#1.  DO NOT MAKE PAYMENTS LATE!!!  Even if you catch up later the late payments will show up and hurt your credit score.  Anything other than ‘paid as agreed’ on accounts on your credit report hurts your score.”

#2.  Dollar amounts don’t matter in FICO scoring.  The effect on your score is the same whether you have a $1 late payment or if you have a $1000 late payment.

Always pay your bills on time, every time.  If you must be late and want to avoid damage to your score, pay the accounts that report to credit bureaus first.  You will find this information by getting a copy of your credit report.

#3.  Do not close credit card accounts.  You could be throwing away years of positive credit history.  A long term positive account history can boost your score.

Some unexpected good news for anybody working to get into a home, especially first-timers who don't have much down payment cash on hand: The door to an FHA-insured mortgage just opened a little wider.

 Two of the largest FHA-approved lenders have backed off their controversial "overlay" requirements on FICO scores (lender overlays are qualification requirements that can be more stringent than FHA's own requirements).

 Wells Fargo and another national lender confirmed to that they will now lend to applicants with 580 FICOs and 3.5 percent down payments.

Their revised standards conform in most respects to FHA's own minimums, and open the agency's financing to large numbers of buyers whose credit scores have sagged during the recession. Wells Fargo is the largest originator of FHA-insured mortgages.

Per a survey conducted for the National Association of Realtors a large majority of homeowners (87 percent) and 64 percent of renters agree or strongly agree that owning a home provides a healthy and stable environment for raising a family. More than three-fourths of homeowners (77 percent) and 55 percent of renters believe homeownership helps them meet long-term financial goals, while 70 percent of homeowners and 48 percent of renters believe it helps them realize the American Dream. We at House to Home Properties are here to help you with your dream.  Call us at 920-324-5200.

An Educated Buyer is a Confident Buyer

By: Scott Beaulieu, Realtor

Pre-Qualification

The first step for any potential buyer is to visit with a lender and “Pre-Qualify”. A lender can accurately determine how much you can comfortably afford to spend on the purchase of a new home and if you are a qualified buyer. You can help narrow your search criteria for a new home by viewing homes within your target price range. You will need a copy of your “Pre-Qualification Letter” to submit with any offer you may make.

Choosing Your Professional

Choosing a Realtor to assist you with your new home search is easy as 1-2-3.

1). Accountability

Your Realtor should never make promises he/she cannot keep. Your Realtor needs to be forthright. A Realtor may not have all the answers to your questions or concerns on the spot, but a GOOD Realtor working with you, will find those answers. Your Realtor should be prompt in responses to your requests. Your Realtor should be informative about the buying process, the steps involved and any concerns you may have. Hold your Realtor accountable for the service you desire.

2). Compatibility

Make sure you feel comfortable with your Realtor! Your Realtor is more than a “Sales Associate”. Licensed Realtors have the ability to show you any

property listed for sale even if listed by a different agency. Realtors pride themselves on the professional relationships built with Clients. Some of those relationships are like oil and water, they just don’t mix. It’s okay to recognize it and address concerns with your Realtor. Many times he/she can refer you to someone more compatible.

3). Refer-ability

Most of the clients/customers a Realtor has, come by way of referral’s. Ask around. A friend or family member usually can refer you to a specific agent or at least a reputable company. Ask a Realtor. Most agents can provide you with a flyer or brochure of the testimonies of their past clients.  A successful and pleasant buying experience for you and your Realtor help to contribute to their “Refer-ability”.

Start Your Search

There are numerous resources available to you and your Realtor. Narrow down the specific criteria in your future new home. You should have a relative idea of how many bedrooms, bathrooms, size of garage, style (ranch, two story), square footage, city lot or country property. Combining these with your “Pre-Qualified” target price range will increase the likely hood of matching your needs with your new home. 

Your Realtor has the ability to search the MLS. A database of homes listed throughout the state of Wisconsin. My recommended resources for buyers are: housetohomeproperties.com, trulia.com, realtor.com, and The Home Run, a free publication. All of these resources are available at our office and they are accurate and current. 

Viewing Properties

        Realtors have the ability to show any house for sale regardless of which company has the

listing. Just call your Realtor and inform them of your interest in a home and they will set up a date and time to view the property when it is convenient for you.

Making that Offer

By now you’ve found that home you really love. The next step is making an offer. Some preparation by the Buyer is necessary to make an offer. All items listed below are negotiable and subject to both buyer and sellers agreement. Items to consider:

        *Purchase Price                How much are you offering to buy the house?

*Earnest Money               This is good faith money or down payment money, held by the    Listing Broker to “hold” or “reserve” the house for you. In most                  cases: $500-$1,000 earnest money on purchases up to $150,000, $1,000 earnest money on purchases over $150,000.                        Earnest Money is a payment you will make upon acceptance of your offer. Your payment will be deposited into a trust account. This is an expense buyer’s must have up front.

*Included Items              Some properties have items included in the purchase of the home. It is very common for appliances to be included. Make sure you have an idea of the items being included and if you would like them or not.

*Closing Date                  You will need to pick a closing date of when you would like to take possession of the house. Typically a closing takes 30-45 days from the acceptance date of the offer. You will also need to decide on a closing location. Typically closing’s take place at the buyer’s lender. A large majority of closings take place on Friday’s. This affords buyers the luxury of moving over the weekend, not significantly affecting their work week.

*Home Inspection           You have the option to have a home inspection done. Your Realtor should have a list of reputable state certified home inspectors for your choosing. Typically a home inspection costs $275-$350. This is another expense for the buyer paid at the

completion of the home inspection, typically within the first 10-14 days after acceptance of the offer.

*Radon Gas                     You will have the opportunity to test for Radon Gas. Typically around $100 and a Buyer/Seller negotiated expense paid at the time of testing. Radon gas is the number two leading cause of lung cancer next to smoking. I recommend all buyers research Radon gas testing and mitigation systems prior to making an offer. Your Realtor should be able to answer some basic questions about Radon Gas Testing and mitigation systems as well.  

* Well/Water/Septic         For country properties, you will want to consider a well, well water, and septic inspection. This is typically a seller’s expense. In some cases it may be a buyer’s expense. Lenders will require testing to be done as a financing stipulation.

*Financing                       Unless you are paying cash you will most likely have a financing contingency. Within this contingency you will need to know approximately how much money is being used as a down payment on the home and how much you are financing. You will also need to know what type of loan you are applying for, i.e. 30 year, 15 year, fixed, adjustable, is it conventional financing, a VA, USDA, etc. All of these you should answer with your lender at your “Pre-Qualification” meeting.

Customer vs. Client 

 Believe it or not there is a difference; you are either a customer or a client.

        Home buyers should be aware of the difference between being a Customer and being a

Client. A Customer is a buyer who is NOT represented by an agent. A Client is a buyer who IS represented by an agent. As a Realtor my license limits me from offering my professional opinion, experience, and knowledge to customers. When working with a customer, a Realtor facilitates a sales transaction and represents the seller. 

        A buyer who is looking for the professional opinion, advice, knowledge, experience and representation in their best interest should consider a Buyer Agency Contract. The Buyer Agency contract elevates the buyer from a customer to a client. With this contract the agent no longer represents the seller; he/she represents the buyer.  

Ask your Agent today if a Buyer Agency Contract is right for you.

Job Duties Owed to Customer’s

Honesty

Complete loyalty to seller’s needs

Relay to seller all information received from buyer

Focus on our seller-client’s needs in selling/ Limit properties to MLS only

Less attention given in searching new listings

Show buyers properties listed strictly within buyer’s pre-qualified affordability range

Disclose just material facts regarding properties discussed

No advice regarding property, only the facts

Get the best price for the seller and fulfill the seller’s needs

Cannot give an “opinion of value” unless it supports the seller’s listing price

No price counseling

Suggestions made regarding financing or any other terms must benefit the seller

Prepare offer on behalf of seller

Negotiate on behalf of seller

Attempt to strengthen the seller’s negotiating position

Attempt to solve problems and close the transaction to satisfy the seller

Job Duties Owed to Client’s

Honesty

Complete loyalty to buyer’s needs
Keep information confidential –buyer can talk freely
Consider alternative solutions in finding property to fit the buyer’s needs
Given first opportunity to view new listings
All properties are available for showing consideration
Full disclosure of all facts and pertinent information
Advice and opinion along with facts/Educate the buyer
Give every attempt to find the best property for the buyer and fulfill the buyer’s needs
Volunteer an “opinion of value” (CMA)/specific property value
Provide price counseling
Suggestions made in buyer-client’s best interests
Prepare offer on behalf of buyer
Negotiate on behalf of buyer
Attempt to strengthen the buyer’s negotiating position
Attempt to solve problems and close the transaction to satisfy the buyer

National statistics show the average person lives in their home for 7-10 years. Depending on when you buy your first home and how long you live, you can buy and sell your homes 5-8 times in your lifetime.  Typically purchasing a home is usually the single largest investment you will ever make at one time. With the constant change in market values and real property laws, enrolling in the services of a Realtor will benefit you throughout these years. I encourage all buyers to take an active role in the buying process. Remember,

An Educated Buyer is a Confident Buyer!

As we close out the calendar on 2010, we look back at what appears to be another year of high unemployment and decreased home values. National headlines continue to scare home buyers, sellers, investors, and real estate professionals. Is it possible that smaller market areas are affected more by national statistics than by actual decline in values?

In late 2006 & 2007 the housing market bubble began its decline, crashing in August 2008. The Federal government allocated $900 billion dollars towards special loans and bailouts, with over half going to quasi-government agencies like Fannie Mae, Freddie Mac, and the Federal Housing Administration. Still today we are fighting to move past what has been labeled the worst economic housing decline in history. 

*National Statistics: The national median existing-home price was $170,600 in November 2010, up 0.4 percent from November 2009. However, overall home values are still down over 22 percent since 2007. At that time, the median existing-home price was $218,900. Distressed homes have contributed to a large market share, accounting for 33 percent of sales in October and November 2010, and maintaining that large market share since November 2009. Foreclosures, which accounted for two-thirds of the distressed sales, sold at a median discount of 15 percent in November, while short sales were discounted 10 percent in comparison with traditional home sales.

*Regional Statistics: Existing-home sales in the Midwest increased 6.4 percent in November from a month ago to a level of 1 million. That is still 35 percent below last year sales. The median price in the Midwest was $138,900, down 1.1 percent from November 2009.

*Local Statistics: Locally in Waupun the median existing-home price was $105,500 in November 2010, up just under 10 percent from 2009.  Following the initial decline, Waupun’s median existing-home price fell from $112,000 in 2007 to $105,000 in 2008 a decrease of 6 percent. Since the high in 2007, Waupun has maintained a median existing-home price of $106,750. This is less than 5 percent decrease in home values over the past 3 years.

While the selling price has been nearly steady, there has been a dramatic drop in the number of units sold. In Waupun the number of unit transactions has fallen every year since 2007. 178 units sold in 2007, 127 units in 2008, 111 in 2009, and 102 in 2010. That is almost a 44 percent decrease in the number of homes sold over that period. The question becomes, if the number of buyers is down almost 44 percent over the past 3 years due to market conditions, why have the median values remained steady. National statistics have a tendency to pollute the thinking of a smaller market like Waupun. Sellers are hesitant to sell believing the value is down based on nation statistics. The reality is the Waupun market area has held strong, maintaining nearly steady home values!

Record low interest rates in 2010 were reported at 4 percent for a 30 year fixed and 3.5 percent for a 15 year. In the short term, mortgage interest rates should hover just above recent record lows. Although mortgage interest rates have increased slightly in recent weeks, overall conditions remain extremely favorable for buyers who can obtain credit. Coupled with government tax incentives for home buyers the low interest rates are a once in a lifetime opportunity. 

**The national rise in unemployment rate is not as large of a contributing factor as some would think. The national unemployment rate reached 9.8 percent in November, up from 9.3 percent in 2009 while Wisconsin’s overall unemployment rate in November was down to 7.6 percent from 8.9 percent one year ago. Dodge County reported an unemployment rate of 7.2 percent in November down from 8.7 percent in 2009. Fond du Lac County also reported a decrease in unemployment with 6.7 percent down from 8.0 percent in 2009.

Within the Waupun area, strong manufacturing, and a large State government labor force, helped maintain market stability that is less susceptible to drastic fluctuations of other locations. Typically the Midwest remains less influenced by economic fluctuations than other regions of the country. The decreases in the unemployment rate statewide, as well as within the county, should continue to provide the local market with continued non-volatile values.  

It is important to disregard national statistics in comparison to smaller market areas. They do not reflect the local current growth. Retail store parking lots are full.  Restaurant and supper club dining rooms have a wait and many cars on the road are new! Just as national statistics don't reflect the local retail or job market, they especially don't mirror the local real estate market. The larger declining markets have scared away sellers and buyers in numerous smaller market areas. As demand for homes rise in 2011, an increase in supply will follow, aiding in the growth of an already well-founded and stable community.

2011 will continue to be a strong buyers market.   As 2011 approaches and we make our New Year Resolutions, don’t let “national statistics” keep you from talking to a Real Estate Professional today!

Questions of comments? Contact House to Home Properties at info@housetohomeproperties.com

*Information provided by RANW MLS, National Association of Realtors, Trulia.com

**Information provided by Wisconsin’s Department of Workforce Development, and United States Department of Labor.  

First, Are You READY To Buy?

Four Big Questions

If you answer yes to the following questions, you are probably ready to buy a home

1. Do you have a steady, reliable income? 

           In other words, have you been employed on a regular basis for the last two years and do you expect to maintain your employment?

2. Do you have a good record of paying your bills?

            Have you made regular, on-time payments?  If not, read on; there is still hope.

3. Do you have money saved up for a down payment and closing costs?

            Many home buyers think that a down payment of 20 percent is needed. It’s not. Many loans exist today that allow buyers to put down 10 percent to as little as 3 percent on the purchase of a home. So don’t give up just because you can’t come up with a 20 percent down payment.

4. Do you have the ability each month to pay the mortgage as well as additional costs that go along with homeownership, such as taxes, insurance, and maintenance?

Don't forget to attend on

Wednesday December 1st

6-8:00pm

  Rockin Around the Christmas Dance Recital at City Hall

By the Masters of Movement, Rhythm In Motion

and the Waupun Warrioretts.

Stop by House to Home Properties at 215 E Main Street (next to City Hall) for a FREE cup of hot chocolate.  We will start serving at 6:15 and continue through the end of the Christmas Parade.  See you Tuesday night, Nov 30th.

Home Sales Fall in October but Prices Are Stable

by David Clark, Economist

MADISON, WI - Home sales in Wisconsin fell in October but prices remained stable, according to the Wisconsin REALTORS Association (WRA). So far this year, sales of existing homes were down 6.9 percent with median prices down just 0.9 percent since January.

Did You Know: Net Worth, Home Owners vs. Renters