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What is Agency
What is Agency
WHAT IS AGENCY?
When you employ a real estate agent, you do more than hire someone to help you sell or buy property. Your agent has a legal responsibility to act in your behalf under the Law of Agency. Your Agent owes you loyalty, obedience, accountability, confidentiality, reasonable care and diligence. You owe your agent compensation and disclosure. Your Agent also has to treat all parties fairly.
Call Roy or Sandy to get the best representation for your real estate needs.
Buying Land
Owning land is an attainable dream but here are some things you need to know before you invest.
When you invest in land, check first to determine that it is properly zoned for your use. Remember that you may have to drill for water. A septic system may require a perk test to determine soil suitability. Distance to electricity is also important because you may have to pay for a line extension.
Land may also be encumbered by an underlying lien, insure that this will be released when your parcel is paid off.
Finally, be sure that you have deeded access, a recent survey and visually inspect the corners. This will preclude future boundary problems.
FICO Score
FICO SCORE
Q. What is a Fico Score?
A. A FICO Score is a measurement of a borrower's payment history, amount of credit available to that borrower, and the potential of future credit available. FICO is an acronym for Fair Isaac and Company, the developers of this rating system. Your FICO score can be from the low hundreds to 850, and your lender may cut-off points for minimum FICO scores to be eligible for credit. FICO scores are used by other industries, notably insurance, to predit risk and as rate discriminators.
The Importance of maintaining a good credit rating cannot be overstated. Call 417 9224 for a brochure on how you can improve your credit rating. (Note- We are not lenders nor do we represent any lender.)
SANDY HANNON IS A VETERAN OF THE LENDING INDUSTRY, WITH 28 YEARS OF LENDING EXPERIENCE. WE CAN ADVISE YOU ON YOUR BEST LOAN PROGRAM.
Preapproval
Whether you are buying or selling residential property, the lender is going to play a major part in the transaction. Buyers can add strength to their offer if it is accompanied by a preapproval letter, verifying that a lender has looked over the buyers financial status and conditionally approving a loan for a certain amount.
Sellers should expect such a letter within a few days of contract acceptance to verify the purchaser's ability to obtain financing. This is normally a contract requirement.
Note that a preapproval letter is conditional. Statements made by the borrower must be checked by the lender. Approval of the loan requires an appraisal, verification of income, debt ratios, and obligations. Borrowers may have to explain or cure adverse credit information. Lenders may require repairs to the property. The final loan approval occurs when the lender's underwriter approves the loan package. This process can typically take four or more weeks. If you use an on-line or non-local lender, expect more time and/or problems related to ineptitude and unfamiliarity with the special considerations peculiar to our area.
Call us if you are thinking of buying or selling. Sandy has 28 years of experience as a mortgage originator and underwriter. We need some listings.
The Appraisal
Just what is an appraisal, and what is it used for? First of all, your lender (if you are a buyer), is keenly interested in the value of the property you are using their money for. They require an objective estimate of the property by a licensed and experienced appraiser as part of the lending process. The Appraiser uses three methods to evaluate the property; sales of comparable property, cost to replace the property, less depreciation, and what the property may return to an investor, in terms of rent or income. Since these methods all result in different values, the appraiser reconciles the figures to arrive at a fair market value.
If you are buying or selling property without a lender, you may employ an appraiser to assist you in evaluating the property. Remember that an appraiser is never compenstated based on the value of the property, and he or she will laugh at you if you suggest a figure that you would like for the appraisal to be. An appraiser's stock in trade is objectivity and experience.
Finally, the appraisal is most accurat on the day it is completed, and loses its validity with time. A year old appraisal is a historical document.
Dead Equity
Equity in your home is defined as the difference between your mortgage balance and current market value. If you purchased your home for $110,000 six years ago, with a $10,000 down payment, your equity, before appreciation, would be about $16,000.
What has happened in the recent market is significant appreciation, especially in the last two years, and your $110,000 home is now woth about $180,000, making your equity $86,000. Lenders are clamoring to refinance your home, and you may have already done so, but it is now time to check your current market value to see if you have more equity in your home to use for other purposes. 'Dead Equity' is the money the money locked up in your home that you could use for investment, a new motor home, or a cruise.
Numbers used for illustration are average figures which may vary with property condition and location. If you do refinance, insure that your new loan does not have a prepayment penalty, which can create a liability if you decide to sell the property.
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