News, Events, Tips and Resources from The Jamisons
The most important investment you will ever make is probably the purchase of a home. Finding the right home for you can be a long and arduous process, but there is no getting around that.
Know Your Wants And Needs
Before embarking on your journey of house hunting, you must know what you really want to find. Sit down with pen and paper and list all the features you care most about, such as:
- Location (in a particular city, school district or neighborhood)
- Size -- how many bedrooms and bathrooms
- Parking -- a 1-car garage or 2?
- Style -- 2-story house or ranch style home?
- Heating -- central heating and/or air conditioning?
Equally important, on a new sheet of paper list all the features you absolutely do not want in a house. For example:
- high-traffic area.
- high noise area (airport, train station or highway in close proximity)
- maintenance -- major repairs needed
As you look at houses, keep both lists in mind. Your lists may change over time as you do more looking. You'll want to add or remove features, or perhaps you'll become willing to make compromises. Realize that you most likely will not find the "perfect" home. Experienced homebuyers will tell you, perfect homes are not found, they are made perfect through hard work.
Get Your Credit Report In Order
Prior to looking at properties, you must get your finances in order. This is the time to review your credit report and clean it up, if need be, to maximize your credit score. Many people do not realize how important it is to check your credit report periodically to make sure it is accurate. You should pay off any past due amounts, or negotiate a settlement price to close the debt. Get such agreements in writing, before paying any settlement. Keep all receipts for any settled items from your credit report since it may take months to get the debt actually removed.
Research Your Home-Buying Options
Decide what kind of property you are interested in. Do you want a HUD property, a foreclosure, real estate, or property for sale by owner?
A number of web sites list homes according to city, state, or price range. Visit these sites to see pictures of homes, many with virtual tours, and review the listing features.
Get Pre-Approved For A Loan
You're ready now to find a lender and get yourself pre-approved for the loan. Being pre-approved offers a number of advantages. It will clarify the price range you can afford. Also, once you find the home you want, you can place an immediate offer. If you have to wait for pre-approval, someone could buy the house right out from under you.
Several special programs are often available from lenders, such as the FHA, VA or PHFA, that can save you money in the closing. Ask the lender about any special programs before you decide on a loan.
Find A Good Real Estate Agent
It is wise for the first time homebuyer to work closely with a real estate agent, no matter what type of property you're looking for. A knowledgeable real estate agent will make your house-hunting much easier. A good real estate agent is usually a good negotiator, and will be able to help you with the complicated paperwork involved in placing an offer on a house or in closing a deal.
It's essential that you have a real estate agent working for you as the buyer. They will represent you and look out for your best interest. And keep in mind, although the agent will be representing you, the sell pays his or her commission. How sweet is that!
To select a real estate agent, you should check with your friends and neighbors for recommendations. Find an agent you feel comfortable with and who is knowledgeable about the area you hope to buy in.
These are just the basics of home buying. You will find many details you need to master as you move through the buying process, but having these basics under your belt will give you a head start.
The Jamison Team
Kevin & Darlene
What great family fun! Especially, if you haven't ice skated before.
Watching family and friends trying to skate on the ice is priceless!
November 29, 2013–March 2, 2014
Lace up your ice skates and celebrate the 20th anniversary of the Blue Cross RiverRink, an Olympic-sized ice rink at Penn’s Landing that is a waterfront winter tradition.
A family-friendly holiday activity, the RiverRink features breathtaking views overlooking the Delaware River and Benjamin Franklin Bridge.
Don’t worry if it’s a little brisk — the RiverRink features a heated pavilion with a snack bar and game room to keep you warm. There’s also plenty of special events to keep you coming back each week — a live DJ is featured every Friday and Saturday night from 9 p.m. to 12 midnight to keep you moving.
Market Street and Columbus Boulevard
Philadelphia, PA 19106
Learn more at http://www.delawareriverwaterfront.com/places/blue-cross-riverrink
Are you constantly trying to stay just one step ahead of your bills? A budget can help you organize your finances. It is really surprising, but a budget can save time and a lot of worries.
Many people think of a budget as a financial jail or a diet. They eventually fail at their budgeting because of this. You have to think of a budget as simply a way to see where you spend your money and a plan that helps you get the things that you want.
First, you have to create your basic budgeting template. You have to look at the way you actually spend your money (not some computer's predetermined amounts) to be able to successfully budget. Start with your income, which is easy to identify.
Then move on to identifying your spending and expenses. Start with your bills. List each one and the amount that you pay. You might want to go ahead and add interest rates and payoff amounts to any of the debts, so that you can get a head start in identifying what you need to pay off first.
Then move on to the basics, such as groceries and car expenses. If you eat out every day for lunch, include this category in your spending. If you have a hobby that you regularly shop for, include this category. Identify the places your money goes during the month.
You can used a template budget worksheet, found online or in a bookstore. Make sure that you edit this worksheet to fit your finances and your needs.
Now you need to identify your budget amounts. Collect your receipts and bills for the past month. This is easy to do. Simply get a receipt for everything you purchase and dump it in a shoebox at the front door every evening when you come in. Go through these receipts and start filling in the spending category amounts. You may find that you need to even add more categories.
For the next two or three months, you should consider simply tracking your spending to get a realistic vision of how you spend. You may immediately find that you are able to cut spending in some areas. Often, people are surprised to know that they spend so much on something.
Once you have an idea of where your money is really going, you can start cutting back in certain areas. Everything is negotiable. Even seemingly fixed expenses, such as your electric bill or water bill, can be reduced.
Remember, your budget isn't something designed to limit your spending. It is created to let you manage your spending. You are able to get an accurate view of how you spend. There isn't anything to be guilty about or shamed about when you really see how your money is being spent. Now you can see how to fix it.
Do you have a budget? If not, can you see the benefits of creating one?
You’ve lived in your home for some time and circumstances such as an expanding family mean you need a new one. This brings up the subject of bridge loans.
From Here to There
You have two basic options when you are considering selling one home to move to another. The first option is to sell your home, make sure it closes and then find a new one. This is by far the safest option.
The second option is to buy and sell at the same time. Typically, you try to close on your sale around the time you close on the purchase. Theoretically, this allows you to move seamlessly from one home to the next. This is an option rife with potential problems. What happens if there are problems with the sale of your home such as escrow issues or the buyer failing to get a loan? Suddenly, you are looking at being the owner of two homes. Disaster has struck since you’re undoubtedly using proceeds from the sale of your old home to fund the new purchase. With no sale, you have no funds and sleepless nights follow.
Bridge loans are often touted as a solution for this problem. In theory, a lender will provide you with a loan to cover the gap in time between the sale and purchase of the two homes. While bridge loans do accomplish this, they should be considered a last resort for a few reasons.
First, bridge loans are obscenely expensive. You’re in a tight spot and the lender knows it. Points and interest rates are going to be shocking. The lender knows there is a higher chance you will default on the loan, so you can expect to pay for the risk up front.
The second problem with bridge loans concerns your old home. Inevitably, you will anticipate a fairly quick sale of your home, but what if it doesn’t happen? Suddenly, you are making payments on two homes. Few people can afford to make such payments and you can quickly run out of cash.
Financing a move from one home to a new one can be a tricky process. Make sure you put a lot of thought into it or you could be in for a very bad surprise.
One of the biggest problems people run into when selling their home is the process of preparing it for sale. Many homes are simply places where we keep the accumulated treasures of the years. Are you a clutter-bug, a pack-rat? It's OK, we all are to some degree. When preparing a home for sale, we need to be mindful of our "stuff." The best way to begin this process is to take a quick walk through your home. Make a list of everything that you have not used in the past 3 months, 6 months? Now, and here is the hard part. Get rid of it. Seem a bit extreme? It might, but things that you have not used in half a year are not likely to get used in the future. Remember we are trying to get rid of some stuff so that people can see the house, not what's in it.
There is a common line of thought that home buyers want to see the "personality" of the homes current owners. This is not true. Buyers want to be able to see their belongings in the home. They want to put their personality into it to see if they could see themselves living there. A backlog of your stuff will get in the way of them doing this. Go through every room in turn and remove the clutter! This includes the closets, shelves and cupboards. Also remove excess furniture if the room seems too crowded. Here is another important thing to remember, don't put all this stuff in the garage! Buyers will go through the garage like any other room in your home. Hire a storage locker if it is really necessary. Aside from that, use this as an opportunity to rid yourself of those things that you never use.
The minimalist approach is a good thing to utilize when showing your home. The lack of personal effects will make it easier for buyers to place themselves in your home. This will also make the moving process easier on you. With less things to pack when moving day comes, you can dedicate more time to creating your perfect space in your new home.
Property Checklist for Preparing Your Home to Be Listed
Most sellers make the mistake of assuming the way they live in a home is a good atmosphere in which to conduct a sale. It is not. Homebuyers are not looking for a property in which you, the seller, seem comfortable. They are looking for a property in which THEY will feel comfortable and can envision themselves settling down in. This may sound like a minor distinction, but it is actually very large. If you can wrap your mind around this fact, you will have a much better selling experience.
First and foremost, you must understand that people have different tastes. The particular chandelier or aspect of your home, which is unique, may seem appealing to you, but not to buyers. Emotionally, you must be prepared for buyers to make rude comments regarding aspects you might cherish. Remember, it is a product to be sold and nothing else. If they don’t have taste, that is their problem. On the other hand, they could be the buyers of the property you are trying to sell, which is your problem. Remember that when you are about to make a snide remark.
Before listing your property, it makes sense to address a few issues to avoid any problems.
1. Clean up closets – sellers look.
2. Clean up garages – sellers consider it a sign of how you took care of the home.
3. Clean the refrigerator – make it spotless. We are talking surgical room spotless.
4. Same goes for the oven.
5. If you have an attic, clean and organize it. Buyers will look everywhere.
6. Make sure all light bulbs work.
7. Fertilize the yard a few weeks before listing the home.
8. Repair leaky faucets.
9. Consider replacing worn or old fixtures.
10. Clean the windows.
Again, the goal is not to show a home you enjoy living in. The goal is to show a home they buyer could be comfortable living in. You are shooting, as much as possible, for that new home look.
There are some simple things that you have to know how to do. But it seems like no one ever sits down and teaches you. Balancing your checkbook, making wise financial decisions and handling debt are vital to your financial health.
I guess it's something that we make our mistakes and learn from. But today, the mistakes are costlier than ever. With credit cards targeting college students and debt problems affecting millions of consumers, every person should take the time to make sure that they and their children know how to manage their finances. Our son had an American Express, Capital One Visa and a Sears Credit card in college.
Have you ever stressed about money? I won't say that proper management will eliminate money stress, but it will certainly cut it back by around 90%. If you've ever spent hours stressing over where you will get the money to pay for bills or gas or whatever, you will truly appreciate the freedom proper financial management brings.
And the thing is, it is so simple. The first things you should know are how to balance your checkbook, what interest rates are and how you pay off loans and save for retirement. Do research before you buy a car or take out a loan.
After you've done a little homework, you can start understanding your own finances. Start with your bills. You need to not only know how to read them and pay them, but also what they mean to you financially. Make a list of your current financial responsibilities -- what you owe, who you owe and your interest and payment amounts. Add to this list all of your expected financial liabilites, such as increases in insurance premiums or a new home purchase. Add in your daily expenses, such as food and gas money.
You've now completed the first step in your own personal family budget. This will be your blueprint of how you will spend and save. Add up all of your monthly income. Subtract your expenses you have listed from your income. The results should be a positive number. If it isn't, you are spending more than you make. You need to find places to cut back so that you don't fall further and further behind.
Many children and teenagers believe that credit cards are a magic way to get what they want. They will buy everything. Adults should know better. Credit cards need to be paid off. This is your top priority -- you have to get out of debt. Don't charge anything that you can't pay back at the end of the month. If you can't resist the card, put it in your safety deposit box. You won't use it on impulse if it is hard to get to.
Here are a few tips on how _not_ to get a loan, and underneath each one, the smart thing to do instead.
1. Ignore borrowing costs.
Examples of these are insurance schemes and prepayment penalties. Make sure you understand and are willing to pay them all. Understand your agreement before you sign, including terms and conditions.
A loan may become too expensive, with variable interest rates and fees. The total cost of your loan will depend on the annualised percentage rate (APR). The annualised percentage rate takes into account the interest amount, and all other charges.
2. Pick the first lender you think of.
Deals vary enormously, from loansharks to credit unions. Consider fully mutual building societies and credit unions, then find companies that are dedicated to loans. The first were set up to help members, and the latter's earnings come exclusively from lending money. They can offer better deals.
3. Communicate by telephone only, and don't record the name of who you spoke to.
Make sure you get the full name of the person with whom you speak, if you call your loan company. Big offices are impersonal; your loan officer could leave at any time. Write letters to keep a record of important points.
4. Take on a loan thinking "Well, I can always go bankrupt".
This is stupid. You will find it very hard to get credit of any kind in the future, when you need it badly.
5. Avoid researching the lender.
Type the name of the lender into a search engine. See if there are any negative postings about them.
6. Who cares what it'll cost you!
Think about your budget; how much can you afford each month? Then leave a portion of your monthly income aside as coverage for emergencies and unexpected bills.
7. Take your time paying it off.
No matter how cheap a loan may be, pay it off as quickly as you can to avoid interest accumulating. Try to get a loan that allows early payments; the quicker you pay back, the less interest you pay. If you extend the duration of the loan, you will have to pay much more in interest.
8. Make lots of enquiries in a short space of time.
Any more than four credit checks in one month for a personal loan looks suspect, and may affect your credit rating. When shopping for a quote, ask them if they're going to check your credit-rating, to be on the safe side. They don't need to, to give you a rough estimate.
9. Have lots of credit available to you, then ask for more.
To ensure you get the best terms, keep your credit-line as small as possible. Loan officers tend to count the total line of credit available as a liability.
10. Default or make late payments on small debts.
Not paying off that hire-purchase agreement years ago will come back to haunt you. Pay off small debts before they're due. Cancel credit cards you are not using. IMPORTANT: Keep your oldest card, for the credit history attached to it. Otherwise, consider their interest rates and fees, when deciding which ones to hold on to.
11. Sign papers without reading them.
You're anxious. You want the money _now_. Cue major upset later when you realise what's in the small print.
12. Keep quiet about repayment problems.
If you have problems with repayment, write to your lender as soon as possible. The earlier you tell them, the more sympathetic they'll be. You can then make arrangements for under-repayments until you get back on your feet.
If you're dragging around bad credit scores, you'll pay more for car loans, credit cards and mortgages. Here's how to turn them around in a hurry. Plus: 4 credit mistakes to avoid.
There are different types of real estate, and different ways to invest in them. Which way is best is for you to decide, according to your particular needs. Here are a few ways to consider, with their advantages and disadvantages.
1. Rental houses. Advantages: One of the easier ways to get started, and good long term return on investment. Disadvantages: Being a landlord isn't much fun, and you typically wait a long time for the big pay-off.
2. Rent-to-own houses. Advantages: When you buy, then sell on a rent-to-own arrangement, you get higher rent, and the buyer is usually responsible for maintenance. Disadvantages: The bookkeeping is tricky, and most tenants don't complete the purchase (this can be an advantage too, but it does mean more work for you).
3. Low income rentals. Advantages: The same as with any rentals, but with higher cash flow. Disadvantages: The same as with other rentals, but with more repairs and tenant problems.
4. Fixer-uppers. Advantages: A quick return on your investment, and it can be more creative work. Disadvantages: Higher risk (many unpredictables) and you get taxed heavily on the gain.
5. Buy for cash, sell for terms. Advantages: You get a high rate of return by paying cash to get a good price, and selling on easy terms to get a high price AND high interest. Disadvantages: You tie up your capital for a long time.
6. Buy land, split it and sell it. Advantages: It is simpler than most real estate investments, with the possibility of great profits. Disadvantages: It can take a long time, and you have expenses, but no cash flow while you wait.
7. Boarding houses. Advantages: You can get a lot more cash flow renting a house by the room, especially in a college town. Disadvantages: You can get a lot more headaches renting a house by the room, especially in a college town.
8. Commercial real estate. Advantages: Long term triple-net leases mean little management and high returns. Disadvantages: Tough market to break into, and you can lose income on vacant storefronts for a year at a time.
9. Buy, live in it, and sell. Advantages: The new tax law means you can fix it up, and sell for a big tax-free profit after two years, then start the process again. Disadvantages: You have to move a lot.
10. Speculation. Advantages: Buying in the path of growth and holding until values rise can yield large profits, especially if you buy low to start. Disadvantages: Prices aren't that predictable, you have expenses with no income while you're waiting, and transaction costs can eat much of the profits.
Good luck and don't hesitate to contact us with your questions.
Kevin & Darlene