Sellers - Frequently Asked Questions

What am I required to disclose about my house to a buyer?

Sellers are required to disclose material facts about the property for sale - that is, anything that could affect the sale price or influence a buyer's decision to purchase a home. This is obviously a pretty subjective requirement -- a fact that is material to one buyer may not concern another. Remember, generally you only need to disclose information within your personal knowledge. If you're wondering whether something should be disclosed, consult a real estate agent or your property attorney. Ask yourself if you'd want to have the information if you were the buyer. If the answer is yes, then disclose. It could save you a lot of trouble down the line.

Read more on what the Utah approved Real Estate Purchase Contract (REPC) states.

How do i best time the sale of my home with finding and closing on my new home?

This can be a little tricky and basically comes down to "negotiation". Most people must close on the sale of their home before they can get approved for financing on their next one. If you are planning on selling your home in order to buy another one, it is best to find the buyer for your existing home first. Once you have a buyer that is presenting an acceptable purchase price, we can then work on negotiating when that buyer will take "possession". I have often been able to get buyer's to accept a flexible settlement deadline. For example, the counter-offer might read something like this... "Settlement shall take place between January 30th and February 28th. the exact date will be decided by the Seller who will provide 3 days written notice to the Buyer. In the absence of such notice, settlement shall be on the last day stated above." This can be used to create the time needed to find your next home and coordinate a simultaneous close of both properties so that you can move from one house to the next without having to find a temporary place to live in between.

My house needs repairs, do I need to fix everything before I sell?

The short answer is, it depends. If it is your intent to maximize the full retail potential of the sale then you will want to do everything possible to attract qualified buyer's. That means if a buyer walks through your house and is already creating a list of repairs, you will likely NET less money when you sell than if you had completed the necessary repairs prior to listing the property. We are professionals and real estate is our full-time business.  We would be happy to walk through your home with you and offer an un-biased opinion to help you maximize the most money possible from the sale of your home. Set up a no cost consultation TODAY.

On the other hand, if you are loosing your home to foreclosure and you are participating with the lender to sell the home to avoid foreclosure, then I would advise you NOT to do any repairs. In this case you are obviously not going to profit monetarily from the sale. Trying to make the property more attractive to a buyer will not benefit you. In this case you are selling "what it is" and there is a price for your home in it's as-is condition. We will help you determine what that is and negotiate with your lenders on your behalf to help you avoid foreclosure. If you are facing a Utah foreclosure, please reach out to us ASAP so that we may have the opportunity to help you avoid foreclosure and move on in a more dignified manner.

There is so much information available online, how do I determine the "true" value of my home?

NO automated website or program is going to be objective enough to give you and accurate valuation of your home, period! There are too many variables to take into consideration to assess the true market value of your home. It is important to combine two methods when determining the correct price to list your home for the maximum profit. 1. The recently  SOLD properties that are similar in age, style, area, size and condition to your home. 2. What is currently ACTIVE on the market that will be you "competition". When you list, one of two things will happen. Your competition will help you sell your home, or you will help your competition sell theirs. Let us help you by preparing FREE CUSTOM HOME VALUATION for you.

Buyers - Frequently Asked Questions

How much of a down payment will I need to buy a home?

There are many different loan programs available... 20%, 5%, 3.5%, 3% or even NO DOWN PAYMENT loans. Your unique situation will determine which programs are available to YOU. There are a combination of factors considered in determining what loan programs you will qualified for:

1. Credit Score and History

2. Debt

3. Income

3. Job History

4. Cash Reserves

If you would like to explore your financing capabilities, reach out to us and we will refer you to one of our preferred lenders.

What are the advantages of owning vs. renting?

Home ownership is still the "American Dream".

• Currently, owning is cheaper than renting.

• The opportunity to "lock-in" your cost of hosing is very attractive. Rental currently are, and projected to continue, to outpace inflation.

• Both house prices and interest rates are on the rise

• You are paying for housing whether you own or rent

• Owning is usually a form of "forced savings".

• There are substantial tax benefits to owning.

• A homeowner's net worth is over thirty-six times greater than that of a renter.

• Real Estate is the best long-term investment.

• Stability for your family

• And so much more...

I want to own a home but don't even know where to start?

Before anything else, you need to do is reach out to a lender. Until you know what financing options are available to you , how can you start shopping? More important than the "purchase price" of a home is the COST. Your total payment including; principal, interest, taxes, insurance (as well as HOA fees and mortgage insurance, if applicable) will determine the PRICE you can pay for your home.

The next thing you should do is set up a consultation with a competent professional that can walk you through the entire process.

How does the interest rate of my loan affect the price of a home I can afford?

Whatever price range you are in, you will loose 10% of your purchasing power for every percentage point  the interest rate increases.

What is the best website to use to search for homes?

There are a lot of great websites out there. There is also a lot of confusion.

Many websites syndicate with the Multiple Listing Service (MLS). The MLS is a Broker-to-Broker listing service where Realtor's advertise their listings to other Realtor's in hopes that other Realtor's will have a buyer that will buy their listing. Websites that have syndication with an MLS feed can show you the ACTIVE properties for sale based on your search criteria. Many websites also pull data from public records. This means that if a person is in "default" on their mortgage it is public record, and some sites may have this property listed as a FORECLOSURE or PRE-FORECLOSURE listing. This property may not even be "for sale". (confusion)

Property value estimates are a whole different topic. Because ONLY REALTOR'S have access to the SOLD data on the Utah MLS, websites like Zillow must rely on public data when assessing a properties value. Let's just say they are not very accurate. Nationwide, Zestimates are currently within 5% of the final sale price ONLY 38.4% of the time. That means the other 61.6% of the time the valuation/Zestimate is 5-20% off. So, you do the math.

The only accurate source of information about available properties in your area will come from a competent Realtor. 

If I can't qualify for a loan, do I have any other options that will allow me to bUy vs. rent?

If you have a "down payment" to work with we may be able to entice a seller to accept a creative financing solution to get you into home ownership. A Lease/Option, Contract for Deed or Seller Finance transaction may work for you. If you need some time before you can qualify for conventional financing, CONTACT US to discuss other alternatives.

I have ZERO money available for a down payment, can I still buy a home?

There are programs available, if you qualify, to be able to finance your new home with NO money out of pocket. If this is something you would like to explore, please reach out to us and we will match you up with one of our preferred lenders.

Investors - Frequently Asked Questions

What financing options are available on investment properties?

For conventional financing, you will typically need a 20% down payment until you reach 4 loans in your name. It will then jump to a 25% down payment for properties 5-10. Some lenders have programs that only require 15% down for your first 4 properties.

As you pick up more property, lenders are going to be more concerned with "cash reserves" as well. They need to make sure that if your tenant doesn't pay rent, you will still make the mortgage payment. There are many variable to consider that will be unique to your situation. It is best you have a consultation with a competent loan officer who has experience working with investors. CONTACT US, we can discuss your goals and refer you to the right lender.

Can i borrow more than the purchase price in order to have money to fix-up the property?

Most lenders will want to see that you "have skin in the game" and will only loan you a percentage of the purchase price, even if the home appraises for more. However, here are a couple of other options;

• Private Lenders

  • If you have a property "under contract" with the right profit margins, then you will likely be able to find a money partner that will finance the renovation of the project for a return on their investment when you re-sell the property.

• Rehab/Construction Loans

  • There are loan programs available that will allow you to borrow off of the After Repaired Value (ARV) of the property. I work with one lender that has a new program. They can loan both the purchase price and the money to do repairs as long as the "appraisal" of the ARV justifies the loan amount.

I don't want to be a landlord, but I want to invest in real estate?

Personally, I suggest you manage your own properties until you own 5 or more rentals. We (Marchant Real Estate Group) are willing to help you along the way... but there is no substitute for hands-on experience. If you have managed your own properties for a while,  you will be better equipped to select the right property management company. However, I realize this is not an option for a lot of you, so the next best thing is to get a personal recommendation. Here's ours...

Can I buy another home, and turn my existing property into a rental?

Maybe... It depends on your credit and financial situation. Consult with a competent lender to explore your options. 

As a general rule... If you have less than 30% equity in your current property, you will likely need adequate "cash reserves" to cover 6 months payments for BOTH properties. If you have 30% or more in equity in your current property, then the cash reserves could drop to 2 months reserves.

Are there still tax advantage to owning rental properties?

First of all, consult a professional when dealing with tax matters. Real estate offers better tax advantages than any other investment. Just about every expense associated with rental property is deductible. Mortgage interest, depreciation, repairs, travel, property management, home office, etc. If your reach your maximum allowable deductions in a given year, you can even carry the additional losses forward to the next year. Read more...

Renting - Frequently Asked Questions

I am facing foreclosure and have to move. Would you rent to someone in my situation?

The short answer is... It depends. If you are wondering if a foreclosure alone would stop us from renting to you then the answer is no. We will look at your current situation just like we would anyone else in qualifying you as a tenant. view our "Qualifications to Rent" page.  We rent to responsible, working individuals, couples and families that will take care of the property entrusted to them and that can afford the rental payment. We are not as concerned about prior difficulties as we are about present performance and the ability to perform in the future.

The good news for you if you truly are facing foreclosure is that we may be able to help you avoid it. Please call us TODAY to discuss your situation. The clock is ticking!

How do I arrange to view a property?

We will be able to meet you at the property by setting a time that works for both of us. You can set an appointment by calling the office at 801-255-4040.

What is your policy regarding pets?

We are open to accepting pets in most of the properties that we manage because we realize they are vital members of your family. However, you need to inquire if any special conditions exist for the property that you are applying for. As a general rule you can expect;

• Additional $30 in rent due for pet per month

• Additional $500 per pet ($300 pet deposit + $200 non-refundable pet fee)

• Each pet required to have it's own Pet Lease

• Policy applies to both indoor and outdoor pets

• Tenants must have signed Pet Lease in place before acquiring pet or Tenants will be charged $100 per month retroactive to the beginning of Tenant's Lease

• Tenants are required to have a valid Renters Insurance policy prior to having a dog at the property

• Fish, hamsters, gerbils and other similar type small caged animals exempt from this policy

• We cannot list every kind of pet you may have, when in question it is best to ask

My Credit is "not so good", can you still work with me?

We work with all kinds of credit situations. Our goal really is to give you a "Nu-Start". If you have had credit problems in the past due to:

• Bankruptcy

• Divorce

• Foreclosure

• Medical bills

• Loss of job

• etc...

We can usually still help you get into a nice property. But if you show a current problem of not being able to pay even simple bills like your utilities, then you will need to get things under control before we can help you. The last thing that we want to do is put someone in a house that they can't afford and make their situation worse. We will not intentionally set someone up to fail.

May I submit my own credit report?

You are welcome to include a copy of any credit reports, if you choose. However, we will still run our own credit check. This is because different credit reports include different information, and often, information important in our application process is not included in other credit check reports.

what is your Late Payment Policy?

  All payments received after the 1st of the month are considered late. 

• There will be a $60 late charge for any rent payment received after the 1st.

• There is an additional $5 per day inclusive of the 1st until rent is paid in full.

• All monies received after the 1st will be applied to late fees first and then to rent.

• If we have to post a 3-day notice there will be an additional $35 charge.

• If you mail your check to the office, please allow adequate delivery time. If it is received in our office after the first it will be considered late. (If needed, you can postdate your check and we will not deposit it until the 1st.)

• If the 1st of any month falls on a Saturday or Sunday, payment must be received in our office the Friday before the 1st.

Foreclosure - Frequently Asked Questions

What is a loan modification?

A loan modification is just what it sounds like, a modification or change to one or more the existing terms of a loan. If you are in default on the current loan/mortgage agreement, your lender may work with you to make the mortgage more affordable. For example they could lower the interest rate or spread the loan out over a longer period of time. Read more...

I received a "Notice of Default" on my house what does that mean?

Your lender has initiated foreclosure on you home. The Utah Foreclosure Process will follow a specific time line. You must do something to interrupt the process NOW. 

How do i stop or postpone the foreclosure on my home?

First, contact you lender ASAP and ask them if there are any "loan workout programs" available to help you avoid foreclosure. I am also here to help. As a Certified Distressed Property Expert (CDPE), I am uniquely qualified to walk distressed homeowners through the many foreclosure alternatives that are available. If you or someone you know could use my help, contact me today for a confidential consultation. Together, we will work to the best possible solution for any situation.

If your home is foreclosed on, you will suffer some repercussions such as:

• Severe credit damage- A foreclosure will have a very negative impact on your credit score. This will make it difficult to obtain credit in the future. A foreclosure will stay on your credit report for 7 years.

• Possible deficiency judgement- State law allows lenders to pursue a borrower for the deficiency balance after foreclosure. This means after your home is sold at auction, your lender could sue you and try to collect their loss from you personally. If they are awarded a judgement by the courts, this judgment could attach to other assets you may have. They could also go as far as garnishing wages.

There are other repercussions of foreclosure, such as the impact it may have on employment opportunities, rental agreements, etc. Contact us today and we can help you understand how a foreclosure could impact you.

WHAT IS A "SHORT SALE"?

Simply put, a short sale is the sale of a property for less than the amount owed. For Example: If you owed $200,000 on your Utah home, but the current market value of the home is only $185,000, your lender may agree to accept $185,000 (minus the cost of selling. i.e. closing costs and Realtor commissions) to release their lien against the property. This is called a short sale because the lender is releasing their lien "short" of the amount owed. Read more...

What happens after foreclosure?

If your home reaches the foreclosure auction block, that means an investor will purchase the property at the highest bid. If no one bids on the property then it goes back to the bank, and is now an REO property (Real Estate Owned). You will now either be "evicted" or contacted by the new owner of your home to work out another amicable situation.

Read our blog post titled "Short Sale vs. Foreclosure" for a comparison on recovering from a foreclosure vs. being proactive and participating with your lender to avoid foreclosure.

can i do a short sale if i already filed bankruptcy?

Yes, it takes a little longer and is more complex but we are very experienced in working with Utah homeowners who have already filed bankruptcy.

what is a "deficiency judgement"?

When a house is sold (short sale or foreclosure) for less than the outstanding mortgage debt, the difference between the outstanding loan amount and the short sale or foreclosure sale price is called the deficiency

If I go through a short sale or foreclosure, who will rent to me?

We may be able to help. At Nu-Start Properties, Inc. we specialize in helping people get a "new start". If we don't have a property available that fits your needs, we will assist, as best as we can, in locating another landlord that will look beyond your past hardships and focus more on your current capabilities.
 

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