For Home buyers
I don’t often write about interest rates or mortgages because when I do this site attracts a lot of spam. Over the weekend I had a client who is first an foremost a friend ask me a bunch of questions about financing. I had to keep sending her back to her lender but I told her what questions to ask and gave her some information about what I call market rate mortgage rates. There are reasons why a borrower may have to pay a higher interest rate. The interest rates that are published are for the borrowers who are credit worthy and they are averages to be used as a starting point when shopping for a loan.
It seems that standards are tougher than they used to be when it comes to new financing for the purchase of a home but it is still fairly easy to refinance. With all the refinancing going on it is common for a homeowner to have lived in a home for twenty year and still owe much more on it than they originally borrowed to buy it. I never assume that because someone bought a home in the 1990′s that they have equity in it because sometimes they don’t.
Here are what interest rates on mortgages currently look like. Yes they have been lower but they are still lower than they have been through most of the last 40 years or so. Each little upward tick in the generally low and stable interest rates seems to start a small panic. Fro the perspective of interest rates now is a good time to buy.
Upper Landing September 18
There is a ruler in the center of the picture and it was almost completely under water 3 months ago. The Mississippi River doesn’t seem to be as low as it was last year at this time but it is lower than it has been during the average September and about 25 feet lower than it was during the epic summer flood.
Taken Late June 2014
Last June I had to stand on the sidewalk above the walking path because even the walking path was under water.
It is Friday and Fridays are for fun. I thought I would give a sneak preview of some fall leaves incase anyone has forgotten how beautiful fall can be. it only lasts about a week and it will be stating soon. Each of these pictures was taken right here in St. Paul at one of our many lovely parks.
Last year we had our furnace looked at before the heating season started which is why we were able to get it replaced before it got really cold out. I hate to sound like your father but it is a good ideas especially here in Minnesota where it gets so cold to schedule a furnace tune-up every fall. It generally costs less to get work done in late summer or early fall than it does during the heating season.
I see a lot of houses with old furnaces that have been well maintained. They really do last longer with regular maintenance. Personally I am not a fan of the service plans but I am a fan of service.
If you are selling your home this fall or winter it is a good idea to have the furnace or boiler serviced and save the receipt or even tape it to the furnace. Buyers who are closing on homes this fall should either have the furnaced tuned up or should make sure that the seller has already taken care of it.
Over the years I have been on a lot of home inspections with home buyers. I almost feel as though I can inspect a home myself . . . but of course I can’t because I am not qualified. I often see and point out problem areas to home buyers and sellers but I add that a professional should have a look.
There is a world of difference between a good inspector and a bad one. The good home inspectors have some experience, the really great one have a lot of experience. Each home and each inspection is a little different and each experience teaches us something if we are open to learning.
The best home inspectors are able to anticipate and recommend future repairs and maintenance and they can tell the potential buyer a lot about the home and how it has been used. A home buyers inspection should not be just about finding problem areas it should be educational so that the buyer or buyers understand what they are buying.
To be honest I don’t always have a lot of faith in the home inspection franchise companies and have had the best luck with the self employed small inspection company inspectors. Often they are sole proprietors. One of the best ways to find a good home inspector is to ask friends and family who have recently purchased homes or ask a real estate agent.
Lofts, Condos & Townhouses
Over the years I have gotten familiar with several condominium homeowner associations. I’ll admit I have a bias and usually prefer the associations that are professionally managed as opposed to those who are run by members who volunteer.
Sometimes the volunteers are a little over zealous. I recently encountered one association office who liked to peak in windows and look inside of garage. He is retired and has all day to lurk around the townhouses and make sure rules are being followed. Some of the townhouse owners just love the way someone is keeping an eye on things and others are kind of creeped out by it.
Older established associations where there is little turnover in the board of directors or among the property owners take on a kind of personality and “culture” that can be difficult for a new member to adjust to.
In some associations no one wants to be on the board of directors and members only get involved when there is a problem and even then it is hard to engage property owners and get them to help make decisions.
In Minnesota anyone buying a property that is subject to a homeowners association has the right to review the association financials and rules before committing to the purchase. In fact there is a 10 day recision period which means a buyer can back out of the purchase if he or she doesn’t like the rules or the financials don’t look good. Some buyers simply glance at the documents and say yes while others study them closely and ask questions.
Sometimes I can kind of tell how well run an association is just by looking at the common areas of a property. If the association is responsible for lawn care and snow removal and the lawn looks horrible or the sidewalks are covered with snow several days after a snow storm that is a clue that the association may not be managing the property. If the laundry room is dirty and the hallways have burnt out lights and cobwebs in the corners that could be a sign that no one cares.
In addition to looking at association documents, looking around the property and calling the association with any questions perspective buyers should also take the time to talk to the neighbors. Ask open ended questions like: “What do you like the most about your home owners association?” and of course “What do you like the least”?
Also see: Association dues do the math Condos and Due diligence