What to do? Buy a house now - or wait for home prices to go down?

Most every buyer asks that very same question, and there is no stock answer that will be good advice for every buyer, despite what some agents will tell you. It's not always the best idea to buy right now, nor is it always the best idea to wait.

Here are some questions to ask yourself to figure out which is best for you, and if you want more advice after you read this, I am only an email or a phone call away. :)

If at all possible, I am of the mind that you should buy a home in this market if you can. Prices are low, interest rates are low, and you may never get those two factors to converge at this level and create this same opportunity again.

How  is your credit? If your credit is very good and you have enough for a downpayment and closing costs, go ahead and buy now. The interest rates are very low, and if they went up just one percent by the time you decided to buy, the same house you can buy right now for $500,000 and a 10% downpayment will cost you an additional $275.00 per month, and extra $3,300 per  year, or almost $100,000 over the life of the loan. Do you want to needlessly spend an extra $100,000 by waiting?

How is your job history? If you have had steady employment in the same field for at least a few years, and have good credit and at least 5% of the purchase price, you can buy right now, and it's a good idea.

Do you have a lot of outstanding debt? The bank's underwriters work on debt to income ratios. This one is not a cut and dry answer if you have a lot of debt  that can cut into your borrowing ability. It's worth talking to a mortgage broker to see whether or not the funds you have in the bank can go towards satisfying some debt to help you to qualify for a loan. If you don't want to call a mortgage broker just yet, I can give you an idea over the phone as to what the next step would be, and if it is feasible for you to proceed.

Have you been pre-qualified for a loan?  If you have some idea that your credit is good, call a mortgage broker to see what you can qualify for as far as a loan is concerned. It doesn't cost anything to ask, but remember don't give out your social security number to a mortgage broker until you are sure you want to purchase something, adn have talked to your agent (me!)

How "liquid" are you? You really can buy a home with as liittle as 5% of the total price. Closing costs can be negotiated, but you will have to have some funds avaialble to you. If you have funds, but they are not readily available or liquid without penalties, you may want to wait- but it's definitely worth looking into further, as the costs of obtaining your funds may be far less than you think, and the money you save by purchasing now instead of later may greatly offset it.

How much of a downpayment do you have? Without depleting your bank account, do you have enough funds for a downpayment and closing costs, or will we need to negotiate some of that with the seller.  Five percent of the purchase price is an absolute minimum, and we can go from there.

Do you need a tax write-off to offset your income? f you are renting and need a write off, a home is great place to start. Talk to your accountant, and then call me.

Are you prepared for homeownership? Lastly homeownership is wonderful, and part of the American dream, but you have to be ready for it, and the upkeep and maintenance that you have not had to do as a tenant.

If you need some advice because things don't seem so cut and dry as to whether you should or can buy right now, call me or email me. I will do my very best to assist you with your goals, and if that means  advice to you to continue renting, or to make some lifestyle changes before you buy, so be it. You'll get straight answers from me. Twenty-seven years of experience in real estate sales and good, solid advice . You can depend on it.

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Renting a home? what you need to know about security deposits

If you are considering renting a home,  or considering leasing a property that you own, you should be aware of state laws in Connecticut regarding security deposits. The following information is excerpted from the Connecticut Department of Banking

• What Is A Security Deposit?  A security deposit is any advance rental payment other than an advance for the first month's rent or a deposit for a key or any special equipment. A security deposit remains the tenant's property but the landlord holds a security interest in it. Security deposits must be kept in an escrow account in a Connecticut bank. ( The interest rate on security deposits is 1.5%.)

• How Large A Security Deposit Can A Landlord Require? Landlords can't require more than two months rent as a security deposit. This limit is reduced to one month's rent if a tenant is 62 years of age or older.

• Do Landlords Pay Tenants Interest On Security Deposits? Yes. Landlords must pay tenants interest on security deposits of at least the average commercial banks savings deposit rate as annually determined and published by the Banking Commissioner. Interest must be paid annually on the anniversary date of a tenancy either directly to tenants or as a credit towards the next month's rent.

• What If A Tenant Is Late Paying Rent? Tenants forfeit interest on their security deposits for any months when they are more than ten days late paying their rent. The only exception is when a tenant's rental agreement already contains a late charge for overdue rental payments.

• When Do Landlords Have To Return Security Deposits? Landlords must return security deposits with interest or give tenants written notice of damages being claimed within thirty days of when tenants move. The only exception is if a tenant fails to provide a written forwarding address: landlords then need not return security deposits or provide a notice of damages until fifteen days after receipt of a forwarding address in writing. If a landlord does not return a security deposit with interest or provide a written notice of damages within these statutory time limits, the landlord may have to pay the tenant twice the amount of the security deposit. Tenants may pursue this remedy in court. For further information, see the section on options for resolving disputes. A landlord's written notice of damages must itemize the nature and amount of tenant damages, including any unpaid rent or utility payments, and must be accompanied by the balance, if any, of the tenant's security deposit not being claimed for damages plus interest.

If you are considering renting a home, or leasing a property that you own, contact me. I offer both Tenant representation  and Landlord representation  as well as buyers and sellers.

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