What Renters Should Know About Buying !

You've made the decision to take the step into home ownership from renting ! The common questions are easily answered thanks to google and apps like Trulia or Zillow.  What about those less commons questions like what and when should you tell your landlord ? Those  will be the questions that I will answer in this blog ! 

What Should I Tell My Landlord ? 

If your currently in a rental where you are NOT in a lease than you will want to wait until you've found a home and gone to contract on the purchase of your new home.  

If your currently under a lease that will be ending within 2-3 months than I suggest a conversation prior to your lease coming to an end.  

If your currently in a rental that has 4 months or more than again no conversation is needed until you've either A. Found a home (before going to contract) B. When you are 2-3 months from your lease expiring. 

Why Does The Timing Of The End Of Lease Matter ?

Remember just because you've decided it's time to purchase it does not mean you can abandon your lease.  Depending on how particular your wants & needs are will effect how long the shopping process will take.  If you have a few months left in your lease this will allow you some breathing room since your "deadline" typically is by the end of the lease.  Also keep in mind if you find the perfect home and will be leaving before the end of the lease your landlord might ask for additional payment because of you breaking the lease.  

If your lease is ending relatively soon than a conversation with your landlord prior to it ending will be beneficial & appreciated for both you and your landlord.  With the "deadline" being much sooner you should discuss staying in your rental on a month-month basis to give yourself a buffer on time.  Most landlords are open to this if it is discussed prior to the lease actually ending.  

Why Can't They Wait For Me To Leave ! 

This is the most common complaint and stressful for renters who are becoming homeowners.  Keep in mind most rentals are necessary income here on Long Island having a vacant apartment is less than ideal for most landlords.  Be prepared that once you have gone to contract on a home that their is a high chance your rental will be advertised for rent.  

If you have not gone to contract and they ask to begin showing than an honest conversation with you, your buyers agents and landlord is a good idea.  Your agent will be able to explain the timeline and the benefits of waiting for it to be advertised.  Also your agent might be able to handle the showings to make it an easier transaction for everyone.  

You've Gotten Your Mortgage Committment, I'm Outta Here ! 
Not so fast, that on or about closing date you had negotiated ? It is still just that an on or about closing date ! Before you give your landlord notice call and speak with your attorney, make sure that the seller is still on the same target date as you.  If they have a home they will need to close on than you might have to sit tight a bit longer ! Communication as always is key to making this transition go smoothly for everyone involved ! 

What Tenants Should Know & Expect During The Sale Of A Home

For many renters selling a home isn't something they need to think about, but what about when your the tenant in a property that is being sold.  Often times it is hard because you are not told what you should expect to have happen and what rights you have.  This blog will help clarify what your responsibility and rights are through-out the process.

Do You Stay Or Do You Go ? 

• If you are currently still in a lease on the property, by law you are allowed to occupy the apartment until the lease expires.  After the housing market crashed, many tenants found themselves paying rent to an owner who did not keep up with payment to the bank leaving the tenant in a home the bank would no longer allow them to live in.  This was the reason legislation was passed to protect tenants from these potential issues.  
• If you are NOT in a lease than you are not legally entitled to stay, which may not be a bad thing.  Once the potential buyer has gone to contract on the home I will normally reach out to the tenant so that both the "soon to be landlord" and tenant can meet.  Just like when you rented the apartment you may decide that it will not be the right fit for you anymore.  This will allow you time to decide without having a closing date looming in front of you.  

Showings & Open Houses:

• These 2 things will have to happen, you should discuss with your landlord having a meeting with all parties including the listing agent to set up a schedule and open communication to make sure that everyone is on the same page.  If you have a specific showing schedule that is established from the very beginning of the process it will make things much more predictable and easier to deal with.  
• Open houses are often a difficult idea for a renter, you are not given much choice on allowing people to go through your home and it may feel a bit like an invasion of privacy.  This is a risk all renters take when they move into a home that is either an investment property or in someone else's home.  That being said, the open communication and scheduling will help ease this tension - some homeowners will decide that they do not want their tenant disturbed with an open house but that is ultimately a discussion that must be decided on between landlord and tenant - the Realtor must abide by your landlord.  

Where Does Your Security Go?

• This is another important reason to meet with the soon to be landlord. If you decide that you will be staying as the tenant than your security deposit will need to be given from your original landlord to your new landlord.  
• If you will be vacating the apartment than your security deposit will legally need to be provided to you by the original landlord. If their was repairs needed than they will need to provide you with the documentation and the remainder of the security - same as if the home was still under their ownership.  

Who Works For Who ? 

• The listing agent works for the landlord, unfortunately the agent must follow the direction of the landlord in regards to showings, open houses and information provided to buyers.  Although you may want the listing agent to do things in a particular way if the agent is being directed by the landlord that is ultimately who they need to follow direction from.  
• If you feel that the process will be too much the agent can work for you as well by helping you to move out of your current location.  Their is no form of dual agency if you will be going into another rental home.  If you have decided to go into a purchase than you can still use the agent but you will want to fill out a Buyer Broker contract to keep all information about the motivation for a quick move confidential from all other sellers.  

Selling Your Home With Tenants, What To Expect !

For many homeowners here on Long Island renting out part of your home is quite common, most usually do this to help pay taxes or to help out a friend or family member but what do you do once you've decided to sell.  This can sometimes become a sensitive situation because although it is your home the tenants have their own rights to their area of the house.

First and the most important question is, did you get the required permit for this rental ?  In the case where it is not a legal apartment it is important to know that their will be things that need to be removed from the rental dwelling in order for any buyers bank to approve their loan.  Not only will the tenants need to vacate but things like stoves, or illegal conversion of rooms will need to go as well. 

Next question is where do your tenants stand in their current lease, if they have one ? There are very few cases where the purchase of a home includes the new owners taking on the old tenants, commonly this will only happen when it is bought as an investment property.  Open communication is key regardless, the tenants may be willing to ignore the lease end date in order to move sooner, although they do have the right to stay until the end of their lease.  

The key to a successful sale is always communication but in a sale where there is a third party involved before a buyer it is extremely important.  Your agent should communicate information about showings and open house procedures with your tenant before they release it onto MLS.  This also allows your tenant to have any questions they may have answered.  Typically I will work as a tenants agent (similar to buyer brokerage) to help the tenant find their new rental once we have gone to contract on your home.  

For those tenants who are living in a home that is currently on the market it can be just as stressful as if they were the homeowner.  They will still need to keep their area clean and showing ready, as well they will need to leave during showings and open houses.  If your using a full service brokerage to sell your home than your agent will have the knowledge and tools to not only sell your home, but to help you and your tenants find your next home ! 

Relocation 101

Relocation can be a bit overwhelming, but with online shopping become much more common it is not surprising how many buyers we see purchasing homes without ever seeing them until move in day.  There is one thing almost all of these buyers have in common is that they relied heavily on their Buyer Broker to be their eyes and ears during the purchase and the search ! If your considering relocation here are some helpful tips to make your relocation a successful one !

Speak To Your Employer:

• If your relocating for work, many employers have a specific division in the company that can help you find all of the necessary parties to help you make the transition.  As well some companies will pay for some of the expenses of that move.  
• Some companies will often work with actual real estate relocation companies, one of the largest being Cactus Relocation, who only works with the best real estate companies.  Coldwell Banker Residential Brokerage is part of their team for information you can check out our Relocation Site Here. 

Decide On Your Must Haves: This is a bit different than a normal home search because we aren't just talking about bedrooms, baths, or style you will need to think about some other important characteristics.  

• Location: You will be relying on a third party to help you find the perfect location, so communicating how close or far away you would like to be to major roadways, transportation, or even schools is very important information for your agent to know.  
• Amenities: Are you looking for an area with an incorporated Village with private pools or marinas, this is also very important for those who are looking to go into Condominiums, and Townhouse Communities. Each community will offer not only different amenities but also different requirements to purchase, you will want to be aware of this before beginning negotiations.  
• Home Characteristics: Of course you will still want to have specific homes "likes" and "must haves".  Be sure to review this list carefully with your realtor so they understand the physical size of the home so that on move-in day all of your items will fit ! I will often go out and preview the home and take video while I am there so my buyers can get a good feel for the homes flow and size.  If your looking to fit specific size furniture such as large bedrooms sets or wall units asking your Realtor to be sure it will fit before committing to the home is a good idea.  

Get Your Finances & Time Management In Order: 

• Finances: Make sure you specify with any mortgage company that the purchase of your home will be taking place with a more than likely job transition to make sure you will be aware of the additional paperwork that your bank might require. 
• Moving Cost: You will also need to prepare for the move a bit different than the normal buyer, speak with numerous moving companies to find out their pricing and the customer satisfaction once their possessions made it to the new home.  
• Time Management: This covers quite a few different aspects because you will want to coordinate with many different parties from making sure your possessions arrive around the same time you will, as well you will want to make sure your utilities will be in working order when you arrive, and give yourself time to unpack before beginning your new job.  

Most Important Choose Someone To Be On Your Side:

• You of course will need a real estate agent to help you find the home for previewing it, but keep in mind you will also be having home inspections, bank appraisals and final walk-thrus without ever stepping foot in the home.  Make sure you interview more than 1 Realtor until you find someone you feel 100% comfortable with.  My recommendation is always see how they are able to communicate with you during the interviewing process that will give you a good idea how you will be communicating during the transaction.  
• You will also need to find a home inspector and a attorney from the area to help you with the process.  If your working with a Full Service Realtor they should be able to recommend you a few different professionals to choose from.  Choosing local professionals will help because they are a bit more familiar with the area, and the laws that go with it.  

These are just some of the important factors when it comes to relocating, if you are interested in finding out more about what Long Island has to offer please take a refer to the Community Information Page for school information and town amenities ! 

Should You Keep Renting Or Is It Your Time To Buy !

Many of my rental clients will often ask me for my advice when it comes to them renting or should they take the steps to purchase their first home.  There are some specific questions you have to ask yourself when your deciding to rent or to buy.  

1. Do you have enough work history ? You don't need to have worked at the same place but you will want to have worked steadily for about 2 years for most loans, if your applying with a co-signer than your work history can be a bit less if the other person has a good work history. 
2. How is your credit ? The average credit score to be able to obtain a mortgage is about 625, running your own credit to make sure you don't have too much outstanding debt is helpful and it can also help you correct any information that might not have updated on your report.  
3. What kind of savings do you have ?  There are costs that you will have to be able to meet to purchase starting with the down payment, and closing costs but you also home inspections and an attorney. 
4. How much time do you have ? If your currently in a rental and your landlord is not open to you staying on a month-month basis you may not want to rush into a purchase because of those kinds of time constraints.  

Here is a great tool that Realtor.Com provides to help you decide if financially would be better suited to continue renting or making your first purchase ! Rent Vs Buy Calculator 

There are also ways around the financing is some instances, there are options of grants, down payment assistance, flexible mortgage options that can put buyers in a perfect position to buy.  

• State/Town Grants - These are most common in Condo Developments where the State/Town is paying a large portion of the mortgage - Here is a current listing where the actual price of the grant is contributing about $40,000 and the buyer in turn is getting a new construction 2 bedroom condo for under $250,000 - Courtland Square Condo Development
• Down Payment Assistance - There are some programs that will match what you are able to put down on a home, or larger programs that allow your down payment to come from your loan without paying interest on that down payment.  Here are 2 helpful links for down payment assistance: Long Island Housing Partnership Down Payment Assistance - SONYMA Down Payment Assistance 
• Mortgage Options - You have many different mortgage options you can add sellers concessions to help with closing costs, or choose a loan that is interest only, you also have mortgages that increase your payments as it progresses allowing you to pay more when you financially will be able to.  To find out more about your mortgage options, you can fill out the contact for to speak with a Coldwell Banker Mortgage Advisor.  

Of course their are pro's and con's to both so here are a few that you should think about when your deciding which is a better fit for you ! 

Pro's Of Buying 

• Creative Control - You won't have the limitations of decor since it will be your own home to do what you would like.  
• Investment - You are investing in your future with the current market conditions, buying will put you in a great position in the future. 
• Tax Breaks - You have the ability to take deductions that you ordinarily do not get simply just paying rent, even property tax has exemptions for just living in your home, and veterans as well. 

Pro's Of Renting 

• Flexibility - You have the option to move around into different areas, this is important for those who maybe are thinking about switching jobs you can move where your work actually is, moving for those who own can be more difficult. 
• Less Maintenance - The responsibility of general maintenance in most cases does not fall on you, those details are handled by someone else. 

Rentals 101

Although I don't often go out in search of rental listings I often get calls and referrals to list these homes, I always than receive calls from potential tenants often times a bit frustrated with their search.  I wanted to take the time and give some quick pointers and tips to finding the right rental for you, and what you should do to prepare for when presenting your application.  

How Long In Advance Should You Begin Looking For Your Next Rental ? 

• If your looking for a rental in a very specific area (School District, Neighborhood) than you should begin your search 3 months prior to your lease being up.  Keep in mind not all landlords will be willing to wait for a tenant, but often times your current landlord will allow you to move a bit early if they are aware of you needing to stay in the specific area.  Speak to your landlord sometimes they might not allow you leave early but they will allow you to stay on a month-month basis after your lease is up to find a new place.  
• If your looking within an area less specific than usually starting the month before your current lease is up provides you with enough time, although I still recommend speaking with your landlord about you choosing not to renew the lease.  This way if you do need a bit longer because you were unable to find a new apartment or you may need time for an existing tenant to vacate the house they might be more willing to be flexible with a month-month.  

What Should You Prepare To Have When Putting In An Application ? 

• Name, Number, Employment Information (Including Manager Or Human Resources Contact Number) On ALL parties who will be living in the apartment.  
• References should be at minimum of 2 non-family members.  You will want to inform that they will be getting calls from potential landlords so they return the call promptly.  
• Current Landlord Information, Length Of Time Living In Apartment, Reason For Leaving
• 1st Page Of Credit Report, Landlords are only entitled to see the score and you obviously will be allowed to black out your personal information such as your social security number.  
• Proof Of Income can be provided with either 2 recent pay stubs or a letter from your company confirming your employment & yearly salary.  

Should You Hire An Agent & Where Should You Look ! 

• If your looking in a very specific area or have specific needs your looking for (pets, whole house rental, adult community) than I recommend finding an agent that your comfortable with and using them.  Keep in mind they will be doing quite a bit of legwork for you, so there needs to be a mutual agreement to work exclusively with them.  
• If your looking for a smaller rental within a few towns than many times you can find a suitable apartment thru a complex that has numerous locations through-out Long Island, and example of this is the Fairfield Apartments which will only charge you an application fee.  
• You can look on MLS, but many Realtors will keep their listings on exclusive and advertise them on their company website, and commonly CraigsList keep in mind even those will include the 1 months broker fee.  If your working with a broker and come across one listed that way pass it along and allow them to call the agent directly.  

If your in the process of deciding whether you want to buy or rent but are not sure I have written a full blog to help explain the benefits of renting and buying HERE: Deciding Whether To Buy Or Rent !   

Here is a helpful calculator provided by yahoo to help you decide if buying or renting is good for you ! Click HERE For Calculator

Deciding To Buy Or Rent What You Need To Know

It's that time of year again where we see renters deciding whether or not they will continue renting, or will consider being a new homeowner ! This blog is to help all those considering purchasing answer that most common question "Should I Buy Or Should I Rent?" 

Why Should I Buy A Home Instead Of Rent ? 

It's a fact that in most markets, buying a home is significantly cheaper than renting.  Renting is money you will never get back, but buying a home is an investment in your future.  In most areas, if you can afford to rent, you can afford to buy! For more information on this topic you can refer to my blog, here it will give you both the pros and cons for both buying and renting, as well as offer you alternative options.  

How Do I Know I'm Ready To Buy A Home? 
The best way to know if you're ready to purchase a home is to look at your current situation.  You don't need to be employed with the same place for 2 years, you just need to have had a steady income in one field for the past 2-3 years.  You will want to run your credit and take a good look and make sure everything that is on the report is correct, if not you will want to have it corrected! You will also want to make sure you have money saved up for a down payment, in some cases you can withdraw from an IRA penalty free for a first time home purchase.  For more information on this topic you can refer to my article, here.

How Much Money Will I Have To Pay Upfront To Buy A Home? 
This is not an easy answer, because there are two factors depending on what kind of loan you take and the amount of the loan is what will decide your down payment.  For an FHA Loan you will need to put down 3.5% where a Conventional Loan you will need to put down atleast 20%.  The average cost of a home in Suffolk County is about $325,000 which would require a FHA down payment of $11,375.  

You will also need to factor in closing costs, but you can also ask for a sellers concession or have the money "gifted" to you from a friend or family member.  This ranges again by the loan amount, and any mortgage broker is required by law to give you a good faith estimate of closing costs, this is why you should always choose a reputable bank Of course, Coldwell Banker Mortgage is more than happy to help and you will always be given all of your loan options.

Once you have decided that you are in a financial position that you would like to go ahead and begin searching for your new home there are a few things you should look into.  You will want to learn the difference between what kind of homes are on the market, who you should have working for you, and what happens once you have found that "perfect home".  Because each of these topics are best explained in detail I will list each topic below with a direct link to blogs to help you get informed ! 

• Why You Should Work With A Buyer Broker
• What Kinds Of Home Are On The Market
• Benefits Of New Construction
• Short Sale VS Foreclosure
• What To Offer For That House 
• What Happens After Your Offer Is Accepted 
• What It REALLY Means To Be In A Buyers Market 
• Tips To Finding The Perfect Home