Home ownership is touted as the American Dream for good reason. Owning your own home gives you tax breaks, the freedom to make changes and the chance to build equity in your home. However, the cost of a home doesn’t end with the monthly mortgage payment. There are other monthly costs that you should be aware of if you want to stop renting and are considering buying Summit NJ real estate.

First time home shoppers browsing the Summit NJ listings often think of their budget as simply the asking price of the home. This way of thinking quite often gets first time homeowners in trouble. The price of the home is only the first step. There are several other costs you will have to factor into your monthly budget.

Before you jump into the market, be sure you’ve planned for all the costs associated with home ownership. There are plenty of on-line calculators and other tools to use to help you plan a budget. In addition, your Summit NJ real estate agent or a HUD-approved mortgage counselor may be able to counsel you on how to plan your finances so you don’t end up as a foreclosure statistic.

Here are a few categories of cost that you may or may not have thought about as part and parcel of home ownership.

Taxes
You’re probably expecting taxes but are you expecting your future taxes? Property taxes are not a fixed rate so plan for increases over time. You can expect your property taxes to be about 1% to 2% of your home’s value. You’ll also want to research other taxes like storm water run-off taxes, school taxes, fire department services taxes and other little fees that add up.

Insurance
There are several types of insurance to plan for when buying a home. Your basic home insurance policy will cost around $30-$60 for every $100,000 of value. You may also need to purchase flood insurance to fill in the gaps not covered by the policy. If you put down less that 20% as a down payment you might be paying for private mortgage insurance, too.

Sewer, Water, Electrical
Renters may be used to having utilities built into their rent. Make sure you have your Summit NJ realtor give you a good idea of the property’s monthly utilities. Be sure you’ve budgeted for these expenses.

Upgrades and Furnishings
Once you’ve bought a home, you will want to furnish it. Your new home will probably be a different size, shape or style from your rental. A purchase or two is inevitable so don’t use up every cent your have at closing.

Home ownership may have many costs but the benefits certainly outweigh them. You just have to plan your budget with these costs included.

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Not long ago, the Summit NJ real estate market witnessed many bidding wars on properties. Gleeful sellers would get multiple offers, each topping the last. Tenacious buyers would keep upping their offers to beat out the competition. While we don’t see that so much these days, we are still seeing multiple offer situations. The more recent pattern is to see several offers just at or just under the asking price.

A multiple offer situation can be awkward for both parties. It can be heartbreaking to learn that someone else is just as in love with your dream home as you are. It’s also difficult to decide which offer is the best offer if you are a seller. Your Summit NJ realtor can help you navigate this awkward situation so trust her advice.

Don’t fall prey to greed or competition.
As a seller, it’s tempting to grab the offer containing the highest dollar amount and rubber stamp it “accepted.” However, a high offer might not be a strong offer, so don’t be led by greed. A buyer who is financing is preapproved and who has a solid down payment is a much safer choice, even if their offer is slightly lower. You don’t want to go through the whole process and only to find out their financing fell through. By then, your other offers will have probably found a new favorite among the many Summit NJ listings.

As a buyer, have your financing in place and earnest money ready to show sellers you are serious. Have your lender prepare a letter of preapproval to show you are qualified and capable of making it to the closing table. Be prepared to write your best offer if there are other offers on the table but don’t make it into a contest. There is plenty of inventory on the market so keep your perspective.

Don’t dilly-dally, waffle or stall.
When more than one offer is in play, it’s not a good idea for either buyer or seller to waste any time. If you are the buyer, be sure that this is the house you want and make the offer. Write your first offer quickly and with confidence. If you spend days making up your mind, someone else’s offer might be accepted while you’re dithering over the price.

As a seller, it’s just plain rude to waste people’s time. If you’ve received two or more fair offers, choose one and end the buyers’ misery. Don’t hold out for just one more offer that might be a few hundred higher or a buyer who won’t ask for closing costs. Deal with offers in a timely manner so that the other parties can get on with their home search.

A Summit NJ real estate agent will advise you on how to proceed when there are multiple offers. Ask for her advice on making and accepting a good offer.

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Building a pool on your Summit NJ real estate property may be a dream for you and your family. The temptation to invest in a backyard oasis is particularly tempting during the hot summer months. The thought of enjoying cool waters and splashing fun right at home can seem like a dream – at first.

If you are planning on staying in your home for a while and want to enjoy a pool, then you should go ahead with the addition. Just remember that a pool gives only a small return on the investment and may actually shrink you potential buying pool for resale. That dream pool may end up costing you some sleep when it’s time to put your home in the Summit NJ listings.

Selling a home with a pool doesn’t have to be a nightmare. Like any other taste-specific feature, it just needs to be marketed properly. Look to your Summit NJ real estate agent for guidance and great marketing ideas.

Plan for the future owner
You will limit your group of buyers a bit if you install a swimming pool. Many buyers will have small children for whom a pool is a serious danger. Make sure you plan your pool decking to include some type of child proof gates or a barrier system for safety. Even if your children are older or grown up, make sure safety features will be easy to put in place for the next owner. A barrier will also help keep uninvited neighborhood guests (for whose accidents you may be liable) out of your pool.

Focus on the right buyers
Families with school age children will be a better target market than families with infants or toddlers. Focus your marketing efforts on those most likely to enjoy your pool. Talk to your Summit NJ realtor about how she plans to advertise your home and market your pool, too.

Minimize the maintenance
If there is any way to optimize the performance of the equipment, lower the utility usage or automate the cleaning process, invest in it. The biggest hurdle most buyers have to overcome in choosing a home with a pool is the maintenance. Do everything you can to make this a non-issue for your buyers. Make the upkeep as easy and energy efficient as possible.

Make it pristine
Like anything else in your home, you pool should be in top condition when it comes time to list. Make sure it is in perfect working condition. Pressure wash the decks and concrete surrounds. Not one spot of algae should be visible in the water or on the sides of the pool. Have any cracks professionally repaired. Take a look at the landscaping around your pool, too. Does it say luxurious retreat or concrete jungle?

If you are planning on adding a pool or buying a home with a pool already installed, talk to your agent about the future value of this popular amenity.

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Foreclosures are a sad fact of the current economic climate. Some homeowners are, for whatever reasons, not able to keep up with the mortgage payments on their Summit NJ real estate properties and their lenders have to take the homes back. This situation is hardly ideal for either party.

Losing a home to foreclosure not only traumatic, but damaging to an owner’s credit and his ability to buy in the future. Lenders are none too happy about taking over a foreclosed home, either. They are in the money lending business, not the real estate business, and have no desire to be stuck trying to sell a property. Foreclosures usually mean a significant loss to the lender as well. It’s a situation everyone involved wants to avoid.

A foreclosure may not be an inevitable event. There may be some ways to dodge the bullet and salvage your home and credit score. It may not be easy; it may take some sacrifice. In the end, though, you’ll always be better off without a foreclosure in your history. Talk to your Summit NJ realtor about your options.

Don’t get scammed.
Many of the so-called “foreclosure assistance” companies you can find on-line are nothing more than scammers and charlatans. Do not make your situation worse by falling prey to one. Take advice only from a trusted Summit NJ real estate agent, a real estate attorney or a HUD-approved mortgage counselor. Remember, there will never be a charge to talk to a HUD mortgage counselor. If a company asks you to pay up front, walk away!

Get your head out of the sand.
You know when you’re getting behind on bills. Don’t ignore the problem and hope it will go away. Likewise, don’t throw away letters from your lender. They may offer you options you didn’t know about. Call your lender as soon as you begin to slip behind. Even one missed payment can put you at risk for a foreclosure.

Know your options, research your rights.
You may be eligible for federal or state government assistance. Your lender may have program to help you catch up on your payments. Your lender may be able to modify your loan to make it a payable monthly expense. You’ll never know if you have these options if you don’t ask questions. Find out what help is available to you in your time of need.

Sacrifice when you must.
A foreclosure is no small occurrence. It can affect your ability to purchase another home for years to come. If selling a second car or cutting out all the extras like cable TV will give you the funds you need to pay the mortgage then do it. If the payment is just not manageable, talk to your agent about putting the home in the Summit NJ listings. It’s better to sell it while you can and live in a more affordable home than to go through a foreclosure.

If you’re at risk of a foreclosure, talk to a real estate professional as soon as possible. The situation may not be as bleak as you think. Don’t panic. Take a deep breath and learn about your options.

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Staying Too Long at the Dance

Spring is in full bloom and prom season is rolling around again.  Remember how all the really cool kids left the dance just a little early?  It was as if they had something better to do and they were just dropping in on their way.  No one wanted to be the last one hanging around as the decorations were torn down.  It would be, well, a little desperate and sad to stay too long at the dance.  The Summit NJ listings aren’t much more forgiving when it comes to hanging around too long. 

How Long is “Too Long”?

The mark of a stale listing used to be 90 days.  In the current market climate, many areas are seeing a longer average number of days of the market.  But anything past 6 months will make Summit NJ real estate buyers think twice about your home.

Does It Matter?

Unfortunately, yes, it matters to buyers.  If your property stays on the market for an extended period of time, buyers make some assumptions that may or may not be based in fact.  Here are a few things your buyers are likely to think.

• The house is overpriced.
• The seller is stubborn or difficult.
• The seller has got to be desperate by now — I can make a lowball offer.
• There’s something seriously wrong with the house.

How Does this Happen?

You home might just be sitting on the market for some of the reasons listed above so consider them well.  Pricing is one of the biggest factors that allow a home to linger on the listings.  Listen to your Summit NJ real estate agent when she counsels you on price.  She has an unbiased perception of your home and the price the market can bear.  There are a few other factors that contribute to lengthy day on the market.

• The home is not available to show or show very poorly.
• There is no internet presence or a listing with no photos.
• The market is soft.

What Can I do to Avoid This?

The first thing to do is choose your Summit NJ realtor well.  Pick a local, professional agent that knows your market and is experienced in selling your type of property.  Don’t “test” the market or be a reluctant, unmotivated seller.  List your home for a sellable price only when you are truly ready to sell.  Get the property ready and be available for showings.  Make sure your home doesn’t stay too long at the dance.

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Real Estate Vocabulary: Short Sale

The real estate business has a lot of buzz words and industry terminology.  Many of these words are being used with regularity in the news, but the average person may not know what they mean.  Feel free to check on unfamiliar phrases with your Summit NJ real estate agent, but here’s a brief primer on one headline-grabbing real estate vocabulary phrase: the short sale.

Short sales have been getting a lot of press lately.  It seems like everywhere you turn someone is talking about getting a steal on a short sale from the Summit NJ listings.  Are they really such a great buy or is this just another case of too good to be true?

What is a short sale?

Here’s the quick “regular English” definition of a short sale.  It’s when a house is sold for less than the owner owes the lender.  The money all goes to the lender and the seller avoids a foreclosure on his Summit NJ real estate property.  In other words, the lender has decided that taking a loss on the loan is better than trying to unload the property on the open market or at auction.  The price gets approved by the lender; the seller doesn’t get a say on it. 

How does it occur?

It can happen for any number of reasons.  There could have been a job loss or the seller may have mismanaged his finances.  It is difficult to assess exactly why a home has gone into a short sale situation unless the seller is willing to tell you what happened.

Is a short sale a good idea for me as a seller?

Selling short is typically a last ditch effort to avoid a foreclosure.  However, the repercussions on your credit rating will be very much like those from a foreclosure since a short sale is a type of settlement.  In addition, your lender might forgive the amount remaining after the sale but they may not.  They aren’t required to forgive it.  If you can avoid selling short, you should.  However, it is better that losing the home in foreclosure.  If that is your only other option a short sale would be the better choice.

Is it a good idea to buy a short sale?

That depends largely on the property and the price.  Some short sale homes have fallen into disrepair or are located in areas that have seen too many foreclosures and vacant properties.  These might take more money to bring up to par than you will save by buying them at a cut rate.  Other homes are excellent values for the dollar.   Your Summit NJ realtor can advise you on which properties are real bargains and which aren’t worth your money.

Short sales aren’t for everyone.  Check with your realtor to see if a short sale is right for you.

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Mortgage Loan Counseling

There aren’t many schools that offer a class in Mortgage 101.  It’s really too bad; many of us could have used that course!  Considering the current rate of foreclosures nationally, many schools are developing or implementing life skills courses.  Until this kind of education is more widely available, there are some other options for folks considering jumping into the Summit NJ real estate market who might need a little more information.

Homebuyer counseling or pre-purchase counseling has been around for decades.  Since the 1960s certain agencies have been helping buyers make better decisions.  More recently, it has become a required factor for some first-time or low-income buying programs.  With foreclosures running rampant nationally, maybe buyers should take the time to get a financial education before browsing the Summit NJ listings.

Mortgage counseling began in an era when people shopped with cash, even for cars and homes.  Credit was nearly non-existent and the American consumer was ill-informed as to how to manage it.  Sadly, many buyers are still not well-informed. 

Major financial decisions are intimidating.  Buyers often look to the wrong people for advice.  An experienced, reputable Summit NJ real estate agent can advise buyers in many ways but some may need more guidance than a realtor can offer. 

There are many nonprofit groups around the country who offer such services at no cost to the borrower.  Counseling is also available for borrowers who are already homeowners but who have fallen behind or are having difficulty meeting their obligations.  No one should feel badly about asking for mortgage counseling.  Buyers who look for counseling are not helpless or unintelligent; they are simply not yet educated in this complex field.

There are a number of HUD-approved counseling agencies.  Your Summit NJ realtor may be able to point you to a few.  You can look for a list of HUD-approved counselors through their website www.hud.gov.  Metropolitan areas that utilize the 211 dialing code can be directed to local agencies by an operator.  These agencies are typically funded by government monies and classified as non-profit agencies. 

You, as a client, should not be required to pay anything for the service.  If a so-called credit counselor charges for his services or makes unlikely claims that he can erase your debts or cut your mortgage in half, seek another agency immediately.  A legitimate agent will help current homeowners address any mortgage arrears, review any delinquencies and help you develop a plan of action.  He can also help potential homeowners understand the mortgage process and develop a solid plan for purchasing a home within a budget.  A better education, on any subject, is never a bad idea.

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Any home sale has a few legal issues to be considered.  Your Summit NJ realtor will, of course, be by your side to guide you through these murky waters, but you should still educate yourself on these matters as well.  One of the first legal considerations you will need to examine is the idea of disclosure.

Disclosure is defined as “the revelation of information that was previous secret.”  In real estate terms, disclosure is the seller making the buyer aware of any problems or defects of which he is currently aware.  It’s a way of keeping both parties safe from future legal problems.  In very simple terms it tells the buyer what he is getting into and keeps the seller from being blamed for anything he didn’t know about or anything that happens in the future.

As a seller, you must complete the form for disclosure; your Summit NJ real estate agent cannot legally do it for you.  It should be accurate and honest.  If the home was built prior to 1978, the seller must give the buyer 10 days to conduct an inspection for lead-based paint, unless the buyer waives this right in writing.

As a buyer, you should always request a disclosure statement.  This will give you a starting point as to the condition of the home.  However, a seller only has to tell you what he knows is wrong with the house.  A disclosure statement may not tell the whole story of a Summit NJ real estate property.  It should never take the place of a thorough home inspection.

Sellers must disclose material facts about the property.  Material facts are any bits of information about the house that might influence the buyer’s willingness to purchase, the price of the property or the terms of the sale.  For instance, some states require the seller to inform the buyer if a person has died on the property within a certain number of years.

More common disclosures are things like the condition of the roof or the plumbing.  Pending zoning changes on a Summit NJ listing may also be included in disclosure.  Once again, this is only if the seller has knowledge of the potential changes.  It is still up to the buyer to do his homework and find out what is going on in or around the neighborhood.

Disclosure can be a tricky subject.  What if you aren’t sure about something?  For instance, say there’s some discoloration on the basement floor.  It might me mold or moisture or it could have been a spilled drink.  Do you add it to a disclosure statement?  What about rumors or stories from the neighbors?  When considering disclosure, think about the Golden Rule.  If it’s something you would want to know, add it to the statement but note that it was unverified.

Disclosure boils down to two basic instructions.  Sellers: tell what you know.  Buyers: don’t be lazy; double-check what sellers tell you.

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Neighborly Advice

We spend so much time pouring over the Summit NJ listings choosing a home, a floor plan, a schools system and a geographical area that we can sometimes overlook what makes a neighborhood: the neighbors.  People can make a neighborhood feel like home or like a prison.  Here are some ways to keep your neighbors from turning your dream home into a nightmare.

Ask Around

Most neighborhoods have plenty of chatty folks willing to give you the low down if you are willing to ask.  Talk a walk on a warm evening and chat with the people you find outside working in their yards or walking their dogs.  Keep in mind that sometimes what you hear is just gossip, but if you hear the same thing from several different people you should take note.  Your Summit NJ realtor may be able to help you find out more about your potential new neighbors as well.

The Direct Approach

If you are the brave sort, you could think about taking a direct approach.  Knock on the neighbors’ door, tell them you are thinking about buying nearby and ask their advice.  If they swear a blue streak, slam the door in your face or otherwise make a scene, you can guess how they will behave during a conflict.  Don’t try this tactic alone, though.  Have at least one other person with you for safety and stay outside the front door.

Keep Your Perspective

Keep a good perspective on neighborhood issues once you do purchase a home.  Try not to let little things become big things.  Take a minute to see things from someone else’s point of view.  If your neighbor likes to put out a big holiday display, it won’t likely drive down the value of your Summit NJ real estate so maybe you can grin and bear it for a few weeks.  However, if he is allowing his property to become run down, abandoned or dangerous, this can negatively affect your home’s value and might be worth a calm, kindly worded conversation.

Build Bridges

When you move into a new neighborhood, make an effort to meet your neighbors and build some relationships with them.  It’s much easier to talk to a friendly acquaintance about an issue than it is to confront a perfect stranger.  You’ll both feel more comfortable if your first meeting is a positive one, like a block party or a barbecue, rather than a conflict.  If your Summit NJ real estate agent has sold other homes in the neighborhood, she may be able to introduce you to some of her previous clients to get the ball rolling.

If all else fails, remember the words of the poet Robert Frost in Mending Wall: “Good fences make good neighbors.”

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Picturing a Sale

A strong internet presence is essential for selling Summit NJ real estate.  Buyers in our area are technologically savvy and looking on-line is usually the first step in their search process.  Wordy descriptions aren’t what buyers want.  They want pictures, lots of pictures.  Good, clear photographs are vital to getting your buyers away from their laptops and into your home.

The Summit NJ listings are full of great homes.  Unfortunately, they’re also full of dark, blurry, frustrating photographs.  Make you home stand out from the crowd with beautiful, high quality pictures.  Plenty of professionals would be willing to provide pictures for a price.  Bu all you really need is a good camera and a few tips for good photos.

The Camera

You don’t have to invest in a top of the line digital SLR camera to show off your home.  (However, if you already have one or access to one by all means put it to good use!)  You will want to use a high resolution digital camera for a few reasons.  First, your images are intended for a digital medium – the internet – so they need to be in a digital format.  You can scan a print but the effect is like making a copy of a copy; the image looses clarity.  Second, if your images are digital your Summit NJ real estate agent can get the images from your memory card and put them directly on her site.

The Accessories

The pros use fancy lighting, lenses and post-production software to create a perfect image.  The rest of us just need a tri-pod.  A tri-pod will give you a stable base to prevent “camera shake” and produce a blur-free photo.  For good lighting, choose a bright but overcast day and open all the window treatments.  Try not to use table lamps or overhead lighting as the primary light source.  They create high-contrast bright spots and shadows.

The Pictures

This is one case where more is always better.  With digital cameras, you can take as many photos as you want without worrying about the cost of developing the pictures.  Take many different pictures of each room from every angle.  Show off the home’s the best features, like detailed moldings, with close up shots.  Get shots of a great view or excellent landscaping too.  Pay attention to what is in the shot.  Put the toilet seat down, pick up the clothes and make sure the house is clean.

Think of your photos as a virtual open house.  Make sure your home is in perfect shape for a showing before you pull out the camera.  Your Summit NJ realtor will help you choose the shots to best show your home and give it an on-line advantage.

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