ONE STOP SHOPPING FOR INVESTORS
After initial consultation with our clients to establish their criteria’s for their portfolio. Orlando REO Professionals I, Inc has the experience and will handle all of the steps to acquire, repair and rent the asset.
FORECLOSURE AUCTION PURCHASES
Go through the sale calendar and determine possible assets for acquisition. Check public records for liens and past due HOA fees. Check high value for the asset in the past. Drive by all possible purchases to determine occupancy, condition and repairs needed. Determine proper high bid to offer based on clients parameters. If successful, coordinate relocation assistance or initiate eviction proceedings to get the asset available & vacant. Secure bids for repairs. Have bids approved by the client. Insure repairs are completed on time and correctly. Market property for rent.
MULTIPLE LISTING SERVICE PURCHASES
Go through the MLS daily to determine possible assets for acquisition. Prepare offer for presentation. Negotiate offer with listing agent and seller. Upon successful execute contract we will follow up to make sure the escrow deposit is sent on time. Coordinate the home inspection with our contractors, and receive bids for repairs for evaluation. Follow up on all procedures to get to a successful closing. Review closing statement to make sure all charges are correct, have errors corrected & request closing funds. Upon a successful closing, Insure that repairs are completed on time and correctly. Market the property for rent.
Buyer & Seller Tips
Advantages of Owning a Home
The difference between what you owe on your home and its value is called equity. In the early years of a home mortgage, most of each payment will go toward the loan interest, but later it will gradually go more and more toward your principal balance (what you owe). Through the years your payments will reduce this balance, thus raising your equity. Plus, if your home increases in value, your equity will rise even more. Your equity is like a savings account and it could prove very important for future needs such as a retirement plan, or major purchases.
By law, you can deduct mortgage interest and property taxes from your U.S. Federal Income Tax and from some state income taxes. This results in significant tax savings, especially in the early years of a mortgage when interest payments are higher. And you may find the tax savings alone makes it less expensive to buy than to rent.
Unlike renting where payments can increase over the years, a fixed-rate mortgage payment will remain the same for the term of your loan. Other types of loans could vary in the structure of payments and there always could be slight adjustments for tax and insurance, but owning a home can result in being able to depend on stable payments for years to come. During times of inflation when rent goes up and home values rise, renters end up paying more each month while home owners increase their equity as they make the same payment.
Determining the Right Home for You
Make a List
Make a priority list of things important to you. Start with the most important, things you have to have. Then work down the list, putting them in order of most important. After you are done, go up to the top and move down until you get to a place where you can draw a line. Above the line should be all of the items you have to have, and below the line should be all of the things that would be nice to have. This will save you a great deal of time and provide a clear focus for your house hunting.
Working with an Agent
Although the Internet can provide you with homes matching your criteria and it seems easy to drive around, take notes, and set up appointments to view homes for sale, using an agent can be more efficient. They can do the same thing for you, but by working with an agent, you benefit from their knowledge and experience also. Their advice could better help you determine the right home for you and they can assist you with the actual purchase contract.
What to Do When You Find the Right Home
Considering everything has come together, the price is within your budget, and a home has met your demands, it’s time to make an offer. Part of the offer should require a home inspection so you have reliable information about any major problems or repairs you might incur and how they will be handled. If your offer is accepted, the sale proceeds. If your offer is not accepted, the seller may counter-offer with different terms.
Figuring What You Can Afford
Monthly Mortgage Payment
Lenders want to make sure you have the ability to pay your loan. As a general rule of thumb, you can figure that your monthly mortgage payment should be equal to or less than 25% of your gross monthly income. This also will vary depending on circumstances.
Amount of Money Needed
You will need money for a down payment and closing costs, plus any move related expenses and maintenance or repair costs for your home.
» Down Payment – Your down payment is a percentage of the property value and is usually from 3 to 20%, or more if you want a lower loan amount. This can vary by the type of mortgage you obtain. Also, if your down payment is less than 20%, you may be required to pay mortgage insurance (PMI or MI).
» Closing Costs – these are settlement costs involved in purchasing your home. They range from 2 to 7% of the property value and include such things as points (a percentage paid for securing a particular interest rate), financing fees, taxes, title insurance, pre-paid and escrow items, and your down payment. You will receive an estimate of these costs prior to closing.
What to Know About Credit
If You Don’t Have Credit If you haven’t established credit, start now. Perhaps apply for a credit card or two, then use them carefully and pay them off each month. Once you’ve done this, you’ve started your credit history. Next, apply for credit on a store purchase such as an appliance, or a TV. Do this even if you have the cash to pay for it. When the first bill comes, use your cash to pay it off in total. You see, buying on credit and paying it off helps your credit better than buying something for cash.
If You Have Bad Credit It can take awhile to improve bad credit, but it can be done. Since credit scores reflect much of your most recent activity, the first thing you should do is to start paying on time. Pay all of your bills, even if it’s just the minimum. Never pay less than what is due, and never pay late. And, don’t max out your credit cards because it indicates poor money management. One of the best things you can do is to make a budget to help with your monthly expenditures and then live by it. Also, start a savings account and make it part of your budget. You will need money for a down payment, or it will help if you lose your job or source of income.
By Owner or Use an Agent
On the other hand, listing your home with an agent means that upon the sale, you pay a commission to the agencies involved out of your proceeds. This commission is negotiable. The advantages, however, might just be the deciding factors to justify using an agent to sell your home.
Advantages of Selling By Owner
» The seller pays no real estate commission.
» Possibility of selling at below market value yet receiving higher proceeds than you would have gotten had you used an agent.
» The seller controls all aspects of the sale (some believe this to be a disadvantage).
Advantages of Using an Agent
» The agent plans the marketing strategies.
» The agent can do a market analysis showing comparable home sales so that together you can determine the asking price.
» The agent places your home in the Multiple Listing Service (MLS) so it can be seen and shown by other agents from other agencies. This makes a huge difference in the number of prospective buyers that are able to actually see that your home is for sale.
» Agents typically screen potential buyers.
» Agents show your home to potential buyers.
» Agents assist you with contracts
» Agents present purchase offers from buyers, or submit counter-offers to buyers on your behalf.
» Many buyers use agents to help them find a new home.
Determining a Price
» The recent selling prices of similar homes in the same area and/or the average recent selling price per square foot in the same area are both a good starting point.
» Major improvements to your home such as a pool, or other additions can add to your selling price but not to the extent of what you paid for them.
» Interior and exterior amenities can be beneficial to selling your home and may increase your selling price.
» The general condition of your home’s interior and exterior is important and can either increase or decrease your selling price.
Showing Your Home
» First impressions mean a lot and often prospective buyers make a decision almost immediately.
» Curb appeal is important since many buyers search by themselves and then call agents about property they have only seen from the street.
» Fresh paint on your house’s exterior and interior is one of the easiest and best improvements you can make to enhance that first impression. It makes your house look bright and clean. If you paint, use whites, creams, or neutral colors on the interior and exterior colors that will blend with the neighborhood. If you don’t paint everything, at least paint the places that need it most.
» Get rid of clutter. Clutter doesn’t sell. Sometimes clutter can be described also as too much décor, too much furniture, too much stuff on the mantle, etc.
» Don’t cook fish prior to showing your home. Not that you need an air freshener, but you don’t want that first impression to be a bad odor.
» Keep yards and vegetation mowed and trimmed.
» Keep pets out of the house when showing, especially dogs, since many people are afraid of dogs.
» Open blinds and curtains so rooms are bright and inviting.
» If your house is shown by an agent it is best that you are away. If you cannot leave, remain in a separate part of the house and allow your agent to work for you. Refrain from attempting to point out special features, or initiating idle chat. Do not follow them around. Buyers are uncomfortable in the presence of sellers and it could spoil their tour. Take the dog for a walk or go outside. Trust the skills of your agent to present your house for you. Prior to showing, discuss with your agent everything you would like to convey to the buyer. It is in your best interests.
» Be flexible. Your house could be shown at any time. Agents do everything possible to arrive within a certain schedule, but sometimes this isn’t possible. So too, they may call at a moment’s notice which means your house should be ready for viewing at any given time. This eliminates the need for panic and will help reduce your stress level.
Passing a Home Inspection
» Mold & Mildew – Mildew stains and odors will drive a buyer away.
» Roofing – Deteriorated shingles or other roof coverings are hot-spots for buyers and inspectors. Repairs will be requested.
» Cracks in walls or ceilings – These are red flags. Mortar and brick should be in good condition. And flashing should be watertight.
» Structure and foundation – This could be a deal breaker.
» Gutters and downspouts – They should allow water to run away from the house.
» Plumbing problems – Leaks and clogs should be fixed. Inspectors will check water pressure by turning on numerous faucets and flushing toilets at the same time. Dishwashers and other appliances will be tested.
» Heating and cooling – These should be in good working order, and efficient.
» Electrical – The inspector will make certain your electrical system is working properly.
Remember, no home is perfect and the inspector will most likely find those imperfections. Don’t be discouraged, and don’t feel that you must comply with unreasonable demands for repairs. Your contract probably states that things should be in good working order at closing. That doesn’t mean you have to replace a roof because of a leak. It simply means that if you fix the leak, then the roof is in good working order. The bottom line is to do everything possible to get your house in good condition prior to selling.