Category: Real Estate Topics

Okay, you first-time home buyer.  You’ve scrimped, you’ve saved, and you’re ready to go talk to a banker or a mortgage lender about acquiring a mortgage.  You’re going to take the leap and become a homeowner.  What documents will you need to assemble?  Let’s point out several.

First of all, you’ll need to share your driver’s license.  Okay, that’s no biggie.  You’ll also want to provide a secondary form of identification, typically a passport or your social security card.

Next, we’re going to look at $$ documents.  You’ll need to supply a representative sketch of your financial picture.  That means the banker or the mortgage lender will ask to see recent pay stubs (for at least a couple of months).  You might supply copies of your bank’s statements for a couple of months, too.  Then, we move on to bigger — annual — statements of your worth.  You’ll be asked to provide copies of your Federal tax returns for the past couple of years, and it’s highly likely that those Federal returns will include copies of your W2’s (or W9s if you are self-employed).  It’s possible that your mortgage lender might request some other document as well, but these are the key elements of establishing your financial security.  For instance, the lender may ask for your landlord’s contact info to verify that you have been paying your rent on time.

You can start the process of getting “pre-qualified” even before you start the home search.  In fact, it’s a pretty good idea to do so, because the pre-qualification process usually takes several weeks.  Then you have chosen a mega Realtor (and I’m hoping it’s me).  We will work together: you’ll explain what you’re looking for, and I will narrow down selections based on your preferences and email them to you.  Once you find a few you want to visit, we will go visit those homes (and I will be encouraging you to take notes — believe me, houses will “run together” in your brain quickly).  Once you find THE house, we will execute a Purchase Contract on it — and you’ll take that to your lender.

If everything is in order — which means you’re not trying to buy an $800,000 house when you were only pre-approved for $300,000 — we submit the offer.  If it’s accepted, there’s only a couple more hurdles before you get the keys to your new home.  We’ll talk about those other hurdles in another post.

For now, start digging up your last couple of years’ tax returns, and give me a call.  I can recommend some excellent local mortgage lenders.  It’s sfelton@realtracs.com or call me at 615-870-4094.

If you’re planning on buying a home in the next few months, you are probably facing more than a little work — especially if your credit score isn’t in good shape.  While you can’t change your credit score overnight, you can put some steps into place to raise it over the duration of two or three months.  Hence, start now and you may be ready to purchase this Fall and be in your new place before the big holidays!  Here are some basic tips.

Tip 1: Take a good hard look at your credit history.

Credit scores are drawn from information in your credit history, so anything that’s wrong, even from something way back, can possibly still bite you today. Most folks advise you to visit annualcreditreport.com and pull a free copy of your credit history. But there’s another great website called creditkarma.com.  Check for mistakes and call the places if you do find a mistake. Hint: don’t be angry when you call; assume the role of “I am seeking to purchase a house and I need your help” to get this error cleaned up.

Tip 2: Lower your utilization ratio.
Teach yourself a little about how credit scores are calculated. (Visit the Buying tab of this website) to find some great information).  One factor is “Amounts Owed,” which determines about 30% of your credit score. What those folks look at is how much you OWE on credit cards versus how many DOLLARS are made available to you (your credit limit).  Hence, if you are allowed $5,000 on a certain credit card and you keep it maxed out most of the time, that’s not so good.  It’s much better if you only keep maybe $1,000 or at the most $1,500 charged on that $5,000 card. This whole idea is called the “utilization ratio” — how much of your credit limit are you utilizing each month?

So how should you accomplish that low balance?  Well, (obviously), the first step is to pay down your credit cards as faithfully as you can. Your payment history accounts for 35% of your credit score.   But if you can’t exactly do that, consider shuffling the burden to another card.  Be careful here, of course — but if you have a high balance on one card and you haven’t put much of anything on a second card, shifting some of the balance to the less-used card might help.  (You have to pay it, too, of course: no free lunch…).  And a second step you might take is simply to call the bank or credit card issuer and ask them to raise your balance.  But, again, obtaining a higher credit limit does not mean that now you can go out and buy that new 55-inch HDTV you’ve secretly been wanting…

Tip 3: Refresh a card you haven’t used for years…maybe….

If, after reviewing your credit history, you are reminded that you used to have a Mastercard that you haven’t used for years, find that puppy. Call to make sure that the credit line is still “open.”  Getting that old account refreshed will increase the amount of available credit open to you (a good thing).  It might also extend your credit history (another good thing).

Okay, here are two things not to do. Don’t open a new account – that definitely will lower your credit score. And don’t close any accounts, because that would negatively impact your “utilization ratio” as described above.  Oh, and don’t go any freaky and buy a lot of expensive stuff like furniture for the house you haven’t even bought yet, or a new van to help you with your upcoming move…

Give Becky or me a shout if you’d like more information on the home-buying process: either of us would be thrilled to help you.  And let me just say — with a wink to your upcoming great credit score and new house — an early Happy Thanksgiving to you!!!

 

Lots of life’s activities require teamwork.  How about your job?  Who do you depend upon?  Do you need someone from a certain department to get a needed report done before you can run a particular program?  How about the teamwork required to run your household?  One person gets the dinner cooked while someone else gets to load the dishwasher, maybe.  And how about the teamwork needed simply when you’re driving from Point A to Point B?

I’ve been thinking a lot about teamwork this week.  I’ve taken on a small project that might help one of the people with whom I work.  And in turn I have been depending a huge amount this week on a friend who can help me solve some annoying computer problems.  It’s a natural phenomenon; none of us can get it all done.  We need the help of our friends.  Our teammates.

Teamwork is an essential ingredient in real estate, too.  If you’re ready to get your house sold, you need a team behind you — to help you with getting the place ready to sell (which might include packing, plumbing, or painting).  You need a teammate — such as a trusted realtor — to give you an objective opinion on how to price your home and how to present it in the best light possible to bring in an excellent and quick offer.  And you’re going to need some teammates to get you moved into your new place, too.

If you’re on the buying side of the equation, teamwork is even more necessary.  You’re going to need to locate a mortgage lender with whom you’re comfortable, a realtor to help you locate the right place, someone to help you sort through all of the many home choices, then you’ll need a home inspector, and perhaps a closing attorney.  Lots of people are involved (see graphic above), and it can feel a bit overwhelming at times.  Share your needs with your realtor; that’s our job.

Teamwork.  It’s necessary.  How can I help you today?

When you think about moving to Nashville, what are your primary motivations?  Were you born here, and you moved away to see “more of the world”?  And now, you’re returning home to Tennessee because there’s something about Nashville that calls you back home?  What *is* that something about Nashville?  I can’t find the words to describe what that magical pull is all about.  But there’s a song that really describes it for me: “The House that Built Me.”  Miranda Lambert sings it, but it was written by Tom Douglas and Allen Shamblin.  According to a source I know, the song was originally pitched to Blake Shelton (Miranda’s husband) to be narrated by a male singer, but Miranda heard it, loved it, and knew (wisely, I believe) that the singer of this song should be female.

I also felt the song deeply a couple of years ago.  My mother passed away in November 2010, and about six months later, we were auctioning off a good deal of the contents of her house.  She had lived there some sixty years, and as the antique Hoosier cabinet and the maple tables and the big metal desk she had painted pink were transported to the front yard, my friend and business partner Becky reminded me of that song.  Houses are filled with things that we love, and my mother’s house was definitely stocked with things.  My brother and I were there to observe and to watch those possessions we had known for years find new owners.  Becky was a marvelous friend that day; she was also busy observing.  She knew that the current bid on one of my mother’s antique “pie safes” was pitifully low, so she upped it to a much higher price so she could claim it.  That pie safe now sits in my kitchen.

So if it’s not family, what else about Nashville attracts you?  Yes, we are a creative city; we have a plentiful supply of art, music, sculpture, beautiful parks and green space.  Green space is an important element for a lot of folks.  It’s possible to still buy land here, for a reasonable price — unlike California or New York or other parts where acres of land would be simply unimaginable.  And we are a friendly city; we just like people here.  Those are good features to keep in mind as you begin your search for a new home in or around Nashville.

What’s important to you?  We have it all, really.  Privacy (if you want some acreage); condos with clubhouses and other amenities right in the middle of things, walking distance to great places (if you choose that).  Trendy contemporary homes (in East Nashville, particularly); stately and spacious traditionals (in all corners).  Modestly-priced homes to multimillion dollar mansions.  It’s likely that the kind of home you want now may reflect the kind of home that built you, so enjoy the emotions of coming back home.

Miranda Lambert, The House that Built Me 

Hummingbirds and housing?  How in the heck might those two concepts be related?  Well, stick with me for just a minute and I’ll try to explain.

I have a hummingbird feeder outside my office window.  I do my best to keep it filled with fresh food.  (By the way, in case you didn’t know, hummer food has to be changed about every third day because it will spoil in the hot sun and begin to ferment — and you certainly don’t want to have any tipsy hummers around!).

There are four feeding ports (yellow flowers) on this feeder, and I get regular visits from these beautiful birds.  Upon occasion, two hummers will attempt to belly up to the bar at the same time — and the result is they will begin an aerial knockdown.  Hummer # 1 will get his fiercest buzz on and bodyslam Hummer # 2 out of the way.  Hummer # 2, not so easily deterred, will flit away for a couple of seconds and zoom back in for dominance at the feeder.  I wish I knew why this seemingly-violent behavior occurs.  There are, after all, four feeding stations and only two birds trying for the nectar.  Makes one wonder whether hummers carry any testosterone in their tiny little systems.  I know they are male birds, because the females are not nearly as brightly colored, nor as aggressive, as the males.

So how do the hummers relate to the topic of housing?  Well, I read an interesting story in the Tennessean from a couple of days ago (June 16, 2013).  The article is entitled “New type of neighborhood coming to Nashville.”  What’s the new type of neighborhood?  It’s called “co-housing.”  Construction of this new neighborhood — in the Germantown area of town — is expected to begin by late summer.  It will be privately-owned condos, lots of green space (about 40% of the development), rain gardens, edible landscaping, and a clubhouse-type facility designed for meetings and gatherings and committed to energy efficiency.  Decisions will be made by consensus, and disagreements will be allowed “as long as people remain respectful and civil.”  Hmmmm.

The co-housing philosophy is admirable.  In fact, I would love to be part of a community where consensus and civility are promoted behaviors; it sounds like a lifestyle any of us would enjoy.  But edible landscaping?  Hey, I’ve got an edible landscaping feature right outside my office window; it’s got four feeding stations and two visitors who regularly battle for superiority.  In short, anytime you get people together, politics — and trouble — won’t be far behind.  I wish the best for this new neighborhood.  But I will manage my own edible landscapes; thank you very much.

When Becky and I were originally discussing creating a blog for our website, I had recently lost a sale.  I told her that I was choosing to be Grumpy about it.  I had worked many long hours — several months, actually — to locate a place for this client, and the negotiations simply evaporated.  She said something uplifting, like to move past this disappointment, things will work out, I should be Happy.

And then it dawned on me.  There are 7 dwarfs operating in real estate, and both agents and clients inhabit the roles upon occasion.  So here’s my stab at the ways in which each dwarf might be represented — in no particular order.

If you are moving to middle Tennessee, particularly to Nashville, you are likely to meet Sneezy.  According to WebMD, “Tennessee is where everything [speaking of allergens] comes together.”  Nashville ranks #47 in the nation on the list of allergy-affected cities, and shockingly, Chattanooga ranks #3!  We have a long growing season, a temperate climate, and lots of rain — which means one can “expect to sneeze a lot!”  Southern trees — oak, cedar, birch, hickory, and pecan — begin dispersing their pollen as early as February.  I’ll bet more than one of our readers has had the experience of having to turn on the windshield wipers to remove the dusty yellow pollen on a sunny April day.

But you’ve decided on Tennessee, and you want a great home.  Sometimes clients are Bashful about admitting to your realtor exactly how much money you have to devote to the down payment or to the price of the house.  Please don’t be troubled about your level of finances: it does no one any good if we offer half-a-million-dollar houses when you can only afford a $150K house.  We respect your financial picture.  That’s why one of the first pieces of advice we offer to our clients is to go get yourself pre-approved.  Touch base with a mortgage lender (and yes, we can recommend some great ones), and simply find out what’s going to be comfortable.  That’s all it takes.

So we begin looking for houses in your price range.  We find one that is a great fit; it meets all your criteria and you can already imagine how super your sideboard will look placed against that wall, and how you want to plant petunias right there.  If the house is a hit, then don’t get too Sleepy or reticent about it.  The real estate market in Nashville has turned HOT; both of us have seen listings posted one day that sold within 24-36 hours, fast, fast, fast.  You may not have the luxury to “sleep on it.”  Once your heart tells you “this is it,” you need to be ready to pull the trigger.

And along those same lines, you also don’t want to submit a Dopey offer.  I had found a great place for my client that was listed just short of $180K.  She offered $156K.  In truth, I was almost embarrassed to submit that offer; I was pretty sure that the sellers would easily check the “REJECT” box, but they counteroffered, knocking $1,000 off the original price.  Now we learn something about negotiations.  Had my client’s original offer not been quite so dopey, we could have arrived much more quickly at something agreeable to all.

As it was, however, the deal fell through, leaving me, the client, and the sellers Grumpy.  In my armchair analysis, I ended up feeling a little like a Doc, because I genuinely knew what medicine would have saved this “patient.”  No one approaches real estate as a big game or as a chance to practice one’s debating skills.  Our lives, our hopes, our hearts are all involved; we don’t want conflict, we want smooth sailing.  We want a nice home where we can feel safe and proud of where we are, for ourselves and for our children.  That’s the idea behind why the real estate agent is involved in the first place: to help things move along smoothly, efficiently, hassle-free.  Yep, in the final analysis, we all just want to be Happy.

Oh, did anyone besides me think about the Lumineers’ Ho, Hey song?
You have to experience Lennon and Maisy Stella singing it: Fabulous!