If you’ve been browsing the Summit NJ listings lately, you’ve probably been thinking about the various types of mortgages.  News headlines have been disparaging this type and touting that one for the past few years.  It can get confusing, especially for a first time homebuyer.  Talking to a HUD-approved mortgage counselor will help you sort out all the different options.  In the meantime, here are a few pointers on the old standard fixed-rate loan.

The biggest benefit of a fixed-rate mortgage for a Summit NJ real estate buyer is right in the name.  The rate is fixed; it doesn’t change.  Regardless of the changes in the economy or interest rates, your monthly payments will stay the same.  You know exactly how much your mortgage payment will be every month over the entire course of the loan.  There will be no surprises or shocks with an economic shift.  Your budget will be set and you can plan accordingly.

This type of mortgage works well in certain economic condition.  It is a smart option when you have a stable or fixed income.  If you are planning on staying in your home for a long time, a fixed rate is a solid choice.  Fixed rates are also a good choice in an unstable economy or when interest rates are on the rise.  In periods of inflation, keeping your interest rate constant can help you ensure you aren’t forced into an early sale.  Keeping in touch with your Summit NJ realtor is a great idea, but you don’t want to be in a position where you are forced by costs into making that call.

Like any mortgage, a fixed rate mortgage also has a few negative points.  If you bought during a period of high interest rates, you won’t have the opportunity for a lower payment without a complete refinancing.  Since the first several years of a fixed rate mortgage is spent paying down the interest you should plan on staying in your home for a while.  If you are working with a short timeline, another option may be a better idea.  These mortgages also typically have a slightly higher interest rate than their competition, depending on the economy, so there may be periods of time where you are paying more than your neighbors.

Your Summit NJ real estate agent can also help you sort through a few options.  She can also point you towards a HUD-approved mortgage counselor who can guide you through the process and help you choose the best loan for your next home.

There’s been a lot of talk in the news about adjustable rate mortgages.  Most of it has been bad press.  This type of mortgage has been blamed for the rise in the national rate of foreclosures and for the general downturn in the economy.  So why are some Summit NJ real estate buyers still signing up for an ARM?

There are some benefits to having an adjustable rate mortgage, despite all the negative news surrounding them.  If you’ve been looking at Summit NJ listings and considering buying, there are some benefits to using an adjustable rate mortgage that you should consider.  Before you sign with a lender, you may want to talk with a HUD-approved mortgage counselor to learn more about the potential risks and benefits.

The payments for this type of mortgage, unlike a fixed rate mortgage, will not remain the same over the life of the loan.  At specific scheduled intervals, the interest rate will change in accordance with the terms of the contract and current market rates.  It’s these periodic adjustments that make this type of mortgage a bit riskier than some others.

Like all mortgages, an adjustable rate mortgage works best in a certain set of circumstances and within particular economic trends.  Talk to your Summit NJ real estate agent about your plans for the home and the types of financing available in your area.  Your lender can also help you crunch numbers and make an educated choice.

An ARM usually comes with a significantly lower introductory rate than a fixed rate mortgage.  If rates are falling, an ARM can help you save some cash early in the loan.  If you only plan on staying in the home for a short time, you may be able to finance a lower monthly payment with an ARM.  You can use the extra to pay down debts and build saving or retirement funds.  If you live in the home for 10 years or more you may be better off with a fixed rate.  You may qualify for a larger mortgage with an ARM, which could be a good thing or a dangerous temptation.

If you think an ARM might be a good choice for you, be sure you have a very clear understanding of the way these loans work.  There is a very good chance that your interest rate and thus your monthly payment will go up at some point.  You must be prepared for this eventuality.   Ask your Summit NJ real estate agent to recommend a HUD approved mortgage counselor to go over all the options and guide you to the best choice.

Some of the biggest costs of home ownership, after the mortgage payment, are the energy bills.  Energy costs are often an unpleasant surprise for first time home owners.  When you purchase a Summit NJ real estate property, be sure you’ve estimated the cost of living there before you make an offer.

Your Summit NJ realtor can help you figure out an approximate monthly cost for a particular property.  However, it’s your energy usage that will ultimately determine the size of the bill.  Luckily, there are lots of ways to conserve energy and reduce the monthly cost of home ownership.

Heating & Cooling
Temperature control accounts for the brunt of your monthly energy cost.  When you’re looking through the Summit NJ listings, plan for this part of your budget.  You can save money on heating and cooling with some simples steps.
• Install a programmable thermostat so you can have a comfortable temperature when you are home and a money-saving one when you aren’t.
• Keep your filters clean.
• Use fan and fresh air when you can.
• Use window treatments to help regulate a room’s temperature.
• Don’t block vents, radiators or baseboard heaters with furniture.
• Use landscaping to regulate interior temperature.  Plant deciduous trees for summer shade that won’t block the winter sun.

Appliances
Buying Energy Star-rated appliances is a great way to cut back on energy costs.  Replace old, energy-hogging units with newer models.  A few tips on using these appliances will help you cut costs.
• Clean the dryer’s lint filter with every use.
• Wait till the dishwasher is full before your run it.
• Wash and dry clothes with only full loads, too.
• Use power strips.  Many appliances have a “phantom draw” – they use energy even when turned off – and a power strip eliminates this draw.
• Make sure your electric water heater is properly insulated.

Outdoors
You may have admired the fancy landscaping when you toured the home with your Summit NJ real estate agent, but did you consider the energy costs involved in maintaining it?  Reduce your energy costs outside with these methods.
• Use compact florescent bulbs in all outdoor lighting.  The last longer and use less energy.
• Consider installing solar lighting.
• Use motion sensors on light so they aren’t in use when no one is outside.

The US Department of Energy has plenty of information on saving energy on their site.  Read over it for tips on reducing your monthly bills.

The day you take possession of your new home is one of the happiest days of your life. However, your work isn’t done until you take the keys from your Summit, NJ real estate professional. There are still several important things you need to look for on your final walk through that could delay you taking possession of your home. Here are a few can’t miss tips for anyone who is wondering exactly what to look for when it comes to your final home walkthrough.

First off, be sure that you have a copy of your agreement with you when you make your final walk through. Your agreement will outline any and all conditions that the seller must meet for you to buy the home. These conditions could range from repairs to additions to things that were supposed to be left in the home. Your Summit, NJ realtor will help you compile an easy reference list so you don’t miss anything, but it helps to have your agreement with you, as well.

Second, you want to look for any new damage or issues that may have sprung up since the last time you viewed the property. Chances are, the seller has been living in the property during the sales process, and if the sale took a significant amount of time to complete, there could be issues that weren’t there beforehand. You will want to document all of these issues before you sign the final paperwork. You will also want to bring a camera so you can clearly photograph any problems that you find. Talk with your Summit, NJ real estate agent about what you have found and who has the responsibility to fix them all. If you don’t document these issues and bring them to the attention of your Summit, NJ real estate agent, no one will.

Many home buyers start browsing the Summit NJ listings reluctantly. They might love their neighborhood, their street and their home but they forgot to plan for expansion when they bought their house. It’s the expansion of their family, not their home, which they should have considered prior to closing a sale.

Sometimes, we get stuck in the present and neglect the future. A small condo with a great location in a bustling urban center may be just the thing for a young, single professional or a newly married couple. A lack of outdoor living space or a super small second bedroom won’t seem like much of a sacrifice until a baby comes along. Then what once seemed insignificant may become a major issue. You may not be financially ready to dive into the Summit NJ real estate market again. It’s best to do some planning and make some decisions about your future in a home prior to making a purchase, even if that future seems a long way off.

How long will you stay?

One of the first questions you should ask yourself is how long you intend to stay in the home that you’re considering buying. How does that time frame relate to your needs? Most home owners should plan on spending the next 5 to 7 years in a home bought now in order to maximize the return on their investment. If you are single and/or childless and intend to stay that way, that one bedroom condo with the perfect city-center location could be a great buy. If you are thinking about starting a family or have small children, perhaps you should move your search to an area with excellent schools. Your Summit NJ real estate agent can help you find the location that is best for your needs now and in the near future.

How much room will you need?

Spend some time deciding how much room you will need for your growing family. How many children would you like to have? Should they each have their own room or will they be able to share? Think about finding outdoor spaces for play time and exercise. Consider your floor plan choices like two-story homes versus ranch plans.

How much house can you afford?

Keep your budget in mind when planning for the future. Your plans may warrant a 5 bedroom house but your budget may not allow it. Resist the urge to buy beyond your means. You won’t want to be “house poor” when it comes time to furnish a nursery or put up a swing set. Ask your Summit NJ realtor to show you homes that won’t push you past your spending limits.

With a little planning, you can find a home that fits the needs of your growing family both now and for the future.

How much research did you do for your last car purchase? Did you spend hours on-line looking at reviews and choosing your favorite features? What about your next home? You’ve probably timed the commute to work, checked out the local shopping options and practically memorized the property values. But how much time have you spent investigating school systems? This is a very important consideration if you are looking at buying a Summit NJ real estate property for your current or future family and should not be overlooked.

Even if you don’t currently have children, this is still an important decision. If you don’t have children, this thought may not have entered your mind at all. But if you decide to start a family in the home, it will soon become a major issue. Even if you don’t plan to have children, the school system can still affect you. The school system can be a huge factor in your resale value. If you haven’t spent any time researching schools, perhaps it’s time to start.

Our Summit NJ listings are blessed with some great schools. But you’ll still have to do a little investigating to find the one that fits your needs. First, decide what the ideal school for you would be. A strong foundation in basic subjects is essential, but opinions diverge widely from there. Some home owners want a school with a special emphasis on the arts while other may look for a school particularly sensitive to the needs of the physically or mentally challenged. Next, narrow your focus to areas in which you are likely to buy a home. There may be too many options in a large, metropolitan area to research each school system. Your Summit NJ realtor can help you choose neighborhoods based on price, location and other essential factors.

The Internet is a good place to start researching schools. Check out the websites for the local school systems to see what they have to say about themselves. Many will publish their test scores or rankings on their site. Check out the special programs they offer. Does the school system offer music classes or have programs for exceptional children or those with special needs?

Check out the standings of the school district you’re interested in by looking at some less biased sites as well. Your Summit NJ real estate agent may have some links on her site to guide you. This site has a couple of links to get your research on NJ schools started. One is a list of school data statistics with information like overall proficiency of students in certain subjects and student-to-teacher ratios. Another is a school ranking page giving the 2008 rankings of over 300 of our state’s top schools.

Start thinking about schools now, before it becomes an issue.

Do you know what your credit score is? Can you, right now, recall that magic number that your lender is sure to know? We’ve all seen the funny commercials with the catchy songs talking about the wisdom of getting a free credit report so you can buy everything from a car to a cell phone to a home and the sad consequences of not doing so. If you are browsing the Summit NJ listings, this may actually be pretty good advice.

What is the all-important credit score anyway? There are three major credit reporting agencies: Equifax, Trans-Union and Experion. Each one collects data about you and your borrowing history. They track how much you borrow or charge, how fast you pay it back and whether you are late or default on payments. They put all this data together into a report, which is made available to lenders to view any time you apply for a loan or credit of any sort. Companies like the Fair Isaacs Corp. take all these reports and filter them with their own trade-secret formulas to come up with a single number between 300 and 850. The higher your number, the less risky you look to a lender. Ask your Summit NJ real estate agent to suggest some websites when you can get a report.

Your credit score and your mortgage rate are tied together. They have what is called an inverse relationship. That means if one goes up, the other goes down and vice versa. If you have a high score, about 700 or so, you will be much more apt to be offered a low mortgage rate because you appear to be a good candidate with a low risk of defaulting on your loan. In short, the lender is likely to get the full value of their loan back from you over the course of the mortgage. Lower scores, 620 to about 500, fall into a category called “subprime” which has gotten a lot of press. Subprime applicants will be offered fewer options and higher rates. The thinking is that a subprime candidate might be a bad bet for the lender and he may not pay back the loan in its entirety. A Summit NJ realtor can tell you more about what options you have for your score.

The Summit NJ real estate market has room for a wide variety of credit scores. Just because your number is a little lower than you thought doesn’t mean a new home is out of the question. And your score can be improved with some effort. Find out what factors could be killing your credit score and work to correct them before you jump into the market.

You hear a lot of questions as a Summit NJ real estate agent, most of them from first time buyers. House hunting can be confusing; many potential buyers are intimidated. A good agent will smooth the way and answer many questions. Here are a few commonly posed by first time buyers and some basic answers.

1. Why should I buy Summit NJ real estate instead of renting? Isn’t renting cheaper?

Paying rent may well be less expensive in the short run, but in the long run home ownership is a wiser choice. Will you ever see any of your rent money come back to you? Money spent a home is an investment that will pay dividends later, both in tax deductions and when you eventually resell the home.

2. Why should I use an agent?

Buying a home isn’t just browsing the Summit NJ listings, choosing a nice picture and writing a check. An agent will have access to more listings and more current listings as well. She will help you with the sometimes unpleasant business of negotiating a fair price and setting up a closing. She will be able to objectively assess the value of a home based on location, features and information on comparable homes recently sold. A Summit NJ realtor is an advocate for your best interests.

3. How do I get that $8000 from the government?

A measure was recently passed that gives first time home buyers up to $8000 in tax credit. A tax credit means that the government subtracts that amount from the taxes you owe for the year. If you owe less, you will receive the difference as a refund. If a first time buyer closes a purchase for a primary residence between Jan. 1, 2009 and Apr. 30, 2010 he will be eligible for a credit of 10% of the purchase price. There are certain maximums for the value of the home and the income of the buyer, so do a little research before you pre-spend that extra eight grand.

4. How much should I spend?

This question has no easy answer. It’s really up to a buyer to figure out a budget that allows them to live as they like and still pay their mortgage payments. A rule-of-thumb is to spend about 1 ½ to 2 ½ times your gross monthly income. However, for some this is too great a stretch. Getting pre-qualified for a mortgage will give you a better picture of what you can and cannot afford. Don’t be too apt to spend every cent the lender is willing to loan you. Consult a certified financial planner if you have trouble working up a budget.

There are dozens more questions that could be added to this list. Call your Kristin today for answers to your home buying questions.

A safe neighborhood is the first thing we look for in a Summit NJ real estate property. We might be willing to sacrifice a little square footage or live without the hardwood floor but skimp on safety? No way. Finding out what areas are safe can be a tricky process. It’s hard to know if what you’re being told is fact or opinion. It’s doubly difficult if you are relocating to a new city or state and are completely unfamiliar with the surroundings. How do you find a neighborhood that’s safe?

One obvious source of information is your Summit NJ realtor. A good realtor will be able to point you to parts of town where you’ll feel comfortable and secure. An experienced agent will have a thorough understanding of her town. She’ll know what areas are up-and-coming and which are in decline. She should know something about the direction that city leaders are taking in order to deal with problem neighborhoods. Don’t be hesitant to ask questions about safety.

The Internet is another go-to place for data on safety. A quick search of the National Sex Offender Registry will help you double check any address for the presence of offenders. Local and national law enforcement offices also post data on-line. Many local police departments, especially in metropolitan areas, have searchable data bases. The FBI also has one. Looking through theses public records can help you narrow down which Summit NJ listings you want to examine more closely. Be aware that areas in close proximity to public places like malls may not fare well on data sites. The arrests on public grounds may make a neighborhood look worse than it is. You can also talk to school resource officers and Drug Abuse Resistance Education (DARE) offices at the local schools for more details about a particular neighborhood.

Once you’ve chosen a few neighborhoods to pursue, have your Summit NJ real estate agent give you a tour. Drive around and let her point out streets and areas she thinks are best. Go back later and revisit the area at night. (Just don’t go all alone.) Look for signs of neglect and deterioration in the home and streets. Broken or burned out streetlights, graffiti and vandalism are all sign telling you to steer clear. On the other hand, people out walking, children playing outside, clean streets and well maintained homes are signs of safety.

Walk the neighborhood in the daytime and talk to residents. Talk to the cashier at the grocery store and the desk clerk at your hotel, too. Just remember to take opinions with a grain of salt. It’s always best to do your own research.

Smart, well-planned renovations will almost always upgrade a home’s selling power. Updated homes show better and usually sell for more than their more dated counterparts. If you are thinking of placing your home in the Summit NJ listings, now or in the near future, you may want to consider renovating the less attractive features of your home. And there’s no better way to renovate than with eco-friendly methods and products.

“Green” renovations are the newest trend in home maintenance and for good reason. They can decrease your cost of ownership, increase your resale value and lessen your personal impact on your planet. Green improvements made to your Summit NJ real estate property can be divided in to two categories: the seen and the unseen. If you are thinking ahead for resale value, you’ll want to strike a good balance between the two.

Visible “green” touches will grab the attention of observant buyers. Bamboo is a popular and eco-friendly choice for flooring. It’s also quite beautiful. It lends a modern and stylish touch to a home with its warm golden tone and linear look. Bamboo grows at an incredibly fast rate and is considered one of the most easily renewable choices for wooden surfaces. Recycled stone, composite or concrete countertops make a green statement, too. Details like this tell buyers that yours is a responsible home. Ask your Summit NJ real estate agent to mention these options when showing the home and on any printed materials.

Perhaps even more important than the obvious eco-friendly options in your home are the unseen green choices. An upgrade to your furnace or water heater can produce a much larger energy savings than even replacing widows. Small choices all over the home add up to a big difference. New weather stripping in doors and windows will reduce heat loss and keep nasty drafts from chilling your buyers. Changing to low-flow shower heads and toilets will conserve water and keep bills lower. Attic fans will reduce the need for air conditioning by keeping the upper reaches of the home cooler. An automated thermostat can help you control heating and costs by regulating temperatures while you are not at home. This little feature is very popular with buyers.

Make sure buyers know about the commitment you’ve made to creating an eco-friendly home. Your Summit NJ realtor will have some ideas to highlight these important selling points and ensure your buyers know about both the visible and hidden green features of your home.