colleges, including the new Virginia Beach Higher Education Center and the upcoming Advanced Technology Center, as well as the College of William and Mary, Old Dominion University, Norfolk State University, Virginia Wesleyan College, Eastern Virginia Medical School, and Tidewater Community College.

Are fixers a good idea in bad areas?
It depends. Distressed properties or fixer-uppers can be found anywhere, even in wealthier neighborhoods. Such properties are poorly maintained and have a lower market value than other houses in the neighborhood.  Many experts recommend that before you make such an investment, first find the least desirable house in the best neighborhood. Then do the math to see if what it would cost to bring up the value of that property to its full potential market value is within your budget. If you are a novice buyer, it may be wiser to look for properties that only need cosmetic fixes rather than run-down houses that need

Are there programs for fixer-uppers?
If you need home loan to buy a "fixer-upper" and remodel it, look at the U.S. Department of Housing and Urban Development's Section 203(K) loan program. The program is designed to facilitate major structural rehabilitation of houses with one to four units that are more than one year old. Condominiums are not eligible.

A 203(K) loan is usually done as a combination loan to purchase a "fixer-upper" property "as is" and rehabilitate it, or to refinance a temporary loan to buy the property and do the rehabilitation. It can also be done as a rehabilitation-only loan. Investors no longer may participate - only owner- occupants. Owner-occupants are required to come up with only 3 to 5 percent. HUD requires that a minimum of $5,000 be spent on improvements. Two appraisals are required. Plans and specifications for the proposed work must be submitted for architectural review and cost estimation. Mortgage proceeds are advanced periodically during the rehabilitation period to

Are there any special tax breaks for historic rehab?
Qualified rehabilitated buildings and certified historic structures currently enjoy a 20 percent investment tax credit for qualified rehabilitation expenses. A historic structure is one listed in the National Register of Historic Places or so designated by an appropriate state or local historic district also certified by the government. The tax code does not allow deductions for the demolition or significant alternation of a historic structure.

Where are fixer-uppers found?
You can find distressed properties or fixer-uppers in most communities, even wealthier neighborhoods. A distressed property is one that has been poorly maintained and has a lower market value than other houses in the immediate area. Ascertaining whether the property you're interested in is a wise investment takes some work. You need to figure what the average house in a given area sells for, as well as what the most desirable houses in that area are like and what they cost.

Some experts suggest that buyers who take this route try to find a "cosmetic fixer" that can be completely refurbished with paint, wallpaper, new floor and window coverings, landscaping and new appliances. You should avoid run-down houses that need major structural repairs. A house price that looks too good to be true probably is. A smart buyer will find out why before buying it. The basic strategy for a fixer is to find the least desirable house in the most desirable neighborhood, and then decide if the expenses needed to bring the value of that property up to its full potential market value

Are there government programs for rehab?
The U.S. Department of Housing and Urban Development's Section 203 (K) rehabilitation loan program is designed to facilitate major structural rehabilitation of houses with one to four units that are more than one year old. Condominiums are not eligible. The 203(K) loan is usually done as a combination loan to purchase a fixer-upper property "as is" and rehabilitate it, or to refinance a temporary loan to buy the property and do the rehabilitation. It can also be done as a rehabilitation-only loan.
Plans and specifications for the proposed work must be submitted for architectural review and cost estimation. Mortgage proceeds are advanced periodically during the rehabilitation period to finance the construction costs.

If you are a veteran, loans from the U.S. Department of Veterans Affairs also can be used to buy a home, build a home, improve a home or to refinance an existing loan. VA loans frequently offer lower interest rates than ordinarily available with other kinds of loans. To qualify for a loan, the first step is to apply for a Certificate of Eligibility.
Another program is the Fedeal Housing Administration's Title 1 FHA loan program.

What are some guidelines to follow when trying to find a contractor?
While hiring contractors recommended by friends is usually a safe route, never hire a construction professional without first checking him or her out. If your state has a licensing board for contractors, call to find out if there are any outstanding complaints against that license holder. Also, call your local Better Business Bureau to see if there are any complaints on file.  If you are satisfied with the answers you find there, interview the contractor candidates. Ask what kind of worker's compensation insurance they carry and get policy and insurance company phone numbers so you can verify the information. If they are not covered, you could be liable for any work-related injury incurred during the project. Also be sure that the contractor has an umbrella general liability policy. If they pass the insurance hurdle, next check some of their references. A good contractor will be happy to provide as many as you want. Finally, don't let yourself be rushed into making a decision no matter how competitive the market may seem. Also, never pay a deposit to a contractor at the first

What kind of return is there on remodeling jobs?
Remodeling magazine produces an annual "Cost vs. Value Report'' that answers just that question. The most important point to remember is that remodeling a home not only improves its livability for you but its curb appeal with a potential buyer down the road. Most recently, the highest remodeling paybacks have come from updating kitchens and baths, home-office additions and extra amenities in older homes. While home offices are a relatively new remodeling trend, for example, you could expect to recoup 58 percent of the cost of adding a home office, according to the survey.

What are some resources for info on home improvements?
If you're getting ready to embark on a home improvement project involving contracting help, "Ready, Set, Build: A Consumer's Guide to Home Improvement Planning Contracts" lays out a road map for selecting the right contractor, obtaining competitive bids up to what to include in a contract. There also is information on consumer rights, liens and financing.  The book is available for $9.95 through Consumer Press and Women's Publications, Inc., Dept. SR01, 13326 Southwest 28th St., Fort Lauderdale, FL 33330-1102; (954) 370-9153.

Once you have made the decision to buy a home versus renting or living at home, it is time to explore the steps involved in the home buying process.

1. Choose mortgage lender
Whether you find a lender online or thru a referral from realtor, friend, or family, you must consider the following criteria when choosing a lender:
· Banker versus Broker-a banker will process, underwrite, and close the loan in their name and a broker is a middleman who will shop among several banks for the best programs and rates to secure your financing but usually does not underwrite or fund the loan in their name. They process the file and ship the loan package to an outside bank to underwrite and close the loan. The banker can expedite the loan process since you are directly dealing with the lender and there is no middleman, the broker. The last option is to to deal with a banker/broker who can offer their in-house programs and they have the ability to broker the loan to another bank, so you can get the best program and rate to meet your financial needs.
· Good Faith Estimate of Closing Costs, Fees, and Points-a good faith estimate will show all the costs associated with the loan and how much much money you will need at the closing. I feel that you should get at least 3 good faith estimates to compare and discuss with each loan officer every line of the estimate to understand what the fees are and what they mean. Watch out for additional or “junk fees” which make no sense. It is very important to ask the loan officer if there any points, origination, or brokers fees associated with the loan program. For example, if one lender is offering you a $100,000 30 year fixed rate loan at 5.875% with 0 points and another lender is offering you $100,000 30 year fixed rate loan at 5.625% with 1 point, it will cost you additional $1,000 to secure the loan with 5.625% rate. The program with more costs may be a better program for you if you intend to stay in the home for a long time and you want to pay less interest over life of loan, but you need to know how long it will take you to recoup the $1,000 cost (3, 4, 5 years..etc.) to see if it is worth paying the extra money up front. Just know that the lender quoting you a lower rate with points may not be a better deal than the lender quoting you a higher rate with 0 points. If you decide you want a 0 point quote, make sure each lender gives you a good faith estimate with 0 points so you can compare apples to apples.
· Service-You should work with an experienced loan officer who provides excellent service. They should explain to you what are the best loan programs available to meet your financial needs, how the process works, and how long it will take to approve and close your loan. Also, they should answer all your questions and respond to your inquiries in a timely manner. Finally, they should have a good processor who is responsible for requesting credit reports, appraisals, employment and bank account verifications, and preparing the file for underwriting.
2. Get Pre-approved not Pre-qualified- A pre-qualification is simply a letter stating that you are pre-qualified to purchase a property based on verbal information given to a loan officer. A pre-approval is a letter stating that underwriting has approved your loan based on receiving actual documentation such as paystubs and bank statements. Do not start looking for a home unless a lender has pre-approved you! Most sellers will not accept an offer or real estate agents will not show you any properties without a written pre-approval in your hand. Contact your lender for a 10 minute phone application and they can most likely submit your loan to automated underwriting and receive an official pre-approval in minutes! If your loan is not approved or if the loan program requires submission to an underwriter, then you need to contact your loan officer 30 days prior to you beginning a home search, so he can put together and structure a good loan file to submit to a real live person to manual underwrite and hopefully approve the file. It is very important to use an experienced loan officer for loan files with issues to give yourself the best chance of getting your loan approved. Pre-approvals are usually good for 120 days on existing construction and 180 days on new construction and they are renewable with updated credit report and documentation. See chapter on qualifying for a firsthomebuyers loan which discusses issues which need to be addressed when applying for a home loan. Finally, you may get pre-approved for a certain loan amount but you may not be able to afford the payment. It is important to discuss with your loan officer what type of payment you want so he can customize a loan program to fit your needs. Get Pre-approved now!
Click here to find realtor who specializes in first time home buyers.

3. Shop for a home-First of all, you should find a good real estate agent when buying your first home because they will help you expedite the home search process and they will cost you nothing. They will fax or email you the most updated property listings based on your home search criteria, schedule appointments to view listings which you are are interested in, and most importantly, write a purchase contract and negotiate the offer with the seller or listing agent. Make sure to interview at least 2-3 agents and choose one which best suits your needs and personality and makes you feel comfortable. Write down a wish list of what you want in a home, prioritize them, and give them to your real estate agent. Remember, your first purchase can be a starter home and you can always build up some equity for a couple of years and move up to the home of your dreams with more of the features you desire. You shouldn’t pass up on buying a home now if it doesn’t meet all your criteria because next year that same home may cost you several thousand more and interest rates could be higher making the mortgage payment a lot less affordable.

Here are some ideas for a first home wish list:
Neighborhood-want to live in the city, suburbs, or rural area? Make sure you walk around the prospective neighborhood and listen and observe what it may be like to live there. Are people neighborly? Are there good schools, restaurants, shopping centers, and movie theatres in the area? Is there public transportation, highway access, and city sewer and water? How about hospitals and fire station? What is the proximity to work and family?
Property type-single family, condo/townhome, or 2-4 unit building? Single family homes in residential neighborhoods are easiest types of properties to finance for many first time home buyer programs. Many condos/townhomes have less privacy, more rules to abide by, and they have monthly association dues to upkeep your property which adds to the monthly mortgage payment. Multi-units have rental income which can cover a significant part of the mortgage payment, but you must be willing to be a landlord and there are more repairs and maintenance which requires a good handyman. Have you seen the movie Pacific Heights ?
New or existing construction? New construction requires a lot of patience and there could be some headaches due to delays in construction.
Number of bedrooms-expecting a child or plan on working at home in the near future?
Number of bathrooms-married or do you intend to live in home with someone else? Believe me, the extra bathroom or double basin sink is worth it.
Amenities-garage/parking-fireplace-hot tub-home office/den-formal dining room-living room-basement-storage-doorman-back yard-satellite dish-dsl service?
Repairs-does home require major repairs or renovations?

4. Prepare an Offer-Step back from your emotions. You're making a contract to purchase a home, which will legally bind you if the seller accepts. You also will submit an earnest money deposit with your offer, which is only refundable under certain conditions. Things to consider prior to making an offer are:

What are current market conditons? If there are more sellers than buyers, be prepared to pay more money due to supply and demand. If interest rates are low, you may be willing to pay a few thousand more for a home since the slight increase in price will be more than offset by a lower mortgage payment if you buy now versus later when rates may be higher.
Prices of comparable homes sold in area? Get home prices here. Also, you can rely on your realtor to find out what is the fair market value of the property you are thinking about purchasing. You need to check out at least 3 comps which are homes that have recently been sold and are similar in size, rooms, and amenities.

Seller’s Motivations- In cases, such as divorce, relocation, home being on the market for a long time, or for sale by owner, the seller may settle for a lower price in exchange for a quicker sale. Also, if the seller is selling home by owner, he may pay for some or all of the closing costs or be willing to help with the down payment.

Now, you are ready to make offer. Make sure you include a pre-approval letter and you will need to write a check for earnest money or good faith deposit which will be credited back at closing toward down payment and closing costs. Even, if you are doing a zero down loan, the seller will request a minimum deposit of $1,000 or up to 5% of the sales price to take your offer seriously. Attach contingencies or conditions, such as seller paid closing costs or repair allowance, to the offer and submit. The seller may accept, reject, or counter your offer. If the seller accepts, it is a done deal. If the seller rejects it, don't take it personally, look elsewhere, and you will find the perfect home. If the seller counters, you can accept or "counter the counter." I strongly advise that you hire an attorney on your first home purchase because there are many legal forms and details that need to be addressed concerning your specific real estate transaction. Once an offer has been accepted , there is a period of time usually five days during which a home inspection is done and the attorney reviews the contract and makes any modifications to the contract such as the seller to pay for specific repairs. One piece of advice, you can ask the seller to fix anything you want, but if they refuse to fix a minor item, don’t sweat it and let it detour you from buying a good home. Once, I had a client who was willing to walk away from a real estate deal because of a cracked washing machine hose which cost less than a buck, but purchased the home anyway when she realized that this was such a minor item and she probably just had a bad case of cold feet.

5. Secure a mortgage-after your offer is accepted, you need to secure a mortgage. Here are the steps:
1. Complete loan paperwork and supply required documentation to complete the loan file. Contact your loan officer to update the loan application with property address, real estate taxes, and any other information required to print out the paperwork. Also, you will need to discuss which program will best suit your needs, go over the final good faith estimate of costs and funds needed to close, and whether you should lock in the current interest rate on your loan or wait. If rates are low and the payment meets your budget, then you may want to lock in your rate before rates go up. If you don’t lock in a rate, you are gambling and you may lose out to a lot higher payment than you expected. In 2003, I have seen rates jump 1% in less than 30 days which would increase your payment $100 per month for a $150,000 loan. If you wait and try to get an 1/8th lower on the rate, which is $12 per month on a $150,000 loan, you may sweat and lose sleep wondering if rates will go up or down. Next, the loan officer will meet with you or overnight night you a loan package which contains the application and disclosures for you to sign as well as a document list which states what documents you will need to complete the file. Here is a list of typical documents you will need:
Fully executed purchase contract with all signatures, addendums, and riders
Last 30 days paystubs
Last 2 years W2 forms
Last 2 years tax returns (if self-employed)
Current bank and asset statements (all pages)
Legible copy of driver’s license
Complete divorce decree (if applicable)
Complete bankruptcy papers and letter of explanation (if applicable)
Evidence for receipt of child support or alimony (must continue for at least 3 years)
Names and phone numbers of attorneys and realtors involved in transaction
If you are purchasing condo or townhome, you will need name and phone number of association or management company for the complex
If you are purchasing single family or multi-unit, you will need to find a home insurance agent and provide a paid 1 year receipt and declaration page for the policy prior to closing. Check to see if flood, hurricane, earthquake insurance is applicable.
Check or credit card for appraisal fee.

2. Order appraisal and title-The lender will need to order an appraisal to determine the value of the home and hopefully, substantiate the price you paid for the home. If the appraisal comes in low, which is not often, then you can negotiate with the seller to drop the price or you need to pay the difference between the appraised value and sales price. If the appraisal comes in high, the lender will still use the purchase price to base the loan on because they use the lesser of the appraised value or purchase price to calculate the loan amount. Also, if there are repairs noted on the appraisal, such as a leaking roof, they will most likely have to be completed prior to closing and the appraiser will come back out to make sure the work is completed. Finally, an underwriter can review the appraisal and reject one or more of the comparable sales utilized for comparison and the appraiser will have to provide new ones or write an addendum addressing the issue. I encourage people to get the appraisal done as soon as possible so they will have plenty of time to address any issues. Finally, it very important to supply all the documents the loan officer requests from you as soon as possible because it will delay processing and approval from underwriting. There is a commitment date on the purchase contract which states you must get a written approval from the lender by this date or you are in breach of contract and you may lose your earnest money deposit and home. Please cooperate and provide all the documentation to your loan officer in a timely manner to avoid any headaches.

Usually, the seller or seller’s attorney will order title insurance. A title search traces the chain of ownership to make sure there are no liens, judgements, or defects in title which may prevent the buyer from receiving good title. Title insurance protects you and the lender against any errors or omissions made by the person conducting the search. Sometimes, an attorney will wait until the last second to order title which can delay your closing so you should follow up on this closely.

3. Processing and submitting your loan to underwriting for approval-the loan officer has a processor who prepares the loan file to submit to underwriting. She does employment and bank verifications, orders credit reports and updates, and gathers any other information and documents necessary to complete the loan file. Sometimes, a borrower may be asked to write a letter to explain some issue such as a gap in employment history or credit card lates on the credit report. The more experienced processor will make sure the file is complete with appraisal before submitting it to underwriting to obtain an approval with the fewest conditions possible. One of the biggest mistakes that first time home buyers make is they turn in a file with most of the paperwork and they delay getting the loan officer the rest of the paperwork which holds up the approval. Once the loan is approved, a mortgage approval or commitment letter can be issued. If you do not get an approval by the commitment date stated on purchase contract, you must file for an extension or possibly lose your earnest money and home. Usually, there are few to many conditions which must be cleared before preparing a package for closing. You must cooperate with the loan officer and processor to clear these conditions to expedite the closing process. The process can take 14-30 days on average to close a loan, sometimes less if all documentation is in the file and the lender orders a rush on the appraisal. If you did not get pre-approved up front and your loan is denied, the lender should find an alternate program that may work for you or you need to get on your high horse and shop around for another lender to obtain financing for your home. Usually, if you can’t obtain a mortgage loan approval, you will get your earnest money back but you will have paid for an appraisal and home inspection. Just get pre-approved before embarking on your home search to avoid paying out hundreds of dollars in unnecessary fees.
6. Closing the Deal!-Here are some last minute details to consider prior to closing.

Check out moving checklist.
Make sure your home insurance policy is squared away at least 1 week prior to closing and forward the declaration page and proof 1 year premium has been paid to the lender’s processor.
Schedule a final walk-thru of the property a couple of days prior to closing to make sure that the property is in same condition as the day you bought it or to make certain any upgrades or repairs spelled out in the contract have been completed to satisfaction.

The purchase contract will state the date of closing, and in most cases, it will take place at a title company or attorney’s office who will coordinate all the paperwork and disburse the loan funds. The seller will usually choose the closing location. If possible, please schedule the closing date a few days prior to moving in to avoid being overwhelmed. The lender’s closing package with the paperwork is emailed or shipped overnight to the closing location 2-3 days prior to closing to determine final figures. It is important to clear all conditions on your loan at least 3-4 days prior to closing so that the lender’s closing department can prepare the closing documents. You will get your final figure of what you need to bring to closing 1-2 days prior to closing. You will have to go to the bank and get a cashier’s or certified check made out to the title company or yourself and you can endorse the check over to the closer. Please check with your attorney on how to handle funds for closing.

On the day of closing, you will need your driver’s license or ID and any other documentation the lender has requested from you to bring to the closing. Check with the lender’s processor to make sure that you have everything you need. Most likely, the seller and his attorney and you and your attorney as well as the title company or closing agent will be present at the closing table. Usually, the loan officer does not attend closings but keep his phone number handy in case any issues arise. Next, you will sign all the paperwork and exchange legal documents. You will need to go over the closing statement or HUD 1 with your attorney and make sure you are receiving any credits for earnest money deposits, seller paid closing costs and allowances, lender credits, etc. After signing the paperwork, a check from the closer will be given to the seller which includes the loan funds that have been wired or sent via check and the keys will be put in your hands. Done!

The appraised value of a house is a certified appraiser's opinion of the worth of a home at a given point in time. Lenders require appraisals as part of the loan application process; fees range from $200 to $300.  Market value is what price the house will bring at a given point in time. A comparative market analysis is an informal estimate of market value, based on sales of comparable properties, performed by a real estate agent or broker. Either an appraisal or a comparative market analysis is the most accurate way to determine what your home is worth.

Buyers considering a foreclosure property should obtain as much information as possible from the lender, including the range of bids expected. It also is important to examine the property. If you are unable to get into a foreclosure property, check with surrounding neighbors about the property's condition. It also is possible to do your own cost comparison through researching comparable properties recorded at local county recorder's and assessor's offices, or through Internet sites specializing in property records.

A comparative market analysis and an appraisal are the standard methods for determining a home's value. Your real estate agent will be happy to provide a comparative market analysis, an informal estimate of value based on comparable sales in the neighborhood. Be sure you get listing prices of current homes on the market as well as those that have sold. You also can research this yourself by checking on recent sales in public records. Be sure that you are researching properties that are similar in size, construction and location. This information is not only available at your local recorder's or assessor's office but also through private companies and on the Internet. An appraisal, which generally costs $200 to $300 to perform, is a certified appraiser's opinion of the value of a home at any given time. Appraisers review numerous factors including recent comparable sales, location, square footage and construction quality.