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First Time Homebuyer’s Guide To Choosing A Lot August 9, 2010

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Did you ever consider building your own dream home? The first thing that you have to do to achieve this dream is to find the right piece of property. There are some things that you have to take into consideration aside from where it is located, there are different types and styles of real estate properties in MN to choose from. In addition to these, it is best that you are aware of such things such as the lots accessibility to power and other important amenities and the natural features that are found in the area.

The author of “Tips and Traps When Buying a Home”, Robert Irwin, recommends using a checklist when searching for a lot as a first time home buyer to avoid missing any critical details. Here are some essential tips that you can use to help you find the right property to build on:

1. Map out the nearby towns and cities. If the property you are considering is located in a rural area, you would have to know how far away it is from the nearest town and city. This is an important factor to be aware of since you might have to commute from your future home to work. Take the time to find out what your travel time is and what access roads to take so to get to the places you might need to go to like schools or hospitals.

2. Review natural features. How many trees are in and around the lot? Do you have access to a lake? How far is it from your new home? Many first time homebuyers overlook these important details when they have found what looks to be like their ideal lot. However, building a house that is very close to a lake or a forest means you may need to deal with wildlife and flooding during certain times of the year.

3. Find out where the water source is. When you live in a city or urban area, you typically don’t consider where the water is going to come from. When you are building a home on new land – especially in the countryside – you may need to work with a private water company and find ways to irrigate your gardens and land.

4. Find out the soil quality. When you plan to build a new home, you have to know the quality of the soil you will be building on. This is an important factor as it will ensure that your new home is going to have a solid foundation. There are professionals you can hire to assess the soil quality of the lot if you do not know how to check it.

5. Find out about building restrictions. Knowing what the building restrictions are in the area that you plan to build a new home will aid you in your planning. It is highly possible that there are restrictions on what you can build, how much you can renovate or remodel, especially if the property is located near a national forest, a wildlife preserve or a major landmark. Being aware of any restrictions will can help you decide what to do and save you from investing in something that you might regret on a later date.

Aside from assessing the physical features of the lot, you have to review the title in detail. Find out if it is a clear title and if there are no easements of any kind on the lot. Try to use these tips to help you find that ideal lot to build your dream home.


Calculating A Home’s Worth As A First Time Homebuyer June 10, 2010

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First time homebuyers can save a lot of time, money and effort by being organized and prepared for all the steps in the home buying process. When you are choosing any of the homes for sale, one of the most vital steps to take is the valuation of the home or being able to determine what the home is worth by making your own assessment.

Authors Eric Tyson and Raymond Brown of the book “Home Buying for Dummies” point out that the true value of the home doesn’t only consist of the price. Value means different things to different people, so you need to identify the factors that are most important to you when searching for your ideal home. Ultimately, the value of the home is what a particular home is worth to you, and what types of benefits you will derive from this type of investment.

When you begin the valuation process of any of the homes for sale, the first step that you can take is to review its actual dollar cost and compare it to the other homes for sale in the same neighborhood. This can be done by studying the Minnesota MLS listings of the area and discovering how much the seller had paid for the home, if possible. Finding out how much was paid will give you a baseline amount to use in your assessment, whether or not it is lower or higher than the seller’s current asking price. Other factors that you have to take into consideration is when the seller had bought the home because if more that 3 years has elapsed, an estimate based on the purchase price will no longer be accurate.

The next step in determining the value of the home is to consider how much work needs to be put into it if you were to move in next week. What needs to be fixed? How much do you estimate the repairs would cost? This amount may or may not be factored into the asking price, so it’s important that you understand what type of investment you will need to make on top of the asking price in order to ensure your home is exactly how you would like it to be.

The final step in determining the true value of any of the homes for sale is to project what the real estate value of your investment will be 5, 10 or 20 years from the date of your purchase. Is the home for sale located in a brand new subdivision or in a historic part of town? What is the average appreciation price of the homes in the neighborhood that you are interested in? Home buyers must be aware of the fact that investing in real estate property in an area where the price steadily appreciates will be to their advantage in case they ever decide to sell the home that they have purchased.

There are several factors to consider when you are looking at different properties and exploring various neighborhoods as a first time homebuyer. The true value of your home goes well beyond the asking price because you need to take into consideration how much of the home needs to be repaired, what the biggest benefits of living in a particular neighborhood are, and what the property will be worth in a few years. Take the time to learn about the price history and general market appreciation (or deprecation) rates in your neighborhood so that you can make a well-informed financial investment as a first time homebuyer.

Neighborhood Research Tips for the First Time Homebuyer May 14, 2010

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If you are a MN first time home buyer, the excitement of finding your dream home may turn into a chore because of the number of things that have to be kept track of and the important decisions that have to be made. Any undue stress and headaches in your property search and purchase can be eliminated by going about your search in an organized manner. It is of utmost importance to spend some time to assess new neighborhoods and looking at prospective homes. It may also be necessary to do your own research to discover which neighborhood is the ideal area for you to live in.

One important thing that a first time homebuyer can do is to explore at least a five-block radius of their ideal neighborhoods to see all the available homes for sale. You can choose to drive around the area or use an online mapping tool to navigate around the area. This will greatly aid in identifying the areas you would like to purchase any of the homes for sale and give you a relatively large inventory to work with.

A first time homebuyer must also be aware of where the nearest gas stations, grocery stores, public libraries are and the access points to interstate or major highways of the new neighborhood under assessment. Try to imagine what it would be like to live in that specific neighborhood. Keep mental notes of the locations of the various stores, service centers and roadways so the you can easily navigate around the area and commute to work if you decide to buy in that area.

You may also want to learn about zoning laws in your particular neighborhood, especially if you’re considering moving to an entirely new area. While some first time homebuyers are satisfied with the layout and structure of their new home, others are determined to start remodeling within months of moving in. Make sure you understand basic zoning laws and regulations for building pools, decks and extending your home out into the garden or yard so you can make the best decision for your needs.

Finally, you will need to learn about any condo association fees particular to your prospective area, as well as any taxes and other fees specific to the address you want to move to. You can find this information by contacting a real estate professional or checking the local county tax collector’s office website. Most tax collector offices have at least one website that allows you to enter an address and find out tax information. For condo fees and other fees related to the purchase, you can contact a local lender or real estate professional for an estimate.

Taking the time and effort to take find out about the new neighborhood you plan to live in is a vital step in the purchasing any homes for sale. Find out the important details about taxes, zoning laws and other related fees associated with a real estate property purchase by doing online research and contacting a local lender, a mortgage professional or a licensed real estate agent. The data that you have gathered will greatly aid you in deciding which among the MNhomes for sale to purchase.

Buying Your First Home Can Be Easy April 14, 2010

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Beginning homebuyers need to understand one essential aspect in the process of owning a Minnesota house and sales contract, which is ‘closing costs’.Most people seem to be unaware that closing costs are usually set at 15 percent of the sales amount and loaners usually ask that you pay for it directly. Although some lenders can roll them into the loan package, it would still be advisable to identify them as early as possible so you can wisely project your funds and easily discuss what you want as far as terms of arrangement in the final price is concerned.

It may be best to keep in mind that the lender base the maximum amount offered to you not on the net price (the sales price minus the closing costs) but from the actual sales price paid by the buyer. Closing costs are allocated in various ways and this may require the assistance of your real estate agent and lender so that you can project your funds in the best possible means and for you to work within your budget limit.

Having knowledge about the responsibilities of a buyer is the first prerequisite to understanding what closing costs are. The ‘Smart Consumer’s Guide to Home Buying’ book’s author, Barron, explicated how important it is to be aware that contrary to the belief of many, custom prescribes how closing costs are allocated as well as the buyer and seller responsibilities as stated in the contract, and not the law.

It is the buyer who typically settles all the fees and the loan’s the discount points. The lender adds all these at the end of the contract and may vary differently from one financial institution to another. More often than not, bankers will treat this fee as a part of the contract or may be dispensed depending on the customer, but still you must figure out the exact estimated amount.

Another responsibility of the buyer is the premium of the homeowner’s title insurance policy that has to be paid and needs to be settled before the purchasing even starts. Most will agree that it is beneficial to have some extra cash in your hands to pay for the premium and to avoid getting it rolled into the loan. Note also how premium cost may vary from one insurance company to another. Make some research on the homeowners insurance policy rates or look around for more options before you decide to sign the contract right away. These costs constitute the seller’s obligations.

Sales Commissions – are the fees apportioned to the buyer’s and seller’s agents. However, these may depend upon the MN real estate agent you chose to work with.

Inspection Costs – refers to the expenses related to the home’s inspection and all other forms of inspection that may be required before the buying and selling commence.

Title Insurance – there is one misconception about title insurance since many first time homebuyers think that they will need to take care of any costs associated with the title company except it. But, the closing costs also covers the title insurance costs, making it a responsibility of the seller.

When you know what closing costs are, you can have a better idea as to what your home’s final price will be during the signing. As a matter of fact, if early on the financing process you have done so, the lender may give you necessary information like the fees you will have to pay and discount points among others.

How to Get Started with Buying Your Home Online March 17, 2010

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To make it easier for you to find MN homes for sale or any other real estate property in the US from any point you are in the globe, a number of licensed real estate agents and professional realtors have created websites with a database of the latest real estate property and homes for sale listings. This was done to make it much easier for real estate buyers to be able to find prospective homes for sale in the location of their choice by being able to accessing it easily with the aid of the real estate website listing search.

This can be a very valuable opportunity when you are considering moving out of state or across the country, but there are still several important things to consider as you proceed with an online search. Whether you’re a first time homebuyer or looking for vacation home property, here are some important considerations when buying your home online:

1. Limit your browsing. Manage the time you have for browsing through the real estate property listings. There will be a vast number of homes for sale to choose from and you can target your search by choose a specific state, then placing in the price range, number of rooms, and other details within a real estate website search tool.

2. Keep track of all seller’s contact information. Set up a separate address book or spreadsheet to keep track of seller contact information for various properties so you have that information at your fingertips when you need it. This makes it easier to set up your appointments or second and third showings of a property; you won’t have to start the entire listing search from scratch when you create your own easily-accessible reference system.

3. Conduct an aerial view of the property. It is easy to get a bird’s eye view of the area that you want to live in and do an outside inspection of the homes for sale you are interested in. This can be done with the use of Google Maps satellite images and other tools. It will allow you to take a closer look at the homes for sale, the garden area, the garage, and area surrounding the home.

4. Don’t rely solely on listing pictures. Make a list of the homes for sale that you are interested in purchasing and make an appointment with the licensed real estate agent or professional realtor of the website that you found the property in so that you can get to conduct a home inspection when you visit your prospective area. This will be able to get a ‘feel’ of the home, take a better look at its advantages and disadvantages, and help your be better prepared to make the purchase of your new home.

5. Check the credentials of the Minnesota real estate agent. A professional real estate agent can help you to find the right real estate property without the headaches related to the property search and documentation as these things can be handled by them. You would have to find out how established the real estate agent is in the business, their credentials, their track history, if they are licensed, and what kind of listings they have.

6. Use a variety of search tools. Shelley O’Hara and Nancy Lewis, authors of the book, “The Complete Idiot’s Gide to Buying and Selling a Home” encourages prospective homebuyers to use several different sites and home buying tools when doing their research. For targeted search engine results, type in the name of the state you would like to buy property in, and then type in the words ‘buy homes for sale’ to ensure more accurate results. You may be able to find your perfect new home right away.

Why You Should Attend a Home Buying Seminar January 18, 2010

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Mortgage lenders, banks, libraries and real estate firms in MN often host home buying seminars to educate the community about the home buying process. Whether you’re a first time homebuyer or are thinking about moving to a new neighborhood, the home buying seminar in your area is a great place to have your questions about home buying answered by local professionals.

Home buying seminars are commonly conducted in places like the local library, the community center, or in a banquet room of a hotel or restaurant. It may be held as a lecture with a Q&A session, or as a PowerPoint presentation or as a slide show. Many of the home buying seminars can be attended free of charge and you will surely benefit from tremendous amount of information that will be given.

A key benefit of attending such seminars is getting meet people like the local realtors. This is a great opportunity to know the various realtors and agents in person, rather that have to having to find them by using the Yellow Pages or search engines. It is also a way to establish new relationships and get to learn more about their services or the firm that they are working for.

Mortgage lenders that conduct home buying seminars will educate you on the financial side of home buying, and may introduce several loan packages and programs available, or even prequalify you on the spot. Meeting mortgage lenders at these events helps you establish a relationship and may make it easier for your to get started on the preliminary loan document process.

Some lenders and realtors may also offer discounts or incentives for attending their own branded seminar. While local libraries and educators also host these informational events, they may not be able to direct you to specific professionals in the area. When you attend a seminar hosted by a lender or realtor, you’ll have an opportunity to get referrals and other insider information about services you need. Mortgage lenders who host the event may waive your closing costs if you attend the event, and realtors may offer gift cards or other free gifts as part of their invitation.

“1,200 Great Sales Tips for Real Estate Pros” book authors, Christina Spira and Mariwyn Evans, stated that realtors who go the extra mile by creating videos to introduce their services and offer free gift bags go these things to establish a relationship with their prospects. These seminars can be used by you to get a closer look on how the company and the agents treat their valued and prospective clients.

The information you can garner from the professional realtors and the other benefits that you can get by attending these seminars will greatly aid you to getting a better home purchase. Consider signing up for one or two home buying seminars in your prospective area to get an insider’s view of the current market and learn more about your home buying needs from the experience realtors.

Tips in Choosing Between Existing and New Homes December 28, 2009

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Buying a brand new home as a first time home buyer in Minnesota is an attractive proposition for most; you get to move into a completely new living space with brand new amenities and don’t have to worry about maintenance and renovations for at least the first year.

Nevertheless, brand new properties are more expensive than existing ones and you’re not always sure what awaits you in the new neighborhood you will be living in.

Understanding the benefits and drawbacks of each scenario can help you make the best decision about your new home purchase; consider the following important points as you get started on the home buying process:

1. To what extent would you be wanting to pay for your desired property? Because of its newness, all brand new homes in Minnesota are priced at a premium; this means that you will be the one to get a taste of everything it offers, from the moment you entered your new property.

2. How important is resale value to you? Existing Minnesota homes for sale can have slower appreciation than newly-constructed ones, as explicated by Ilyce Glink (writer of the book ‘100 Questions Every First-Time Home Buyer Should Ask’). If you are planning on selling your home in the very near future, a brand new home may have a higher market value shortly after you move in, making it easier to sell the home for a profit.

3. Can you easily adapt to a new neighborhood? New home construction developments can grow at a rapid pace, and if you’re one of the first few homeowners in the area, you won’t have a strong idea of what the neighborhood is really like until more people move in.If you have family consisting of smaller children or elderly living with you, it can be great to factor in safety and security by finding out your options as far as making your property safe.

4. Do you want to invest time and money to renovate a home? Existing homes can appreciate tremendously in value if you have the time and resources to invest in renovations and maintenance. Finding good investments that will work in the long run but can be profitable even in a shorter time is possible with a ‘fixer upper’.

5. Which do you prefer, a primary residence or an investment? Most beginning homebuyers want investment properties that they can soon turn into a profitable business. However, older and mature homebuyers prefer primary residence mainly for purposes of settling down or establishing themselves in the neighborhood. Consider what your short-term and long-term goals are so you can make the best decision for your first home purchase.

Based from your goals (both longterm and short term) and the amount of money you are willing to shed off your pocket – thats when you decide to have either a new or existing home. Consider all of the above questions when you’re deciding between the two options so you can make the best investment with your resources.

What You Should Know About Working with a Seller Broker November 26, 2009

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Many first time home buyers in MN end up working with a subagent, otherwise known as a seller’s agent and it’s important to understand that these agents are working on behalf of the seller, not the home buyer. Seller’s agents are hired to represent the seller and bring the buyer to the deal, but they do work on a commission and have certain rights and responsibilities towards the buyer.

Real estate regulations vary across different states but there are federal laws that define common responsibilities, and limitations, of a seller’s agent. Ilyce Glink, Author of ‘100 Questions Every Home Buyer Should Ask’, advises home buyers to know the exact terms of service of an agent by reading the agency disclosure form. Clarify what each provisions mean with the agent; but if you really cannot understand the wordings, it is best not to sign the form. Below are the key obligations of a seller’s agent:

A seller’s agent can give you information regarding similar homes in the area. This information is called comparables or ‘comps’ and is a listing of homes that have similar price, size and area, and age. Comps can include homes that were recently sold or are currently in the market. This information allows a homebuyer to have a basis of comparison to ascertain the value of a home.

Seller’s agents cannot dictate, or otherwise pressure, home buyers into buying a home. The seller’s agent’s job is to facilitate the selling of a home but it doesn’t mean that they can force homebuyers into buying a home. You might be in a situation wherein you are deciding between two homes that are handled by one subagent. In this case, the seller’s agent cannot compel you to choose one home over the other.

A seller’s agent cannot reveal the flaws of the home, except for imperceptible material imperfections. They are not allowed to disclose information that can influence you not to buy a property. Homebuyers must conduct their own inspection to assess the condition of a home.

It is illegal for seller’s agents to provide information regarding the best offer amount to homebuyers. Remember that a seller’s agent should be concerned with the interests of the seller first and foremost. Giving a tip to the buyer infringes on a seller’s agent’s relationship with the seller.

With all the restrictions on your relationship, a seller’s agent can still ask for referrals from you. Seller’s agents are typically self-employed or small business owners and there is no law that restricts someone from referring others to a business.

The job of a seller’s agent is to make the buying and selling process as smooth as possible. As a buyer, you have to remember that seller’s agents are working for the seller. Therefore, it is still important for you to do your own research and work with a professional buyer’s agent.

Homebuying Basics – Negotiating The Best Price For Your Home October 17, 2009

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After you’ve spent enough time doing all of the research about your prospective MN home and are comfortable with working with the seller, it’s time to make the offer. However, the home buying offer isn’t the end of the sales process; you may be involved with negotiating a price after making the offer if the seller refuses to accept it, so you’ll need a plan to get the price you want – or close to it – well before you extend your initial offer.

Studying the contract in detail and having a back-up plan are just two ways to prepare for the negotiation process. Barron’s ‘Consumer’s Guide to Home Buying’ explains that it is best to be prepared for price negotiations even before submitting an offer by creating a checklist of items to consider when negotiating. Here are some items you need to take into account when negotiating for the price of your new home:

1. Knowing who the decision-makers are in the transaction. Understanding who really calls the shots is a critical element in any negotiation. Is the seller working alone or do they involve their lawyers, accountants, agents or any other third parties in their transactions? You can adapt your negotiating approach and gauge the trustworthiness of the seller if you know who the decision makers behind the contract are.

2. Do you have a contingency plan? If the seller refuses all of your offers, do you have other options? It can be frustrating to not be able to get what you want from the negotiation, but you also need to know when to back off and pursue another direction. Outline exactly how high you are willing to bid for the home and don’t go beyond your decision just to win.

3. Read the whole contract in detail. Know what you’re getting into before you sign your name on the contract. Review the contract in detail and take note of any provisions that are not clear to you. It is best to clarify all terms in the contract with the seller than to assume the meaning of the terms yourself.

4. Develop a relationship with your realtor. Realtors have the experience to give you professional advice about your prospective home. Spend the time to develop a positive working relationship with them. Voice out your concerns to your MN realtor well ahead of the negotiation process to give your realtor time to help you in making an informed decision.

5. Be prepared to handle negotiation setbacks. Poor communication happens in any negotiation often and you have to learn how to deal with it. There are other things as well that make negotiating difficult. It is important to remain impervious to negotiation setbacks but you have to know when to stop negotiating when you think the transaction is not going anywhere.

Home Inspection Basics As A First Time Homebuyer September 17, 2009

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You want to avoid any major surprises when you’re considering a new Minnesota home purchase so contracting with a professional home inspector can alleviate much of the stress and concerns about your prospective home early in the home buying process.

Then again, official home inspections are only required after an initial contract is signed. It would be better for you to gather your own information about the house you are eyeing. You can go straight to the seller and ask him or her everything about the house. You can also ask for permission to conduct your own mini-inspection.

Sellers typically allow prospective buyers to inspect their home before anyone enters into any agreement. Barron’s ‘Smart Consumer’s Guide to Home Buying’ advises homebuyers to use a checklist in taking note of any problems and issues in the earliest time possible. The book further explains, “If you are thinking about buying a house that will need renovation or upgrading, the more value will be derived from your mini-inspection.” The mini-inspection will ultimately give you a bargaining leverage when negotiating for the price of the home you are buying.

Create a checklist that you will use in your home inspection. This will help you in taking notes of the general condition and appearance of the house. Below are important issues to include in your notes:

The age of the house – You should know exactly when the house was built. Find out if there are any renovations or upgrades done and when these took place. Ask if blueprints, architect or engineer plans are available.

Check the foundation for potential problems – are there any large cracks or noticeable water problems around the home or in the basement? Ask about flooding issues and weather-related problems that have taken their toll on the home in different seasons.

Check the interior for defects and potential problems – you’ll want to make sure that all doors open and close easily and that all the walls are flat, even and free of cracks. Make a note of any visible cracks or deterioration and take pictures of anything that stands out. You’ll also want to check for mold problems, odors and make sure all water entry areas are clear and functioning properly.

Inspect the exterior of the house – Check if all windows and doors move smoothly and if these are properly insulated. Inspect the sidings of the house. Look for signs of deterioration.

Review heating and air conditioning appliances – ask about the average heating and cooling costs each month, and find out how long the systems have been in place. In some cases, you may need to invest in a new water heater or air conditioning system.

In addition to the written inspection report, you may consider taking pictures or short video clips using a digital camera/camcorder so you can review everything again in more detail at a later date. This extra footage or coverage may also give you an upper hand during the negotiation process with the seller.