Home Warranty Basics

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Whether you’re a homebuyer or seller, a home warranty can give you peace of mind. Also known as a home service contract, the home warranty typically covers mechanical systems and built-in appliances in the home.

Not to be confused with homeowner’s insurance, which covers damage from external forces, home warranties are designed to fill the gap between the original manufacturer’s warranty and normal wear and tear, according to HomeServiceContract.org.

Here’s how it works. If your AC goes out, or your dishwasher breaks, you contact the home service company and describe the problem. The dispatcher will send the appropriate licensed plumber, electrician, or appliance repair specialist to service the call. Expect to pay a service fee of about $50 or higher for each visit.

Remember that home warranties don’t provide blanket service. They don’t cover repairs or replacement for pre-existing conditions or for elderly mechanicals that are beyond their useful lifespan. But they are good for emergencies if your toddler clogs the toilet trying to “wash” his teddy bear.

For home sellers, home service contracts improve the home’s marketability to homebuyers and diminishes liability. For buyers, warranties can absorb the costs of unexpected repairs or replacements. Extended coverage for non-built-ins such as clothes washers, dryers, and stand-alone refrigerators is usually available.

When you think about the wide range of systems and appliances that it takes to operate your home, a home service contract is a bargain at approximately $400 to $500 and could pay for itself with one use.

Tips for Fixer-upper Buyers

 Tips for Fixer-upper Buyers

Home prices have been rising for five years, and spring sales are outpacing last year, according to the National Association of REALTORS.® When it’s harder for buyers to find the perfect home, what’s a great strategy? Buy a fixer upper!

There are real advantages to buying a home that needs work. Unloved or outdated homes don’t attract as many buyers, allowing you to mine the gold under the dirt. You’re getting the home at a discount compared with the rest of the neighborhood. You’re not paying top dollar for someone else’s improvements and you can make the home your own. You’ll wow your friends and family with the result.

Shop for the best neighborhood you can afford. Look for the worst home in the best neighborhood. Usually that home is older, smaller and not as well maintained as other homes. You’ll build instant equity when you improve the curb appeal, so the home looks like it belongs with its neighbors.

Ignore the cosmetics. Don’t stress over ugly paint, shag carpet or gingerbread trim. We at Fab Realty  Group can help you distinguish features that matter and which are easy to change.

Consider the bones. You need to know whether or not you can open a kitchen to the den or add on a bathroom or other square footage. These updates can be costly but they add value to the home. Talk to your lender about loans that pay for remodeling such as FHA’s 203(k) program or Fannie’s HomeStyle Renovation Mortgage.

Fabiola Brunache

Fabiola Brunache, Trusted Real Estate Advisor

 

Three Responsibilities of Homebuyers

Three Responsibilities of Homebuyers

Nothing says, “Welcome to Adulthood” like buying a home. You’re taking on very real responsibilities, but you may not realize how far they reach and impact others. Meeting them will reward you and your family for years to come with more equity, happier neighbors and a better living environment for your family.

Financial responsibilities: Paying your mortgage on time helps you build better credit and gets you lower interest rates if you refinance or make a new purchase loan some day. Now’s not the time to get overextended with new furniture, remodeling or other debt.

Limit the credit you actively use and pay off balances every month. Don’t add new charges until you’ve paid off your balances. Try to save as much as you comfortably can with the goal to build at least six months of cash so you can make your house payments if you become ill, lose your job or face an emergency.

Neighborhood responsibilities: When you buy a home, your household becomes part of the neighborhood. Protect your investment and that of your neighbors by keeping your lawn and trees trimmed, your home freshly painted and repaired, and toys and trash picked up from the yard.

Household responsibilities: Your home should help make you and your loved ones safer and happier. Don’t take on more house than you can comfortably afford. Try to choose the best home that suits the needs of your household without creating anxiety between you and your spouse over monthly bills.

Home buying mistake #1 – Failing to have a plan

Mistake #1: Failing to have a plan

Deciding to buy a home is probably the biggest financial decision you will ever make. It is an exciting decision, but it is serious business too, and you deserve serious advice. With a game plan, you will eliminate many of the headaches involved in this complicated transaction.

You should have a clear plan when deciding to buy a home. Evaluate your current situation. Do you currently own a home? If so, will it be necessary to sell before making another purchase? Are you renting” How much time is left on your lease? What is important to you about the location of your home? How close do you need to be to schools, work, shopping?

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Make a list of features that are important to have in your next home. List your desired price range, locations that you would like, number of bedrooms and baths, and any other amenities. Be specific and prioritize your list. It is unlikely that you will find a home that offers every feature you desire, but a list will help you identify homes that best meet your wants and needs.

Share your list with your real estate agent and review the details and priorities. Your agent will look for homes that best match your criteria, saving you time looking at homes that don’t fit your needs.

A proper game plan will save you time and reduce the stress of shopping for a home. Invest time at the beginning and you will have a more satisfying home buying experience.

The right real estate agent can make the home buying process a satisfying and profitable experience.

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Bank Owned, Short sale and foreclosure: How are they different?

short-sale-foreclosure-shopping-cart

As unfortunate as it can be when homeowners fall behind on mortgage payments and must face the possibility of losing their homes, short sales and foreclosures provide them options for moving on financially. The terms are often used interchangeably, but they’re actually quite different, with varying timelines and financial impact on the homeowner. Here’s a brief overview.
A short sale comes into play when a homeowner needs to sell their home but the home is worth less than the remaining balance that they owe. The lender can allow the homeowner to sell the home for less than the amount owed, freeing the homeowner from the financial predicament.
On the buyer side, short sales typically take three to four months to complete and many of the closing and repair costs are shifted from the seller to the lender.
On the other hand, a foreclosure occurs when a homeowner can no longer make payments on their home so the bank begins the process of repossessing it. A foreclosure usually moves much faster than a short sale and is more financially damaging to the homeowner.
After foreclosure the bank can sell the home in a foreclosure auction. For buyers, foreclosures are riskier than short sales, because homes are often bought sight unseen, with no inspection or warranty.

 

 

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