How much can I afford?

According to most theories, people can generally afford a home two and a half times their annual income. However, because of the ever-changing interest rate market, most experts suggest you take into consideration how much you've saved for a down payment and closing costs, how much of a monthly mortgage payment you can afford and how much additional funds you need to meet other financial responsibilities.

Because a down payment is typically between five and twenty percent of the purchase price of your home and closing costs are about five percent of the purchase price, it is a good idea to find out how much money you have available. This money could be from:
• Checking, savings and money market accounts
• Cash value of your life insurance
• Stocks and bonds
• Resale value of any personal property
• Gifts from parents or other relatives

Once you know what your assets are worth, figure out what your expenses total. Expenses might include:
• Utilities
• Charge account balances
• Insurance premiums
• Auto and/or school loans
• Federal, state and local taxes

Don't forget to consider moving fees, home decorating costs and any other upcoming expenses - you don't want the down payment and closing costs to deplete all of your savings.
When you subtract your expenses from your assets, the difference will be what you have to use for a down payment and closing costs.


How do I choose the right real estate professional?

Selecting the right real estate agent is crucial to ensuring your home buying experience is enjoyable. That’s why it’s important to find a professional who has your best interests in mind and listens to your needs. Here are a few suggestions when finding a real estate professional:

• Ask your friends and family for agents they have used and trust.
• Look for an agent with an outstanding reputation, specifically when it comes to his or her experience, track record and awards received.
• Interview at least three agents until you find the agent you feel most comfortable with.
• Seek out someone who is a member of the Board of Realtors® .
• Find someone who is continuing their education – a Certified Residential Specialist (CRS), Certified Residential Broker (CRB), a Graduate of the Realtors Institute (GRI) or an Accredited Buyer's Representative (ABR) – this shows that the Realtor is interested in the business long-term and is willing to invest in their career.


What should I look for in a home?

As you begin searching for that perfect house, you first need to narrow down your search by making a list of your specific needs and wants, specifically naming those must-have features and neighborhoods you would like to live.

Some features you might consider include:

• Certain number of bedrooms
• Certain number of bathrooms
• Bath in the master bedroom
• Separate dining room
• Garage
• Basement

Optional features might include:

• Fireplace
• Swimming pool with Jacuzzi
• Greenhouse
• Breakfast area
• Two stories
• Skylights

You should also keep in mind the features you do not want in your new home, such as: 

• Small bathrooms
• No counter space
• No windows in kitchen/bathroom
• Tiny yard
• Insufficient closet space
• No garage

When considering the location of your new home, keep in mind the quality of the neighborhood, schools, convenience of location to shopping centers, banks, churches, schools and other frequented establishments. It’s also important to consider the rate of crime, traffic levels and flooding areas of the neighborhood. 


What role does the title company play in the purchase of my home?

Capitol Abstract & Title offers you experienced escrow officers and closing specialists well trained in real estate procedures, title insurance, taxes, deeds and insurance. Their wealth of technical experience and knowledge is your assurance of a smooth closing. By acting as a neutral third party who follows the instructions of both the buyer and seller, keeping track of all the details of the transaction, Capitol Abstract gets the job done with efficiency and accuracy.


 What is escrow and why do I need it?

Escrow is an arrangement where a neutral third party, called an escrow holder, holds legal documents and funds on behalf of the buyer and seller, distributing those funds and legal documents according to the instructions in the real estate contract.

People buying and selling real estate often open an escrow for their protection and convenience. The buyer can instruct the escrow holder to disburse the purchase price only upon the satisfaction of certain prerequisites and conditions. The seller can instruct the escrow holder to retain possession of the deed to the buyer until the seller's requirements, including receipt of the purchase price, are met. Both rely on the escrow holder to carry out faithfully their mutually consistent instructions relating to the transaction and to advise them if any of their instructions are not mutually consistent or cannot be carried out.


What is title insurance?

Many new homebuyers are uncertain about the reason for needing title insurance, but it is our goal to help you better understand how title insurance will help you. Without a title insurance policy, you may not be fully protected against errors in public records, hidden defects not disclosed by the public records or mistakes in examination of the title of your new property. As a result, you may be held fully accountable for any prior liens, judgments or claims brought against your new property. However, your policy insures that if such an occasion arises, you will be defended free of charge against all covered claims and paid up to the amount of the policy to settle valid claims.

Frequently Asked Questions from Home Sellers

How do I select a real estate professional to sell my home?

Selecting the right real estate agent is crucial to ensuring your home buying experience is enjoyable. That’s why it’s important to find a professional who has your best interests in mind and listens to your needs. Here are a few suggestions when finding a real estate professional:

• Ask your friends and family for agents they have used and trust.
• Look for an agent with an outstanding reputation, specifically when it comes to his or her experience, track record and awards received.
• Interview at least three agents until you find the agent you feel most comfortable with.
• Seek out someone who is a member of the Board of Realtors® .

Find someone who is continuing their education – a Certified Residential Specialist (CRS), Certified Residential Broker (CRB), a Graduate of the Realtors Institute (GRI) or an Accredited Buyer's Representative (ABR) – this shows that the Realtor is interested in the business long-term and is willing to invest in their career.


What improvements should I make to my home before selling?

Whether you’re meeting someone for the first time or showing your house for the first time, first impressions are incredibly important. That’s why the way you prepare your house will ultimately ensure you receive the financial reward you deserve.

Walk around your home and spot check all your walls ensuring holes, nicks or chipped paint are repaired and that your wallpaper, walls, baseboards and windows are clean and free of chips. Most importantly, de-clutter your entire home including your closets, shelves and drawers. The more space you create prompts the buyer to view the house as larger and cleaner.

Similarly, on the exterior of your home, manicure the yard by mowing and weeding flower gardens, trimming shrubs and repairing any broken lights, fences or windows and screens. If your house needs paint, consider repainting before putting it on the market, as the sale value will far outweigh the time spent painting. 


What price should I set?

One way to determine the value of your home is to hire an experienced, licensed professional to appraise the home. While many appraisals are based on opinion, the professional will know how to determine your sale price by reviewing the condition and location of your home.

In addition to receiving an appraisal, it is also a good idea to perform comparison pricing of your own by determining the value of homes similar in size and age as your home. Be sure to also take into consideration the neighborhood and/or location.

Regardless of the market at the time of your sale, you are more likely to benefit by determining a fair value and sticking close to it than you are by asking an unrealistic figure and waiting for the buyer to make you the "right" offer.

Finally, ask your real estate agent for their help as they should be able to help you accurately determine a fair selling price based upon the current real estate market. 


As the seller, how do I prepare for the closing?

By the time of the closing, the hard part of your job is nearly done!

A good rule of thumb is to schedule the closing back to back with the buyer so all the papers will be signed at the same time, thereby ensuring you are paid.

Be certain to bring the following items to the closing with you:
• A copy of the sales contract and documentation showing that any contingencies have been removed or satisfied.
• All documents needed to complete the transfer of title. This may include certificate of title, deed, correcting affidavits, quitclaim deeds, survey and title insurance policy or binder. The title company will prepare and coordinated with you or your realtor the procurement of all these required documents prior to closing.
• Homeowners insurance policy.
• Receipts showing payment of the latest water, electric and gas bills.