Columbia SC home buying is competitive. Jockeying for position has some purchasers using a bold new tactic: personal letters sent to the seller of the home they want. Let's look at why this phenomenon exists –- and whether it's right for you.
Columbia SC Home Buying Becomes Personal
Most real estate agents agree it's rare today for buyers and sellers to meet during the home buying process. We live in a society of texting, emailing and shrinking personal engagement. However, when a seller receives a heartfelt, impassionate letter from a buyer it "humanizes" that person in the seller's eyes. Such a letter is often accompanied by the ages of their children – even a family photo. It's all designed to tug at the seller's heartstrings in the hope their offer will be accepted over others vying for the same house.
Agents say while these efforts don't always work, there are some sellers who are swayed. Home sellers form a strong emotional bond to their homes and like the idea of selling to someone that will feel the same way. Sellers who've raised a family in the home have a strong sense of attachment and can be influenced by a buyer who also has a family.
However, some home sellers make decisions purely on financial or economic reasons. They're the ones looking for the highest offer, the greatest likelihood of credit approval and quickest loan closing. Still, agents say, every seller is different. Sellers sometimes make decisions not based on financial issues but emotional reasons. Some sellers actually accept a lower offer and turn down a fast closing date because they identified with their buyer.
In today's Columbia SC home buying market, usually the two most important factors to consider are price and terms. If a home buyer can't make those two items pleasing to the seller, a deal probably won't get made, and an emotional appeal will have little bearing. There are exceptions, though, and some agents cite cases where a seller rejected a higher offer from an investor who planned to rent the property in favor of a family who planned to live there.
Consider the following as to whether the letter-writing tactic may work for you.
Can you offer a price that will get the seller's attention? If so, your family may have an advantage if you can convince the seller that you will be "faithful stewards" of their home.
Will the terms work for the seller? The loan closing date, any contingencies or other parts of the contract may matter to the seller as much as the sales price. Have you met that criteria? If not, then the emotional aspect of the deal may not mean as much as you hope.
Have you done everything you can to convince the seller that you have every intention of closing the deal? Get pre-approved for a mortgage and make sure you have all the necessary down payment and closing costs available.
Are you making a large enough down payment? In the seller's eyes it's an indication of the buyer's financial strength. A small down payment may be worrisome and may lead to other questions about whether to accept your offer.
Are you prepared for any potential surprises a home inspection may reveal? If there are issues important enough to restart negotiations, the seller may want to find out how emotionally interested you are in order to reach a agreeable solution if there's a problem.
Tread lightly if you really want the home. Remember the market is competitive. That's why you considered writing an emotional appeal in the first place. The seller probably has back-up contracts – or at least options to consider – if you hesitate or fail to meet your end of the deal.
For more Columbia SC home buying tips, check out our other articles in the Home Buying section to your right just below Columbia SC Real Estate Categories. And be sure to look us up on Twitter and Facebook.
Before you enter the Columbia SC home buying market, there are three important pieces of the puzzle you should understand. What do you know about closing costs? How about your credit score? What you know will help you make the best decisions once you find the home you're ready to buy.
Columbia SC Home Buying: What to Know
Tip #1.
Find out how much your closing costs will be. Often prospective buyers are shocked when they find out how much closing costs can be. Knowing in advance an estimate of your closing costs will help you plan better for how much of a down payment and other costs you will be expected to pay.
Most closing costs average between 2%-5% of the mortgage loan amount and cover items such as mortgage fees, appraisal charges, attorney’s fees and home inspections.
If the total amount exceeds what you have available or what you’re comfortable in paying, there are alternatives. One, as we’ll touch on in Columbia SC home buying Tip #2, is to negotiate with the home seller on payment of the closing costs. Another popular alternative is a low down payment loan program that requires as little as 3% down on approved home purchases. In addition, Fannie Mae recently rolled out a mending program designed to assist first-time home buyers. Qualifying purchasers are able to receive up to 3% of the home’s purchase price in closing cost assistance.
Tip #2.
Know which party is responsible for paying closing costs. There is also a fair degree of confusion as to who is usually responsible for paying certain closing costs at the settlement. As mentioned above, often home sellers will agree to pay some or all closing costs as an incentive to prospective purchasers.
Tip #3.
Know the value of your credit score. A popular television commercial depicts the feeling of empowerment a consumer has when they know and understand their credit score. A high credit score gives you a better chance at a lower interest rate when it comes time to take out a mortgage. In addition, your credit score may also affect other credit decisions regarding your home purchase such as the amount of utility deposit you may be required to pay, and even your home owners insurance premium.
There is currently some discussions in the home buying industry that some lenders are considering pulling away from FICO scores. However, it’s safe to assume that until it is known what will replace the FICO score, most lenders will base their credit decisions on the payment history of the debts you owe.
Following these important Columbia SC home buying tips will make your home search more enjoyable and more fruitful — since you’ll be more confident and informed about what is expected of you in the home buying process.
For more Columbia SC home buying tips see our Columbia SC Homebuying Tips articles to your right just below Columbia SC Real Estate Categories. Don't forget to find us on Facebook and Twitter, too.
Columbia SC home buying just got a little easier, thanks to home buyer education classes. For those receiving down payment assistance, a home buyer education course may be a requirement. Mortgage lenders may also require the course. The classes can be very informative for anyone thinking of buying a home.
Take a Columbia SC Home Buying Course
While some home buyer education classes charge a fee, some are free. They are often available online. A certificate from a HUD-approved agency is needed for lenders requiring classes for borrowers.
The course provides beneficial information about the home buying and mortgage process. Subjects include personal budgeting, credit scores, finding the best mortgages, homeowners insurance, home inspections and how to select and work with a real estate agent.
A recent survey of 1,000 people revealed nearly 75% of consumers think the home buying process is complicated. Recent mortgage disclosure requirements have made it even more confusing.
Experts suggest buyers enroll in the class as soon as they decide to enter the Columbia SC home buying market. Do that, they say, before you select a home or a lender. The class will teach you how to shop for both.
The course can be very important to prospects with credit problems or with little or no credit. Anticipating the questions a lender may ask will empower you and better prepare you.
A first-time home buyers course will help with the following topics:
How does a credit score work? Lenders use credit scores to determine if you qualify for a loan and, if so, what the terms will be. You should know your credit score before taking the class.
Why is a home inspection needed? While most lenders don’t require a home inspection, it’s a good idea to have one to be safe. It will let you know about any needed repairs the home may have. Knowing that up front gives the buyer information that can be used in negotiating the sales price.
How to choose and work with a real estate agent? Since real estate commissions are normally paid by the seller, there is no cost for a home buyer to select and work with a real estate professional. Establish a relationship with the agent you choose and make sure he or she understands what you’re looking for in a home.
How can I save water and electricity in my new home? Because your monthly mortgage payment is just a portion of the cost of home ownership, it’s important to know how to budget for the other costs. Water, heating and cooling, trash collection and other fees will increase monthly expenses. A home owner class can provide money-saving tips.
What costs can I expect when I get ready to close the loan? In addition to the down payment you’ll have to make, you’ll also have to pay closing costs. Items like title insurance, appraisal fees, real estate taxes, homeowners insurance and other costs are your responsibility at the loan closing — unless you’ve negotiated with the home seller to pay some or all of them.
How do I shop for the best mortgage? Mortgage lending programs vary among lenders. Interview several lenders to find out what they offer and what best fits your needs. Then you can provide your financial information for them to perform the underwriting to make sure you qualify.
How do I obtain ownership with another person? Real estate titling varies by state. How the title is set up will determine, for example, whether the co-owner’s interest will transfer to you upon their death, or be left to surviving relatives.
Where can I find assistance with a down payment? There are programs available in some cities that offer grants or loans for down payments for first-time buyers. The class may assist in helping you find those programs as you enter the Columbia SC home buying arena.
Get more Columbia SC home buying tips by finding our Columbia SC Homebuying Tips articles to your right just below Columbia SC Real Estate Categories. Don’t forget to find us on Facebook and Twitter as well.
When you think about "shopping" in December, it's normally in retail stores, not the Columbia SC home buying market. However, the month of December could be a great time to shop for a new home. This may be especially true for potential buyers who may have been outbid during the more active home buying months.
A Good Columbia SC Home Buying Month
While the majority of home sales occur during the spring and summer, there are definitely advantages to consider the so-called "off-season" of the real estate market.
A compelling reason to make any purchase is value. For sellers just listing their homes or for those whose homes have been for sale for awhile, fewer prospects mean lower offers. That represents a wonderful opportunity for bargain shoppers looking now rather than in peak months.
Real estate experts say a home's selling price may fluctuate during the course of the year by 5-7%. Many of the price variations are predictable. A home generally will be priced higher in the spring and summer than in the winter.
According to RealtyTrac, a publisher of real estate market data, the best bargains are usually found in October, with average sales prices around 2.6% below normal. Other experts say December is the best month to get more bang for your buck. Much of the rationale has to do with the seller's mood, likely to be happier and more generous during the holidays.
Let's examine five reasons to shop for a home in December.
The competition is limited. Most people are busy with the hustle and bustle of the holidays and aren't active in the market then. Fewer potential buyers means less competition and greater opportunity for a savvy buyer.
There are tax benefits. If you're in the market not only for a house, but also for some year end tax deductions, December could be a good month. Purchase and close your home prior to the end of the year and you can deduct the mortgage interest paid, any loan points paid and your pro-rata share of the property taxes from your 2015 income tax return.
Motivated –– even desperate –– sellers. As mentioned above, sellers often are willing to take the best offer they can if their home has languished on the market. They could be especially motivated if they have a contract on another home contingent on the sale of their existing house. In the case of job relocation, the sellers may have to move before the first of the calendar year and may be desperate to sell.
See homes in their "natural light." Shopping for a home in December gives buyers a chance to see homes in their natural state –– without "make-up," so to speak. When trees have lost their leaves, grass is dormant and flowers aren't in bloom buyers can get a better idea of the home's features and uniqueness. In addition, it's a good idea to check out things like drafty, cold areas in the home. They could be signs of faulty insulation or window or door seals needing replacement.
Interest rates are still very low. Despite recent rumblings that interest rates may edge upward slightly, today's mortgage rates are very affordable. And that's good news for anybody entering the Columbia SC home buying market during December.
Happy holidays… and happy home shopping!