7 Reasons Not to Skip A Home Inspection

If you’re in the market for a new home, don’t forget to include an inspection contingency in your contract. A professional home inspection can save you a ton of aggravation and thousands of dollars in the long run. The inspector will carefully examine the entire house, checking its systems, structure and equipment for functionality and potential problems.

Here are 7 reasons to not skip a home inspection:

1. Find deal-breakers

A house may look fantastic, yet have major issues with wiring, roof, HVAC, plumbing and more. A quality home inspection will give you the inside scoop. If the inspection reveals any large problems that may take heavy work or expensive repairs, you might want to back out of the deal.

2. Safety concerns

An inspection can reveal the presence of harmful substances like radon, carbon monoxide and mold. Look for these hazards before it’s officially yours. You don’t want any unpleasant surprises when it’s too late to back out.

3. Anticipate future costly repairs

A home’s systems and equipment may appear to be working fine when they’re actually on their last legs. A professional inspector can determine the age and condition of the systems and equipment, and then forecast when they’ll need to be repaired or replaced. This can help you budget for a major repair several years down the line.

4. Reveal illegal additions

The awesome rec room you love in your potential new home might have been illegally built. An inspection will check for rooms, garages and basements that were added or finished without following legal codes or obtaining the proper permits. Having an illegal addition in your home means owning property that does not officially exist. This can get you into big trouble with home insurance and property taxes.

If a home inspection reveals any illegal additions, you can ask the seller to obtain the proper permits now, use this information as a bargaining chip or choose to back out of the deal.

5. Obtain insurance easily

Lots of home insurance companies will not insure a home if it has not undergone a certified inspection.

6. Learn how to protect your investment

The inspector will be an invaluable source of information for you, providing tips and knowledge on how best to maintain your home. Knowing how to properly care for your home can save you thousands of dollars over the years.

7. Negotiate

Most home inspections will reveal problems. If they are minor enough to keep you interested in buying the house in its present condition, use them as bargaining tools and renegotiate the purchase price of the home.

Are you in the market for a new home? Call, click or stop by Olean Area Federal Credit Union today to ask about our fantastic home loan options!

Tips for Recent Homebuyers

Becoming a homeowner is a major milestone. There’s a thrill in owning your own place, and you’ve got a new, large investment to maintain. Successful homebuyers are those who can perfectly balance that new freedom and responsibility.

There are several upcoming firsts for recent homebuyers. Check out these common homeowner situations, and you’ll be prepared for a possible setback.

1. Something major breaks

As a renter, if the refrigerator breaks, the landlord repairs it. In contrast, when something like an appliance or major system breaks in your home, you’ll be responsible to fix it.

If you’re counting on homeowner’s insurance or a home warranty to cover you, check your policies carefully. Most home warranties end at the walls of your house, and insurance won’t cover damage outside of a disaster. If your home needs significant work, you’ll probably be covering the costs yourself.

Consider practicing self-insurance. Start a home repair and renovation fund, and build major expenses into your monthly budget. These expenses become manageable when spread out over the course of several months. Expect to spend 1-4% of the value of your home in repairs and maintenance annually.

2. Costs increase

When considering a budget in your new location, housing costs aren’t the only thing likely to increase. If you’re moving from a smaller apartment into a larger home, utility costs will rise. If you’re moving into an older house, appliances won’t run as efficiently.

Additionally, transportation costs may rise if you’ve moved further away from work. A larger kitchen might encourage more cooking and entertaining, increasing the grocery budget. Lawn maintenance costs may appear on your budget for the first time.

During your first month as a homeowner, document your new living expenses so you can budget for them properly. If, after a month, you see that your expenses are too high, you’ll have an idea about where you can make cuts.

3. Tax bills come due

Property taxes can wreak havoc on your budget. While many mortgage companies include these costs in your regular mortgage payment, other homeowners are responsible to pay them at tax time. If that’s the case for you, it’s important to determine what your tax bill might look like.

The U.S. average property tax bill is under $3,000, or $250 per month. Here also, setting the expense aside monthly instead of paying it in one shot makes it manageable.

4. Maintenance requirements increase

There are dozens of things around the house, such as smoke alarms and toilet bowl seats, that decay with time. Some of these objects can damage your house if they don’t work properly.

Make a list of chores that need to be done monthly, weekly or annually. Keep a spreadsheet so you know the last time maintenance was performed on major items in your home. As always, it’s a good idea to fix little problems before they turn into big ones.

Buying A Home in The Winter

Q: What do I need to know about buying a house in the winter?

A: Icy driveways and snowed-out open houses can be less than thrilling, but there are surprising benefits to purchasing a home during the coldest time of year.

The challenges

It can be difficult to check out a property that is covered in snow. There will also be some structural elements, like the septic tank, roof and A/C system that can be difficult or impossible to inspect.

Home-shopping during the winter also means working with fewer homes for sale. That’s because most sellers put their houses on the market in the spring, hoping to sell well before autumn.

Finally, if you decide to go through with a sale during winter, expect delays during the process. Inclement weather can push off the scheduling of important events, like the inspection, appraisal and final walk-through.

The advantages

Homeowners who choose to list their properties for sale during winter may be quite eager to sell. You’ll also find homes that have been on the market since the previous spring with an equally motivated seller. Plus, the smaller pool of buyers during the winter puts you at an advantage. These factors will make it easier for you to negotiate a lower price and to ask for extras like light fixtures and appliances.

Buying a home in the winter can also mean enjoying better service from the professionals you work with during the process. Your real estate agent, home inspector and lender will have fewer clients and therefore be able to provide you with optimal service.

Finally, inspecting a home during harsh weather will enable you to see how the house handles the cold, snow and ice and to check out the heating system.

Tips and tricks

If you’ve decided to go house-hunting during the winter, keep these tips in mind:

Ask for photos showcasing the home’s exterior during the spring and summer months.
Offer a starting bid that is well below the listed price.
Ask for documentation, such as inspection receipts and purchase dates, for the home features that are difficult to check out because of the weather.

Next season’s sellers will start listing homes right after the Super Bowl. So, if you can’t find that perfect house just yet, hang tight until you find what you seek.

The real estate market may cool down during the winter, but if you know how to optimize the advantages, you can walk away with a hot deal during the coldest time of year.

Are you in the market for a new home? Contact Olean Area Federal Credit Union to ask about our home mortgage options!

What Do I Need to Know About Today’s Real Estate Market?

Q: What do I need to know about today’s real estate market?

A: Trends and stats in real estate are constantly changing, especially during the unstable economy of COVID-19. Here’s what you need to know about the real estate market today.

Is it a buyer’s market now?

Pickings are slim for homebuyers right now, giving sellers the upper hand and driving up prices for buyers. Low supply also means homes are on the market for less time than they would likely be in other years.

If you’re in the market for a new home right now, it’s best to be prepared to change some of the items on your list of must-haves into nice-to-haves.

What does low inventory mean for sellers?

An uneven balance of supply and demand that favors sellers means homeowners looking to sell may be able to get a higher price for their home than anticipated.

Is home equity up?

According to the NAR , home prices have swelled to a national median of over $300,000. This makes it a great time to sell a home.

If you’re selling your home, it’s a good idea to work with an experienced agent to ensure you’ll get the best possible offer for your home.

If you’re planning to buy a home in this market of increasing home prices, work out the numbers and determine how much house you can afford before starting your search.

Are interest rates still low?

Interest rates reached record lows in 2020 and economists are predicting that low rates will continue through 2021.

For buyers, this helps make homes more affordable; however, it’s important not to let a low interest rate make you think you can afford a home with a price tag that’s really outside your comfort zone.

What do I need to know if I don’t plan to buy or sell a home soon?

According to Freddie Mac , equity will likely continue rising in 2021. You may want to monitor how much your home is worth this year since you may change your mind about selling. Similarly, this can be a great time to tap into your home’s equity with a home equity loan or line of credit from Olean Area Federal Credit Union. You can easily explore our home equity loan rates by clicking here, and our line of credit rates by clicking here.

If you’re interested in purchasing a home this year, check out our Mortgage Loan options, contact us for current rates, or click here to start applying for a loan today!

All You Need to Know About Closing Costs

If you’re in the market for a new home, don’t forget to budget for closing costs! This includes all fees and charges incurred while officially transferring a property from one owner to another.

Here’s all you need to know about closing costs:

How high will my closing costs be?

Closing costs usually amount to 2-5 percent of the home’s price. For example, if you’re purchasing a $130,000 home, your closing costs can be anywhere from $2,600 to $6,500.

What kind of charges can I expect as part of my closing costs?

Application/Underwriting/Origination fees: Compensation for the administrative costs associated with processing a mortgage loan.
Appraisal: Covers the fee of a professional appraiser to provide your lender with an estimate of your home’s true value.
Attorney fee: In some states, the closing documents must be reviewed by an attorney before they become binding. This charge covers the attorney’s fee.
Closing fee or escrow fee: The cost of the title company, escrow company or attorney for facilitating the closing.
Credit check: Some lenders charge a fee to examine your credit history.
Escrow deposit: You may be asked to make your initial escrow deposit at closing, to ensure the financial institution has the funds to pay property taxes and/or mortgage insurance for the first twelve months.
Home inspection: The cost of a professional inspection of your entire home and property.
Homeowners’ insurance: Many lenders require you to pay the first year’s worth of homeowners insurance premiums prior to closing.
Lender’s title insurance: Title insurance insures the outstanding balance of a mortgage in the event there is a financial loss due to a defect in the title to the property.
Prepaid interest: Most lenders require buyers to prepay the interest that will accrue from the day of closing until the date of the first mortgage payment.
Primary Mortgage Insurance (PMI): If you need to pay PMI on your loan, the first month’s premium is due at closing.
Title fees: This covers the cost of a title search, in which your lender hires a title company to look for possible legal claims on your property.

Should I choose the “no-closing-costs” option?

Before signing up for a no-closing-cost loan, it’s important to understand that there’s no such thing as a mortgage without closing costs. In a no-closing-costs loan, these fees will could be rolled into the mortgage. In this scenario, you would be paying interest on your closing costs throughout the life of the loan. Also, lenders usually raise the interest rates on no-closing-costs mortgages.

All You Need to Know About Selling Your Home During COVID-19

For many homeowners, the hot real estate market of spring and summer of 2020 was going to be the season they put their homes up for sale — until the coronavirus hit. With people struggling just to get by financially, selling a home seemed like a dream from another lifetime. Records of U.S. home sales for March show a sharp decline of 21% in total homes sold, according to data from the National Association of Realtors.

Now, though, the U.S. real estate market is looking very different. As the economy limps toward a recovery, national home sales climbed a record 20.7 percent in June, compared with home sales from June 2019.

However, many homeowners who have planned to sell this year are still reluctant to take that leap. Here’s all you need to know about selling your home during the COVID-19 crisis.

Are you really ready to sell?

Before putting your home on the market, consider all variables involved and be sure it’s a financially responsible move. Thanks to coronavirus, life circumstances you may have relied on, such as a steady salary, may not be dependable anymore.

Stage your home to sell

With restrictions still in place in many states and lots of people home in quarantine, many buyers will be doing their touring virtually. For sellers, this means staging and photographing a home properly is more important than ever.

Consider hiring a professional home-staging and photography service to present your home in the best light. You can also invest in virtual staging software to help you update the furniture with just a few clicks.

To make it easier for buyers to view your home, you can post a virtual tour on your online listing, and offer the option of scheduling a live tour with an agent through FaceTime.

Play it safe

If you will be allowing potential buyers into your home, set up a box of disposable masks, shoe covers and sanitizing wipes at the door for all visitors who will be tramping through your home.

Price it right

Fewer homeowners are putting their houses up for sale this year, but the pool of buyers is also smaller than usual. This means that you won’t be able to jack up the price of your home for way more than it’s worth. Work with a real estate agent to look at comparable home sales in the area and to determine a fair asking price.

Closing during COVID-19

The coronavirus pandemic will likely affect every aspect of selling your home. With many professionals working with a smaller team now, be prepared for various steps of the process to be delayed. This is especially true with lenders, as low mortgage rates have triggered a spike in refinance applications and lenders are busier than ever.