“Fire-damage required stripping to the studs. I am considering selling and don’t know if one option is better than the other for obtaining down payment on new property?”
When a fire occurs it often creates an issue with how to sell the home. [Jeinny Solis S., stock.xchng]
Well, that all comes down to money. Point blank. Plain and simple. I know it sounds callous and harsh but when you are investing in real estate or dealing with a property that’s been damaged it is essentially the only way to look at things.
The key here is the question’s last part: what is best for obtaining a down payment on a new property. Assumption is that you are rolling the funds from the home into a new investment as a down payment. Which means we need to sell the house for as much “outright” as we can.
We also have to assume that you own the subject free-and-clear and have made no insurance claims in regards to the fire damage. Keep in mind if you have a mortgage the bank will often make a decision on what they deem to be the best “answer” to this question for you in consultation with your mortgage company.
Okay, now let’s assume that as-is the property will sell for $25,000 and with real-estate related fees you’ll make just over $19,000 on the sale. Totally rehabbed, you could sell it for $115,000 and the rehabilitation would cost you $50,000. You would net about $102,00 after the real estate fees and then that drops to $52,000 after the rehabilitation costs are taken into account.
Okay, so I’ll rehab it … $33,000 more in my pocket!
Well, not so fast there Mr. Investor.
That $33,0000 is subject to cost over runs and when you have a gutted house you never know what you are going to get into. Haven’t you ever watched Flipping Sheboygan?
That $33,000 doesn’t include carrying costs, which would be basically taxes and opportunity cost on other options that you could have moved your money into had you taken that $19,000 purchased something right away. However, the biggest cost not included is cost over-runs on the budget for rehabbing the current property.
Should You Rehab a Damage Property or Sell it As-Is?
Well that depends on your risk situation and your comfort level with that risk. If you are playing with next month’s mortgage on your personal residence then sell it as-is for what you can. If you’re in a stronger financial position where you can take on the added risk to make a little more money then go for the bigger bucks if that’s up your alley.
We’ve been considering listing our house for sale but have always been told to wait for Spring. But should be wait? – Susan, Delaware
The properties in Powell, Ohio, are selling faster than they can put them on the market in September 70 homes transferred to new owners.
The short answer is always the most frustrating one, that depends.
Now allow me to take a few minutes to explain with two different scenarios and decide which one your home fits into best.
Why You Should List Your Home Today
You’ve been planning to sell your home and it is ready for the market. The paint is done, the trim is complete, and everything is ready for your home to maximize the value for location.
You’re facing a distress situation and need to sell your home.
You are prepared to sell for a little less if it isn’t in top condition.
Why Should You Wait to List Your Home
You need to make updates to your home that will assist you in getting maximum price for your home.
The facts are very simple when it comes to putting your house on the market in the winter. You are going to get less showings, however those that are looking are traditionally more-realistic and more-buying oriented than those looking in summer. Add that information with the fact that Delaware County currently has its lowest inventory in many years and you get a market that is ripe for fresh properties.
So in that matter, the answer would be list, and list as fast as you can. Your neighbors are waiting for the spring selling season to roll around, if you list today you have a chance to get a good 4-6 week jump on them and if priced right and ready to move should be in contract and ready to close.
Ahh, but I hear a but coming here Toby …
You’re right. The biggest thing to keep in mind is that while the real estate market is in this unique situation where there are record-lows of inventory, buyers are not willing to overpay for a home or give up on those things they seek out as being “keys” to their new home.
So buyers are keeping the real estate market moving, but they aren’t ready to improve the market price too much yet.
The first tip is to “pay more money” while the remaining include:
Refinance with a Shorter-Term Mortgage. “Standard” mortgages are 30 years, so go down to 15- or 20-years instead. You’ll pay more per month in principle but will also get a break on the interest rate as the bank’s risk is reduced by the amount of time.
Switch to Bi-Weekly Payments. Concept is that you’ll make 26 paymens per year rather than 12, and it the amount will reduce your interest payments over that amount of time – hence saving money and in time paying your home off quicker.
Money-Merge Account (Australian Method). Not something I’ve seen in Central Ohio, but the concept is similar to your home-equity line of credit in that you are loaned “x” amount of dollars and then you write the check to pay for the home and in time pay it back.
Boy that’s an amazing list of ways to pay off your mortgage early. Seriously. If you refinance from a 30-year to a 15-year mortgage you’ll pay it off quicker alright. But honestly, there is only one way to pay your home off early …
Pay more money.
I know that’s boring to say, but it is the only way. Now that doesn’t mean there aren’t savings involved when you utilize sound financial monetary discipline when it comes to your mortgage and focus on doing it correctly.
I love that they include refinancing to a shorter term as way to pay it off quicker. Since, usually 30-years is done because it allows for people to afford a home. For example, if you buy a $130,000 home with $20,000 down payment
I’m not a fan of bi-weekly payments for the simple fact that there is usually charges to setting the program up and monthly surcharges that limit the actual effectiveness of doing the program. However, I do suggest making a “13th payment” every year.
The 13th Payment Made Easy
Very few people have the cash to just pay an extra mortgage payment every year towards their principle, however it becomes much easier when you do this basic trick. When you go to write your January mortgage payment divide it by 12. For example, if you pay $1,000 per month (I do the full amount we pay to maximize our savings) divide that by 12 for $83.33. So instead of writing that check for $1,000 write it for $1,083.33 and after 12 payments you’ll have paid an extra mortgage payment this year.
The savings? I figured this out for Gretchen and I’s house and just by doing this we cut a 30-year mortgage down to 21-years. I can pay an extra $90 per month to save nine years on our mortgage. Of course, if you can’t do that much that’s fine just do something and it will add to your savings.
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Toby was featured in an article in Sunday, October 28, Columbus Dispatch highlighting the coming end to the Foreclosure Relief Act of 2007 and was quoted in “Tax break on forgiven debt to end.”
Toby Boyce, who specializes in short sales with Triumph Realty, said he figures the tax break ultimately will be extended.“If it doesn’t get extended, it’s going to slow down stuff, and then you have a huge outcry because it sounds really bad,” he said.
Now of course, anyone that has spent two — or twenty — minutes talking to Toby knows that he could never say something that short about a subject. So head on over to the Dispatch and read the story and soon you’ll see an update here on more of my thoughts about the Foreclosure Debt Relief Act of 2007 and its extension.
Should I hire someone to resurface my Delaware Ohio driveway?
Well Toby takes that on in our latest Home Ownership video. Give it a watch, or slip below for more information in written format on resurfacing your Delaware, Ohio drive way.
Should I Resurface My Drive Way?
Is it gray? I know it seems a simple answer but if it is then the shortest possible answer is “yes.
Is it time to apply driveway sealant to your Delaware Ohio driveway and do you need to hire a professional to do so?
Can I Do It Myself?
Of course you can. It is a very easy – though messy – task to complete and will give your home’s exterior and easy pep up when finished.
To start with you need to get the surface ready.
Place two posts and “caution” tape at the end of the driveway to keep walker, dogs, and cars off your driveway – and you’ll want to leave them up for at least 48-72 hours.
Use a shovel to clean off the edges of the driveway and push back any growth of grass that has pushed onto the driveway. I usually will cut it back a little further to give a clean look.
Take a broom and sweep off the grass and debris from the top of the drive way.
Clean the drive way off. The most common way is to use a pressure washer which uses forced water to combine all the aspects of cleaning off the drive way and usually you don’t need any detergent. These can be rented at most rental appliance locations for about $50 a day – however keep in mind that it will also remove pieces of your drive way along with the dirt.
Once the drive way is clean then you want to make sure to have enough drive way sealant to cover the entire surface without stopping. If you stop in the middle you’ll get two different colors as the batches could be different however more likely is that the sun and temperature will cause it to cure just a little different.
I like to use the heavy-duty sealant that will coat the drive way and if we have a mild winter usually can last for 2-3 years (don’t believe the “five year” guarantee) considering the Ohio winters that’s not a bad deal. But as you can see, ACE has a lot of options – I like to support the local guys but Lowe’s, Home Depot and Andersons do offer cheaper prices on these products – for redoing your driveway.
What Do I Need?
Squeegee or large broom
Sunny day with no chance of rain for 48 hours
If you have cracks that are bigger than 1/4-inch wide and less than 3/4-inch wide then you need to get a crack sealer and begin with that process. Basically, it is a 48-hour cure where you squeeze the tar-based liquid into the bottle to fill the cracks in your drive way. The goal is to create a smooth surface that will be sealed when you add the final sealant.
After allowing the crack sealant to cure for at least 48-72 hours, the easiest way is once you have the surface clean and still slightly damp (read the instructions for your particular sealant as each kind is a little different) pour a slight bit out in a corner of the drive. I usually work high to low and will focus on one side and then move across to the other.
The key is to create a smooth coat with no runs across the surface as those “blobs” will become very noticeable in the final product – and yes I speak from experience.
This is why I like to use the squeegee over a brush. The squeegee gives a nice smooth look and you can control the pressure on the blade leaving a little more in a certain section than another if required.
I will always work across and down the driveway towards the sidewalk using little bits of sealant as I go in an attempt to keep from having an overloaded amount at the end.
Why Shouldn’t I Just Hire The Guy?
I’m not saying you shouldn’t “hire the guy” but this is one of those things that I think you do a better job than 90% of the people that will do it for you. My neighbors have someone do it for them every summer at $60 to $80 a pop and I watch these guys do it. They are in and out in 10-15 minutes. How much care is in that process? They are giving you a ‘skin’ of new covering just to make it look nice, but it is a guarantee you’ll be redoing it in 2013. Mine? A really rough winter and I might be, but more than likely it will be 2014 or 2015 before I do it again and I’m paying less for the project. And it just ain’t that hard.
“I like this house, but what is the best way for me to get to know the neighborhood?
The buyer had been looking in “X” but after we moved around a little he took a look at a house in another area of town. As we stood outside the home it looked like every other subdivision we’d visited – cars were parked, kids playing in back yards, dogs barking – but every subdivision has its own unique fabric.
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If you want to know if a neighborhood is good for you, then the best way to figure it out is by watching and listening.
And the key is to make sure that fabric is one that you — not me, not Yelp, not the guy in accounting — can comfortably reside in for the next several years. So what can you do to get to know the neighborhood better?
Talk to Neighbors – We love to talk about our home and where we live. So visit with a few of the neighbors and get a feel for what they have to say about the community. You’ll be amazed what they’ll say — my favorite was learning that the house my buyer was for sale because the seller needed to get money to pay his attorney. Leverage baby.
Call the Police – Do not (and I repeat NOT) call 9-1-1. However, you have the chance to call the local police or sheriff offices to find out the number of calls in your area. Depending on where you live, there are even some great online tools that could help you out. For example, if you have kids don’t miss the sex offender listings, or if you are in Delaware County ABC 6 has created its Crime Watch that will show police reports on an interactive map for you.
See It With Your Own Eyes – All the talk is great, but there is nothing like good old-fashioned gum-shoe work. Visit the area at several different times of day and be watchful – not freaky – but observant. Are there broken-down cars on the street? Do you get a homey feeling from the development?
Basically the best-way for you to get to know your neighborhood is to spend some time in it and get a feel on its “vibe.” Your REALTOR — of course it’s Toby isn’t it? — can provide you with facts and details – but the important decisions — that “vibe” is up to you.
As the “recovery” from the recession continues to move along at a snail’s pace a question sadly continues to be asked on a routine basis.
“I’m struggling with my mortgage. What are my options?”
We’ve discussed on several occasions the options that are afforded to those that are struggling with their mortgages.
I had a great discussion with the folks at the Ohio Housing Financing Agencyduring the Ohio Association of REALTORS Convention and Expo about this exact topic.
[media-credit name="savethedream.gov" align="alignleft" width="293"][/media-credit]One of the most under-utilized aspects in your arsenal as a home owner are the accredited housing agencies that are supported by FHA and OHFA. If you picked up the phone and called a guy that worked for McDonalds and asked “I’m hungry for a burger where should I go?” What would you expect him to say? He works for McDonalds so in theory he’s going to suggest the Golden Arches.
The people you are talking to in your short sale discussions are very similar. Should you do a loan modification, sell your home in a short sale, file bankruptcy or something else? Well if you ask a person that has a vested interested — like a REALTOR — then you have to keep that bias in mind when you evaluating the responses.
Which is why the counseling agencies are great places to gather information and learn more about your options. Why? Your decision doesn’t have an impact on them getting paid. There are several Central Ohio Counseling Agencies and they include:
Ask The Agent: How Can I Tell Who Bought This Delaware Ohio House?
Who bought that house? The auditor's site will share the information - eventually - with you.
As the communities continue to change ownership, it is human nature to want to know who will be moving in next door.
There is no immediate way to know who bought the house, short of walking next door and just asking. Be sure to bring cookies, everybody loves cookies.
However, if you’d rather do the search from behind the computer screen, the Delaware County Auditor’s Web site is the best place to get the information — as every parcel of property in the county is shown online and ownership can be tracked once it is recorded by the county’s office.
On the left-hand column, there are options to choose how you’ll conduct the search by address, parcel number, sales history, or even address
I hope that helps you figure out who bought that house in Delaware, Ohio.
Ask the Agent is an occassional addition to the Delaware County Real Estat and Events real estate section. If you have a question, don’t hesitate to contact us or send an e-mail to email@example.com.
Too often real estate becomes about documents, big words, bigger dollars, and lots of strung-out emotional times. Trust me, I've been there. Which is why I've made it a conscious decision to make my business model different than most agents. My business plan doesn't have a "number of closings" goal but rather a "number of satisfied customers" goal.
We utilize the latest in technology when it improves the real estate process but know that the true value still comes from looking a person in the eye with a firm handshake and saying "nice to finally meet face-to-face."
So when it comes time to buy, sell, or rent your next property think about taking it easy with Toby Boyce. REAL ESTATE. REAL EASY.