Buyer's Edge Realty, Inc. News
Things to Consider When Buying a Home
Tarrytown, NY...(December 27, 2005)... Where do home buyers begin the process of buying a home? There are a plethora of things to consider, especially since the home buying process is complicated. Home buyers must keep in mind that they can have control of the process- without the process controlling them. A home is often the biggest purchase in a lifetime, and any mistakes made during the home buying process can be costly.
New York State is a "buyer beware" state, which means that when a home buyer works with a traditional seller's agent, the buyer is responsible for verifying information presented about any property of interest.
Gary Herbst, an exclusive buyer's agent and principal broker of Buyer's Edge Realty in Tarrytown, recommends these key considerations:
- Create a needs and wish list for your new home. What are some of the things you are must have in a home and its neighborhood? Is there a certain style or age range of a home you especially like? What are some of the things you would like to have but can also forego? Do you want to live near a train station for easy access to commuting?
- Examine the neighborhood of the home you are considering. Make sure that there are no imminent plans for commercial construction or other non-conforming adverse development that might compromise the value of the area and property.
- Ask questions. Verify the yearly property taxes. Ask about the school system. Find out if the neighborhood is safe.
- Look around the inside and outside of the house. Keep an eye out for leaks or seepage; unusual settlement or sagging of floors; doors and windows that do not open or close property; non-working or few electrical outlets in older homes unusual odors; moisture problems; and overall age and appearance of the heating system.
- Double check that the information reported on the MLS (Multiple Listing Service) sheet is accurate. Oftentimes, people don't read the "small print." On an MLS sheet, that small print reads, "Data believed accurate but not warranted. All data subject to verification."
- Be sure that a professional home inspector or licensed engineer inspects the home and accompanies the inspector. An inspector will seek out and identify any potential and existing problems that might arise with the plumbing, heating, air conditioning, electrical systems, roof, foundation/structural, walls, windows, drainage or ventilation. He will also check for any safety or health-related problems and code violations. If the home has a well, septic system or a buried oil tank, those should also undergo testing. A radon test is also advised.
- Examine room size, floor plan, and adequacy of closets/storage. Think about where your family gathers most often. Is it the kitchen? The family room? Be sure that the space can accommodate all of the traffic that will flow through it.
- Secure a mortgage pre-qualification or mortgage pre-approval in order to determine how much a bank or lending institution will lend. This number is based on income, credit, assets, employment history, and other criteria. In order to determine whether the amount is feasible based on lifestyle, find out how much the monthly payment will be for the maximum amount received.
- Ensure that the amount chosen for a down payment will leave enough for closing costs, emergencies or other expenses. A reserve fund should be equal to at least three to six months of the monthly PITI (Principal, Interest, Taxes and Insurance).
- Be certain to hire someone to help you along the way. Remember that companies which list homes for sale represent the seller's interests by law, not those of the buyer. Seek out an exclusive buyer's agency, which will work 100% on the homebuyer's behalf to find the best home. This includes evaluating property conditions, verifying property taxes, square footage, estimating fair market value, disclosing what is right and wrong with any property of interest and helping you negotiate price and terms – all while keeping your interests confidential.
Buyer Be Aware - New law in effect December 31, 2005
Tarrytown, NY...(January 19, 2006)... Gary Herbst, an exclusive buyer's agent and principal broker of Buyer's Edge Realty in Tarrytown, today announced that as of December 31, 2005, a new law requiring home inspectors to be licensed by New York State has gone into effect.
The new law, the Home Inspection Professional Licensing Act, requires home inspectors to be licensed in order to perform home inspections. As of January 18, 2006, 396 home inspectors in New York were licensed by the state- out of about 5,000 registered home inspectors. Licensed professional engineers, registered architects and code enforcement officers can all perform home inspections under this law.
Additionally, a licensed real estate agent or broker must tell a home buyer that the inspector is required to be licensed. If an agent or broker does not abide by this part of the law, s/he could be held liable for recommending untrustworthy sources. Liability could lead to fines in excess of $1,000, and disciplinary action may be taken.
Herbst said that in a "buyer beware" state like New York, where an unrepresented homebuyer is responsible for verifying any- and all- information reported on a home sale listing, the law serves to provide added protection to that homebuyer.
"This law will ensure that real estate agents for the seller cannot simply accelerate the process of a sale by recommending a 'preferred vendor,'" Herbst said. "Under this law, real estate agents are required to know which inspectors are licensed and which ones are not. It is unethical and unlawful to recommend a vendor simply because there is an existing relationship."
One of the biggest mistakes homebuyers make is not hiring a licensed inspector. Many homebuyers rely on the seller's salesperson to refer an inspector, thereby presenting a potential conflict of interest. Herbst added that utilizing the services of an unlicensed home inspector can slow the home buying process, can cost the buyer additional fees for service and can potentially cause the home to be sold to another buyer using the properly licensed vendors.
To find out if a home inspector is licensed, log onto www.dos.state.ny.us , click on Search for Licensees and Registrants, and enter the business name or name of the inspector whose credentials are being researched. Only licensed home inspectors can be found on this website.
Mortgage Fraud a Growing Trend
How to identify a fraudulent lender
Tarrytown, NY...(March 6, 2006)... In 2005, the FBI reported that it had received almost 22,000 reports of questionable real estate activity and that mortgage fraud is one of the "fastest growing white collar crimes in the United States." The FBI also reported a loss of more than $1 billion for the fiscal year 2005 as a result of mortgage fraud. That number more than doubled from $429 million for the 2004 fiscal year.
Tarrytown's Department of Consumer Protection reported that one mortgage company "has agreed to a settlement of $325 million with 49 states for collecting excessive fees and interest rates. Many homeowners who could not afford to pay the loan and fee amounts charged were forced into foreclosure."
Gary Herbst, an exclusive buyer's agent and principal broker of Buyer's Edge Realty in Tarrytown, knows that homebuyers without the proper resources and support can be deceived when going through the complicated process of buying a home. In order to educate Tarrytown consumers about mortgage fraud and to help them protect themselves from unlawful activity, Herbst makes the following recommendations.
"If a lender asks you to lie about your income or work history, run the other way," Herbst said. "And if the lender charges excessive fees or penalties, that's a sure sign they are not conducting their business ethically - or within the law."
Before making any calls to retain a lender's services, Herbst recommends researching whether a mortgage lender has a valid license. To find out if a mortgage lender is licensed, log onto the National Association of Mortgage Brokers' website, www.namb.org and click on the tab, "Find a NAMB Broker." Members are required to adhere to a strict code of ethics.
A borrower should receive a Good Faith Estimate no later than three days after an application for a mortgage is filed. This report, required by law, provides the borrower with an estimate of the various costs associated with the loan, including taxes, title insurance, inspections taxes and other charges.
Additionally, if any of the loan terms are unclear, ask questions. Honest and principled lenders will be willing to explain the terms until the borrower fully understands them.
Be wary of internet-based mortgage lenders or those who solicit quotes via telephone. They are notorious for underestimating good faith estimates and providing deceptive rate quotes.
Additionally, if extra charges are incurred as a condition to a loan, that lender's practices are unethical. Hidden fees are a good indication that the lender is a fraud.
Utilizing services of an exclusive buyer's agency (EBA) will provide additional support to the home buyer. The EBA will not only make sound recommendations to the home buyer but will also assist in negotiations for the best mortgage rates and terms.
