Your Adult Community Real Estate Place
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| BUYER INFORMATION |
smooth transaction. Some of the information may be familiar, but you need to review them.
10 Steps to Home Ownership!
Systematic steps to help you buy your home
Are You Ready?
Knowledge and experience are the keys to successful real estate transactions. www.YourNJrep.com contains
an enormous amount of valuable information, and such data -- combined with the expertise, experience and
training of local REALTORS® -- can be the essential keys to your success.
One of the keys to making the home buying process easier and more understandable is planning. In doing so,
you'll be able to anticipate requests from lenders, lawyers and a host of other professionals. Furthermore,
planning will help you discover valuable shortcuts in the home buying process.
Do You Know What You Want?
Whether you are a first-time home buyer or entering the marketplace as a repeat buyer, you need to ask why
you want to buy. Are you planning to move to a new community due to a lifestyle change or is buying an option
and not a requirement? What would you like in terms of real estate that you do not now have? Do you have a
purchasing timeframe?
Whatever your answers, the more you know about the real estate marketplace, the more likely you are to
effectively define your goals. As an interesting exercise, it can be worthwhile to look at the questions above
and to then discuss them in detail when meeting with local REALTORS®.
Do You Have The Money?
Homes and financing are closely intertwined. (Financing is the difference between the purchase price and the
down payment, commonly referred to as debt or the mortgage.) The good news is that over the years new and
innovative loan programs have evolved which require a 5 percent down payment or less. In fact, a number of
programs now allow purchasers to buy real estate with nothing down.
In addition to a down payment, purchasers also need cash for closing costs (the final costs associated with
closing the loan). Several newly emerging loan programs not only allow the purchase of a home with no money
down, but also underwrite closing costs.
Not everyone, however, elects to purchase with little or no money down. Less money down means higher
monthly mortgage payments, so most home buyers choose to buy with some cash up front.
As to closing costs, in markets where buyers have leverage, it may be possible to negotiate an offer for a home
that requires the owner to pay some or all of your settlement expenses. Speak with Victor and Dorothy Picazio
your local REALTORS® for details.
Is Your Financial House in Order?
Those great loans with little or nothing down are not available to everyone: You need good credit. For at least
one year prior to purchasing a home, you should assure that every credit card bill, rent check, car payment
and other debt is paid in full and on time.
Home Buyer Protection
Protect Yourself When Buying A Home!
Before you select a Realtor to work with, you should educate yourself on the subject of Agency Relationships.
For years, both the seller's agent (the listing agent)and an outside agent bringing an offer from a purchaser
(the selling agent or sub-agent) were legally considered to represent just the seller and owed their loyalty, best
efforts and other fiduciary duties only to the seller.
This archaic concept left buyers totally confused and legally exposed because they were being treated as a
third party customer without any representation.
Confusion would set in when a purchaser believed that a relationship or allegiance had developed with their
Realtor, only to find out that during negotiations their supposed agent was ethically and legally bound to work
on behalf of the seller, trying to get the seller the best price and terms possible on the sale of the house!
The purchase of a new home, regardless of where it is located, is a significant investment for anyone. The
agent you choose for the position of buyer/broker should consult with you to find out what is most important to
your family. Location, education, safety, conveniences and other factors should be considered so that your
new home matches your lifestyle. Because
this purchase will affect your future, it's important to have someone in whom you can confide. You want to
make sure that you are truly represented; not just because it is a law, but because the agent you choose has
been educated in representation and works on your behalf, not their own.
We will counsel you in determining:
• The home buying process
• How much home you can afford
• What price is fair to pay for the home
• What items we need to have the seller fix, or
• What issues we need to address with the seller
• How to gain pre-approval by a lender
And much, much more!
We offer buyer brokerage service to all of our clients. By counseling with them, we are able to meet their home
buying needs and help them make the right choices for their families. There is no cost to the buyer. The seller
or builder pays the entire brokerage fee.
Working exclusively with an experienced and skilled agent ensures that you will be adequately represented
when dealing with a seller or builder.
Home Inspection Report
The majority of purchasers are not overly surprised by the findings of their home inspection. Before getting this
far, they have usually had a very close look at the property. And yes, they already know about the peeling
paint and old furnace. They may even have noticed the wet basement and taken that into account when
making their offer.
It is when an inspection uncovers something unexpected that an inspection condition could save you from
making a major mistake. Below are some of the more common problems found in a typical home inspection.
While most of these problems are usually obvious and have already been reflected in the purchase price, a
home inspection lets you know if your personal opinion of the structural condition of the property is correct (i.e.
is it in as good shape as I think it is?).
1. Minor maintenance problems:
Poor overall maintenance usually leads to a large range of problems that will require the new homeowner's
attention. These can include everything from peeling paint to rotting decks.
2. Minor structural problems:
These problems are typical in older homes and can cover everything from cracked plaster to small movements
in the foundation. While they are not likely to cause the house to fall down, they should be corrected before
they become more serious. In most Adult Communities the montly maintenance fee usually includes fixing of
any structural problems. Ask your local Realtor for more information about the community you are interested in
to be sure that this is covered.
3. Grading/drainage problems:
Improper grading and drainage can often lead to damp or wet footings/basements. Correction can range from
installing new roof gutters and downspouts to installing weeping tiles. It should be noted that sometimes simply
re-grading the surrounding lawn to channel surface water away from the house is sufficient. Most adult
communities include this in their monthly maintainance.
4. Older/insufficient electrical system:
It is very common to find older homes with undersized services, aluminum wiring, knob-and-tub wiring or
inadequate/poorly-renovated distribution systems. It is important to have these problems looked into since they
are potentially dangerous.
5. Older/poorly installed plumbing:
It is also very common to find plumbing problems in older homes. Repairs can range from a simple ten-minute
fix to expensive replacement. It is a good idea to get an expert opinion.
6. Older/leaking roof:
An asphalt roof lasts an average of 15 to 20 years. It is difficult to estimate roof age accurately from the ground
unless the roof is either very new or very close to the end of its life span. You also need to know how many
layers are under it in order to determine if the roof needs to be completely stripped before installing the new
shingles. Replacement of roofs are included in some of the adult communities as part of your montly
maintenance. Ask your local Realtor for more information.
7. Older heating/cooling system:
Older and poorly maintained heating/cooling systems are inefficient and could pose a serious safety and
health risk. While replacement may seem expensive, the newer more efficient systems do reduce
heating/cooling costs substantially, thus helping to recoup your investment.
8. Poor ventilation:
Excessive moisture from unvented bathrooms and cooking areas can damage plaster, promote the growth of
mold and fungus, deteriorate windows and cause allergic reactions. These problems need to be corrected
before the damage becomes excessive.
9. Excessive air leakage: Poor weather-stripping, badly fitted doors, deteriorated caulking and poor attic
seals all contribute to a cold and drafty home. Repairs are usually simple and inexpensive.
10. Environmental problems:
These can include asbestos, formaldehyde, leaking underground oil tanks, nearby gas stations, contaminated
drinking water, lead-based paint and radon gas. It is important to discuss these potential hazards with a
professional and arrange for a specialized inspection if necessary.
If you have other concerns or questions, please feel free to contact us directly.
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Victor and Dorothy Picazio Your Real Estate Consultants...For Life!
Lower Insurance Costs
12 Ways to Lower Your Homeowner's Insurance Cost
1. Be sure to shop around.
It will take a few phone calls, but they could save you a good sum of money. Ask your friends for a referral,
check the yellow pages, use the internet and check consumer guides. This will give you an idea of price ranges
and tell you which companies or agents have the lowest prices. But don't consider price alone. The insurer you
select should offer both a fair price and excellent service. Quality service may cost a bit more, but it provides
added conveniences, so talk to a number of insurers to get a feeling for the type of service they give. Ask them
what they would do to lower your costs. Check the financial ratings of the companies, too. Then, when you've
narrowed the field to three insurers, get price quotes.
2. Raise your deductible.
Deductibles are the amount of money you have to pay toward a loss before your insurance company starts to
pay according to the terms of your policy. Deductibles on homeowner's policies typically start at $250. By
increasing your deductible to $500, you could save up to 12 percent; $1,000, up to 24 percent; $2,500, up to
30 percent; and $5,000, up to 37 percent, depending,of course, on your insurance company.
3. Buy your home and auto policies from the same insurer.
Some companies that sell homeowner's, auto and liability coverage will take5to 15 percent off your premium if
you buy two or more policies from them.
4. When you buy a home...
Consider what insuring it will cost. Because a new home's electrical, heating and plumbing systems and overall
structure are likely to be in better shape than those of an older house, insurers may offer you a discount of 8
to 15 percent if your house is new. Also, most of the adult communities have Master Insurance Coverages
included in the montly maintenance. Your insurance may only have to cover the contents of your home and
the mortgage amount.
Monroe now has a full-time fire service near the Adult Communities. Does your town have full-time or volunteer
fire service? Is your house close to a hydrant or fire station? The closer your house is to firefighters and their
equipment, the lower your premium will be.
5. Insure your house, not the land.
The land under your house isn't at risk from theft, windstorm, fire and the other perils covered in your
homeowner's policy. So don't include its value in deciding how much homeowner's insurance to buy. If you do,
you'll pay a higher premium than you should.
6. Beef up your home security.
You can usually get discounts of at least 5 percent for a smoke detector, burglar alarm, or dead-bolt locks.
Some companies offer to cut your premium by as much as 15 or 20 percent if you install a sophisticated
sprinkler system and a fire and burglar alarm that rings at the police station or other monitoring facility. These
systems aren't cheap and not every system qualifies for the discount. Before you buy such a system, find out
what kind your insurer recommends and how much the device would cost and how much you'd save on
premiums.
7. Stop smoking.
Smoking accounts for more than 23,000 residential fires a year. That's why some insurers offer to reduce
premiums if all the residents in a house don't smoke.
8. Once you retire...
Retired people stay at home more and spot fires sooner than working people. Retired people have more time
for maintaining their homes, too. If you're at least 55 years old and retired, you may qualify for a discount of up
to 10 percent at some companies.
9. See if you can get group coverage.
Alumni and business associations often work out an insurance package with an insurance company, which
includes a discount for association members. Ask your association's director if an insurer is offering a discount
on homeowners insurance to you and your fellow graduates or colleagues.
10. Stay loyal to your insurer.
If you've kept your coverage with a company for several years, you may receive special consideration. Several
insurers will reduce their premiums by 5 percent if you stay with them for three to five years and by 10 percent
if you remain a policyholder for six years or more.
11. Compare the limits in your policy and the value of your possessions at least once a year.
You want your policy to cover any major purchases or additions to your home. But you don't want to spend
money for coverage you don't need. If your five-year-old fur coat is no longer worth the $20,000 you paid for it,
you'll want to reduce your floater and pocket the difference.
Please contact us if you have any questions.
Closing on your home
Go to any local courthouse and you can find property records detailing real estate ownership in your
community -- sometimes records that date back hundreds of years.
These records are important because they provide today's owners with proof that they have good, marketable
and insurable title to the property they are selling. Equally important, such records enable buyers to provide
proof of ownership when they sell.
The closing process is becoming increasingly computerized and automated. In many cases, buyers and sellers
don't need to attend a specific event; signed paperwork can be sent to the closing attorney via overnight
delivery.
In practice, closings bring together a variety of parties who are part of the "transaction" process. For example,
while the history of property ownership has been checked, it's possible that the records contain errors,
unrecorded claims or flaws in the review itself, thus title insurance is necessary. At closing, transfer taxes must
be paid and other claims must also be settled (including closing costs, legal fees and adjustments). In most
transactions, the closing agent also completes the paperwork needed to record the loan.
What to expect.
Settlement is a brief process where all of the necessary paperwork needed to complete the transaction is
signed. Closing is typically held in an office setting, sometimes with both buyer and seller at the same table,
sometimes with each party completing their papers separately.
Whatever the case, the result is that title to the property is transferred from seller to buyer. The buyer receives
the keys and the seller receives payment for the home. From the amount credited to the seller, the closing
agent subtracts money to pay off the existing mortgage and other transaction costs. Deeds, loan papers, and
other documents are prepared, signed and filed with local property record offices.
Most Adult Communities have application fees and capital contribution plans. These costs are usually the
responsibility of the buyer. A buyer usually must fill out an application to be accepted by the adult community
association, which may be filled out prior to purchase and fees vary. Capital contribution plans are being
implemented by many of the communities and are paid usually at closing. For more information ask you local
Realtor about these fees.
What you need to do.
One of the best parts of settlement is that buyers and sellers need to do very little.
Before closing, buyers have a final opportunity to walk through the property to assure that its condition has not
materially changed since the sale agreement was signed. At closing itself, all papers have been prepared by
closing agents, title companies, lenders and lawyers. This paperwork reflects the sale agreement and allows all
parties to the transaction to verify their interests. For instance, buyers get the title to the property, lenders
have their loans recorded in the public records and state governments collect their transfer taxes
