Planning to Sell - Focus on Your Kitchen

When it's time to put your home on the market, many real estate experts recommend that you focus on updating the kitchen first. For many potential buyers, especially the wives, the kitchen may be the most important room in the home. The condition and appearance of the kitchen has the power to make or break a sale.

So, if you want your home to sell quickly at a good price, do everything you can to enhance it before you start showing the home to buyers. Remember however as you appraoch this task that the money you spend is a cost of selling. Don't do a complete remodelling unless the kitchen really needs it. A good Realtor, like Cheryl Stimac, a Tampa Bay Florida real estate expert can give you advice on the extent of remodeling that you should invest in.


Start by creating space. You want you kitchen to look large, light and roomy. Clear the counters of all clutter. Take everything you can out of drawers and shelves and move it into storage. Remove all those magnets from the refrigerator and if the refrig looks scratched, give it a fresh coat of porcelain paint. What you want them to see is a warm, open and inviting space, not your old pots, pans and toaster.

Consider fresh paint. Paint is the most profitable improvement. A fresh coat of light, neutral colored paint on your kitchen walls will make them look spotless and new. Exactly the look you want.

Pay particular attention to the sink. If your faucet looks old and dated, replace it with a new one. It will go a long way towards improving the look of the whole kitchen, for very little money.

If your counter tops look old and tired, you should consider new ones. Today you can buy corian or even granite countertops at reasonable prices. Talk to your local Home Depot or Lowe's hardware satore. Remember to stick with neutral colors, nothing too flashy.

Check the stove and oven. The oven should be spotless. If the stove is a glass-top mmodel, scrub it until there is no residue at all on it. A sparkling range looks great. A dirty one laeves the prospect wondering if the rest of the house is any better maintained. Don't let them even "go there".

Freshen up the cabinets. Replacing cabinets is expensive and seldom makes a good investment. But you can paint them, or put new, modern looking pulls on them for very little money. A fresh rub-down with a good cleaner-polish will give them a fresh look.

Check the windows. You'd be amazed how many people forget to wash the window over the sink or the sliding glass doors next to the dining area. if the trim looks dull, a fresh coat of paint there will also add sizzle.

Finally, a trick that works amazingly well. Just before prospective buyers come, bake a fresh batch of cookies in your oven. And, yes, leave the cookies out for them to sample.

In short, buyers will quickly notice any shortcomings in your kitchen, so do everything you can to freshen it up and give it a modern, open, airy and spacious and "inviting" look.

Are Home Mortgages Really Available Right Now ?

The simple answer to that question is is "yes" but the mortgage you might get today will be way different from the one you might have gotten away with as recently as a year or two ago. There are at least four mortgage sources you might want to consider if you are hoping to buy a home in the Sarasota area while prices are still low.

Before the big "mortgage meltdown," people were able to qualify for a mortgage without even having to prove their actual income, among other things. Today, you'll not only have to be able to document your famly income, but you'll also have to provide information on other assets and liabilities that you have. Mortgage lenders also now want to accurately measure your "debt-to-income ratio", that is, what percentage of you total and take-home pay will be consumed by this mortgage if it is approved. And, there are now few, if any, no-down payment or ridiculously-low down payment loans.

If you meet these qualifications, there is mortgage money available. Mortgage approvals are now based on the more reasonable bases on which mortgages were granted before all the foolishness began a few years ago and the mortgage business eventually crashed and burned when the housing bubble burst. Mortgages being provided today "have to make-sense" in terms of the borrower's ability to repay the loan over time. No longer can you and/or the mortgage provider bet on housing prices going up and up forever so regardless of how silly the situation was at mortgage origination, there would be endless increases in the value of the home
to "bail both the buyer and the mortgage company out the ridiculous mortgage granted." Nonetheless, there are mortgages available today to those who can qualify for them.

FHA-insured mortgages

Federal Housing Administration (FHA) -insured mortgages have been available for decades, focused predominantly on low-to moderate-income families who may not meet
requirements for a conventional loan with a 20% down-payment required. FHA-insured mortgages can require as little as 3.5% down payment with no pre-payment penalty. Credit scores and debt-to-income ratios have been relaxed somewhat to allow more families to buy one of the many homes on the market right now.

Of course, there is always, "good news" and "not so good news" in situations like this. First the "not so good news." With the lower down-payment on an FHA mortgage comes an upfront "mortgage insurance fee" that must be paid at closing plus a monthly mortgage insurance premium (MIP) that essentially adds a half-percentage point to your interest rate.

But the "good news" is that your Realtor, working with the seller and mortgage provider, can structure your loan so that the home seller pays all or nearly all of your closing costs, other than the 3.5% down payment. In the current market environment, many home sellers are willing to participate in this type of arrangement to get their home sold.

FHA-insured mortgages with the lowest interest rates will go only to buyers with a debt-to-income ratio of less 33% or less where your "debt" is the total monthly cost of the home, including principal, interest, property taxes and insurance (PITI) plus any other monthly debt you owe like auto payments, credit card debt, student loans, etc.

Under the stimulus package signed by President Barack Obama last month, more American families will now be eligible to purchase or refinance their homes using affordable FHA-insured mortgages. This act allows increases for the year 2009, in the maximum loan limits for FHA, Freddie Mac, and Fannie Mae loans. These
limits are equal to the greater of 125% of the 2008 local area median home price or $271,050 for FHA, and $417,000 for Fannie and Freddie, with an overall maximum cap of $729,750.

Credit Union Loans
While they tend to issue mortgages only to their own members, the credit union you may participate in at work or in your community may also be a source of an attractive mortgage. Most credit unions avoided the mortgage melt-down because they stuck to solidly-based mortgage underwriting principles. As not-for-profit firms, credit unions had no incentive to get involved in the "make a quick buck on closing fees and sell it off the same day" sub-prime mortgage schemes and scams.

Credit union fixed and adjustable rate mortgages (ARMs) are often written at lower interest rates than are available at conventional banks.

"Hope for Homeowners" Mortgages
The "Housing and Economic Recovery Act of 2008" created "Hope For Homeowners" (H4H) program which allows troubled mortgage holders to avoid facing foreclosure by refinancing their existing mortgage into a more affordable, FHA Secure mortgage, provided the federal government participates in any increase in the value of the home over time and the holder of the existing mortgage agrees to go along with the re-financing. This program increases the allowable loan to value ratio (LTV) to 96.5% for some H4H loans and allows lenders to extend mortgage terms from 30 to 40 years further reducing the monthly payment. More information on H4H loan programs is available on the HUD Hope for Homeowners website.

The American Recovery and Reinvestment Act of 2009 (ARRA)
The ARRA offers assistance to first-time home buyers by providing an $8,000 tax credit for the purchase of a principal residence between January 1, 2009 and December 1, 2009. The tax credit is claimed on your tax return reducing the purchaser's income tax. Two bonus features of this program are:

• The tax credit does not have to be paid back


• If any credit amount is unused, that amount will be refunded as a check to the purchaser.
  

Local and State Programs in Your Own Area
If you are a first-time homebuyer or a low-to-moderate income family, you should investigate whether ther are local or state housing assistance programs that can be helpful. Some programs offer very low-interest loans or even grants to families these agencies want to attract into their communities.  These programs are also sometimes aimed at municipal employees, police officers, firefighters and other first-responders the local area has difficulty recruiting.

So...are mortgages available right now? The answer is definitely "yes. Mortgages are definitely available" and you should contact your Realtor today to see if you can qualify for one of these programs.

I would be delighted to help you find both the right home and the right mortgage for your circumstances. Vist my Tampa Bay Florida real estate website or call me at 813-263-6806.

The Seller Can Help You Buy Their Home

If you and your family are ready now to buy your first home, but you're not sure you have enough cash stashed away, there are ways in which a home seller can assist you in buying his home. A competent Tampa Bay Realtor can review all of your options but here are a few examples.

FHA MORTGAGE WITH SELLER FINANCED CLOSING COSTS
An FHA mortgage requires as little as 3.5% of the purchase price as a down payment. These mortgages have been available for years. Your Realtor, working with the home seller and an FHA-approved mortgage provider, can structure a mortgage loan so that the seller pays all or nearly all of your closing costs. The seller cannot assist you with the 3.5% down payment, but can pay just about everything else at your closing. In the current market environment, many home sellers are willing to participate in this type of arrangement to get their home sold.

SELLER-PAID BUY DOWNS
There are many variations of "Buy Downs," Some are permanent, where the interest rate is reduced over the full life of the loan. Other buy downs are temporary, reducing your interest rate, and therefore your monthly payment, for the first 1 - 3 years. The most popular is what's known as a "3-2-1 Buy Down." Here's how it works. For the first year your rate is 3% below the market interest rate; the second year 2% below, and for the third year the interest rate you pay is 1% below the agreed-upon interest rate. This allows you to grow into your loan payments over 3 years. If you expect your family income to grow over that period by enough to cover the eventual cost, this may be an attractive option for you. "Buying down" your first 3 years of loan payments in this manner will cost the seller about 4.5% of the loan amount. Here is an example on the purchase of a home with a $225,000 mortgage with a fixed rate of 6.5%. The full monthly rate on this mortgage would be $1,422.15/month. Using a 3-2-1- buy down, the first year's payments would be $1,010.35, the second year's is $1,140.04, the third year's - $1,277.53, and then for the remaining 27 years, $1,422.15. The "buy down" of the first 3 years payments saved you, the buyer, over $10,000 in mortgage payments in addition to making your payments more affordable for those first 3 years.

There are other buy-down processes your Realtor can discuss with you. Another popular one is a 2-1 buy-down which works like the 3-2-1 program but reduces the interest rate for only the first two years.

SELLER FINANCING
Less frequently, but occasionally, there are sellers who own their home outright (no mortgage on the property) who will agree to assist you by holding your mortgage. In this case, you do not have to qualify through the normal bank financing route. In effect the seller, instead of a bank or other mortgage company, becomes your mortgage provider. Such a mortgage can be written with essentially any terms and conditions that you and the seller agree upon ranging from financing 100% of the purchase price to requiring a minimal or larger down payment, with or without a "balloon payment" at some point in the future, and for a term of 10, 15, 25 or 30 years.

Such private lenders frequently charge a higher interest rate and may try to use this approach to get the highest possible price for their property. So protect yourself by working with a competent Realtor who can make certain that you are not over-paying for the home you want.

The point of this discussion is this. if you'd like to buy a home now, one of these seller-assisted approaches may work for you. Don't be scared off because you don't think you have enough saved up yet. The price of homes and the interest rates are as low right now as they have been in a long time. Meet and discuss your options with a competent Realtor like Cheryl Stimac, a Tampa Florida Real Estate professional. Got questions about all this? Call Cheryl Stimac today at 813-263-6808 or email her at cheryl@cherylstimac.com

You may be closer to your dream of home ownership than you have dared to hope.