Many of you send me emails with really great questions and I thought I’d share my answers with all of you… I’ve heard the MARKET is changing and TAKING LOANS is harder…although I think owning is better than renting. Any suggestions? Great question, and such a hot topic!
1-Buy a property that you can see yourself living in at least 10-15 years, if the market changes,
this gives you plenty of time to hang on until it’s corrected.
2-Don’t get an ARM (adjustable rate mortgage)- despite the low costs and monthly rates
are attractive, refinancing costs are high, and additional monthly costs when you restart can
force him to sell, a bad idea if the market changes.
3-Buy the best condition you can afford and have it inspected, as home equity lines of credit are
harder to come by, if the property is in excellent condition, there probably won’t be a major repair
or replacement in the next few years. Would you rather borrow the money and pay a small
monthly amount or get hit where the out of pocket cost is thousands or tens of thousands?
We all know when it rains, pouring down, how would you feel if there were several big repairs, like
boilers or roofs at the same time? OH!
4-Research area: make sure there are no future changes that could affect the value of your
zoning of properties, schools, etc., etc. You can maintain or improve the area. sometimes a mall
it can attract a bad element, or a really good one! Neighborhood Blogs and Google Community Boards
to see what’s the latest talk in town!
I have an ARM, should I refinance? My friend Ezra Tawil at Apple Mortgage in New York can answer this… YES, many of us have heard of the current mess of subprime mortgages and the credit crunch. Suppose real estate appreciation and interest rates simply return to average levels since the Great Depression. If appreciation returns to 2-3% per year and rates on a 30-year fixed mortgage return to 9.5%, where will you put it? While no one can predict the future, shouldn’t we all take steps now to protect our assets in the event of such a reality? Don’t leave your home, one of your greatest assets, to chance! If you plan to be in the property for a long period of time, OR you don’t want to risk drastically increasing payments, or worse, have to sell in an unpredictable market, YES, the smart and safest move is to refinance to a 30-year fixed loan. . and protect yourself. To refi call him directly at [email protected]
Does it really matter when you put your property on the market?
OUI bien sur! Historically, the biggest market increases have been in the spring-summer months. Don’t you want to take advantage of that too? Many of my clients ask me what their property is worth…and we discuss condition, timing, and value-aware planning, and those who truly listen and treat their home as the magnanimous asset, WIN! You can too. If you start planning in the winter months by painting, cleaning, and being emotionally ready to move in, by the time spring rolls around, you’ll be READY! Without a doubt, the spring and summer months are the best to sell. That means you need to contact me in February and start your checklist as most properties need painting, handyman, clutter removal and a little TLC… this takes time especially if you have kids as well Please plan accordingly. Your wallet and your family will thank you!
I have 20k saved to buy a property… where do I start? Since NYC and Brooklyn typically have 10% contract deposits, condo closing costs are about 5% of the purchase price and studio prices are $400 and up…try the outside areas! Buying is the first step toward independence from your landlord and there are many options that reduce 5 percent, and New Jersey has no mortgage taxes, reducing closing costs by almost 2%. Call a mortgage broker to see how much banks will lend you, get PRE-APPROVED and start your search!
My market is depressed in my area and I am having trouble selling my house. What are other solutions? Big question! This may sound like a bad thing, BUT you actually have several options – my favorite is to rent the property! Have someone else pay the rest of the mortgage and keep it as an asset; You never know… it may pay for your children’s college! Don’t want to own? A smart solution, especially for new homeowners, is to hire a managing agent. His job is to hedge your risk and educate you on what to do and what not to do. Do you need cash? Before you put the property on the market, call a mortgage broker and refinance or open a home equity loan or home equity line of credit.
Well I hope you enjoyed these tips and any questions you may have are welcome. Email me to join my elist AND receive a copy of “How to Increase Your Home’s Value in a Weekend”.
