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Fine Homes Of The Carolina's Blog

Joy Setzer and Chelci Sutton

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Displaying blog entries 1-10 of 52

OPEN HOUSE - SUNDAY, JANUARY 13TH 2013 FROM 2-4PM- REFRESHMENTS PROVIDED!!!

by Joy Setzer and Chelci Sutton

OPEN HOUSE - SUNDAY DECEMBER 16TH FROM 2-4PM - REFRESHMENTS PROVIDED!!!

by Joy Setzer and Chelci Sutton

Home Staging Tips!

by Joy Setzer and Chelci Sutton

Q.  How can I “stage” my home so it sells quickly for the price I want?

A.   Make sure you address both the outside and the inside of the house by cleaning and de-cluttering everything, from the front yard to the garage to the kitchen, bathrooms, and basement.  Put away your personal items so Buyers can imagine themselves living there.

One way to take years off your home is with paint.  Check the home’s exterior paint job, and don’t forget the front door, mailbox, garage doors, and walkways.   In the interior, remove the pictures from the walls (as well as old wallpaper) and paint the walls in a neutral color. 

Also, consider these tips if you want to sell your home fast for a good price:  a) Hire professional cleaners to do the work; b) Get a home inspection before you put it on the market; and c) Make your landscaping look sharp.   

Do you have a real estate question you want answered?  Feel free to call Joy at 704-241-8831 or Chelci at 919-592-4305.  Perhaps we’ll feature your question on our Blog!

8 Things You Should Know About Down Payments

by Joy Setzer and Chelci Setzer

8 Things You Should Know About Down Payments

Think twice before borrowing against 401(k)

By Jack Guttentag
Inman News®

Q: What is the down payment?

A: The down payment is the property value less the loan amount. It is not the same as the borrower's cash outlay if some of that outlay is used for settlement costs. On a newly constructed home, the land value can be part or all of the down payment.

Q: If the appraised value of a home exceeds the sale price, can the difference be applied to the down payment?

A: No, the property value upon which down payment requirements are based is the lower of sale price and appraised value. An appraisal higher than the price is disregarded.

But there is an important exception, called a gift of equity, where the home seller is someone near and dear, usually a family member, who is willing to sell below market value. In such cases, the lender will probably require two appraisals, and the seller must follow Internal Revenue Service rules to avoid gift taxes, but those are minor nuisances.

Q: Can a home seller contribute to the buyer's down payment?

A: No, because of a presumption that such contributions will be associated with a higher sales price. However, subject to limits, home Sellers are allowed to pay purchasers' settlement costs. This reduces the cash drain on purchasers, allowing more of it to be used as down payment.

Q: Can the lender contribute to the buyer's down payment in exchange for a higher interest rate?

A: No, but lender rebates or "negative points" can be used to pay settlement costs as a possible alternative to seller contributions.

Q: Can cash gifts be used as a down payment?

A: Only if the gift comes from a relative or live-in partner who can document its source. Gifts from parties to the transaction such as home Sellers or builders are not acceptable as down payment funds because of the presumption that the gift affects other parts of the transaction, especially the sale price.

The lender must also be convinced that the gift is not a disguised loan with a repayment obligation that might reduce the borrower's ability to repay the mortgage.

Borrowers who receive undocumented cash gifts can include them as part of their own funds if they can show that the funds have been in their account for at least 60 days. They should have two monthly statements issued after the funds are deposited in the account.

Q: Are there any substitutes for a down payment?

A: In principle, any collateral acceptable to the lender could serve as a substitute for a down payment. The only such substitute found in the U.S. is securities, which must be posted as collateral with an investment bank that also makes mortgage loans. Borrowers who do this are betting that the return on the securities will exceed the mortgage rate.

Mortgage insurance and second mortgages can also be viewed as substitutes for down payment. They do not provide the first mortgage lender with additional collateral, but they shift a major part of the risk of the low-down-payment loan to a third party who is paid by the borrower for assuming it. The payment is either a mortgage insurance premium or a relatively high interest rate on a second mortgage.

Q: Is it wise to withdraw funds from a 401(k) to make a down payment?

A: Withdrawing funds is very unwise, as you would be hit with taxes and penalties, but borrowing against your account might make sense, provided your employer allows it. The cost of borrowing against your 401(k) is not the loan rate, which you pay to yourself, but the return the money would have earned if left in the account.

The risk is that if you lose your job, or change employers, you must pay back the loan in full within a short period, often 60 days. Otherwise, the loan is treated as a withdrawal and subjected to taxes and penalties. Loans from a 401(k) cannot be rolled over into a 401(k) account at a new employer.

Q: What are the costs and benefits of making a larger down payment than is required?

A. The cost is measured by the rate of return you could earn on the money if you invest it rather than use it for a larger down payment. The benefit is measured by the mortgage interest rate, as that rate determines the interest savings on the amount you don't borrow.

If you increase your down payment by $10,000 on a 4 percent mortgage, you earn 4 percent on the $10,000 you didn't borrow.

A possible additional benefit arises when the larger down payment reduces the cost of the loan by lowering either the mortgage interest rate or the mortgage insurance premium.

My calculator 12a shows the total rate of return on investment in a larger down payment taking account of any such cost reductions.

The writer is professor of finance emeritus at the Wharton School of the University of Pennsylvania.

WHAT DO I NEED TO KNOW ABOUT LIABILITY PROTECTION WHEN I HIRE A MOVER?

by Joy Setzer and Chelci Setzer

Q.  WHAT DO I NEED TO KNOW ABOUT LIABILITY PROTECTION WHEN I HIRE A MOVER?

A.  UNDER FEDERAL LAW, INTERSTATE MOVERS MUST PROVIDE LIABILITY INFORMATION OUTLINED IN THE "YOUR RIGHTS AND RESPONSIBILITIES WHEN YOU MOVE" BOOKLET.  THE TWO OPTIONS TO PROTECT YOUR BELONGING (CALLED VALUATION COVERAGE) ARE:

FULL VALUE PROTECTION.  YOUR MOVER IS LIABLE FOR THE REPLACEMENT VALUE OF LOST OR DAMAGED GOODS IN YOUR SHIPMENT.  THEY ARE PERMITTED TO LIMIT THEIR LIABILITY FOR LOSS OR DAMAGE TO ARTICLES OF EXTRAORDINARY VALUE (ITEMS WHOSE VALUE EXCEEDS $100 PER POUND), UNLESS YOU LIST THESE ITEMS ON THE SHIPPING DOCUMENTS.  ASK YOUR MOVER FOR A WRITTEN EXPLANATION OF THIS LIMITATION.

RELEASED VALUE.  THIS OPTION ASSUMES LIABILITY FOR NO MORE THAN 60 CENTS PER POUND PER ARTICLE AND IS OFFERED AT NO ADDITIONAL CHARGE.  YOU'LL BE COMPENSATED ACCORDING TO THE WEIGHT OF THE ITEM, NOT IT'S ACTUAL VALUE.  IF YOU DON'T SELECT RELEASED VALUE, YOUR SHIPMENT WILL AUTOMATICALLY BE TRANSPORTED AT THE FULL VALUE PROTECTION LEVEL AND YOU WILL BE CHARGED APPROPRIATELY.

IF YOU PICK RELEASED VALUE, SOME MOVERS MAY OFFER TO SELL OR OBTAIN FOR YOU SEPARATE LIABILITY INSURANCE.  THIS INSURANCE IS REGULATED BY STATE LAW.  YOU ALSO MAY CHOOSE TO PURCHASE INSURANCE FROM A THIRD-PARTY INSURANCE COMPANY.

IF YOU HAVE ANY QUESTIONS, OR NEED CAPABLE AND TRUSTWORTHY REPRESENTATION, PLEASE CALL US TODAY!  THANKS FOR THE QUESTION!

WHAT DO I NEED TO KNOW ABOUT HOME APPRAISALS AND HOME INSPECTIONS?

by Joy Setzer and Chelci Setzer

Q.  WHAT INFORMATION DO I NEED TO KNOW ABOUT HOME APPRAISALS AND HOME INSPECTIONS?

A.  IN GENERAL, A HOME APPRAISER DETERMINES THE VALUE OF A PROPERTY AND A HOME INSPECTOR DETERMINES THE CONDITION OF A STRUCTURE.  WHILE APPRAISALS ARE PRIMARILY FOR LENDERS, THEY ALSO ENSURE THAT Buyers DON'T OVERPAY FOR A PROPERTY.  HOME INSPECTIONS ARE FOR BUYERS.

A HOME APPRAISAL INCLUDES DETAILS ABOUT THE HOUSE, A DESCRIPTION OF THE NEIGHBORHOOD AND SIDE-BY-SIDE COMPARISONS OF SIMILAR PROPERTIES.  IT ALSO CONTAINS AN EVALUATION OF THE AREA'S REAL ESTATE MARKET, AND NOTATIONS OF MAJOR PROBLEMS WITH THE PROPERTY THAT WILL AFFECT ITS VALUE.  YOU SHOULD HAVE YOUR LENDER ORDER THE APPRAISAL, AND YOU ARE ENTITLED BY LAW TO GET A COPY OF IT.

A HOME INSPECTION IS AN EVALUATION OF A HOME'S CONDITION THAT MAY IDENTIFY IMPROPER BUILDING PRACTICES OR THE NEED FOR MAJOR REPAIRS, AS WELL AS FIRE, SAFETY AND HEALTH HAZARDS.  YOU SHOULD ALWAYS INCLUDE AN INSPECTION CONTINGENCY IN YOUR PURCHASE OFFER.  THE INFORMATION WILL HELP YOU DETERMINE HOW MUCH YOU'RE WILLING TO PAY FOR A HOME, WHAT REPAIRS WILL BE NECESSARY AND WHETHER OR NOT YOU WANT TO WALK AWAY FROM THE DEAL.  WE RECOMMEND HAVING A HOME INSPECTION DONE EVEN WHEN PURCHASING NEW CONSTRUCTION!

SO PRICING YOUR HOME RIGHT THE FIRST TIME SELLER'S, WILL SAVE EVERYONE BOTH TIME AND MONEY...  GIVE US A CALL TODAY FOR A FREE CMA EVALUATION AND OUR RECOMMENDATIONS FOR HOME INSPECTORS!

I'M IN TROUBLE WITH MY MORTGAGE...

by Joy Setzer and Chelci Setzer

Q.  I'm in trouble with my mortgage.  How can I get help?

A.  If you don't know where to turn for reliable answers or need to sort through your options, turn to these experts for advice:

  1. Your REALTOR® can determine the current value of your home and review your options if you owe more than the home is worth.  Knowledgeable agents can also explain more about government programs available today.
  2. A Foreclosure Counselor will help you evaluate your current financial situation by reviewing your monthly expenses and income.  They can also identify assistance programs and serve as an advocate with your bank, free of charge.
  3. A Tax Expert may be needed if you decide to do a short sale or deed in lieu of foreclosure as forgiveness of debt is sometimes considered taxable income.
  4. A Credit Counselor can help develop a plan to avoid future financial difficulty and work to repair your credit score if you've already missed payments.
  5. An Attorney can help if your lender has filed a foreclosure lawsuit.  They can review the lender's paperwork and see if the loan servicing company made a mistake in applying payments or assessing fees.

If you have any other questions, or need capable and trustworthy representation, please call Joy at 704-241-8831 or Chelci at 704-605-9546 today...  Thank you for the question!

 

REMODELING TRENDS FOR 2011!

by Joy Setzer and Chelci Setzer

Q.  WHAT ARE SOME REMODELING TRENDS FOR 2011?

A.  ACCORDING TO A POLL OF BUILDERS AND DEVELOPERS FOR CBS MONEYWATCH BY THE NATIONAL ASSOCIATION OF THE REMODELING INDUSTRY, THE OVERALL TREND IS TO TAKE ON SMALL PROJECTS WHILE YOU WAIT TO DO THE REALLY BIG ONES.  HERE ARE SOME SPECIFIC TRENDS TO WATCH IF YOU'RE REMODELING SOON:

  • UPDATING BATHROOMS.  IT'S CHEAPER THAN DOING A KITCHEN BUT YOU NEED TO KEEP A CLOSE EYE ON YOUR BUDGET.
  • WARMING UP THE HOUSE WITH EARTH TONES AND METALLIC FEATURES, SUCH AS AGED BRONZE OR DISTRESSED HARDWARE.
  • OPENING UP ROOMS.  MORE PEOPLE ARE TAKING DOWN INTERIOR WALLS AND OPENING UP SPACES IN OLDER HOMES.
  • GOING GREEN.  THE FOCUS IS ON ENERGY-EFFICIENT UPGRADES.
  • PAYING IN CASH.  INSTEAD OF TAKING OUT A LOAN, PEOPLE ARE PICKING AND CHOOSING WHAT THEY CAN DO WITH THE CASH THEY HAVE.
  • HIRING GOOD CONTRACTORS.  ASKING QUESTIONS AND BEING MORE DILIGENT ABOUT CHOOSING QUALITY CONTRACTORS IS ON THE RISE.
  • SPENDING TIME OUTSIDE.  THE TREND IS TO FIX UP OUTDOOR SPACES WITH A DECK AND LANDSCAPING.

REMEMBER, IF YOU ARE LOOKING TO SELL YOUR HOME ANYTIME SOON, PLEASE GIVE US A CALL...  WE WOULD LOVE THE OPPORTUNITY TO ASSIST YOU!

GOING GREEN?

by Joy Setzer and Chelci Setzer

Q.  I'M PLANNING TO BUY A "GREEN" HOME.  WHAT DO I NEED TO LOOK FOR?

A.  HERE ARE SOME OF THE FEATURES YOU SHOULD LOOK FOR, ACCORDING TO THE NATIONAL ASSOCIATION OF HOME BUILDERS (NAHB):

ENERGY-EFFICIENT.  LOOK FOR APPLIANCES, WINDOWS AND WATER HEATING SYSTEMS WITH ENERGY STAR® RATINGS AND EFFICIENT LIGHTING FIXTURES AND BULBS.  RENEWABLE ENERGY SOURCES FURTHER DECREASE ENERGY CONSUMPTION IN THE HOME.

WATER-EFFICIENT.  LOOK FOR PROGRAMMED, LOW-VOLUME IRRIGATION SYSTEMS, RAINWATER COLLECTION SYSTEMS, WASTEWATER TREATMENT SYSTEMS AND HOT WATER RECIRCULATION SYSTEMS.

RESOURCE-EFFICIENT.  THE HOME SHOULD USE STRATEGIES TO REDUCE HEAT GAIN IN THE SUMMER AND HEAT LOSS IN THE WINTER.  IT SHOULD CONTAIN RENEWABLE MATERIALS AND RECYCLED-CONTENT MATERIALS IN CARPETS, TILES AND CONCRETE FORMULATIONS.

INDOOR AIR QUALITY.  THE HEATING, AIR CONDITIONING AND VENTILATION SYSTEM MUST BE APPROPRIATELY SIZED.  LOOK FOR LOW-VOC (VOLATILE ORGANIC COMPOUNDS) PAINTS AND FINISHES.

TO ENSURE THE HOME IS "GREEN", LOOK FOR THE GREEN CERTIFIED MARK ISSUED BY THE NAHB RESEARCH CENTER.

THANKS FOR THE QUESTION!

Could My Home Be Underinsured?

by Joy Setzer and Chelci Setzer

Q.  HOW DO I KNOW IF MY HOME IS UNDERINSURED?

A.  THE INSURANCE INFORMATION INSTITUTE RECOMMENDS THE FOLLOWING:

  • IT'S A GOOD IDEA TO INSURE YOUR HOME FOR THE COST OF REBUILDING IT.  CHECK YOUR HOMEOWNER'S POLICY TO SEE THE MAXIMUM AMOUNT YOUR INSURANCE COMPANY WOULD PAY IF IT HAD TO BE REBUILT.
  • FIND OUT WHAT IT WOULD COST TO REBUILD YOUR HOME.  YOUR INSURANCE AGENT CAN CALCULATE REBUILDING COSTS FOR YOU OR YOU CAN HIRE AN APPRAISER (CALL OR EMAIL US FOR REFERENCES).  MAKE SURE YOUR INSURANCE AGENT KNOWS ABOUT ALL IMPROVEMENTS YOU'VE MADE, SUCH AS A DECK OR LARGER KITCHEN.
  • MAKE SURE THE VALUE OF YOUR POLICY IS KEEPING UP WITH INCREASES IN LOCAL BUILDING COSTS.  MANY POLICIES INCLUDE AN INFLATION GUARD; IF YOURS DOESN'T, CONSIDER PURCHASING ONE.
  • FIND OUT IF YOU HAVE A "REPLACEMENT COST" POLICY FOR YOUR HOUSE.  IF YOU OWN AN OLDER HOME, YOU MAY HAVE A "MODIFIED REPLACEMENT COST" POLICY. 
  • FOR THE CONTENTS OF YOUR HOME - FIND OUT WHETHER YOU HAVE "REPLACEMENT COST" OR "ACTUAL CASH VALUE" INSURANCE.
  • CHECK THE LIMITS ON CERTAIN PERSONAL POSSESSIONS, SUCH AS JEWELRY.  CONSIDER BUYING AN "ENDORSEMENT" TO INSURE VALUABLES SEPARATELY.

GREAT QUESTION, AND THANKS FOR WRITING! 

 

Displaying blog entries 1-10 of 52

Contact Information

Photo of Joy Setzer and Chelci Sutton Real Estate
Joy Setzer and Chelci Sutton
Berkshire Hathaway HomeServices Carolinas Realty / York Simpson Underwood
NC
Joy (704) 241-8831
Chelci (919) 592-4305