Down Payment – 10 Things to Know Before Buying a Home

For many Americans, coming up with a down payment for their first home can be a major roadblock—and quite often the reason for renting, rather than owning a home.

A down payment is the difference between the home’s purchase price and its mortgage amount. This percentage of the sale price must be paid up-front and can vary by lender, location, and loan program. A higher down payment generally translates into lower loan interest rate requirements.

Typically, a down payment comes from personal cash savings, but it can also be a gift that is not to be repaid, or a borrowed amount secured by assets.

While conventional loan down payments may be close to 20% of the sale price, government loans typically have lower down payment requirements. This allows potential homebuyers who normally cannot meet down-payment requirements an opportunity to qualify for a mortgage. Keep in mind that down payments that are less than 20% of the sale price typically require mortgage insurance payments.

10 things to know before buying a home

  • Before you start looking for a home, get pre-qualified for a loan. This will help you determine how much home you can afford and will give you an advantage over buyers who do not have their financing setup in advance.

 

  • If you have marginal or bad credit, consult your lender. You may be able to qualify for a loan depending on how long ago and what reason(s) caused the bad credit.

 

  • You will need a down payment. Down-payment requirements vary depending on the type of loan.

 

  • You will need funds for closing costs. Closing costs are charges for services related to the closing of your real estate transaction. They include, but are not limited to: Escrow fees, title policy issuance fees, mortgage insurance fees, fire, flood, and homeowners insurance, county recorder fees, and loan origination fees. Consult your lender for an actual estimate of these costs.

 

  • Some loans have “points” and some do not. A point is a loan origination fee equivalent to 1% of the loan amount. Together with the interest rate, they constitute the yield on your loan for the lender.

 

  • Mortgage rates can be fixed or adjustable. Which one is right for you depends on whether mortgage rates are at a high or a low point when you purchase, and on how long you plan to live in the home.

 

  • There are two main types of loan categories. Conventional mortgage loans are available with fixed or adjustable interest rates. Government loans include FHA fixed and adjustable rate mortgage loans, and VA fixed rate mortgage loans.

 

  • If you are a low-to-moderate-income homebuyer, there are special programs designed to help you. These loans are available through private lenders, as well as local and state housing agencies.

 

  • You may have to pay mortgage insurance. Mortgage insurance protects the lender from potential loss if you should default on your mortgage loan payment. Mortgage insurance is always required on FHA mortgage loans.

 

  • Many organizations offer home loan counseling to prospective homebuyers. They will cover home selection, REALTOR® services, lenders, loan programs, homeownership responsibilities, saving for a down-payment, and other important pieces of information.

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Nicole Emanuel Real Estate

Coldwell Banker

(408) 410-2060

nicole.emanuel@cbnorcal.com

www.realestatebynicole.com

Pantone Has Chosen a Color of the Year…and You’re Going to Love It!

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Drum roll please….and the pantone color of the year for 2018 is officially Ultra Violet! Looks like they have chosen a fun and funky color for your new home decor or fashion trends. When looking at staging homes for sale, a pop of color such a ultra violet in a pillow or a chair can make a home feel more modern and provide a bit of fun.

Here’s an excerpt from the Pantone website (www.pantone.com) on why they chose this color this year.

“Complex and contemplative, Ultra Violet suggests the mysteries of the cosmos, the intrigue of what lies ahead, and the discoveries beyond where we are now. The vast and limitless night sky is symbolic of what is possible and continues to inspire the desire to pursue a world beyond our own.

Enigmatic purples have also long been symbolic of counterculture, unconventionality, and artistic brilliance. Musical icons Prince, David Bowie, and Jimi Hendrix brought shades of Ultra Violet to the forefront of western pop culture as personal expressions of individuality. Nuanced and full of emotion, the depth of PANTONE 18-3838 Ultra Violet symbolizes experimentation and non-conformity, spurring individuals to imagine their unique mark on the world, and push boundaries through creative outlets.

Historically, there has been a mystical or spiritual quality attached to Ultra Violet. The color is often associated with mindfulness practices, which offer a higher ground to those seeking refuge from today’s over-stimulated world. The use of purple-toned lighting in meditation spaces and other gathering places energizes the communities that gather there and inspire connection.”

Will you be using ultra violet in your home decor this year?

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Nicole Emanuel Real Estate

Coldwell Banker

(408) 410-2060

nicole.emanuel@cbnorcal.com

http://www.realestatebynicole.com

BRE 01899594

 

Home Inspections – Specialists You May Want to Check Out

While most folks settle for a home inspection, pest (termite) inspection and possibly a roof inspection, there are a myriad of specialists you can hire to investigate just about anything home-related when you are purchasing a home. The California Association of Realtors put together this short list of the most popular, but some common inspections we see  also include:

Pool & Spa – If the home has a pool and spa, its a must to get it inspected. This is often an overlooked item and failing pool pumps and heaters can be very expensive.

Arborist – Does the home have a huge tree in the front yard? Is one of the trees looking overgrown? Sometimes, it makes sense to call an arborist to make sure the trees on the property are healthy and not in danger of falling limbs or needing to be uprooted (all of which can be rather costly).

Contractors – Are you considering doing some renovating to a home after purchase? Its smart to have a contractor walk the home before you purchase to ensure you can do all the items you want. Sometimes structural modifications might not work or will be very expensive due to the placement of load-bearing walls and foundations so its something you might want to know up front if you are planning on adding on to a home or re-arranging.

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Nicole Emanuel Real Estate

Coldwell Banker

(408) 410-2060

nicole.emanuel@cbnorcal.com

http://www.realestatebynicole.com

Burglary Prevention Tips

BurglaryOne of the crimes most frequently reported to the police during the holidays is residential burglary
It’s also the most preventable. It doesn’t take much or cost much to out-smart most burglars. They’re usually not professionals, but rather people taking advantage of an easy target. Burglars may do more than steal things. If they’re surprised by someone coming home or if they choose a home that’s occupied, someone may get hurt.

Tips on Safeguarding Your Home

  • Make sure all exterior doors have good locks-at least dead-bolt locks with a 1″ throw.
  • Always lock up when you go out, even if only for a few minutes.
  • Secure sliding glass doors with bars or locks, or put a broom handle in the door track.
  • Make sure your windows have good locks, especially those at ground level.
  • Make sure all porches, entrances, and outside areas are well lit.
  • Trim any bushes or trees that hide doors or windows.
  • Maintain your yard and keep ladders and tools inside when you’re not using them.
  • Don’t hide your keys under the doormat or in a flowerpot. That’s the first place burglars look! It’s much better to give an extra key to a trusted neighbor.
  • Mark your valuable property like TVs, VCRs, computers, cameras and stereos with your driver’s license number.
  • Keep a record of your property in a safe place.
  • Install an alarm system for summoning emergency help.
  • If you park your car outside, never leave a garage door opener in the car.
  • Install a monitoring device such as a Ring Video Doorbell or Chime Doorbell. Easy to spot cameras are also a good choice.

When you go away

  • Ask a neighbor to collect your mail and newspapers, and offer to return the favor.
  • Put an automatic timer on at least two lights and a radio. Consider photoelectric sensors to turn outside lights on and off automatically.
  • Tell a trusted neighbor when you’re leaving and when you’ll return. Include an itinerary and phone numbers where you can be reached in an emergency.

Does Moving Up Make Sense?

Couple moving house

With prime home buying and selling season upon us, it’s a good time to ask yourself if a move up is right for you. Sometimes we talk with buyers that are considering a move but faced with the reality of a larger mortgage payment, find that its best for them to wait. Or some clients need to know what their home might sell for in order to decide if moving into a new home is right for them. There are many things to consider when deciding if selling your home and buying a new home is right for you. Whatever the case, we are here to help you decide whats best for you and your family.

Whether your family size is growing, you are running out of space or simply want to seize the opportunity to “move-up” to your next home, below are a few questions to consider as you weigh your options.

  1. Have you built substantial equity in your current home? Home equity can be defined as the value of a home, minus the amount of outstanding debt. Although equity does not generally develop in the first few years of home ownership, five or more years of home payments may create significant unrealized gains.
  2. Has your income or financial situation improved? Homeowners should consider their overall financial situation including current and future expenses in order to make an educated decision on price range for a new home. For example, an increase in salary may allow for an increased mortgage.
  3. Has your lifestyle changed? Lifestyle changes are one of the most common reasons people choose to move. Starting or adding to a family may require an extra bedroom or additional square footage, as well as a desire to live closer to work or family may provide the impetus for a move to a larger home.
  4. Is your current residence one that could potentially be rented out? For those homeowners who are ready to make a move but are concerned about purchasing a new home before the current property is sold, renting out the current residence may be a viable option. We also work with a variety of clients who decide they want to find a home to purchase before they sell their current home.
  5. Are interest rates attractive? A low interest rate means lower mortgage payments on homes of the same price. I’d be happy to refer you to a mortgage advisor should you need to check on interest rates.

No matter what you decide, you need an expert team to help you balance a concurrent purchase and sale transaction seamlessly. Nearly two-thirds of our client base is either moving up or downsizing and we have successfully assisted them with both sides of the transaction. If you want to discuss any of the questions above or have more to ask, don’t hesitate to give us a call or email! Nicole.emanuel@cbnorcal.com, (408) 410-2060.

How to Turn Your Home into a Party Pad for Football Season!

Football season has begun! Read on for tips into turning your home into the ultimate game day party pad!!! Whether you are a 49er’s fan or a Patriots fan, your guests will appreciate you being game-day ready! Check out this article to find out more!

Football Season Begins: How to Turn Your Home into a Party Pad.

Just Listed! Remodeled Craftsman Style Home Near Japantown in San Jose

Remodeled Craftsman-style Home Near Japantown!
674 E. Empire
Street, San Jose

 

Nicole Emanuel (Culbertson)

Direct: (408) 355-1512

Mobile: (408) 410-2060

CA DRE# 01899594

Nicole.Emanuel@cbnorcal.com

674 E. Empire Street, San Jose
2 bedroom + bonus room & 1 bath
Approximately 1,000 (permits unknown)
$495,000

Welcome Home! Recently remodeled craftsman-style home incorporates original charm with modern day finishes! Features bamboo flooring, french doors, gourmet kitchen with granite, remodeled bath, renovated back yard and 2-year old roof! Third room can be used as an office, baby’s room or a sitting room. Home is approximately 1,000 square feet – permits unknown (assessors office 884). Located across the street from a park and a short walk to Japantown and Watson Dog Park!

©2013 Coldwell Banker Real Estate LLC. All Rights Reserved. Coldwell Banker® is a registered trademark licensed to Coldwell Banker Real Estate LLC. An Equal Opportunity Company. Equal Housing Opportunity. Each Coldwell Banker Residential Brokerage Office Is Owned by a Subsidiary of NRT LLC. All rights reserved. This information was supplied by Seller and/or other sources. Broker believes this information to be correct but has not verified this information and assumes no legal responsibility for its accuracy. Buyers should investigate these issues to their own satisfaction. If your property is currently listed for sale, this is not intended as a solicitation. If your property is listed with a real estate broker, please disregard. It is not our intention to solicit the offerings of other real estate brokers. We are happy to work with them and cooperate fully. DRE License #01908304

Why You Should Consider Selling Your Home During the Holidays

Star Christmas Lights Hanging from an Eave

 If you are considering a move during this holiday season but you are unsure how the market will react, read on. You may be surprised to find that some of the most serious, ready-to-go buyers are waiting in the wings during the holiday season to take advantage of the market while others are out holiday shopping. At an open house a few weeks ago, I had over 125 people through both Saturday and Sunday, proof that plenty of buyers are waiting for your home to come on the market!

WHY SHOULD YOU CONSIDER SELLING YOUR HOME DURING THE HOLIDAY

  • Holiday buyers are particularly serious, committed and focused.
  • The corporate executive transferees have more free time to shop for a home now than at any other time of the year.
  • Over the holidays there are fewer homes available, therefore supply and demand work in your favor.
  • Homes are seasonally radiant during the decorative holiday period.
  • The holiday season is a time of heightened consumer spending.
  • Some buyers purchase homes as gifts.
  • Interest rates are still attractive.

TO PRESERVE PRIVACY OVER THE HOLIDAYS, AT YOUR REQUEST WE CAN TAKE AN EXCLUSIVE MARKETING APPROACH

  • All showings are by appointment and only available to qualified buyers.
  • Take a low key approach to advertising your home, reinforcing its exclusivity.
  • Don’t include property address in advertising.
  • Consider not placing your home on the MLS during the holiday period.
  • No lock box.
  • No open houses for either public or Realtors® (unless homeowners request otherwise)
  • No for sale sign.

If you are considering selling, give me a call today at (408) 410-2060 for a FREE home estimate. Also, remember, if you buy or sell a home through me, or refer me to someone who does, YOU get a FREE 16GB iPad4! What a deal!

Market Update: Bay Area Real Estate is Heating Up

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What a difference a few weeks make in the Bay Area housing market! Our office is laden with tales of multiple offer situations and frustrated buyers struggling to find homes to purchase. To me this means only one thing, Bay Area residential real estate is once again hot and values are on the rise – a great time for you to get in the market as a buyer before there is even more competition and a perfect time for anyone contemplating selling to take advantage of low single family inventory.  Take a look at this weeks Market Watch, where Rick Turley, President of Coldwell Banker’s Northern California division discusses the current state of the local market and the disparity between the San Francisco Bay Area markets and many other parts of the country. I’ve included excerpts from his blog below.

LOL: We’re having a wild house party- but too many sellers missing out on all the fun!

By: Rick Turley

 It seems like every day I see national headlines decrying the “struggling” housing market and questioning when things will finally turn around. And then I get to work and read the reports from our Bay Area offices showing sales jumping and multiple offers for many if not most homes in a number of areas, and I wonder if we’re on the same planet.

The disconnect between the Bay Area housing market and what’s being reported on a national basis is getting stranger every day. In other parts of the country, agents and government officials are trying to figure out creative ways to rid their markets of a huge backlog of housing while buyers show little interest in jumping in to help. Then there’s the Bay Area, where the housing market is just the opposite.

Take, for example, a few of the reports this week from our managers and agents on the frontlines:

  • From our Southern Marin manager: “Multiple offers continue to be the name of the game, but the difference from the past markets is we are now seeing multiple offers in all price ranges, not just REOs and Short Sales.”
  •  One $1 million-plus Mill Valley home in Strawberry garnered 11 offers last week, and another priced at $1.35 million had six offers.  Both are rumored to be in contract for almost $300,000 over list price.
  • “Buyers are getting frustrated over not getting the property in multiple offer situations, even when going substantially over the list price.”
  • From our Los Altos manager: “We are selling more than we are listing in most price ranges.  We had a healthy increase in the high end this past week with a $12 million and $7 million sale, several sales above $3 million and a dozen over $2 million.”
  • “Inventories are at historic lows and the market continues to heat up!”
  • From our Walnut Creek manager: “We’re seeing multiple offers on most every listing that comes on the market.   A condo in Walnut Creek received seven all cash offers!”

The same stories are being echoed in all parts of the Bay, from San Francisco and the Peninsula to San Jose to the East Bay, and not just the more expensive markets. Buyers are pounding the pavement, cash in hand and looking for good properties to buy – now, if not sooner. “It’s nuts out there,” said our Cupertino manager. “A third of our sales resulting in multiple offers.”

Given the surging demand for housing you’d think sellers would be rushing to their local brokerage office to list their home, right? Guess again. The inventory of homes for sale is the lowest it has been in years, maybe even a decade, according to long-time industry observers. The result is that buyers are fighting it out for the few homes on the market listed by savvy sellers.

So what’s keeping the other sellers away when homes are going for great prices once again? Two things, both of which could come back to bite sellers who try to time the market:

  1. A misunderstanding of the state of the housing market.

Perhaps they are reading the national headlines and still believe the market is in the doldrums, prices are still going down, and they don’t want to sell at bargain-basement prices. If so, they’re missing an incredible opportunity. We’re having a honest-to-goodness house party with lots of anxious buyers. But somehow, sellers never got their Evite.

  1. They’re waiting for the Facebook IPO.

The thinking goes that once Facebook goes public, hundreds of employees will receive lucrative stock options which – eventually – they will be able to cash after the lockup period and then rush out to bid up prices for local homes.  Wow, talking about betting on the come.

I’m not questioning the “Facebook effect” on the Silicon Valley housing market. Far from it, I think it certainly will have some impact on pricing at some point in some communities in the heart of the valley. But this strikes me as something like trying to time the stock market. I don’t know about you, but I’ve never been able to get that right. And I don’t think many others have as well.

The fact is that the real estate market has always come down to two simple factors: the law of supply and demand, and consumer confidence. Right now, both of those are telling me it’s a sellers’ market in the Bay Area. Consumers are feeling pretty darn confident as the economy picks up steam and the stock market presses higher. And the scales of supply and demand are tipping heavily in favor of sellers.

Smart, strategic sellers get that, and they’re making their moves now – not six months or a year from now. They’re the ones receiving multiple offers over their asking price because there just isn’t a lot of competition for buyers’ attention. They’re out there now, well before everyone else joins the party, tipping the scales back in favor of buyers once again.

Below is a market-by-market report from our local offices:

Silicon Valley – “It’s nuts out there,” our Cupertino manager said. Both sales activity and inventory are increasing and a third of sales are resulting in multiple offers. Our Los Altos manager reports that the single-family home segment of the market continues to surge and he’s seeing multiple offers in double digits and overbids of 10-15% on well-priced homes in good school districts in Los Altos, Mountain View and Cupertino areas.  Some activity is driven from the “Facebook buzz” and some from the stock market uptick. Financing is still a problem for many and some buyers make cash offers to out compete the others and then try to get a loan during the escrow period.  Interesting times ahead as we have lost inventory in Santa Clara County each week this year beginning the second week of January. We are seeing an uptick in multiple offers at all levels of the market in the Los Gatos area. In San Jose, our Almaden office manager says overpriced listings are not selling.  However, you cannot underprice a home.  It will and does get bid up – typically much higher than if you came out asking that price.  Sellers who feel the market is healthier are confusing that it is time to raise prices.  That’s not working.  Overall inventory is lowest we’ve seen in a decade. Similarly, our San Jose Main manager says inventory continues to decline. Open houses are extremely active. Low interest rates and increased consumer confidence is driving the market. Multiple offers are common in all price ranges. Sales activity is also up in Willow Glen.

SF Peninsula — Our Burlingame manager says agents are “crazy busy” and honing their multiple offer skills as it seems that every home in every price point has multiple buyers making offers. We are back to the non-contingent 1-3% per offer over asking type of market, last seen in 2004-2006. One Burlingame listing had 7 offers. The winning offer was $200k over asking. One other listing had 9 offers, and $179k over asking only got a backup position.  The challenge now is taking the buyers who are rightfully afraid of overpaying for a property through the process enough times and suffering enough disappointment that they begin to understand what it will take to be successful in an offer. In Half Moon Bay, our local office is seeing a lot of buyers from the over the hill coming to the coast with serious interest due to the low inventory and multiple offers situations on the Peninsula. Our Menlo Park manager says she’s seeing some “pretty vicious competition” for prime housing there.  If buyers do not have 50% down, it is VERY difficult to buy a house.  The local market still needs a lot more inventory. Buyers want to buy now. Our Palo Alto manager says they’re still suffering from extremely low inventory – probably a seven year low.  There are approximately 20 listings for 425 agents in Palo Alto.  Quite a few off-market sales are occurring – adding to an inflamed market. There was some good action in the Woodside office, including a couple of big sales – $8 million and $13 million. In San Carlos almost all sales are multiple offers due to extremely low inventory.