Call Flat Fee Realty 919-342-5230 Terry McDonald LinkedIn Page Follw Us On Twitter See Us On Facebook

3 Reasons Down Payments are Important to North Carolina Home Sellers

house with money, ddpavumba, freedigitalphotos.netThe Triangle’s spring real estate market is heating up, and buyers are looking for ways to strengthen their offers and stand out among their competition. One popular piece of advice is for buyers to increase the size of their down payment. Many buyers wonder why this would make a difference to sellers, since sellers receive payment in full at closing regardless of how much down payment there is in the sale. Flat Fee Realty wants buyers to know that it’s what happens before closing that makes a difference to sellers.

Here are three reasons sellers prefer a larger down payment:

  • A larger down payment makes the appraisal easier: For all sales financed with a mortgage, the lender performs an appraisal to justify a home’s purchase price and the loan amount. If the appraisal is too low, they won’t fund the mortgage, making the sale impossible. A larger down payment decreases the loan-to-value ratio, making the appraisal more likely to go through without any issues.
  • Down payment size indicates a buyer’s level of commitment: While the days of 0% down loans aren’t completely gone, there has been an unmistakable trend towards larger down payments. More money down usually signifies a greater commitment to the property, putting anxious sellers at ease. Motivated sellers want assurance that they won’t have to deal with additional showings, more offers, and ultimately, more stress.
  • A larger down payment (sometimes) means a more qualified buyer: In reality, a buyer putting down 5% can be much more financially qualified to purchase a home than s buyer putting down 20%. Credit issues, employment, and other factors come into play. But in seller’s minds, the fact that a buyer has amassed a decent amount of cash signified a level of financial and personal responsibility (whether or not this is true is anybody’s guess).

Each of these scenarios comes down to one important factor: the ability to close the transaction. In the end, there’s no real difference between a down payment of 0% or 50%, as long as the sale goes through. Logical or not, a larger down payment simply gives many sellers peace of mind.

Home buyers and sellers are surprised to find out that although real estate transactions have a financial aspect to them, there is a lot of psychology as well. If you’re looking for a stress-free buying or selling process, contact the experienced agents at Flat Fee Realty today!

**

This post on selling and buying a home in the Triangle is brought to you by the team at Flat Fee Realty and is intended for informational purposes only. 

The Future of Real Estate! 

Flat Fee Realty 

919 342 5230

Contact Us

Terry@FlatFeeNC.com

Photo: ddpavumba, Freedigitalphotos.net


 

4 Common Myths about Real Estate Agents in the Triangle: A Must Read

FFR Pic- Stockimages- freedigitalphotos.netThere are a few professions that have historically served as inspiration for an array of humor.  Automotive salespeople, attorneys, and yes, real estate agents. All have all had their turn in the humor department. Seriously, many people have heard both good and bad stories about working with real estate agents; just what is true and what is not? The professional real agents at Flat Fee Realty want home buyers and sellers in Cary and the Triangle to remember the following about real estate agents.

Flat Fee Realty shares four common myths about real estate, along with the straight truth:

  • Realtors and real estate agents are the same thing: Although the terms are sometimes used interchangeably, not all real estate agents are realtors. Earning a license in North Carolina makes someone an agent. A Realtor is an agent who is also a member of the National Association of Realtors. Realtors must adhere to an additional set of high standards and ethics beyond the legal requirements of North Carolina.
  • The higher a home’s selling price, the more money an agent makes: This is technically true, but it’s a misunderstanding. The home would have to sell for tens of thousands of dollars more to make any material difference in an agent’s commission. Consider that an increase of $10,000 would only net most agents an extra $150. Honest realtors and agents simply are not going to risk reputations over a few hundred bucks (or any amount, for that matter).
  • Agents recommend certain professionals because they get a kickback: If agents recommend a home inspector, a closing attorney, or other professional to a client, it’s almost always because they have worked with these individuals (often for years) and can vouch for their service excellence. It is important to note that it is unethical for agents to get any kind of incentive or favor from a vendor; it’s also illegal according to the Real Estate Settlement Procedures ACT (RESPA).
  • Agents must show homes to anyone who calls: A buyer’s agent isn’t obligated to show homes to clients unless there is a signed representation agreement in place. Typically, the agent would also require a pre-approval or pre-qualification letter. These documents show that buyers are serious and have the funds to complete a home purchase, ensuring the agent isn’t wasting his or her time.

It’s understandable why prospective home buyers and sellers would believe these common misconceptions. After all, buying or selling a home here in the Triangle is a complex financial and often emotional transaction fraught with worry and anxiety. However, that is exactly the reason it is essential for buyers and sellers to work with the right real estate agent.

Need help separating fact from fiction regarding the home buying or selling process? Give Flat Fee Realty a call today and let our realtors and agents earn your trust!

**

This post on selling and buying a home in the Triangle is brought to you by the team at Flat Fee Realty and is intended for informational purposes only. 

The Future of Real Estate!

Flat Fee Realty

919 342 5230

Contact Us

Terry@FlatFeeNC.com

Photo: Stockimages, freedigitalphotos.net

3 Questions that Need Answers Involving Mortgage Insurance

stockimages, freedigitalphotos.net (3)Most types of insurance work like this: Clients pay a monthly or annual premium, and in return, insurance companies agree to assume financial responsibility and the risk in certain situations. While the traditional coverage is something that the insurance companies (and their clients) hope they’ll never need to use, it’s just one of life’s necessities.

Mortgage insurance works a little differently. And it can be confusing to homebuyers in the Triangle who aren’t sure what it is, let alone whether they’ll need to pay for it.

The professional agents at Flat Fee Realty want their clients to be as informed as possible. Below, we help to answer three common questions about mortgage insurance*:

What is Mortgage Insurance?

With mortgage insurance, the borrower still pays a premium, but they’re not exactly paying to for their own protection (and they don’t even get to choose the insurance company). The policy actually protects the lender in case the borrower defaults on the loan. So the question is not whether a borrower “needs” mortgage insurance, but rather if the lender will require it.

When is Mortgage Insurance Necessary?

Borrows usually will be required to purchase mortgage insurance if they make a down payment of less than 20%. The amount of the mortgage premium depends on the size and type of loan, but usually costs between 0.5 and 1% of the loan amount. Mortgage insurance can be private or public, depending on the type of loan.

How Can Borrowers Get Rid of It?

Most homeowners are responsible borrowers, and think that making on-time payments is the best way of getting the mortgage insurance requirement removed as quickly as possible. Unfortunately, this is not necessarily the case:

  • Private mortgage insurance automatically terminates when the loan balance reaches 78% of the original value of the home according to the amortization schedule. Extra payments won’t help homeowners cross that threshold any sooner. However, if the 78% mark is reached more quickly, a borrower can request that the insurance be removed.
  • Public mortgage insurance terminates when the loan balance reaches the same 78% threshold, but not sooner than 5 years into the loan. The borrower is going to pay mortgage insurance for at least 5 years.

Mortgage insurance is often an unwelcome (and unplanned) expense for many borrowers. When determining what type of mortgage payment is affordable, be sure to include mortgage insurance as part of those costs (along with the principal, interest, property taxes, and homeowner’s insurance).

Concerned about potential pitfalls in the home buying or selling process? Let the experienced agents at Flat Fee Realty explain how they can make the process easier than ever. Give Flat Fee Realty a call today!

*This post is for informational purposes and should be considered for reference only. We suggest consulting a financial specialist with experience in mortgage insurance if needed.

**

This post on selling and buying a home in the Triangle is brought to you by the team at Flat Fee Realty and is intended for informational purposes only. 

The Future of Real Estate! 

Flat Fee Realty 

919 342 5230

Contact Us

Terry@FlatFeeNC.com

Photo: Stuart Miles, freedigitalphotos.net

3 Options Everyone Should Know About Real Estate Appraisals

FFR- Jan 19 Pic- Stuart MilesMost Triangle-area buyers and sellers think that the purpose of a real estate appraisal is to determine the real value of the home. In reality, an appraisal is an important tool that banks and other financial institutions use to help them make lending decisions. An appraisal justifies the purchase price of a home, so a low appraisal can have an effect on the entire transaction. This situation can sometimes result in big problems for buyers and sellers alike.

Flat Fee Realty wants buyers and sellers in Cary NC and the surrounding Triangle to know the options when an appraisal threatens to affect a potential deal:

  • Appraisers sometimes err on the safe side: Appraisers are held to a high professional standard and can be held accountable for their opinion of a home’s value. In the case of foreclosure, the appraiser could be held liable by the bank for over-appreciation. To avoid this risk, appraisers may be conservative with their figures, sometimes leading to a too-low appraisal.
  • Appraisals can contain mistakes: Sometimes, an appraisal that’s too low to meet the loan requirements can be the result of a simple error. Incorrect measurements or a transposed figure during data entry are seemingly benign errors that can cost home buyers their loan.
  • Appraisers and agents work together: It’s usually in everyone’s best interest that a given transaction moves forward, and problems with the loan can be disconcerting for everyone. Many times, a good appraiser will contact a home’s listing agent (who knows the property inside and out) if the appraisal is low. Together, they can verify measurements, make sure every detail is listed, discuss comps, and otherwise work together to get the value up.

In order for a financial institution to proceed with a buyer’s loan, the home’s appraised value must meet or exceed the agreed-upon purchase price. When this doesn’t occur, the entire transaction is at risk. An experienced agent is a lifesaver when it comes to challenging low appraisals, or any of the other complex issues involved in buying and selling real estate.

Need assistance navigating the buying or selling process? Flat Fee Realty is here to help. Give us a call with your questions today!

**

This post on selling and buying a home in the Triangle is brought to you by the team at Flat Fee Realty and is intended for informational purposes only. 

The Future of Real Estate! 

Flat Fee Realty 

919 342 5230

Contact Us

Terry@FlatFeeNC.com

Photo: Stuart Miles, Freedigitalphotos.net

4 Important Tips to Boost a Triangle Home Selling Price

FFR- Jan 5 Pic- CuteimageNow that the holidays have passed, many Triangle homeowners will look to spruce up their homes in anticipation of selling during the busiest season. While winter is traditionally a slow period for the real estate market, the arrival of spring tends to heat things up. Most homeowners want to sell their homes quickly and for top dollar, and while that’s an admirable goal, the home really needs to be in tip top shape to accomplish it. Luckily, this usually doesn’t mean a major renovation is necessary. In fact, it’s often the little things that count the most.

Below, our real estate experts at Flat Fee Realty share the four important low-cost improvements homeowners can make for the highest return on investment come closing day.

  • Make an entrance: For a few years in a row, adding a new steel front door has topped the National Association of REALTORS Cost vs. Value report. Homeowners could recoup almost 100% of the cost of this improvement.
  • Add some power: According to the same report, installing a backup power generator brings back almost 70% of its cost, and is only trending upwards (perhaps because of the large-scale, unpredictable storms over the past several years). Here in North Carolina, this could be an excellent selling point.
  • Fix the fixtures: Although it’s actually an easy replacement, old fixtures (such as brass or gold) are a turnoff for many buyers. Replace them with a more contemporary design and watch buyer’s objections disappear.
  • Increase living space: Although this one is more of a a choice than a requirement, adding living space without increasing a home’s footprint (such as finishing a basement, creating an attic bedroom, or a rear deck addition) brings average returns of 77% – 88%.

By the time most Triangle homeowners are ready to sell, they look around their homes and see multiple areas that could benefit from some improvement. However, it’s important to look at the home through the eyes of a buyer. Homeowners should choose projects that appeal to the widest range of buyers, and avoid pet projects that will narrow the field.

Wondering what your home is worth, or whether pre-sale improvements are worth the expense? The experienced agents at Flat Fee Realty can help you look at the numbers. If you are considering selling or buying a home, give the agents at Flat Fee Realty a call today!

**

This post on selling and buying a home in the Triangle is brought to you by the team at Flat Fee Realty and is intended for informational purposes only. 

The Future of Real Estate! 

Flat Fee Realty 

919 342 5230

Contact Us

Terry@FlatFeeNC.com

Photo: cuteimage, freedigitalphotos.net

 

 

 

 

 

 

Three Reasons Why For Sale by Owner (FSBO) in the Triangle Probably Won’t Save Money

FFR- Dec 15 Pic- MarkMoz12The average Triangle homeowner who is considering selling a home without help probably isn’t dreaming of becoming the next top real estate agent. People soon realize that it is very challenging to guide a parade of strangers through their home, giving up entire weekends to host open houses, or conducting heated and stressful negotiations with buyers, agents, or the ever present attorney. People marketing their homes as For Sale by Owner (FSBO) are looking for one thing: to save money for their next home.

The simple fact is that selling a home by owner probably won’t save much money.

Flat Fee Realty explains why with three important reasons:

  • Most sellers don’t know how commissions actually work: Usually, the commission charged by the listing agent (and typically paid by the seller from their proceeds) pays two agents. A portion of it is paid to the buyer’s agent, since most of the time (but not always), buyer’s agents work at no charge to their buyers. The commission split is typical for services rendered. This is a major area where FSBO’s will start to see their potential savings erode. Savings can be cut in half by simply offering a standard 2.5-3% commission to buyer’s agents.
  • Agents don’t work for free: Real estate agents are supposed to put the best interests of their clients first. This means that if an agent finds a home that is a fit for their clients, the amount of commission, or lack thereof, should not be a major ingredient. Unfortunately in practice, it doesn’t always work this way. Simply put, a seller who does not offer a commission to the buyer’s agent may just not get the home shown as often.
  • Look out for falling purchase prices: Lack of a seller-paid commission up front means that the commission becomes part of the ensuing negotiations, creating a potential headache (and maybe extra expense) for the buyer’s agent and their clients. Often, this translates to lower offers and ultimately a lower purchase price, because buyer’s will use the fact that they may now have to pay commission to their agent as a negotiation point to lower the purchase price of the house.

FSBO sounds like a great strategy in theory. Instead of using a real estate agent, sellers think they can save thousands of dollars. Unfortunately, this idea doesn’t go as planned for the vast majority of sellers, especially when potential buyers are represented by knowledgeable experienced agents.

Before deciding to sell by owner, it makes sense to sit down with an agent from Flat Fee Realty and discuss current market data and what to do next.

Want to level the playing field? Whether you’re considering selling on your own or just want to find out what your options are, give the agents at Flat Fee Realty a call today!

All of us wish the Happiest Holiday Season ever for everyone and a Prosperous New Year!

**

This post on selling and buying a home in the Triangle is brought to you by the team at Flat Fee Realty and is intended for informational purposes only. 

The Future of Real Estate! 

Flat Fee Realty 

919 342 5230

Contact Us

Terry@FlatFeeNC.com

Photo: MarkMoz12 / Foter / CC BY

Four Important Points Triangle Home Buyers Need to Know

FFR- Dec.1 Pic- JoeldindaIt happens all the time. A buyer is assessing the Triangle NC real estate listings, and comes across the perfect North Carolina home. It’s in a prime location, has an attractive and updated interior, and most importantly, comes at an amazing price. The buyer calls the real estate agent, ready to jump right in with an offer. Then, the enthusiasm stops. The listing description states “as is”. In the area of real estate, these two words can create a lot of confusion.

Here are four important points the Flat Fee Realty team believes buyers should know before purchasing a home sold in “as-is” condition:

  • Selling a home as-is benefits the seller, not the buyer: By listing a home as-is, the seller is telling buyers loud and clear that the house might have some costly repairs. Not only that, but selling “as-is” basically releases sellers from liability for the home’s condition.
  • Inspections are a must: Professional inspections are an essential part of any home purchase, but even more so when the home is listed “as-is”. It is perfectly legal for sellers to claim to have no knowledge of problems, usually indicated as “no representation” on the seller’s disclosure.
  • Know about risk tolerance: Even the best and most thorough inspections can’t guarantee a home will be problem-free, so buyers of “as-is” homes must have a degree of tolerance for the unknown. While purchasing an “as-is” home is risky, it really can often be an excellent decision.
  • Budget for repairs: Buyers of these homes should have either the cash available or the necessary skills to perform all types of repairs, major and minor. If a buyer doesn’t have one or both of these aspects, they may want to reconsider buying this type of home.

The consequences of buying a home listed in “as-is” condition (not to mention the meaning of the phrase itself) are often misunderstood, and the buying decision is sometimes clouded by the possibility of getting a fantastic deal on a new home. Regardless of whether a buyer is purchasing their first home or their fifth one, the experienced and professional agents at Flat Fee Realty can help navigate the risks inherent in every real estate transaction.

Are you looking for an real estate agent who will give you straight-to-the-point, unbiased information on all the homes you are considering? Give us a call!

**

This post on selling and buying a home in the Triangle is brought to you by the team at Flat Fee Realty and is intended for informational purposes only.

The Future of Real Estate!

Flat Fee Realty

919 342 5230

Contact Us

Terry@FlatFeeNC.com

Photo: joeldinda/Foter/CC BY-NC-SA

 


 

4 Reasons Why Now is the Time to Buy Your Dream Home

Flat Fee RealtyThe housing market in North Carolina has stabilized and continues to be on the upswing! That’s great news for Triangle buyers and sellers who have been dreaming of selling their current home and moving up to the home they’ve always wanted. Current market numbers support those plans, and there has never been a better time to trade up.

Flat Fee Realty offers these four reasons why now is a great time to make a move:

  • There is strong demand from buyers: Purchasing a new home contingent on the sale of a current home can be troublesome. Luckily, pent up demand has flooded the market with buyers who are ready, willing, and able to buy. Sellers who wish to divest themselves of one home before purchasing another will have an easier time doing so right now.
  • There is less competition from sellers: Housing supply is still historically low. There are currently not enough homes on the market to satisfy all of the buyers. However, home values have risen, and many homeowners who previously wished to sell but couldn’t (due to negative equity situations) are now financially able to sell. More homes will be coming onto the market in a very short time.
  • Housing prices and mortgage rates are predicted to rise: The bottom of the real estate market has come and gone. Nonetheless, prices and interest rates are still relatively low, but will only remain so for a short time. Now is the time to lock in a low mortgage rate and take advantage of increased buying power. Waiting will end up costing more, in both down payment and mortgage payment.
  • It’s time to make a lifestyle change: There are many reasons to buy or sell a home, and when it comes down to it, most of them aren’t financial. Perhaps more space, a more desirable location, or a shorter commute to work or school are important. Sometimes, life necessitates a change regardless of what the real estate market is doing. Luckily, the numbers favor moving up at this time.

Selling one home while simultaneously buying another can be hectic and complex, and homeowners are often hesitant to put their families through the stress of a move. Flat Fee Realty wants homeowners to know that market conditions are excellent right now in terms of moving up to a dream home.

Are you looking for a great real estate agent to help you navigate the ups and downs? Give us a call today!

**

This post on selling and buying a home in the Triangle is brought to you by the team at Flat Fee Realty and is intended for informational purposes only.

The Future of Real Estate!

Flat Fee Realty

919 342 5230

Contact Us

Terry@FlatFeeNC.com

Photo: Flat Fee Realty

 


 

 

5 Tips for Selling a Home in the Triangle during the Holidays and the Winter Season

FFR - Nov 3 Pic - 100216603It’s no secret that the spring and summer are most popular seasons for real estate sales in the Triangle and Central Carolina area. Beautiful North Carolina weather and long daylight hours mean that homebuyers are out and about in full force. In contrast, most sellers will face a few challenges when placing a home on the market in the late fall or winter season. Flat Fee Realty wants sellers to be successful no matter what time of year they are selling.

Our FFR team suggests these five tips to sell quickly and for the most money, even during the slow seasons:

  • Invite buyers in out of the cold: Be sure to create a warm and inviting experience when showing the home. Make sure all lights are on, that the inside heat is comfortable, and even light the fireplace if possible. Consider using aromas that evoke relaxation, like cinnamon or apple pie.
  • Use the holiday season to an advantage: Appeal to buyer’s emotional side by helping them envision spending the holidays with their family in their new home. Stage the home with all-purpose holiday decorations, like potted poinsettias, twinkling white lights or evergreen garlands.
  • Consider a pre-listing inspection: A seller’s inspection brings any potential issues to light and allows for their resolution early on. The holiday season tends to prolong a closing process already prone to delays. Don’t let last minute maintenance issues postpone the transaction. Slower processes create buyer’s remorse.
  • Avoid liability: Winter weather can create hazardous conditions for buyers and sellers. Keeping steps and walkways snow and ice-free to prevent slips and falls. Protect against maintenance issues (like frozen pipes or falling tree limbs) to ensure the home remains in marketable shape.
  • Price correctly: Although winter buyers may be more motivated, there are definitely fewer of them. To attract the most buyers, start out with a realistic asking price. Remember, homes that undergo several price reductions usually sell for much less than if the home was priced correctly in the first place.

With the right sales strategy (and a great Flat Fee Realty Agent) winter can still be an excellent time to sell a home. Cool weather buyers tend to be more motivated, and there is less competition, since many Triangle sellers often take their homes off the market until the warmer months and spring. Regardless of when you sell, Flat Fee Realty wants all sellers to land the best deal possible, no matter the time of year.

Wondering if November and December are is the right months to sell? Give us a call today!

**

This post on selling and buying a home in the Triangle is brought to you by the team at Flat Fee Realty and is intended for informational purposes only.

The Future of Real Estate!

Flat Fee Realty

919 342 5230

Contact Us

Terry@FlatFeeNC.com

Photo: ddpavumba, Freedigitalphotos.net

4 Approaches Good Real Estate Agents Use to Create Success

FFR- Oct 20 Pic-10051836The Triangle region of North Carolina is home to thousands of real estate agents. Although the vast majority of real estate agents are very good at what they do, there are certainly some agents who are below average in both honesty and professionalism. When looking for someone who represents the true interests of the buyer or seller, look for those who are truly great agents, good people, and top producers. What is it that separates the average from the great?

Flat Fee Realty offers four attributes to look for when choosing a real estate agent partner:

  • A great agent will tell the truth about price, even if a client doesn’t want to listen: Let’s say a buyer loves a particular house, gets into a bidding war, and wins. Good news, right? This is not necessarily true. Today, homes must be sold twice—to the buyer and to the bank. If the bank doesn’t agree (say, the home doesn’t appraise to the selling price), the deal is off. A great agent will recognize this in the beginning and prepare the client for alternatives.
  • A great agent anticipates instead of reacts: Professionals make a complex process look easy for the client. Pro-activity, anticipating challenges, and removing roadblocks are important factors in a stressful process. Good agents have the foresight that develops with time and experience. And while challenges might the norm for them, they never take their clients concerns too lightly.
  • A great agent will get the seller the most money possible for their home, even if it takes a little longer and requires more marketing: A great agent always puts their client first, even if it means more work and less commission. Setting the right price for a home doesn’t mean pricing it low enough to sell quickly (unless that’s what the seller wants). It means getting the most profit possible for the client, even if it takes more time and effort.
  • A great agent doesn’t just answer the phone when clients call; a great agent is the one doing the calling: Some agents complain about their clients constantly calling them. This, however, can mean that they are not giving the client enough information. Even if nothing is happening, the clients want to know that nothing is happening. Great agents never let silence speak for them.

Any one of the thousands of real estate agents in the Triangle can show homes, negotiate a deal, and close the transaction. However, when money (and sometimes stress) is on the line, go for the great, not the average. Flat Fee Realty strives for the best. It is what everyone needs in real estate as we head to 2015. We are the FUTURE OF REAL ESTATE.

Looking for a great agent to help you buy or sell? Give us a call!

**

This post on selling and buying a home in the Triangle is brought to you by the team at Flat Fee Realty and is intended for informational purposes only.

The Future of Real Estate!

Flat Fee Realty

919 342 5230

Contact Us

Terry@FlatFeeNC.com

 

Photo: jannoon028, Freedigitalphotos.net


 

 

 

Do NOT follow this link or you will be banned from the site!