Heather Morris Realtor Expert for Cedar Rapids, Marion, Hiawatha & Robins

Just in case you didn’t know, it is a great time to buy a house! Whether you are renting, refinancing, trading up, or building, many factors are in your favor. Recent changes in home financing, tax benefits, and investment opportunities are keeping the real estate momentum moving forward.  

“Free Money” is one incentive for purchasing your first home. As a first time buyer you may qualify for local or state grants that assist with down payment and closing costs. With good credit, a down payment is not even needed to buy a home. Times are changing and the benefits to owning real estate keep getting better and easier. The stretch loan mortgages such as the interest only and the forty year loan are lending tools for a diverse buyer demographic. Need I mention that only a handful of times in the last thirty years had the fixed rate mortgage been this low?  

Great financial news for new and current home owners is the recent change in private mortgage insurance. For the first time in history, you may qualify to deduct your monthly mortgage insurance from your taxable income. When applying for your new home loan, ask your lender to prepare at least two Good Faith Estimates for your financing options so you can make the best financial choice for you.  

Have you ever considered a second home? If you qualify, the gain you would have from a second residence is tax exempt as long as you reside in it for two out of a five years. With many “snow bird” markets experiencing a pull back in pricing, this might be your time. In 2006, the National Association of Realtors reported that for the first time in history, the median sales price for a condominium was higher then the single family home.  

From first time buyers to secondary residences, it is your time to buy real estate. Lending options, home loan rates, and tax benefits are all in your favor. Make sure to review all of your financial options in your next real estate transaction. It may be easier then you think!

Heather Morris

Several times a week I will have someone ask me the difference between assessed and appraised value? Should they be the same or should one be higher or lower then the other? How does that affect me? These two words are commonly mistaken for each other and both are used frequently when relating to a homes value. As a homeowner, or soon to be owner, please make sure you understand the difference because it does affect you financially. 

The assessed value of a home is the valuation placed on a property by a public tax assessor and is the basis for property taxes. If you would like to keep the property taxes low, you would want your assessed value to be as little as possible. There are many cases where the assessed value of the home is higher then what the home could actually sell for. If you find this is true, please petition the assessor for a revised evaluation to lower your taxes. The assessed value of a home is not related to the fair market value of a property.  

The appraised value of the home is determined by the purpose of the appraisal. When purchasing real estate, the lender will want to make sure the amount you paid for the property is fair and current with market trends. The bank will hire an independent appraiser to protect themselves and the buyer from paying too much for the home. Buyers would typically like the appraised value to be what they offered for the home or higher. This new home purchase appraisal is related to the fair market value of the property. Buyer and seller beware however, if you have a refinance appraisal, this was not to determine fair market value. The re-finance appraisal is to determine the available amount of your new loan.  

Most owners of real estate want the assessed value low and the appraised value high. It is a good financial decision to know the value of your home and if you are taxed properly. A professional real estate agent can help you with questions you have about the fair market value of your property or the taxable assessment

Did you ever wonder why some homes sell faster and for more money then yours? One factor might be the other home was “staged” properly. Homes that have been prepared to sell often have more buyer demand regardless of the market conditions. Home staging has become more popular with owners, Realtors, and an increasing segment of television media. Staging a house to sell maximizes the emotional and décor sense of the largest buyer segment in the real estate market.  

As a homeowner, you may consider a few options and levels of staging. The least expensive, free, is to ask a non-biased friend or co-worker to walk through the house as if they were a potential buyer. They can give you their opinion and point out ideas to de-clutter. Professional real estate agents are very familiar with the staging concept and can provide references for painters, plumbers, fix it vendors, and potential buyers concerns. Realtors know the market and the condition of the homes currently for sale. Home staging vendors are also available for a consulting fee or hourly rate. The amount spent in hiring a professional home stage company is well spent when you arrive at the closing table! The luxury service of hiring an interior designer to vignette your home is the highest level of staging. An interior designer may suggest wall colors or replacing or moving furniture to create a more emotional appeal to buyers.  

A few tips when preparing your house for sale is to neutralize wall and flooring colors. De-clutter all kitchen counters, bath vanities, dressers, and remove the hall of fame from your refrigerator. We want the buyer to picture themselves there, not you. Ask someone who does not live in the house if there are any smells or dirty items they may see that you may not. Storage bins, closet organizers, and shelves create more sense of space. Remember, buyers are buying SPACE! Since you are moving anyway, start packing. One third less personal property and open closet space will make your house seem larger. For a quick sale and more money, consider the level of home staging that best suits you. 

References are available upon request. 

Heather Morris, CRS Certified Residential Specialist
Skogman Realty

“I’m so relieved, “says the seller, “no open houses!” So many times, we clean the house, pack up the kids and pets, and leave for the day to find that nobody came to the open house other then our neighbors and co-workers. Technology continues to change the way buyers research, educate, and buy real estate. Homes being sold today are found on multiple web sites with buyer benefit links to answer every and all questions buyers may have. An average of three out of four buyers view homes on line before calling a real estate agent or lender. The virtual open house is an amazing web marketing tool benefiting both buyers and sellers.  

One of the benefits sellers receive from an IPIX virtual tour is results based marketing. Realtors using this tool provide seller service reports with the number of “hits” compared to “ghost” buyers touring their home. Hits represent the amount of buyers who matched their personal wish list to your home. Ghost buyers are the buyers who download your virtual home tour and viewed links offered on your home. These buyer prospects can run a monthly payment, view your property disclosure, compare school statistics, and map quest options. As a seller, this is a hassle free way for buyers to view your home. Safety has also become an issue and hosting virtual open houses protects your family and assets. Non-qualified buyers can be eliminated and qualified and motivated buyers can view your house with a professional real estate agent. 

Buying real estate has also been made easier and faster because of the virtual tour. You can now search for a home on YOUR time and have your privacy respected. You receive immediate information with no down time. Buyers are now in the driver seat searching their price window, areas, and features they want in their home. Buyers can email or call the real estate agent for any questions they may have and schedule a home viewing. Being able to qualify themselves and the homes they want to tour saves buyers, sellers, and realtor’s time.  

With virtual tours, highly qualified real estate agents are meeting the needs of buyers and sellers more efficiently then ever before.

On line shopping saves you time and allows you to price compare in your convenience. Should your home mortgage be any different? Local buyers are finding the traditional safeguards are not applicable when shopping on-line. When shopping on line for your new home loan, research the following questions before making your decision. 

Is there a pre-payment penalty? The state of Iowa allows a consumer to pre-pay principle or payoff a loan without charges or cash-out fees. What if your internet mortgage is originated outside of Iowa? Many homeowners have their down payment or equity lost by these “surprise” fees when selling down the road.  

Does the good faith estimate include title insurance or the abstract extension fees? Iowa is the only state to have an abstract requiring an attorney’s opinion for clear title and title insurance. Make sure the closing cost fees quoted are all-inclusive for your area. Another traditionally undisclosed fee is the e-closing fee. Your internet mortgage lender will need a third party to receive and present all of your closing documents for you to sign.  

Would this internet mortgage meet Fannie Mae guidelines or is it  

Sub-prime lending? Sub-prime lending has created a new buzz word in the real estate industry, the ultra stretched consumer. Stretching your mortgage has become easier with forty year mortgages, adjustable rate mortgages (aka ARM loan or teaser rate) and stretched debt to income ratios. Compare your good faith estimate with a local lender that you can trust. Referrals by a professional real estate agent or closing company are excellent sources for lenders.
Reviewing all of your mortgage options is a good financial decision. The internet mortgage can save you money. Before you send in an application fee or sign a commitment, make sure to have everything you are required to sign emailed to you in advance to read. Happy loan hunting! 

Heather Morris
Skogman Realty
Certified Residential Specialist