First Time Home Buyer?

Thinking of purchasing your first home? Don't know where to begin? Here are four steps to get you started.

1. Get pre-approved by a mortgage lender. Before you start looking at homes you will want to know how much you can afford to pay for a home. So visit a lender. This could be a bank you like, a mortgage broker, or a credit union. Ask friends who have recently purchased a home for a referral. Or go to your favortie bank. Or go online and search (although be sure to meet someone in person at their place of business before giving any personal information). There are also many programs to assist first time home buyers and your mortgage lender can help you with that. When you are ready to make an offer on a home you will need a pre approval letter from a mortgage lender to submit with the offer. Meeting with the mortgage lender first speeds up this process.

2. Now that you are pre-approved and know how much house you can afford, find a Realtor to work with. Realtors work on commission and their commission is paid by the seller so it costs you nothing to be represented by a Realtor and the benefit to you is great (you tell me after you have purchase your home). Meet with the Realtor and discuss your wants and needs. What do you have to have in a home? Must have a three car garage and would like four bedrooms but three bedrooms could work? Have to have a fenced in yard and two baths and would like stainless steel appliances but they are not necessary. These are just a few examples. The more details you give your Realtor the better he/she will be searching for a home for you and the more they know the closer you will get to the home you want. How do you find a Realtor? Ask friends, co-workers, neighbors for referrals to a Realtor they have worked with. Make some calls or send some emails. If you receive a quick response to either this is a good sign. Interview a few Realtors and see if your personalities mesh. You will be working together closely for two - six months so you will want to work with someone you like.

3. Look at homes. Your Realtor will email listings to you and you will let her know which ones appeal to you. Schedule a day to look at homes. While you look make sure you let your Realtor know what you like and dislike about each home. This helps her to clarify the type of home you want. When a home comes on the market you want to see, notify your Realtor quickly. If it is a seller's market (which it is now) homes go fast. You will want to look at homes that interest you quickly so it isn't sold before you have a chance to look.

4. Make an Offer. Once you find the home you want it is time to make an offer. Your Realtor will prepare the offer and explain it to you before you sign. Your pre-approval letter from the mortgage lender will accompany the offer. It is at this time that you provide earnest money in the form of a check made payable to the listing company or a cashier's check if you are offering on a foreclosure. This earnest money is held in an escrow account and is part of your down payment. You can ask for comparable sales in the area to help you decide how much to offer for the home. There is a lot of paperwork when purchasing a home so be prepared. The offer is usually made contingent on financing and an inspection. In other words you are telling the seller, "I will buy your home for X dollars but if I do a contractor's inspection and decide I don't want the home based on that, I can cancel the agreement and if the bank decides they won't give me a loan, I can cancel the agreement." So the offer includes addendums such as the Financing Contingency Addendum, Inspections Contingency addendum, etc.

 Questions? Ask in comments.

Come back next week for "What happens once my offer is accepted?"

What Difference does the Interest Rate Make?

Interest rates have not been this low in decades. I just closed a transaction in which the buyer received a 3.5% interest rate on their 30 year mortgage. That is a fixed rate for the life of the mortgage. As you can see from the chart above it makes a big difference on your monthly payment. If you have been considering purchasing a home, now may be the time. Questions? Email or call me and we can discuss the process.

FIVE things to do before you move

Moving is stressful! Even when planned, it can be chaotic at times and hard work for sure. What can you do to minimize the stress and chaos and just enjoy the moments?

1.  PLAN AHEAD. Do the easy stuff first. Get on the phone and transfer the utilities into your name; schedule the cable installer, and arrange for garbage pick up. It doesn't take much time and you will feel like you have really accomplished something.

2.  BOXES - BOXES - BOXES.  You need boxes! Lots of boxes! If you are hiring movers; great. They will bring boxes with them. Or you may have agreed to pack everything and the movers are carrying everything. Start collecting boxes. Look on www.craigslist.org and check if anyone if giving away moving boxes. Or you could purchase from a local U-Haul.

3.  DONATE. Take the packing opportunity to clear out unused items. Kids can donate toys they don't use anymore to a local charity. Clothes can go to the Salvation Army or the Goodwill who actually pick items up at your home.  

4.  ASSIGN DUTIES. Give everyone in the the family a job and a deadline. For example, each child has to pack his/her own room. Give them the boxes and a marker for labeling. If they are too young to pack alone, let an older sibling help. List each family member's job and deadline and give a reward when it is completed on time.

5.  EXPLORE THE NEW NEIGHBORHOOD.  Take a Saturday or Sunday morning and drive to the new neighborhood and explore. What restaurants are there? Any parks that look like fun? Where is the movie theater? Get the family excited about trying new things. Take pictures and print them out so the kids can show their friends their new home. If the new home is too far away for a drive, google it. Explore on the web all the great places. You can even use Google Earth for a look at parks.

What have you done to make moving less stressful?

What to Do in This Cold Weather?

Winter is here so let's enjoy it. Here are some cold weather places to have fun here in Andover.

Ice Skating:

Prairie Knoll     595 - 146th Lane     Hockey Rink and Ice Skating

Crooked lake School     2939 Bunker Lake Blvd     Hockey Rink and Ice Skating

Hawkridge     18001 Verdin Street     Hockey Rink and Ice Skating

City Complex     1885 Crosstown Blvd    Hocky Rink and Ice Skating

All of the above have a warming house.

Nordeens    15535 Juniper Street    Ice Skating

Hidden Creek North    2620 Bunker Lake Blvd    Ice Skating

Hidden Creek East    2156 135th Lane    Ice Skating

Sliding:

Andover Station North    1823 139th Lane

Prairie Knoll Park     595 146th Lane

Andover Community Center at 15200 Hanson Blvd NW offers several things to do. Click here to go to their website. Here are a few offerings:

Ice Skating Lessons - 1/5/2013 - 3/2/2013 or 3/23/2013 - 5/4/2013

Lots of Activities for older adults: potlucks, book club, walking club, bingo and fitness.

Indoor Walkting Club - Monday - Friday from 5AM - 9:30 AM

Tot-Time Open Gym - Mondays and Tuesdays from 10AM - Noon

Open Gym and Open Skate - Check the website for times.

Five Things to Expect From the Housing Market in 2013

Happy New Year and a joyful and prosperous 2013 is wished for all. What can we expect to see in 2013 from the Housing market?

1.  TRENDING UP! Last year we began to crawl out of the deep hole that housing has been in since 2008. It is a long way out but at least we are moving up. In 2012 prices began to trend up while inventory of homes for sale trended down. Nationally, housing hit bottom in October 2011 and home values have risen 5.3% since then. A survey of expert economists predict that home values will rise 3.1% in 2013. Homeowners can be assured that if they sell in 2013 they won't be selling at the bottom of the market.

2.  REAL ESTATE IS LOCAL.  Buying beats renting in almost every market. Here in the Twin Cities buying a home will give you a lower monthly payment than renting in many markets. I have clients who were paying $1200/month rent in Champlin for a 2 bedroom apartment. They purchased a three bedroom townhome and now their payment (including mortgage, property taxes and Homeowner's Dues) is $1100/month. They have more space, nicer amenities, similar area, tax deductions and a lower monthly housing payment. If you want to live in a condo in downtown Minneapolis or in a home on Lake Minnetonka this may not be the case but most areas in the Twin Cities it makes sense to buy a home.

3.  LOW MORTGAGE RATES.  Interest rates continue to be historically low. Combine the low rates with low housing prices and your dollar goes a lot further than it did four or more years ago.

4.  SHORT SALES? When the recession hit the housing market was impacted the most. Homes lost value and many homeowners owed more than the amount their home was worth. This meant they could not sell if they wanted or had to unless they brought money to closing or their lender approved a 'short sale'. For the first time since 2008 the number of 'underwater' homeowners has fallen below 30% nationally. This is a great sign for those who are looking for the housing market to recover. Still 28.2% of homeowners are still underwater which means people who want to sell cannot. Inventory is still low so buyers are fighting over homes on the market. Here in the Twin Cities the majority of homes on the market are receiving multiple offers. If you want to and can sell, now is a great time. Whatever you lose in your sale you will make up in your new purchase.

5.  MORTGAGE INTEREST DEDUCTION.  As our government decides how to cut spending and increase revenue one of the items that is often discussed is the mortgage interest deduction. It is likely that if anything is done with this deduction it will affect the high end (homes with values over $500,000) and second homes. Real estate lobbying groups continue to fight against changes to tax laws allowing for the mortgage interest deduction. Unless you are buying a home with a 1/2 million dollar price tag or more the impact of changes to the mortgage interest deduction will be muted.

Check back for updates as the year progresses. What trends are you watching?

Market Update

Here is your monthly Real Estate Market Update. It just keeps getting better. Prices are increasing, days on market is decreasing, inventory is decreasing. Great news for sellers.

Click here to see report.

If you have been thinking about buying; don't hesitate. Interest rates are still at an all time low. There are down payment assistance programs out there for incomes up to $120,000 annually (depending on this size of your family). Questions? Call me. Or email me. I will be happy to answer any questions you have about buying a home.

A Few Helpful Links

Winter has arrived and that means using the fireplace (if you are lucky enough to have one). Warmth and romance are great and here is how to stay safe:

http://freshome.com/2012/12/13/how-to-enjoy-your-fireplace-safely/

Some great decorating tips for the holidays:

http://freshome.com/2012/12/12/30-christmas-decorating-ideas-to-get-your-home-ready-for-the-holidays/

LG Smartphone Giveaway:

http://www.engadget.com/2012/12/13/engadget-giveaway-sprint/%3Ehttp://www.engadget.com/2012/12/13/engadget-giveaway-sprint/

Some fun links. Check back next week for more.