Laura Hsieh-DeGnore's Blog
If you’re planning on buying a home in the near future and are confused about many of the terms associated with mortgages, you’re not alone. Real estate is its own industry with its own set of processes, terms, and acronyms. If you’re new to the home buying process, there can be somewhat of a learning curve to understand what each of these terms means.
Since buying a home is such a huge investment and life decision, there’s a lot of pressure on home buyers to make sure they get everything right. This makes for a stressful situation for buyers who don’t feel like they understand the terminology of things like mortgages, appraisals, credit reports, and other factors that contribute to the home buying process.
To alleviate some of those concerns and to make the home buying process run more smoothly, we’ve compiled a list of the most common, and most commonly confused, real estate words, terms, and acronyms. That way, when you’re talking things over with your real estate agent or your mortgage lender, you’ll be confident that you understand exactly what’s being considered.
Read on for our real estate terminology glossary.
Adjustable rate mortgage (ARM) - This is one type of home loan. Mortgage rates with this type of loan fluctuate throughout the repayment term of the loan. The fluctuation is based on a market indicator.
Fixed rate mortgage (FRM) - Another type of home loan, a fixed rate mortgage has a rate which does not fluctuate, remaining constant for the life of the term, most commonly 15 or 30 years.
Appraisal - An appraisal is the determination of the value of a property. Appraisals are used when purchasing and selling a home, as well as when refinancing a home loan. Appraisers are required to be licensed or certified in each state and are usually paid for by the lender.
Appreciation - An increase in a property’s value, most commonly due to market inflation, or the general increase in home prices over time.
Depreciation - A decrease in a property’s value, due to either market deflation (uncommon) or the wear and tear on a home that comes with age.
Closing costs - The costs and fees that a buyer is responsible for when purchasing a home or taking out a mortgage. These include underwriting fees, inspections, appraisals, transfer taxes, and more. Closing costs typically range from 2% to 5% of the total loan amount.
Contingency - Home purchases have contracts to protect the interest of the buyer, seller, and lender. Contingencies are provisions designed to protect the buyer or lender should something occur in the time leading up to closing on (or purchasing) the home. One common contingency is the buyer’s right to have a final inspection of the home before closing to ensure no new issues with the home have occurred.
Private mortgage insurance (PMI) - Buyers who cannot afford a down payment of %20 typically are required to take out a private mortgage insurance policy. This policy protects the lender should the borrower default (fail to repay or meet the conditions of their loan).
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To sell your home, one of the essential things for you is to stage your home. While the price of your home is often dictated by the market and your own surroundings, the people who are going to buy your home ultimately need to have some attraction to it.
The question is- can you stage your home yourself, or do you need to leave the home staging to the professionals? Either way, you may need to spend a little bit of cash in order for the home staging to actually work well.
The first step in the home staging process is for you to declutter the home. Get rid of anything that’s taking up space, or making the home appear “junked up.” No one can picture themselves living in a cluttered home.
Hire A Maid
If you’re doing the home staging yourself, one of the most important aspects of getting your home ready is making it clean. A maid service can provide that deep clean that you may not have time to do yourself. This service is definitely worth the investment to make your home presentable to potential buyers.
Professional Home Staging Is Pricey
Professional home staging can cost quite a bit, (we're talking thousands of dollars.) You can do a lot yourself to stage your home. You don’t need to spend top dollar in order to have your home staged appropriately. Just know that homes that are staged correctly (whether professionally or by you) sell for more.
Staging Gives Buyers Vision
It may be hard for buyers to envision a room any other way than how you currently have it set up. People may not be able to picture a chair in the corner or a bed in a different position. You can play around with the furniture in your home to make the rooms look best.
Add Some Paint
One of the easiest things that you can do to stage your home is to paint it. Even if you simply put a fresh coat on the doors, it can really add some appeal to the home. If you have the time, you should paint the rest of the home’s interior as well. Buyers are most attracted to neutral colors. If you have any rooms that are oddly colored, or looking rough due to age, some paint can really bring life into the home.
Make Each Room Inviting
When potential buyers walk through the home, you don’t want them to simply skim the house without checking out each individual room. See what draws you into the room, whether it be lighting, a fireplace, or an ornament on the door. Any of these small touches can make a big difference when you stage your home.
If you want to buy a house, it pays to enter the real estate market with a checklist in hand. That way, you can streamline the process of going from homebuyer to homeowner.
Now, let's take a look at three things to include in your homebuying checklist.
1. Your Budget
Your budget will dictate whether you're able to afford a condo, luxury home or something in-between. As such, you'll want to assess your finances closely as you determine exactly what type of house that you can afford.
Oftentimes, it helps to get a copy of your credit report. You are eligible to receive one free copy of your credit report annually from each of the three credit reporting bureaus (Equifax, Experian and TransUnion). If you know your credit score, you can determine whether now is a good time to enter the real estate market, or whether you should improve your credit score first.
You may want to consult with several banks and credit unions too. These financial institutions can teach you about various mortgage options and help get pre-approved for a mortgage. Then, once you have a mortgage, you'll know exactly how much you can spend on a house and tailor your home search accordingly.
2. Where You Want to Live
Living in the suburbs is very different from residing in the city. Therefore, you'll want to consider where you want to live so that you can search for a home in specific areas.
For example, if you prefer the peace and quiet of a small town, you may want to consider houses in small towns in the state of your choice. These towns may feature dozens of available homes. Plus, in many instances, small town houses are priced lower than big city residences.
Or, if you enjoy the hustle and bustle of the big city, you can search for residences in any city, at any time. These houses likely will ensure that you'll have quick, easy access to a variety of big city attractions and landmarks.
3. Real Estate Agent
There is no telling whether you're about to enter a seller's or buyer's market, as the housing sector often fluctuates. Fortunately, if you hire a real estate agent, you can increase the likelihood of a quick, successful homebuying experience, regardless of the current housing market's conditions.
A real estate agent is committed to your homebuying success and will do what it takes to help you find the right home, at the right price. He or she will learn about your homebuying goals and offer expert insights into the real estate market. Also, if you ever have homebuying concerns or questions, a real estate agent is available to address them.
For those who want to streamline the homebuying process, it helps to hire a real estate agent. And if you hire a real estate agent today, you can get the assistance that you need to make your homeownership dream come true.
Get started on your homebuying checklist, and you can simplify the process of acquiring your ideal residence.
An enriched soil is an indispensable requirement for a fantastic garden. Flourishing plants are a delight to the soul. An affordable means of improving the quality of your garden soil is making your own fertilizer. This cost-saving process can be clean and easy if done the right way. It is waste management by recycling. The results are as complete as that of inorganic fertilizers, yet it lasts longer and is safer because it is organic. Making your organic fertilizer will be hassle-free if you pay attention to these three things:
- Get a good container: A proper container will help you hold all the decomposing materials that you are going to use. Your bin doesn't have to be fancy or decorative; it just needs to be able to keep all the elements together while bacteria works on them. The kind of bin that works is one that retains both heat and moisture as both are essential to the process. You can purchase a compost bin from any gardening store near you. The container should be situated in the sun so that it gets maximum heat.
- The right ingredients and preparation process: Your compost should be a combination of brown and green plant materials along with some moisture so the bacteria can get to work in a conducive atmosphere. Use items like newspapers, dry leaves, and wood shavings, kitchen waste (not including meat, however), and grass cuttings to start the compost. Other items that should go in your compost bin include fruit and vegetable scraps, eggshells, coffee grounds, cut grass, and wood. Some items are not good composting materials because they cause pests infestation. Avoid things like meat, fish and dairy products as they will attract rats and raccoons to your compost bin. Also, avoid diseased plant materials as these will transfer pests to the soil. Also, avoid animal feces. Always add even layers of green and brown materials for excellent balance and an even flow of moisture.
- The composting procedure: Add water to the compost pile regularly; you are aiming for the consistency of a wet sponge so be careful not to add too much water. Keep turning the pile with a pitchfork every two weeks to make sure the process is going as expected. The mix should always be warm, around 130 to 150 degrees Fahrenheit.
- Final use: Your fertilizer is ready to be added to your garden soil when it no longer gives off heat. You can then apply it to your garden and flower pots up to about five inches of thickness. Following these basic steps will help you to enrich your garden soil organically. A beautiful lawn and garden add curb appeal to any home.