Buyer Resources

Most home buyers know that they need to have a substantial amount of money saved for things like a down payment (as much as 20% of your purchase price depending on your loan product) and closing costs (typically between 2% to 3% of the purchase price).

But some home buyers – even those buying their second or third home with me – are surprised by the upfront out-of-pocket costs of buying a home, which can range from small to significant.

Here are the upfront costs of purchasing a home in the Arlington area:

Earnest Money Deposit (1% to 2% of the sales price)

The earnest money deposit helps to show the seller that you are a committed buyer and is due when you submit a contract offer to buy a home. An average earnest money deposit is usually 1% to 2% of the sales price, but it will depend on a variety of factors including existing competition from other buyers and additional terms you are offering.

If your bid is one of multiple bids made on the home, this “good faith deposit” may influence the seller’s decision-making in your favor. That’s why in a competitive bidding situation, I may recommend that you deposit more rather than less to make your offer as strong as possible.

The deposit is held in a non-interest bearing account at your selected title company. It will be deducted from the total amount of funds required from you at settlement.

Inspection Fees ($500 to $1,000)

There are several inspections that you will need to pay for as a buyer at the time of the inspection and they include:

• Home inspection ($400 to $800). A home inspection helps to determine the condition and performance of the home’s major systems and to check for any needed repairs. I usually recommend that you make your home purchase contingent on the result of the inspection so you can walk away in case significant defects are found. Learn about what a home inspector looks for during an inspection.
• Radon Inspection ($100). I also suggest that you purchase a radon inspection as about 15-20% of the homes in the Arlington area have radon levels that need to be remediated. Radon is the second leading cause of lung cancer and the leading cause of lung-cancer among non-smokers, according to the EPA’s Radon Guide.
• Termite Inspection ($35). I recommend that you get a termite inspection as termite damage can be very expensive to repair if there’s a problem. If the inspector finds signs of an active termite infestation, the seller is responsible for the treatment and any repairs.

Property Appraisal and Credit Report Fees ($430 to $550)

• Property Appraisal ($400 to $500). Your mortgage lender will have an appraisal completed to confirm the value of the home you want to purchase because the property serves as collateral for the loan.
• Credit Report ($35 to $50). Your lender will purchase a report to check your credit. You pay the cost for this.

Cash Reserves (3 to 6 months of your monthly payment)

While not exactly an upfront expense, most lenders will require that you have 3 to 6 months’ worth of monthly payments in cash available (usually in a checking or savings account) at the time of closing.

Those are the main upfront costs of buying a home in the Arlington area. If you’d like to know more about all the costs of buying a home or would just like to talk about buying a home or selling a home please feel free to contact me at 703-447-0970 or email me for a no-pressure, free consultation.

Many people ask me if they should buy or sell a home during the winter market, which is typically November, December and January.

If you are a buyer, there are fewer homes on the market but there are also fewer buyers to compete with. Additionally, you may be able to get a nice discount since homeowners who place their home on the market in the winter are typically highly motivated. However, if you have very specific criteria that makes the home you want difficult to find, you may need to be patient until spring when more homes for sale come on the market.

If you’re looking to buy, remember that the seller is likely as motivated as you are because very few people choose to put their house on the market during this time of the year.

If you are looking to sell, buyer motivation and low inventory can be on your side. While some homebuyers are looking for a “deal,” some need to find a home due to a job or family change that necessitates a move before the spring season. With fewer homes available for sale, your chances of getting a contract can be stronger.

Here are five tips for buying or selling a home during the winter:

1. Buyers should be quick with an offer. Other motivated buyers and sellers are also out there, so time is of the essence in securing a home.
2. Sellers should not be quick to dismiss an offer. With less competition, buyers may be more likely to make a “low ball” offer than during the busy spring or fall seasons. Be open. If the initial offer is low, you don’t have anything to lose by countering the offer.
3. Be open to negotiation. It’s likely that both seller and buyer are motivated to make a sale.
4. Be flexible on closing/settlement times. Consider the holiday schedule, which affects not only lender and title company availability as well as employee vacation time and the family commitments that the seller and buyer likely have.
5. Be joyful. You might end up with a great gift for your family during this often-festive time of year: A new home or the sale of the family home.

Want To Know More About Buying Or Selling Your Arlington Home In The Winter?

Have questions about when is the right time to buy or sell a home in Arlington, VA? Feel free to email or text/call me at 703-447-0970 to talk about buying a home or selling a home. I’d be happy to help.

Every so often, an opportunity arises for Arlington area home buyers – and investors – to purchase homes at a good price because they need repairs, improvements, replacements or cosmetic attention.

And, while buying a house that needs some TLC can have advantages (like being able to update it the way you want), it can also come with some challenges.

Here are 7 tips and resources for buying a fixer-upper (or any home) that won’t zap your budget:

1. Check Local Zoning. Zoning regulations specify how a property can be used and can – or cannot – be changed. Think about how you may want to change the property.
2. Investigate Local Building Codes. Building codes are designed to ensure the structural and fire safety of buildings. Codes cover pretty much everything relating to building design, construction, additions, enlargements, alterations and even repairs and maintenance including standards for plumbing, electrical and mechanical construction.
3. Check Permits. Have changes already been made to the home that required permits? If so, check the county website to make sure the permits exist and have been satisfied.
4. Read HOA Covenants. If the home you are considering is governed by a homeowners association (HOA), you’ll want to check the HOA covenants to see whether they will limit your plans.
5. Consider Easements. An easement is a property right that has been granted to an individual or entity that does not own the property to which the easement is attached.
6. Order Inspections. A licensed home inspector will check the major systems of the home and report on their condition and whether they are working properly. Remember, though, a general home inspection may not find everything that’s wrong with the home.
7. Investigate Development Plans. Conduct research to find out whether the city, county or state has plans or has approved private-entity plans that might adversely affect the home’s value.

RESOURCES AND LINKS

Here are helpful links to information about local building permits and development projects in Alexandria, Arlington, Falls Church, Fairfax City and Fairfax County.

City of Alexandria Permits and Projects

• Permit Center
• Active development projects in Alexandria

Arlington County Permits and Projects

• Residential building permits overview
• Do I need a building permit?
• Plans for significant projects in Arlington
• Quarterly development tracking report

City of Falls Church Permits and Projects

• Building codes, policies and permits
• Development projects in Falls Church

City of Fairfax Permits and Projects

• Building permits
• Major projects and plans in Fairfax City

Fairfax County Permits and Projects

• Building permits

HAVE QUESTIONS? I’M HERE TO HELP

Have questions about buying or investing in a fixer-upper or a home that you would like to improve and remodel? Feel free to email or text/call me at 703-447-0970 for a no-pressure, free consultation. I’d love to see if I could help.

Buying a home isn’t always a straight-forward task. If you want to get your dream home, you must avoid the deal killers that could adversely affect your transaction. Here’s a list of the top 10 deal killers that can damage your chances at buying a home.

1. Don’t Start Shopping Until Your Financing Is In Place. If you’re thinking of buying a home, go to a lender now and get pre-approved for a mortgage loan. You’ll know exactly how much home you can afford, and your purchase offer will carry more weight with home sellers.
2. Don’t Dismiss. Just because a house doesn’t show well online doesn’t mean it should be dismissed. If the home meets your requirement for size and price, take the time to visit it in person. You might be surprised to learn that it might be the perfect home for you.
3. Don’t Keep Talking. Remember, silence can be golden. If the seller’s real estate agent – or the sellers themselves – is present during your home tour, let them talk. Just listen and nod. You might learn something about the home that will make you jump to put in a purchase offer – or run in the opposite direction.
4. Don’t Blather About The Deal. It’s a small world. Keep the details (price, terms, condition, etc.) of the sale to yourself, at least until closing/settlement.
5. Don’t Lowball. Your real estate agent’s job is to advise you on the value of a home you’re considering purchasing. Don’t ask your Realtor^® to submit a purchase offer significantly under the home’s value. You’re wasting your time, the agent’s time and the seller’s time. Realize that a seller is not required to counteroffer, and may choose to ignore your offer completely.
6. Don’t Nitpick. Yes, the home inspection report comes back and a faucet drips here and a door knob is squeaky there. No one’s house is perfect, including the one you’re about to buy. Don’t be difficult and unbending in dealing with sellers. They could walk away from your purchase offer because of your attitude and select another buyer.
7. Don’t Be Greedy. Don’t ask for too much. If you had to work to win the house over other purchase offers, it’s best to keep your financial requests to a minimum. Don’t expect closing costs to be covered, a new HVAC system installed or a brand new roof be put on.
8. Don’t Be Slow. If you’re looking to buy a home in today’s Arlington area market, you have to move fast. You don’t have to make rash decisions, but taking too long can mean losing a house. Additionally, don’t drag your feet in submitting documents and information to your lender. Your delays may postpone settlement or even cause the cancelation of the sale entirely.
9. Don’t Forgo A Final Walk-Through. Make sure the home is substantially the same as when you put in your purchase offer. It is important to tour the home before settlement to ensure nothing is amiss and that all required repairs have been completed. Skipping the walk-through could cost you. You might be stuck with expenses for repairs that the seller should have taken care of prior to closing.
10. Don’t Forget To Work With Professionals. As a homebuyer, make sure you have a real estate professional on your side to represent your interests in the transaction. The home seller’s real estate pros are working for the seller and anything you tell them in relation to the home purchase can be reported to the seller, and potentially work to their advantage. Plus, as a buyer, having a Realtor^® represent you doesn’t cost you a penny.

Interested in buying a home or selling a home in the Arlington area and want someone to represent your interests? Feel free to email or call/text me at 703-447-0970 for a no-pressure, free consultation.

Before you go home shopping—online or in person—make sure your finances are in order. And when you start to get serious about buying a home you need to start at a lender’s office, not at an open house.

There are two options for home shoppers to show potential sellers that they are ready to buy: pre-qualification and pre-approval.

Pre-Qualification is a Ballpark Estimate

Pre-qualification is typically done via a phone call with a lender where the lender conducts a cursory review of your finances – a verbal listing of your income, debts, savings and other finances – and then comes up with a rough ballpark guideline of the mortgage amount for which you would qualify. That number is just an estimate and is not a guarantee that you’ll get approved for a mortgage or that the amount you were pre-qualified for won’t change—either up or down.

However, pre-qualification is a quick and easy way to find out your price range.

Pre-Approval Makes You a Serious Home Buyer

To be considered a serious buyer you will need to speak to a lender and get pre-approved for a loan. What’s the difference between pre-qualification and pre-approval? Details. When you are pre-approved, you fill out a loan application and provide proof of your income, debts, savings and other finances that affect your ability to repay a mortgage loan. The lender will give you a detailed approval letter that confirms exactly how much mortgage you’ll be approved for.

Pre-approval allows you to shop confidently for a home in your price range. Additionally, when you make an offer on a home, the pre-approval makes your offer look more desirable as the home seller knows your financing is pre-arranged. In a competitive home sales market like Arlington, sellers won’t even entertain offers from buyers unless they have a pre-approval letter in hand.

That’s why you should be pre-approved for a mortgage before you start seriously shopping for a home.

Need Help?

If you’re getting ready to buy a home and looking for a lender, feel free to email, call or text me at 703-447-0970 for a recommendation of several trusted local mortgage lenders you can talk to about mortgages and pre-approval.

Read more about how I can help you buy a home.

Dual agency, when one real estate agent represents both the buyer and the seller in one transaction, can be fraught with perils and pitfalls. Dual agency is a bad idea and I won’t do it – and neither should you.

But before I explain the 5 reasons why you should avoid dual agency, let me list the types of real estate representation that are available when you buy or sell a home:

• Listing Agent: The Realtor^® is employed by the seller and represents only the seller in the real estate transaction.
• Buyer’s Agent: The Realtor^® is employed by the buyer and represents only the buyer in the transaction.
• Designated Representative: The listing agent and the buyer’s agent work for the same real estate firm or broker. Even though the agents are in the same company, they each represent the buyer and seller separately.
• Dual Representative or Dual Agency: The same Realtor^® represents both the seller andthe buyer during the same transaction.

When Are You Likely To Encounter Dual Agency?

A common way that a dual agency situation can arise is if you visit an open house as a buyer before you’ve hired a real estate agent, and tell the agent showing the home that you are interested in buying the house. Then the agent, who is working for the seller, offers to help you write an offer on the house. If you accept that offer, you will be working with a dual agent or representative.

5 Reasons To Avoid Dual Agency

Here are 5 reasons why you should avoid dual agency when buying or selling a home:

1. There are no benefits of dual agency to you if you are a buyer. A dual agent can’t be your advocate since the agent is representing both parties. Plus, you could be losing out on the opportunity to have an agent search for properties and represent only your interests.
2. A dual agent is not required to disclose the lowest price or terms the seller will accept, or the highest price and best terms the buyer is willing to offer. That creates a conflict of interest since the seller wants the highest possible price and the buyer wants the lowest possible price.
3. While your agent is bound not to share any information you provide, would you feel comfortable telling someone also working for the seller the top price you would be willing to pay for a home?
4. A dual agent has a large incentive to close a sale and this could create issues where the agent may not adequately represent one or both parties for fear of spoiling the deal, and losing out on not one, but two commissions.
5. Dual representation is the most common cause of lawsuits in the real estate industry because it poses ethical risks.

You should know that every agent has their own opinion on this subject and can choose to do it, if they wish, if both the seller and buyer agree to it. It’s a completely legal and very common practice in Virginia and D.C., but it is prohibited in Maryland and many other states.

My Advice: Hire Someone Who Will Represent Only You

My advice to homebuyers and sellers is to hire a Realtor^® who will only represent you. Do not sign a contract with an Arlington area real estate agent who will be a dual agent and represent you and someone else. Having the same Realtor^® represent both the buyer and seller is like having the same attorney represent both sides in a divorce.

You’ll be forfeiting your right to proper representation. And as a buyer, having a buyer’s agent represent you and your interests doesn’t cost you a penny since the seller pays the commission.

Want To Know More About An Agent’s Role?

Click here to request the brochure “Agency: Straight Answers About An Agent’s Role,” that explains the differenced between a buyer’s agent and seller’s agent and answers commonly asked questions.

Need A Trusted Advisor Who Works Only For You?

Interested in buying a home or selling a home in the Arlington area and want someone to represent your interests? Feel free to email, call or text me at 703-447-0970 for a no-pressure, free consultation – I would love to see if I could help you.

REAL ESTATE TERMS HOME BUYERS AND SELLERS SHOULD KNOW

Having a basic understanding of the ABC’s of real estate can help you navigate the sometimes confusing world of terms, jargon and “lingo” used when you are buying or selling a home in the Arlington area.

CMA? LTV? MLS? Here are 20 real estate terms you should know before you buy or sell your next home.

APR — Annual Percentage Rate: The true cost of your home loan, which includes the interest rate, points paid and any other fees in taking out your mortgage; often the best rate to use to compare mortgage loans when shopping for a lender.

ARM — Adjustable Rate Mortgage: A home loan with an interest rate that can change periodically, on the basis of changes in a specified index, meaning your monthly mortgage payment can go either up or down, as market conditions change.

CMA — Comparative Market Analysis: The process by which a real estate pro arrives at a value of your home by examining local data including the features, size and location of your property along with recently sold and for-sale homes in your area.

Comparable Sales: Sales that have similar characteristics as the subject property and are used for analysis in the appraisal process and for contract negotiations.

Deed: Written instrument, which when properly executed and delivered, conveys title to real property.

Discount Points: A fee charged by a lender, at the purchaser’s option, to “buy down” the interest rate on the mortgage loan. One point = 1% of the loan amount.

Escrow Payment: That portion of a mortgagor’s monthly payment held in trust by the lender to pay for taxes, hazard insurance, mortgage insurance, lease payments and other items as they become due.

FHA — Federal Housing Agency: An agency of the U.S. Department of Housing and Urban Development (HUD). Its main activity is the insuring of residential mortgage loans made by private lenders, especially allowing those with financial struggles to obtain mortgages.

Fixed Rate Mortgage: A loan that fixes the interest rate at a prescribed rate for the duration of the loan.

LTV – Loan to Value Ratio: The ratio of the mortgage loan principal (amount borrowed) to the property’s appraised value (selling price). Example – on a $100,000 home, with a mortgage loan principal of $80,000 the loan to value ratio is 80%.

MLS — Multiple Listing Service: An organized nationwide system that provides real estate professionals a centralized location to search for properties and comparable sales for their clients. The MLS in the Arlington area is known as the MRIS, one of the nation’s largest MLS systems.

Origination Fee: A fee charged by a lender on entering into a loan agreement to cover the cost of processing the loan.

PITI—Principal, Interest, Taxes, Insurance: Related to home mortgages, PITI refers to the total amount paid each month including principal, interest, taxes and insurance.

PMI – Private Mortgage Insurance: The amount paid by a mortgagor for mortgage insurance. This insurance protects the investor from possible loss in the event of a borrower’s default on a loan.

Ratified Contract: A contract that has been agreed to and signed by all parties.

Realtor: A member of local and state real estate boards, which are affiliated with the National Association of Realtors (NAR). Not all real estate agents are Realtors. A real estate agent is an individual who is licensed to buy and sell real estate. A Realtor is an agent or broker who belongs to the National Association of Realtors

Settlement Statement: A financial statement rendered to the buyer and seller at the time of transfer of ownership, giving an account of all funds received or expended.

Tenancy In Common: Ownership by two or more persons who hold an undivided interest without right of survivorship. (In event of the death of one owner, his/her share will pass to his/her heirs.)

Tenancy By The Entirety: A special form of joint tenancy for married couples which creates a right of survivorship, it allows the property to pass automatically to the surviving spouse when a spouse dies.

Title Insurance: An insurance policy that protects the insured (purchaser or lender against loss arising from defects in the title).

Want To Understand More About Important Real Estate Terms Homebuyers And Sellers Should Know?

Have questions about real estate terms, jargon and lingo? Feel free to email or text/call me at 703-447-0970 to talk about anything you have a question about, whether it’s understanding common real estate terms or buying a home or selling a home in the Arlington area.