Home Buying Glossary
Are you in the market for a new house or already in the process of buying a house? There are some terms you should be familiar with:
Appraisal - The estimated market value of a property. Appraisals take into account the features of the property and the condition of the local market.
Balloon Loans - A type of loan where the regular monthly payment is followed by another payment, called “balloon” payment, of the total remaining balance.
Closing - (also called a SETTELMENT) IThe official transfer of a property's ownership from a seller to a buyer. It usually has a form of meeting between the seller, the buyer, the settlement agent and the buyer’s and seller’s agents. At closing, the seller receives the payment for the house, the buyer signs the mortgage (if applicable) and the buyer or/and seller pay closing fees.
Depreciation - Refers to the decrease of the market value of the property over time (due to market changes, changes of the property due to damages etc.)
Fixed-Rate Mortgage - A mortgage with payments that stay the same during the entire life of the mortgage. The interest rates of the loan are not influenced by the changes of the market.
Origination Fee - A fee paid to the lender at closing to cover the administrative costs of making the mortgage. The fee varies depending on the lender and the type of mortgage.
If you want to learn more terms associated with the home buying process, we encourage you to keep coming back to our blog.
If there are any terms associated with the home buying process that you are unfamiliar with, contact us or leave us your question below.
Prevent Your Home From Flooding
The most important step you can take to prevent flood damage to your home is to make sure your gutters are free of leaves and dirt and sticks.
Poor roof drainage is the No. 1 cause of basement leaks. A clogged gutter can cause even bigger problems by concentrating roof runoff water at your house's corners close to the foundation, which can seep through your walls and cause flooding. In fact, clogged gutters may be responsible for cracks in your home's foundation, according to Tom Kraeutler of the Money Pit.
To prevent this, make sure your gutters are tightly secured to your home. You may need to replace the spikes that secure your gutter with gutter screws. To clean clogged gutters, you'll need a ladder and a hose. To clear out debris, you can cut off the bottom half of a gallon milk jug and use it as a scoop to get rid of leaves or sticks.
Or consider gutter guards, which generally cost $3 to $7 a foot. Gutter protection products are available at any home improvement store like Home Depot or Lowe's.
Read more about other ways of preventing your house from flood damage…
Has your house ever sustained any flood damages? Do you know other ways of preventing it? You may comment on this article below.
Using Partnership to Buy Real Estate
Have you ever thought about using a partnership to invest in real estate?
Below, we present you with some of the advantages and disadvantages of using a partnership to buy property.
Advantages:
- You invest less of your own money. You and your partner may take advantage of various financial resources to achieve the goals connected with owning the property.
- Combining yours and your partner's credit scores may significantly lower your interest rate.
- Two heads are better than one. Together with your partner you may come up with many ideas that may help your property become prosperous.
Disadvantages:
- Being in a partnership, you never have full control over the property, thus, your actions may be limited.
- You and your partner/s may have differing views concerning any changes or improvements of your real estate. If a disagreement arises, a compromise will need to be sought.
- If your partner decides to quit the business you may be forced to sell the property.
If you have any questions concerning investing in a real estate you are welcome to contact us or leave us.
First Drop Expected for Home Prices This Year
The national median price for existing homes is expected to drop this year for the first time since the National Association of Realtors began keeping records in the late 1960s.
The NAR is forecasting a 0.7% dip in 2007 for the national median price for existing homes after a 1% gain last year.
NAR spokesman Walter Molony said "most areas should see modest gains, but some will see price declines. On balance, he said, prices should be flat.
The national median new-home sale price is projected to rise 0.4% after a 1.8% gain last year, according to the association.
According to Molony, new-home prices did decline 2.4% in 1991.
What is your opinion about the condition of the real estate market in U.S. now? Share your opinion with us.
Plastic Pipes: Concern for Buyers?
Polybutylene plastic pipe was commonly installed in mobile homes and low-budget housing, mainly during the 1970s and 1980s, and is prone to leakage. This can occur as slow seepage at loose fittings or as a major outpouring from broken lines. A water pipe may simply rupture, causing a torrent to spew wildly within a wall or inside the attic. Surprise leaks can happen at any time, or not at all.
Rarely do sellers repipe a home simply for the sake of marketing. If you choose to repipe, that's OK, but keep in mind that many buyers are willing to assume risks that are fully disclosed. Some might insist on a repipe or ask for a price reduction on the property. A few might withdraw their purchase offer entirely. On the other hand, you might find a buyer who was planning to remodel the home anyway. There is no single decision that fits all situations.
If you're selling a home with polybutylene piping, repipe if you prefer, but if not, fully inform buyers of the inherent risks of polybutylene pipe.
If you're buying a home, a home inspection should note whether the home you're considering includes polybutylene pipes.
Do you have any experience connected with the use of the polybutylene pipes? Share your opinion with us.
