Are All Real Estate Practitioners REALTORS®?
No! Only real estate agents, be they salespeople or brokers, who adhere to the NAR (National Association of REALTORS®) Code of Ethics are recognized as REALTORS®. The Code of Ethics is a detailed document consisting of seventeen Articles and related Standards of Practice which spell out the professional responsibilities of REALTORS® to the public and to each other. REALTORS® are real estate professionals who have chosen to join NAR and have agreed to abide by its strict code. REALTORS® are subject to disciplinary action and sanctions if they violate the duties imposed by the Code of Ethics.
What Is a C.L.U.E. Report?
C.L.U.E. (Comprehensive Loss Underwriting Exchange) is a database generated by LexisNexis® that provides claims information submitted by insurance companies on specific properties. The information gives a seven year history of losses including dates and the amount paid for each loss on the given home. The information is used to underwrite and rate new policies. The C.L.U.E. Home Seller's Disclosure Report can only be ordered by home sellers.
How can I find out how much my house is worth?
The basic tenets of Real Estate are that every market is unique, that no two homes are identical, and that Real Estate is dynamic. To obtain a valuation of your home, you will be best served to either have an experienced REALTOR® prepare a CMA (Comparative Market Analysis) or have a local Appraiser familiar with the area prepare a formal appraisal based on USPAP guidelines. In some markets, AVMs (automated Valuation models) are poor choices and we question their validity. The questions that need to be answered are how does your home compare to similar homes in your neighborhood, and how are homes selling in your subdivision. You need to know if your local market conditions are stable, rising, or declining. Hence, you should use recent sales on which to base your valuations and also take a good look at competing homes currently for sale in your subdivision both asking price and how long they have been on the market. In any event, seek the advice of professionals to provide an estimate on the value of your home.
What should I expect from a Home Inspector?
We always recommend that Buyers obtain a Home Inspection prior to purchasing a home. We deem it invaluable that a neutral party takes a look at the home they are going to buy. At a minimum we recommend that you hire the services of a general Home Inspector who will provide an in-depth visual inspection of the property, both the inside and outside, to determine its condition and to detect any possible defects. Needless to say, an Inspector cannot see through walls, but if there are possible defects the Home Inspector will point them out and, like a General Practitioner, will recommend that you seek the advice from specialists if necessary. The Inspector will prepare a muli-page report addressing the major elements of the home indicating the condition of each and identifying any visible defects. The Inspector should provide details of the latter to help you determine if they are major defects or simply maintenance items. As a Buyer you should be present at the Inspection and have your inspector address any concerns you might have and answer your questions.
Can I borrow money from a family member for the down payment?
When going through the mortgage approval process the underwriters will take a close look at the source of funding for your down payment and closing costs you will incur in the purchase of you home. They will check all of your assets and you will need to document the source of your funds. In other words, to avoid fraud and to make sure that you can meet your obligations, the underwriters will want to see a complete paper trail showing major deposits and withdrawals from your savings and checking accounts. A loan from a family member is a financial liability that will impact your ability to obtain the loan. Do check with your lender during the pre-approval process to determine if they allow it.
What's my first step in selling my home?
The first thing you want to do is select a REALTOR® who can provide you with the expertise and experience to properly market your home. Keep in mind that selling a home sounds easy -playing golf does too! You will want to have your REALTOR® go through your home to guide you in determining if any updates and possible repairs need to be made. We're talking about updates that will make your home more attractive to potential buyers. Having done so, have the REALTOR® prepare a realistic Comparative Market Analysis (CMA) to provide you with an estimate of what homes similar to yours have sold for recently. The REALTOR® will also provide information on homes currently on the market that will be competing against yours. The advice that he provides will enable you to set a realistic Listing (asking) price for your home that will attract qualified buyers and realize a timely sale.
What's my first step in buying a home?
The first thing you need to do is to determine how much you are prepared to pay to cover PITI (Principle, Interest, Taxes, and Insurance) for a new home. Having done so, find a local lender to discuss options that are currently available to finance the purchase. We recommend that you look for an established, local lender you can meet and talk to face-to-face. You will want to visit their place of business and check them out with your local Better Business Bureau. Ask your lender to provide you with a "Pre-Approval Letter". The next step will be to find a REALTOR®.
Is a lease with option to purchase a good idea?
You have found the home that you like, but don't have sufficient savings set aside to meet the down payment requirements. You ran into some financial difficulties in the past and are in the process of re-establishing good credit. However, it will take some time before you reach that point. Although you have had a good job for the past couple of years, you lack the documentable income to satisfy your lender's requirements. In these instances you might consider leasing the property with an option to purchase. Needless to say, the seller has to be willing to do so. If the home has been on the market for some time, or the Real Estate market is experiencing an unusually slow period, a seller might consider a lease-option. Usually you will have to make an up-front payment at signing which would be forfeited if you don't exercise the option. Be sure to discuss this with your financial advisor or accountant to fully understand your options.
What is a CMA?
Comparative Market Analyses (CMAs) are generally prepared by REALTORS® to establish a fair market value of residential properties for homeowners wishing to sell their homes or buyers intending to purchase one. An experienced real estate agent with a good understanding of the local market will compare the home to homes with similar features and amenities that have sold recently in the neighborhood or subdivision. They will also look at "Expired Listings" and "Withdrawn Listings", those are homes that haven't sold. They will take a look at "Active Listings", those are homes currently for sale in the neighborhood that are competing to yours, and finally they will review "Pending Sales", those are homes that have sold but not yet closed. In all instances they will determine how long homes have been on the market and their pricing history. Professional, full-time REALTORS® are well positioned to provide good advice on the marketability of a given home. Please note that CMAs are not Appraisals.
Is Arizona a "Title Theory" or a "Lien Theory" State?
When moving to Arizona keep in mind that it is a "title theory state." This simply means that a borrower does not actually keep title to the property during the loan term. The lender holds it as security until all loan payments have been made. In "lien theory states", on the other hand, the buyer holds the deed and the mortgage becomes a lien on the property. Be sure to check with your lender and/or title company for details.
What Is Xeriscape Landscaping?
Xeriscape, frequently misspelled and mispronounced as zeroscape, is the term used for landscaping in areas —such as ours in Tucson— that are susceptible to drought. The focus is on water conservation and the best use of indigenous plants & materials. One key concern relates to watering. You want to avoid runoff so it's important to install an efficient drip irrigation system. Ideally you'll want to use plants that are native to the Tucson area. Good sources of information in addition to the internet are local retail nurseries, garden centers, and of course County Cooperative Extension offices.
Where do Buyers & Sellers go to find real estate information on the internet?
One of the tools buyers as well as sellers sometime use to get a bird's eyes view of the real estate market is to visit the web sites of aggregators like Trulia and Zillow. It's not a bad way to start your search as they offer a lot of good general information. You need to remember however that many of these companies gather and post information they find from a variety of sources. Since they are not obligated to verify the data for accuracy, some of the information is reliable, some is not. The data is frequently outdated. Ultimately you will want to take a close look at your specific market and the best way to do that is with a REALTOR®. They have local expertise, have direct access to the market and are obliged by their Code of Ethics to provide good, reliable, up to date, accurate information to prospective buyers and sellers.
What Is Title Insurance?
Title Insurance typically consists of a Lender's Policy (Loan Policy) which protects the lender, and a Buyer's Policy (Owner's Policy) which protects the buyer. The purpose of obtaining Title Insurance is to be sure that the seller actually owns the property and that there are no liens filed against it. Once a sales contract has been accepted the title company will perform a title search by reviewing public records to look for any problems or issue that could impede the proper transfer of title. Once the search is completed they will issue a Title Insurance Commitment which will enable parties to the transaction to eliminate and/or address any problems or defects that might have been discovered. Click for Video
What Is a Home Warranty?
Home Warranties, actually Residential Home Service Contracts, cover normal wear & tear for major systems and major appliances. They are often offered by sellers of existing residential properties to provide buyers coverage for the cost of repairs that might be needed after closing. Initial coverage is generally for one year after closing. When selecting a Home Warranty Service Agreement make sure that you understand what is covered, what procedures to follow when service is required, and the costs of the applicable service fees. Since pre-existing conditions are excluded, always have your home inspected by a licensed home inspector prior to closing to make sure that all major systems and major appliances are in working condition. One of the advantages offered by many Home Warranty Service providers is coverage provided to the sellers during the listing period. Payment, by the way, is normally made at closing. Click for Video
What Is a Home Equity Conversion Mortgage?
A Home Equity Conversion Mortgage, HECM, is a Reverse Mortgage insured by the U.S. Federal Government. This federally insured loan enables 62 years or older homeowners to borrow against the equity in their house. The amount that can be borrowed is based on the appraised value of the home and FHA guidelines. It differs from a home equity loan (HELOC) or a second mortgage in that the borrower does not make monthly payments to repay the loan, instead the homeowner receives cash from the lender. The loan typically is not due as long as the homeowner lives in the home as his primary residence. For details we recommend that you contact a qualified FHA approved lender and also visit the HUD.gov HECM website. Click for video
Although there is a significant cost associated with the initial installation of a residential solar energy system, its benefits are numerous. It is an environmentally clean system, solar energy is renewable, it is reliable and it’s free. In our area photovoltaic (PV) systems will significantly reduce your electric bill, and for sellers, research has shown that homes with PV systems not only sell for more, but also more quickly. If you are considering installing a solar system, do contact a reliable, well established company to provide you with an estimate of costs and benefits. Don’t forget to explore possible tax benefits. View video
What Is a BINSR?
A BINSR (Residential Buyer’s Inspection Notice and Seller’s Response) is a three page form drafted by the Arizona Association of REALTORS® to assist Buyers in their due diligence inspections and investigations. This form, along with the “Buyer Advisory” available from the Arizona Department of Real Estate identifies common issues that a buyer should consider in their due diligence process, has been designed to protect you as the Buyer. Do take the time to read and understand them. See Video
Why Are Real Estate Designations Important?
Real Estate accreditations, combined with on-going experience, enable consumers to determine the competency of real estate agents and their dedication to their profession. The CRS (Certified Residential Specialist) is a coveted designation awarded to experienced REALTORS® who complete advanced training in Listing & Selling and who meet rigorous production requirements. They have a proven track record of sales transactions, and must maintain membership in the National Association of REALTORS® and abide by its strict Code of Ethics. The GRI (Graduate REALTOR® Institute) accreditation is granted to REALTORS® who have attended specialized courses over a two to three year period. Other designations are earned by taking subject specific courses addressing the needs of today's buyers & sellers of residential properties. Click for Video