Commercial Real Estate Appraisal

Say you need to find someone qualified to conduct a commercial real estate appraisal? Try contacting your state's commercial board of realtors for a referral on this or other commercial real estate-related matters. Most states have a commercial board of realtors. Another good resource is your bank's commercial real estate lending department. While the bank staff most likely will not make a specific recommendation as to which appraiser to use, most are happy to provide a list of commercial real estate appraisers in your area. Finally, your commercial real estate broker should be tapped into the network of commercial real estate service providers and should be able to make a recommendation.

Finding a Realtor

When it comes time to sell or buy a home, finding a good real estate agent is almost as important as finding the right home. Many people see a listing they want to look at, call the number in the ad, and end up in a long-term relationship with whatever agent picked up the phone at the other end. Sometimes that works out just fine. Other times, it doesn't. To make sure you end up with a realtor who understands your particular needs and ranks high in customer satisfaction, ask your relatives, co-workers, and friends who they have used in the past. Chances are you'll not only get some good tips for which agents to call but for which agents to avoid as well. If you are buying a home, make sure you know if the agent you are working with is a buyer's broker--that is, working for you and not the seller--or is the seller's agent. If you are selling a property, make sure you are happy with the terms of service to be provided by the agent and the agency, including the commission rate.

Is a Home Inspection Necessary?

Buying a home is the single largest purchase most people make. And most of us are not contractors or engineers. It's good business to have a professional inspect the home you're considering purchasing before you make the deal. Often, the results of a home inspection will enable you to renegotiate some details of the purchase contract, or have the seller make some repairs before you buy.

Online Resources for First Time Home Buyers

There are a host of online resources for both first time home buyers and repeat home buyers. For example, there are sites which provide real estate relocation service throughout the U.S. plus 20 other countries, includes resources for first time home buyers as well as veteran home buyers. On many sites you will find articles, calculators, and links to agents and property listings. Another great online resource for home buyers is the U.S. Dept. of Housing and Urban Development's Web site, which includes a wealth of information on real estate related matters. If you haven't decided on a new neighborhood or you want to learn about a distant area you are relocating to, visit Sperling's Best Places Web site.

Fees for Public Records

Any time a piece of real estate is sold; certain records derived as a result of the real estate closing are entered into the public record. Transfer of title or deed, is recorded at the county clerk's or registrar's office and is available for viewing by any member of the public who should so choose to access it. Included in real estate closing costs is a fee called a "recording fee." This is the fee charged by the closing company to record the real estate transfer with the county clerk or registrar. This fee is charged to the closing company by the registrar. You will receive free public record copies at closing. Should you need additional copies of these records, you will usually need to pay copy fees to the county clerk or registrar.

Online Appraisals

Many companies offer online home appraisals. These companies, which include www.ditech.com, www.valuemyhouse.com, www.electronicappraiser.com, and many others, provide an appraisal of your property based on the price that other, similar homes in your area recently sold for. The shortcoming of these services is that no one actually goes out and looks at your home, and the services rely on your description of your property to arrive at a value. These services may be somewhat useful for setting your asking price, but a mortgage lender is unlikely to use an online appraisal.

Definition of Equity

Equity is defined as the value of your home less any liens (mortgage, home equity loans, etc.). So if your home is worth $500,000 and you have a $300,000 mortgage, your equity is $200,000. Many people borrow against the equity in their homes by taking out a home equity loan or 'second mortgage.' Keep in mind that if the value of your home goes down, the amount of equity you have decreases, which can leave you 'upside down,' or owing more than your home is worth, if the real estate market in your area takes a sudden tumble.

Benefits of Participating in a First Time Home Buyer Program

The U.S. Dept. of Housing and Urban Development includes on its Web site a list of approved housing counseling agencies many of which offer first-time homebuyer programs. These programs are designed to help first time home buyers weigh the benefits of renting vs. buying. The programs teach first time home buyers about the different mortgage programs that are available, the value of a home inspection, and what to expect at closing. First time home buyers who participate in one of these courses are much less likely to fall prey to predatory lending practices and report a higher level of satisfaction with their home ownership decision.

No or Low Down Payment Loans

Many financial institutions that offer home loans now offer affordable mortgage options and first time buyer loans. These loans are designed to help borrowers who don't have a lot of money for a down payment or who have blemished credit get approved for loans. Most private lenders still require at least 3-5% down to approve a loan. There are also federal mortgage insurance programs, such as that offered by the Federal Housing Authority, that have low-down payment options. While these programs have done a lot to help people achieve their dream of homeownership, interest rates on low-down payment loans or loans for those with less than perfect credit tend to be higher than conventional loans. A good source of information on first time buyer loans is the U.S. Dept. of Housing and Urban Development's Web site. Search for the guide "100 Questions and Answers About Buying a New Home."

Real Estate as an Investment

For most people, their home is the single largest investment they will make. Some people take the concept of real estate as an investment to the next level. They buy property, and either fix it up and sell it again, or rent it out for an income stream. If you want to use real estate as an investment, you'll be best off if you're able to make improvements to the property yourself or at a very reasonable cost (if you have a brother-in-law who's a plasterer, for example). You'll also need to decide if you're cut out to be a landlord, knowing that you'll get the call about the broken water heater at 5:00 a.m.

Down Payment

Deciding how much of a down payment to make on your home can be daunting. On the one hand, you want to put a much down as possible, because you're going to be paying the mortgage for thirty years (or at least fifteen). Yet you don't want to put down so much that you have to borrow Uncle Earl's pickup truck to move yourself, or you can't afford to plant any bulbs in your new garden. Figure your moving and closing costs carefully, then add a 'fudge factor' of 10-15% for things like dinner out because you can't find the box that holds the pots and pans. Don't put down so much that you're 'house poor,' but make that down payment as big as you can to keep the mortgage reasonable. If you put down 20% of the purchase price or more, you'll qualify for the best mortgage rate (all else being equal) and you won't have to pay Private Mortgage Insurance (PMI).

Financial Benefits of Homeownership

When scanning the residential real estate listings, keep in mind the financial benefits of home ownership. Aside from building equity, there are many tax advantages to homeownership. For example, when considering real estate for sale, keep in mind that most or all (depending on your income level) of the points you pay at closing are deductible on your federal income tax return. Local property taxes and mortgage interest are also deductible. For more information on the tax benefits of homeownership, visit the IRS Web site and search on "home owner deductions." Search results will include a list of publications you can read online or download and print out to read later. One thing's for sure. If you are a first-time home buyer or seller, use the services of a tax professional to make sure you get all the tax benefits to which you are entitled.