Video: Biggest Buyer Blunder | Overlooking Total Costs Of Homeownership

Nice sprinkler system…I wonder what the water bill is during the spring and summer.

The master bedroom has a sitting room…I wonder what the average electric bill is for this home.

Oh, the basement is fully finished…Can the heating/AC system support all of this square footage efficiently?

We’re looking for a fixer-upper…Can we really afford to do more than carpet and paint?

These appliances are nearing the end of their expected usefulness…How much will it cost to replace all of the appliances?

Whether is a foreclosure, short sale, or traditional home, buyers should factor in the total cost of homeownership.  The lender will give you a pre-approval amount, but there are other fees that will never appear on your Good Faith Estimate of Closing Costs, that you will have to factor into your monthly and yearly costs of homeownership such as:

• Utilities: Does the home require gas and electric?  Is the water included or is it separately metered?
• Maintenance: Your home inspection should provide you with an opportunity to gauge maintenance costs.  The home inspector should be able to identify what appliances are running properly, and provide estimates on replacement costs.
• Association fees: What are the condo or association fees and how often are they paid?  Is the home located within a community that requires two fees?  Do the fees include any utilities or yard maintenance?
• Yard upkeep and maintenance: How much does it cost to maintain the pool? If you’re too busy to mow the lawn, how much does it cost to keep up the curb appeal?

And most importantly, can I maintain my current lifestyle if I buy this home?

Don’t househunt without a pre-approval letter!  It’s so much fun to shop for homes.  To walk into a move-in ready home with everything neatly in place and organized, the kitchen has lots of countertop space and the table is set for a gathering, the family room is warm and ready to accommodate your guests, the bedroom is fit for a king or queen and the closet goes on for miles!  It’s easy to start to daydream, and envision yourself living in a particular home. 

But before you venture off into La-La Land, remember that looking at homes isn’t really the first step in the home buying process, securing your mortgage pre-approval is.  There’s nothing scary about obtaining your mortgage approval, it’s painless, and best of all it’s free and it doesn’t commit you to buying a home today (or any day for that matter).

You’d actually be at a disadvantage if you didn’t obtain your mortgage approval before you start looking at homes.  Here are the three reasons why:

• The lending guidelines are no longer relaxed and programs that were available years ago, have been scrapped today.  You can’t assume that just because you have a pulse, that you’ll be approved for a loan.  The lender will want to know how long you’ve been employed and what your credit score is.  Mortgage programs and interest rates are credit score driven; the higher your score, the better your interest rate, and the lower your monthly payment.  If your credit score is not where you’d like it to be, your lender can make recommendations on how to improve your credit score.  You’ll also need to know how much money you’ll need for a down payment and closing costs.
• Special programs are available, and you need to know what they are.  Getting pre-approved helps you determine the best program for your needs.  Do you qualify for special first-time buyer programs?  Are you active military and do you qualify for a VA loan with no down payment?  Are you buying a home in a specific county or city that has special programs? Consulting with a knowledgeable, local lender gives you the benefit of working with someone who is aware of what your options are when it comes to financing.
• Are you limiting yourself?  Are you strapping yourself?  Some buyers think they can’t afford a certain price range, and on the flip side, some buyers assume that they can afford a more expensive home when they can’t.  Getting your pre-approval means that you know exactly what price range you can afford. 

If you’re ready to buy a home, then make sure that you have all of right tools for the journey.  And your first stop along the way, is your mortgage lender’s office.

Alexandria VA First-Time Buyers Watching The Clock As
Tax Credit Deadline Nears

Everybody wants to know whether or not the $8000 First-Time Home Buyer Tax Credit will be extended, and at this point, it’s still in the air.  Right now, no one can say for sure if Congress will extend the deadline for the tax credit, increase it, or even make it permanent.

But the deadline is near and Alexandria VA home buyers have little time left to identify a condo, townhome, or single-family home.  We’re now in the second week of October, and November 30 is a little over a month and a half away.  Realistically speaking, if your goal is to take advantage of the tax credit, then you need to look aggressively at Alexandria VA real estate, identify the property and submit a written offer, and be under contract by October 15!

Why, because you have to allow time for inspections, appraisals, and for your mortgage loan to be fully underwritten and approved.  Just like banks are swamped with short sales and foreclosures, you can bet that Alexandria VA Realtors and lenders will be swamped over the next 2-3 weeks trying to ensure that buyers who are under contract have a smooth transaction, with no delays that could jeopardize them taking advantage of the tax credit.

If you’re considering buying short sales in Alexandria VA, know that there is no guarantee as to when the bank will approve the sale.  As a buyer, your lender can only do the bare minimums on your mortgage loan if you have not received short sale approval from the seller’s lender.

There’s still time for you to take advantage of the First-Time Home Buyer Tax Credit and buy a home in Old Town, Del Ray, Kingstowne, or Manchester Lakes.  Here’s a short video that will help explain how the credit works.