Things to Look for In A Home Inspection

 A home inspector’s job is to make sure you as a homebuyer know what you are buying from the inside out.  Their job is to point out items or conditions on your property which may be in need of repair, maybe a risk to other components of the building or its occupants, or may affect the property’s ability to qualify for certain types of financing or insurance.  Home inspections will vary by home inspector and the location of the country the home is located.  There are eight important factors that will be in every report.

1. Exterior

Not every defect is noticeable on the exterior of a home.  A good home inspector will look for cracks, peeling or damaged siding.  This includes looking for stains, old paint or peeling paint.  They will look to see if you have a clearance between the ground and siding materials on the walls.  This also leads to an inspector checking to make sure there are no climbing vines going up the wall or that trees are planted too close to the home.  The last thing will be to make sure the windows, doors and flashings are in working order and the vents and hoods installation is done properly.

2. Roof/Attic

A bad or damaged roof can lead to big problems.  An inspector will inspect not only the exterior roof but also the attic.  They want to make sure that the structure and integrity of the roof and roofing materials are strong.  They will inspect what type of shingles are used, the conditions of the shingles, if there is proper flashing, the condition of the vents, and the chimney condition on the roof.  In the attic, they will inspect the insulation, the soffit vents, gable vents, ridge vents, exhaust vents, appliance vents and the electrical splices.  They will make sure there is no evidence of damage or decay and look for water spots or staining.

3. Foundation/Grounds

When inspecting the home inspector will make sure the foundation is in good shape.  They will look for proper grading (drainage) away from the base of the home, standing water near the home or in the yard, the condition of the gutters and the downspouts, and make sure the downspouts and the gutters are directing water away from the foundation.  Also, any sheds, detached garages, fences or any other structure in your yard will be inspected making sure they are in good condition and free from rot or termite damage. They will also make sure that the driveways and sidewalks are not cracking or shifting.

4.  You definitely want the interior of your home to be kept up and damage-free.
There will be normal wear and tear, but an inspector takes this into consideration.  They will make sure the walls and ceilings are painted and in good condition. Other things will note are cracks on the walls or ceilings, cracked windows, doors incorrectly closing and opening and not sealed, moisture spots, and level flooring with no moisture or soft spots.

5.  Structure

A very important part of the inspection involves the bones of the house.  An inspector wants to make sure it is liveable. They will make sure:
-Foundation is in good condition – if the foundation is cracked or shifting this will affect the structural integrity of the home
-Door frames are straight allowing doors to swing in and out of the frame with ease
-Window frames are straight on all four sides & without gaps
-Ridge and fascia board lines are level & straight
-Baseboards around all interior walls are flush with the flooring & not lifting or separated
-Flooring (especially hardwood) is flat and not bowed or lifting
-Exterior walls are straight and free of bowing or sagging
-Digitally measure the foundation to see if it is flat and level

6. Electrical

An electrical problem can not only be a fire hazard but can be very expensive to repair.  They will make sure:
-DIY repair jobs – electrical systems should never be DIY jobs as this can cause significant damage to the entire system
-Light switches work & all bulbs light up (a bulb that isn’t lit may just need to be replaced, but can also mean faulty wiring)
-Absence of electrical faults
-All cables are attached to service panel with cable connectors
-Visible wiring is in good condition, secured, protected, & without exposed splices
-Branch circuits are free from aluminum cables
-All wall outlets are working & intact (not pulled out of the wall)
-GFCI outlets are installed where required (bathrooms, kitchens, laundry rooms, garages, crawl spaces, exteriors & anywhere a water source is present.)

7. Plumbing

Another expensive project so it should be working and in order before you purchase the home.  An inspector will look for:
-Visible pipes intact, free from damage
-Pipes are free from signs of leaking or staining on surrounding materials
-Toilets are dry around the base & free of warped or water-stained flooring
-Water heater working properly, free of rust, vented properly
-Well water pump produces steady flow and doesn’t short cycle
-All faucets (indoor & outdoor) in working condition, sealed, & without leaks
-Hot water available at all indoor faucets
-Water runs clear through all faucets
-All drains are clear, don’t bubble, and drain at a reasonable pace
-Yard is free from soft spots, without pooling or soggy areas

8. HVAC

The HVAC is the heating and cooling system of a home.  They will make sure everything is working properly and has been well maintained.

-HVAC is in working condition, properly sized and properly fused
-Air conditioner system produces adequate cold air
-Air filters are clean and maintained
-Condensate is properly and safely drained from the evaporator coil
-Type of heating/cooling system (gas, electric, heat pump)
-Furnace flues slope up to vents with no open seams
-Vents are clear and properly ventilated
-Ductwork isn’t damaged or old
-Absence of odors from gas

Remember that no home is perfect, but make sure there are imperfections that you can live with or easily fix.  An inspector’s goal is to make sure you have all of the information you need to make an informed decision on if the home is right for you.

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Tips To Follow When Purchasing a Home in the Current Market

While today's housing market is not in the buyer's favor, people are still purchasing homes. Most potential buyers will need a mortgage and there are many steps to this process. When deciding if this step is right for you, take into consideration the following things regarding the process.

Now may still be a good time to buy a home

This is a personal decision, there is no right or wrong time to purchase a home in general. Whether a buyer's market or a seller's market you should take the leap when it makes the best sense in your life. Ann Thomspon, with Bank of America, says that consumers will always want to purchase a home and need to purchase a home.

Especially with the changes we have seen in the last year due to COVID-19, our home has become our live, work and play space. People have placed a greater emphasis on the value of a home.

“A second bedroom that can be used as a home office, or an outdoor space, are now more desired, prompting many people to move or buy for the first time,” says Rick Rudman, CEO at Curbio, a home renovation technology company.

Get pre-approved ASAP

The first step before even looking at listings is to see how much home you can afford. Pre-approval is the first step to let you know what you can afford and to prove to others that you are financially able.

In the current seller's market, a buyer needs to prove to agents and sellers that they are serious. “These days, in some markets, you need a pre-approval just to start looking at homes,” says Ann Thompson, retail sales executive of the West with Bank of America.

Prepare for bidding wars ahead of time

A seller's market means bidding wars are inevitable. The record-low mortgage rates coupled with low inventory is causing a panic among buyers. Sellers are entertaining multiple offers, many receiving multiple all-cash offers.

“Potential buyers now should prepare themselves by discussing, with their real estate agent, how much a home is worth beforehand, so that they can go into a bidding war with the strongest offer tactics, while also knowing when to back away if the price escalates,” says Thompson.

Understand appraisal gaps

With bidding wars comes bids over the asking price. These high bids cause appraisal gaps. An appraisal gap is a disparity between the offer you put on a property and what the property is deemed to be worth by a lender.  Even if you are approved for $350,000 and you offer $350,000 on a $300,000 listing price that doesn't mean the lender will give you the full $350,000 on the home. If the appraisal comes in at $300,000, you will have to come up with the $50,000 out of pocket.

“In this market, we are seeing a lot of appraisal gaps being written into contracts. Please be sure to understand how that works before agreeing to it,” says Shanon Schinkel, branch manager and mortgage lender at HomeTown. “Also, check with your lender before agreeing to it. Using that money for an appraisal gap can change your ability to qualify.”

Keep track of changing rates and terms

Today's mortgage rates are beginning to rise and the historical low rates we have seen in the last year will be a thing of the past. Schinkel reports that over the last six weeks, the rates have crept up. You will want to keep track of where the rates are and where they will be going during your home buying process. Shop around for rates and terms for the best deal.

Research down payment assistance programs

This market is hard for buyers but especially challenging for new home buyers. Down payment assistant programs can help. There are programs offered through government organizations and private agencies. You will want to research all of these avenues to see if you are eligible.

“There is a shortage of houses in many markets. This is creating bidding wars, offers over asking, and appraisal gaps—houses are going quickly,” says Schinkel. “But there are still many great opportunities if you’re patient and have a great real estate agent and lender.”

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Five Things To Consider Before Buying Your Family A Home

The housing market is hot right now and there are more buyers than there are homes to purchase. The

housing market is booming right now because of the low mortgage rates and a recovering economy. It is reported that 8.3 million to 9.2 million first-time homebuyers will hit the market by 2022. Even though this is a hot market, it might not be the best time for your family to commit to owning a home. Below are several things to consider before diving into the responsibility of homeownership.

1. Pre-approval is a must.

Getting a pre-approval will not only relay the message that you are a serious buyer but will also give you an idea of how much you can spend on a home. When you are pre-approved a seller knows you are a serious contender and puts you above offers with no pre-approval.

"There are two main things a seller wants to know about buyers: Are they willing to pay my price and can they close a deal if we agree?" says Dale Taylor, a realtor in Chicago.

A good place to start is by using an online home-affordability calculator to see how much money you should be able to borrow. Once you have established this, check out several mortgage lenders in your area. It is a great idea to shop around for the best rates and mortgage offers. You not only want the best bang for your buck but you also want to choose a lender who is happy to help answer questions, trustworthy and easy to reach.

2. Do not let emotions make the decision.

You might take a tour of a listing and say it is love at first sight but that doesn't mean you need to jump right in. Look at all the features of the home from a practical point of view. A home on a hill might have awesome curb appeal but might not be the best choice for families with you kids who like to roller-skate or ride their bikes.

According to Trulia.com half of all homeowners find at least one or not more things they do not like about their current home. There might be a cute three-bedroom bungalow that you love, but it might not have any closet space or back up to a busy street. Remember, always think long-term when investing in a home.

3. A home costs more than just the mortgage.

There are many more expenses than just your monthly mortgage payment. There will be real-estate taxes and homeowner's insurance on top of your principal and interest payment. Tax Foundation states that depending on the area you live in, your property taxes will average about 1.1% of your home's value per year. If you need $250,000 worth of insurance coverage, that will be about $1,477. You will also need to add your utilities to the monthly cost.

There are also some upfront fees you will also have to consider. You will need to set aside around 2% to 5% of the purchase price for your closing costs. A local Realtor can help you through this process.

4. There is a big difference between an appraisal and an inspection.

Banks will need an official appraisal and you will need to hire a licensed appraiser. An appraiser will give the bank a firm value of the home. An inspection will let you know if this home is a reliable purchase.

A lot of times buyers will make their contract contingent on the home inspection. A home inspector has certain criteria the home must meet to be deemed satisfactory. It is always a good idea to have a professional inspector inspect the home you are about to purchase. An inspector can make sure everything is up to code before you go through with the contract.

5. Read the whole contract.

Purchasing a home is a long-term investment and one of the biggest milestones in your life. You need to make sure everything in your contract is in order. You might look at a home love it, put it under contract, close and discover they took the refrigerator. You have to make sure everything is listed in the contract. If you do not understand any wording, ask your Realtor to explain the meaning. Make sure you are comfortable with what you sign.

If you decide to go through with purchasing a home, go through a local sales agent. A Realtor can help you find the perfect floorplan that will fit your family, in a neighborhood you are comfortable in, and in the right school district.

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Upgrading to a New Home – Home Selling Tips

Selling your home is one of the biggest challenges a homeowner will face throughout the life of owning a home.  Upgrading to a new home (2nd or 3rd time home buyer) is not only an investment of equity but also a thrilling adventure, but you have to get the first home sold first!  To do this, you need to be a savvy home seller with the determination to make selling your home your number-one priority or “job.”  There are several ways to avoid hardships and heartaches along the way.

First: You can’t always help what a home buyer is going to do, but there are things you can do to protect yourself as the seller.  Be wise and make sure that the person putting an offer on your home can actually afford to buy your home. Make sure they are pre-approved by a lender.  Pre-approved, not just pre-qualified.  Many people can get pre-qualified based on their answers to a loan application and credit check, but when it comes down to actually examining tax returns and verifying employment, there is a big difference.  Turn down any offers of buyers that are unwilling to take this next step.

Second: Examine and inspect your home before your home inspector does. Or, if you feel like you have already made all repairs and improvements to your home before you put it on the market, be efficient about getting the home inspection done as soon as possible. The home inspection is what can make or break a sale, so be proactive and fix what needs fixing and for a great home buyer offer, get the inspection done and be open to the results.

Third: Make sure you don’t “price yourself out of the market” with the sale of your home.  What you think it’s worth and what a home buyer thinks it’s worth can be very different.  Appraisals are pricey, but if you have a strong discrepancy of what you are asking and where buyers’ offers are coming in, you may want to get an appraisal to boost your chances of getting your asking price.  You can even include this information in your listing.

Fourth: Some buyers want to live a rural lifestyle with no rules or restrictions while other buyers prefer to live in a neighborhood with strict HOA rules and guidelines to protect their home investment from losing value. If you live in an HOA protected subdivision, be sure to have the HOA Guidelines available for your potential buyers.  You don’t want them to be blindsided halfway through the process when they find out they can’t keep their cabin cruiser boat sitting in the driveway of this home they just purchased. Information like this can avoid these types of deal-breaking dilemmas.

Fifth: If you purchased your home either as a previously owned home or a new home, you should have gotten title insurance. If you didn’t get title insurance, you are going to want to consider getting an abstract of title for your home to reassure your home buyer that your home has a clear title.  You will want to make sure that all old mortgages have been cancelled and the you personally have not acquired any liens during the time that you have owned your home.

Using the tips above will help you have a smooth home selling process and allow you to upgrade to your next home purchase.  If you are considering buying a new, custom home for your next purchase, Contact Ron Lee Homes today to set up a personal consultation.  Call 985-626-7619 or E-mail Info@RonLeeHomes.com.

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