The first hour includes all the information…how do I get preapproved? No downpayment? No mortgage insurance? Where do I want to live? How much should I offer? What about those inspections? What happens at closing? What if I’m renting!

Let’s do it! If you are ready, the second hour we sign up for searches to view properties, get preapproved, get to know the Realtor Judy and the Loan Officer Lora who will be your guides on the journey!

Be sure to preregister with Judy Shortridge, 414-852-7707 or judyrae@sbcglobal.net or fax 44-962-1794 BY FEBRUARY 10 IF YOU ARE BRINGING THE KIDS and February 13 for adults.

Come and enjoy desserts and beverages. Milwaukee Yacht Club, 1700 N. Lincoln Memorial Dr, Milwaukee, WI 53211 (across from Alterra on the Lake)

PS: There is another Workshop March 29, 2012!

Presented by:
Judy Shortridge, Owner/Broker Living Dimensions Real Estate
Lora Willms, Network Funding LP #NMLS #222026

Sunday January 29, 2012 from Noon to 3pm

Listings include:

Address /Agent /MLS
2604 E. Hartford / Judy Shortridge  / 1205580 & 1217939
2909 N. Hackett / Jim Christenson / 1219328
3253 N. Shepard / John Newland / 1219015
3123 N Shepard / Bradley Brumder / 1233068
2815 E. Hartford / Rachel Bloch / 1229299
2929 E. Hartford / Sarah Pavlak / 1161223
3054 N. Hackett / Tim Vertz / 1178885
2700 E. Menlo / Suzanne Powers / 1226167
2600 E. Edgewood / Ann Moran / 1221982
3493 N. Shepard / Suzanne Powers / 1234484
3133 N. Hackett / Krystal Kimmel / 1227354

Please join us for a wonderful home tour!  Agents, buyers and anyone who’s interested in seeing these great homes are welcome!

Here’s a link to the map:

http://g.co/maps/qqswr

WE LOOK FORWARD TO SEEING YOU ON SUNDAY!

When I was selling my house back in 2009 I was, of course, trying to save as much money as possible. I knew the market was down and I had to try to squeeze every penny out of the investment I had made.  So even though my broker recommended it, I chose not to do a pre-listing home inspection.  I figured the buyer would do it and there wasn’t anything wrong with my house that I knew of so I should be fine, right?  Right…..

Well, when the buyer did do the inspection the inspector noted that the palmer valve was stuck.  Without getting into hairy details of drain tile systems and the like, I not only had to pay to get the valve un-stuck but the buyer then requested that a drain tile flush be done as well to make sure the system was working properly.  After all was said and done I was down $800- and that’s minor compared to some of the transactions I’ve seen.  Whereas an inspection and the correction of the palmer valve issue would have set me back a total of maybe $500 I had to pay $300 more out of my own stubbornness. And I’ve seen transactions fall thru because of inspection issues that could easily and inexpensively be addressed.  In turn these homes stay on the market for months longer and in cases get a much lower selling price because of it.

Not all homes need a pre-home inspection.  But if you bought your home more than 5 years ago and/or you feel that there may be some issues, I would suggest you get one done.  Talk with your listing agent or any agents you may be interviewing to work with to get their opinions as well.  They will be aware of what issues are holding up sales in the current market and have recommendations of reputable inspectors they have worked with in the past.

Here are some sites to visit for more information on pre-home inspections and why they may be advantageous for you.

http://www.examiner.com/real-estate-in-san-francisco/should-you-get-a-pre-inspection-before-putting-your-house-on-the-market

http://www.ourfamilyplace.com/homeseller/prelistinspect.html

Single Family:
How about 5 bedrooms, large living room and family room with fireplaces and huge
master walk-in closet on one of the largest & most private lots in Shorewood? Add a
3 car garage + 3 outside spaces and mechanicals in tip top shape and you are ready to
move in! Two full baths and two half baths including whirlpool! Includes a huge office/
den and two sun rooms. Oak hardwood floors, ceramic tile kitchen, wonderful attention
to detail throughout! This huge townhouse conversion will be completed by owner. So
much storage you will never use it all!

For the full listing visit our website:
http://www.livingdimensions.net/Milwaukee,_Shorewood,_Downtown_Milwaukee,_Ozaukee,_Whitefish_Bay_listings/A77E83E8-A40F-8AFC-DC18E573817C92C0.shtml

Townhouse-Style Two-Family:
How would you like to live in Shorewood for only $1349/month? With 10% down at
4.5% interest and a renter on the other side, you can make that a reality in this wonderful
side-by-side townhome! It’s a beautiful, spacious side-by-side two-family home with
private entrances! There are 3 bedrooms and 1.5 baths on each side. Huge corner
lot artfully landscaped for privacy, these townhouses have cobblestone SEPARATE
entrances, lots of big windows, oak floors, dens, fireplaces, balconies, newer roof, half
baths on 1st floor, full on 2nd; ceramic kitchens, whirlpool on one side, security systems,
glass block, sump system, 3 car garage + 3 spaces outside. Townhouse style has privacy;
yards are large. Let renter pay your mortgage!

For the full listing visit our website:
http://www.livingdimensions.net/Milwaukee,_Shorewood,_Downtown_Milwaukee,_Ozaukee,_Whitefish_Bay_listings/D9328F39-F373-FF83-EA8C48B248AC1893.shtml

When I was looking to buy my first home back in 2004 I had heard of buyer agency and I was definitely not interested!  I mean, heck, this house business was going to cost me enough I didn’t need someone else taking a cut! Right? But then something happened- a friend actually explained buyer agency to me.  They told me it was free!…

They explained that I could get listings according to my search parameters from realtor.com (aka MLS) sent to my email. Then all I had to do was call the buyer agent who would take me to see any properties I wanted.  When I was ready to move on a property, they would come with all the paperwork and expertise to draft an offer.  If I had to work counter offers with the sellers the buyer agent would walk through it and explain my options.  When the offer was accepted they stayed on top of deadlines and made sure to walk me through all the steps I needed to take to get an inspection, testing, financing, and anything else that came up along the way.  And then at closing I would pay them nothing.  Wait, for real?  Nothing?  Yep, since most MLS listings include a buyer agent commission split the seller actually pays for the buyer agent.  And since the split usually comes out of the listing agent commission having a buyer agent rarely even affects the bottom line!

After hearing all that I did get a buyer agent who really did help me get a great deal on a home that I loved!  And at no cost to me!  Now that’s a great deal!

There is a lot of information available on buyer agency, but here are some sites that I recommend to take a look at:

http://rebac.net/descriptions_of_agency.cfm

http://top7business.com/?id=2761

There are lots of factors that are involved in the buyer agency agreement.  I would always suggest you find an agent that you feel comfortable with and then ask them to walk you through a Buyer Agency Agreement.  They can explain to you how it works and how to maximize the agreement for you!

With the tax credit going on we’ve been busy and focused on blogging about buying a home.  But it’s also good to take some time to look on the selling end as well.  And what closing costs to expect when your home does sell.  It’s not a free transaction on either end but it can be minimized.  Many are variable based on the contract sales price of the home.  Here are some items to expect on the selling end. 

Title Insurance- Hiring a title company to do the transfer of ownership and insuring the title will be able to be transferred. Cost is a flat fee plus the cost of any letters or other documents required ($400-$600)

Gap Insurance- Hiring the title company to insure the title in the time between the initial review and when the paperwork gets filed for the sale. This is becoming more and more of a trend in home sales.  Cost is a flat fee ($100-$200)

Transfer Fees- Paid to the municipality to cover the cost of changing their files to reflect the change in ownership. Cost is $0.003 x contract sales price ($500+)

Home Warranty- Coverage for new owner on a variety of potential problems for the first 13 months they own the home.  This is a growing trend in home sales as well.  Cost is usually $400-$500.

Prorated Tax items- Unpaid taxes and other municipal fees prorated up to the day of closing.  The cost is calculated by looking at the costs for the previous period and breaking it down to a per-day cost.  That daily cost is multiplied by the number of days in the period up to closing day. The actual dollar amount varies on this item.  It all depends on when in the period closing occurs. For instance, when I sold my house we closed on August 27th so I had to pay my share of property taxes from January 1- August 26.  The taxes from the prior year were divided up by 365 and then that daily amount was multiplied by 238 since August 27th is the 239th day of the year.
 
Agent commissions- Payment to the brokerage company for being the procuring cause of the sale.  As an example let’s use 6% of the sales price but that can be less with our a la carte program! ($10,000+)

Of course any remainder of the mortgage you took out initially on the home needs to be paid off as.  That payoff will show up on your HUD statement as well.  There are other costs that are incurred in some instances depending on the sale.  Here’s a concise article on the most common costs involved:  http://www.wisegeek.com/what-are-seller-closing-costs.htm

Our a la carte program can help with one of the biggest hits in the chart above- the commission.  Our program usually comes in at a 2%- 5%commission charge.  It’s a great way if you to save money in commission by hand picking the services you want for the sale of your home!  Feel free to contact us if you want more information about our a la carte program!

Andrea Hartmann
Real Estate Sales Agent
414-839-9701
andrea.m.hartmann@gmail.com

Judy Shortridge
Broker/Owner
414-852-7707
judyrae@sbcglobal.net

Wait, what?  There’s a fourth part to this series?  But once you close that’s all, right?  No more digging in the pockets, right?  NOPE.  There are expenses you incur after you sign on the dotted line.  What happens when the furnace goes out after the first snowfall?  What about that leaky faucet you knew about from the building inspection and have been meaning to fix?  The one thing you can count on when you buy a home is that you will need to set aside money for home maintenance.  Even if you buy a new construction, eventually things will need to be fixed and replaced.  It’s always smart to start saving for those expenses as soon as possible.

Most experts suggest you save1%-3% of the value of the home for maintenance costs each year!  So if you have a nice little $200,000 home that’s $2,000-$6,000 per year to set aside for maintenance.  That’s a pretty decent chunk of change!  And that doesn’t include remodeling projects.  Although it does usually account for things like lawn care and appliances.  Lendingtree.com has some suggestions for ways to keep up maintenance in order to prolong the useful life of the big ticket items.

http://www.lendingtree.com/smartborrower/home-renovation/home-maintenance/annual-home-maintenance-tips/

And don’t think that your lender isn’t taking this into account when you get your loan.  They have to weigh that in to their calculations as well.  And it should always be in yours as well.  Here’s a little blurb about a home maintenance fund from thesimpledollar.com:

http://www.thesimpledollar.com/2007/07/15/building-a-home-maintenance-and-improvement-fund/

Here’s a link to a bi-annual checklist from Bob Vila to ensure your home is in good shape:

http://www.bobvila.com/HowTo_Library/Home_Maintenance_Checklist–A1730.html

Part 1

What?  Earnest Money

When?  Within 3 days of binding acceptance

How Much?  Approx 1% of purchase price

Part 2

What?  Building Inspection

When? Within 10-15 days (and probably sooner) of binding acceptance

How Much? $200-$400

Part 3

What? Closing Costs (excluding down payment)

When? At closing

How Much? Varies

Part 4

What? Home Maintenance

When? Every year

How Much? 1%- 3% of the home value

So now you’ve made it through to the big day- closing day!  The day you get the keys to that new place!  How exciting!!!  But…. Don’t just think that you show up with a down payment that day and we’re off to the races.  There are a couple more things involved.  Here is a good website to check out for a lot of the different fees and costs involved:

http://www.goodfaithestimate.biz/closing_costs.html

But it’s not all bad news.  You do get some credits.  Like the Earnest Money you put down in Part 1 comes back to you at closing.  Not that you get to see it again, but it does help cover costs.  And you are credited for things like taxes, water, and other government services that are prorated to the day of closing (unfortunately you will be paying the full amount later, that’s why you’re getting a credit now).  But it’s useful for bringing the closing costs down.

It’s hard to put a solid number on these costs because so much depends on the cost of the house, what the lender charges for certain things, and even what day of the month and year you close on.  Just make sure to get a GFE (Good-Faith Estimate) from your lender or broker and look it over for what your fees are.

Here’s the yahoo page on closing costs.  These numbers may be higher than yours depending on your financing:

http://loan.yahoo.com/m/securing9a.html

Part 1

What?  Earnest Money

When?  Within 3 days of binding acceptance

How Much?  Approx 1% of purchase price

Part 2

What?  Building Inspection

When? Within 10-15 days (and probably sooner) of binding acceptance

How Much? $200-$400

Part 3

What? Closing Costs (excluding down payment)

When? At closing

How Much? Varies

So now you’ve made an offer to purchase and it’s been accepted.  Congratulations!  Your earnest money check is in the mail.  Now what?  Hopefully your buyer agent has informed you about the inspection contingency and included it in your offer to purchase.  Usually you have 10-15 days from binding acceptance to do a building inspection, review the results and negotiate and changes of terms with the seller.  That’s A LOT to cover in just over a week so don’t delay!  Your agent can give you recommendations of building inspectors they’ve worked with in the past but I always advise clients to do their own research as well.  Your agent cannot schedule your home building inspection for you.  So it’s up to you to find a reliable inspector that you feel comfortable with.  And it’s up to you to pay them.  Be prepared to pay $200-$400 for your building inspection on the day of the inspection.  But please don’t think this is some fat that can be trimmed from your home buying costs.  The home inspection can alert you to current issues with the property and potential ones in years to come.  It gives negotiating leverage to you if an undisclosed material adverse fact is found.  You can ask the seller to correct the issue(s), ask for money back from the seller to correct it yourself, or even get out of the contract and get your earnest money back if you can’t come to an agreement with the seller.

We’ll get into more on what the building inspection covers in a later blog.  But for now, let’s take a look at our home buying expenses to date:

Part 1

What?  Earnest Money

When?  Within 3 days of binding acceptance

How Much?  Approx 1% of purchase price

Part 2

What?  Building Inspection

When? Within 10-15 days (and probably sooner) of binding acceptance

How Much? $200-$400

Most first time homebuyers are aware that most mortgage loans require some sort of down payment.  But many aren’t aware of all the other costs associated with purchasing and owning a home.  Here is a little series on the different costs to consider when you’re looking to buy a home:

The first cost buyers will encounter is earnest money.  This goes along with an offer to purchase, or most often, within 3 days of acceptance of an offer to purchase.  It’s a “good faith” deposit that means you are serious about completing the purchase.  There’s a good article explaining the process:

http://homebuying.about.com/od/buyingahome/qt/EarnestMoney.htm

In Wisconsin there are legal steps to determine how the money is split between buyer and seller if an agreement cannot be made between them.