Updated: Friday, September 25, 2020
When Is “For Sale By Owner” The Right Option?
When you put your home on the market, one of the first decisions youll make is whether to hire an agent to represent the property or to go the for sale by owner route.
While a portion of homeowners initially goes into selling their home on their own, they end up ultimately hiring an agent.
Some of the big reasons homeowners decide to try and sell their home on their own are because they think it will save them money and time. Some homeowners also feel like they understand their home better than a real estate agent will.
So when is it the right option to try and sell your home on your own without an agent?
The Basics of For Sale By Owner FSBO
FSBO means that as a homeowner, you list your home for sale without a real estate agent, making you responsible for the process from start-to-finish. Some of the things youll have to do include pricing and listing your home, staging it, negotiating, and closing.
The standard real estate commission fee is around 6, and trying to save that is one of the primary motivators for people to go the FSBO route.
Along with avoiding the listing commission, there are other benefits of FSBO.
Youll have full control over the price at which you list your home.
You can schedule your open houses and showings, so youre not stuck at the last minute trying to leave the house.
Youre going to be motivated to get the highest possible amount for your home.
You know not just your home but also your neighborhood best.
What Are the Downsides of FSBO?
Some of the potential downsides of trying to sell your home on your own, aside from the commission youll pay, include:
A real estate agent understands how to properly price a home to sell based on fair market value. You may be emotionally attached to your home, which can be problematic. You may think your home is worth more than it is, or you might be offended if someone criticizes your home. A real estate agent doesnt have that emotional connection so they can be objective.
Real estate agents have access to local listing portals, the MLS, networks, and other agents.
Some agents wont show a home thats FSBO.
Real estate agents understand how to efficiently manage the procedural aspects of selling a home, such as the paperwork.
When Does It Make Sense To Sell Your Own Home?
In many circumstances, working with an experienced, professional real estate agent is best.
There are a few cases where it can make sense to opt for FSBO, however.
If you already have a qualified buyer whos interested in your home before it goes on the market, you may not need a listing agent. One of the big roles of an agent is marketing, and if you have someone who plans to buy your home, you wont need an agents expertise in that area. It is important to separate interested buyers from qualified buyers in this case.
Is there a lot of demand in your market? If youre in a high-growth market and inventory is limited, you may be able to sell your home quickly and for top-dollar without an agent.
Can you take your time? If youre in no real hurry to sell your house and you can wait, then you might be able to sell it on your own successfully.
If you do the research and think FSBO is best for you, remember to price it accordingly, based on market research rather than emotions.
Create a listing thats high-quality with professional photographs and an optimized description.
Finally, if you arent going to have a real estate agent, you should work with an experienced real estate attorney early on to protect you and help guide you through the process.
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Ask the HOA Expert: Counting Ballots, Long-Standing Policies & Club House Remodels
Question: What is the most efficient way to count ballots at an Annual Meeting? Our group has a large membership and vote counting bogs down the meeting.
Answer: With many ballots to count, preparation is essential. The ballots should be preprinted with names of all candidates and a checkbox next to each. A couple of blanks should be left for nominations from the floor at the meeting. After the ballots have been completed, they should be collected by the election tellers none of whom should be running for election and divided into equal parts.
Using several teams of two, one reading the results and the other tallying, ballots can be counted simultaneously by the teams and the final tallies from each team can then be added together for the final results. A Head Teller should check the math, circle the names of the winners and hand the results to the president to announce. Using this technique should allow the process to be completed in 5-10 minutes during which other business can be handled. The counted ballots should then be batched and stapled to the tally sheets and retained in the annual meeting file should questions about the election arise.
Question: Can the board cite a "long-standing policy" to prohibit construction of an enclosed patio beyond a side privacy wall in my own back yard, although there is no written rule or regulation in the documents which would prohibit that?
Answer: In general, it is the HOAs right to dictate the exterior appearance of the homes. So, as a rule, an owner should always get approval of exterior modifications before proceeding. Even though the city may issue a permit, the HOA may have restrictions that override local zoning and building codes.
If the board has enacted broader architectural design restrictions than are found in the governing documents, these need to be documented in writing. It is not reasonable to expect owners to know these things by ESP. Also, such restrictions need to be reasonable. If your proposed enclosure is not visible from the street, what difference should it make to the board or the neighbors? Based on your description, this restriction does not seem reasonable and unless the board can produce an Architectural Design Policy that specifically prohibits it and the reasons for it, you should not be restrained from moving forward.
Question: Is it a problem if we are remodeling our clubhouse and a board member charges the materials to her personal credit card?
Answer: As a rule, HOA expenses should be billed or charged directly to the HOA so the record is clear about what was bought and why. It will also keep the record straight for warranties that are included with the purchases.
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What Should Your Credit Score Be to Buy a House?
What credit score do you need to get a home loan? While specifically, it can vary, there are certain things you should know before you apply for a mortgage to ensure youve put yourself in the best possible financial position.
Factors Impacting Your Credit Score
Before you explore specific loans, pull your credit report. You can look for errors that may need to be corrected and get a better idea of what you can do to improve it.
The factors that play a role in your credit score include:
Payment history: This is the main factor of a credit score, making up about 35 of your score. Your payment history is simply whether you pay your bills on time or not. Any creditors you have will report your activity every month to major credit bureaus. One or two late payments probably wont have a big impact, but a pattern of late payments will.
Debt: The amount of debt you owe across the board makes up around 30 of your score. Debt is also called your credit utilization ratio, and it looks at how much debt youre using versus whats available to you.
Credit age: Making up around 15 of your score is credit age. The longer you have accounts on your credit history the better, as long as theyre in good standing. If you have old accounts, keep them open if possible because this will affect your average credit age.
Other factors that are >
Your credit score is important not only because it determines whether you get financing for a home, but also the interest rate youre offered.
The following are typical ranges for credit scores:
Anything below 580 is considered very poor A fair score is one ranging from 580 to 669
A good credit score might range from 670 to 739
An excellent score is between 740 and 799
Anything 800 and above is considered exceptional
If youre applying for a conventional loan from a bank or a similar type of lender, you will usually need at least a 620 to qualify.
Conventional home loans follow Freddie Mac and Fannie Maes standards.
While 620 is the minimum, having that score doesnt mean youll be approved for a home loan. An excellent score is usually considered 740 and above, and with an excellent score youll likely not only qualify for a conventional home loan but youll also get a competitive interest rate and you may have a lower down payment requirement.
The U.S. Department of Veterans Affairs insures VA loans. Theyre available to certain servicemembers and veterans of the U.S. Military, as well as spouses of military members who died while on active duty.
The minimum credit score for a VA loan is likely to be around 620, although this can vary, and theres no set minimum score.
Insured by the Federal Housing Administration, FHA loans are less risky for lenders so you may find its easier to qualify. The minimum score for an FHA loan with a down payment of 3.5 is 580. If youre paying at least 10 for your down payment, theres no minimum required credit score.
If you have an FHA loan originated by a private lender, each will have its own minimum requirement for credit scores.
Other Factors Lenders Consider
Yes, your credit score determines whether your quality for a home loan and also what your interest rate will be, but other factors are >
Lenders will look at your income to ensure that you can afford your mortgage payments if you get a loan. Theyll also look at your existing debt in comparison to your income.
The more of a down payment you can make, the more likely youll qualify for a lower interest rate.
Lenders also want to know if you have savings if your income ends for a period of time. You should be able to show that you have enough money saved to cover at least two months of your mortgage payments.
Finally, employment history is >
If you have a low credit score, you could potentially still get a loan, but youre a riskier borrower.nbsp; Youll have to offset that risk, which means youll have to have a larger down payment, and youre also going to pay a higher interest rate.
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