This age old adage come up most every time someone talks about buying or selling a property.  No matter what state one lives,  the location of your home is vital to the resale of your existing home.  One thing that one must remember in purchasing a home, you make your money when you purchase the home, not when you sell it.  Always remember, Location, Location, Location in any home purchase.

First and foremost, as a home buyer, your only opportunity to have a choice in location is at the time of purchase. As obvious as this fact is, it is forgotten or ignored by the average home buyer way too often. Buying any property be it either real or commercial.  If the property is  not well located for its purpose, it is a mistake that usually manifests itself at the time of sale.  You need to educate yourself prior to any home purchase.

• Remember, at the time of sale, location cannot be affected by the seller except as a function of price. As an example, a certain style and model of a house will sell for 5% to 10% more in the interior of a subdivision that the same style and model located at the edge of the same subdivision backing to a 4 lane highway. So why do consumers buy the house backing to the highway?

• As in many purchases, emotions play a large role, especially a house that will become a home. Builders will generally maximize the financial benefit of developing a division of land by building as many homes as possible on that land, building on the lots backing to that highway. This is done for reasons of profit, and is not inherently good or bad. There is no good reason why a consumer should buy a house that is located next to our proverbial highway, but many consumers do just that. They do so often because of poor or no advice. It is very important to have the services of an experienced professional real estate agent to provide guidance when purchasing any home, but most especially a new builder home.  All of the builder incentives in the world will not make up for that poor location when it comes time to sell.

• The home market has price fluctuations just as any market. The poorly located home purchased at the height of a market can become a nightmare when trying to sell at the bottom of the market or anytime.
• A consumer should always perform an independent investigation of any undeveloped land in close proximity to their “dream” house. Do not rely on anyone’s statements regarding future land use. Due diligence performed by the buyer with school districts and other governmental entities will provide great peace of mind as the decision to purchase is considered.  It is your responsibility to complete the research on what or where one purchases this home.  You are the one at risk and will do the best job in this research.  Don’t count on family or friends in this decision.  Do it yourself for best results with the aid and support of you professional real estate agent.  Always consider what is provided by your local government.  Such as services, water sources, transportation corridors, shopping locations, schools and houses of worship when buying.   Check out any zoning changes for the area as a new shopping center or highway could go up after purchasing this dream home.  Although these items may not be important to you when you purchase,  they will almost always be important to the future buyer of your home.

Remember, the only time that a home buyer has influence on the location issue is at time of purchase.  Due your due diligence before you purchase the most expensive purchase of your life.  Contact your real estate professional for help in making these decisions.

As we start working with you to buy a home in Tempe, Gilbert, Mesa, or Chandler we recommend that you get familiar with the different types of mortgage programs that are available. We work with highly skilled loan officers from locally based Arizona mortgage companies.

Mortgage financing requires competent and skilled loan officers – we know and work with some of the best. Just let us know that you want to talk to a loan officer and we’ll get you several names.

If you do not have enough money to buy a house in Arizona then you will need a mortgage. The legal document that your mortgage lender records on your home’s deed is called a mortgage. The mortgage, including the mortgage note, are the most important documents you get from your mortgage lender when you buy your home as they spell out the terms that you agree to follow while you have your mortgage.

Below are the key components of a mortgage in Arizona:

• the amount of money the lender is loaning to you,
• your interest rate,
• is your mortgage fixed or adjustable,
• how long will you be paying on your mortgage,
• when is your mortgage payment due,
• the mortgage bank’s alternatives if you stop making your mortgage payment, and
• what are your options if you fall behind on your mortgage payments.

The key to having a good relationship with your mortgage company is to touch base with your mortgage lender if you are going to be late with your monthly payment and follow what your mortgage documents stipulate.

Below you can find a list of home loan programs for buying a house:

• Fixed rate mortgage – The fixed rate home loan is the most prevalent home loan because the rate of interest is fixed for the term of the loan. Fixed rate mortgages can range from 10-40 years. Because the interest rate remains fixed for the whole term of the mortgage the fixed rate mortgage is the most conservative mortgage of all the home loan programs.

• Interest only home loans – The interest only mortgage offers a fixed rate of interest for the life of the mortgage with a period of time where you only have to pay the interest payment every month. If you want the most conservative mortgage program then the interest only home loan is probably not for you. Of all the interest only mortgages, the 10 year interest only mortgage is the most popular.

• Adjustable rate mortgage – ARM – Due to the nature of the ARM, you may want to consider this home mortgage program if you only plan to live in your home a few years. The most common adjustable rate mortgage mortgage is the 5 year adjustable rate mortgage (ARM). All ARMs have a fixed rate period and an adjustable rate period. The ARM is the most risky mortgage program because at the end of the fixed interest rate period you could be faced with a mortgage you cannot afford if you cannot get rid of the mortgage and the interest rates go up a lot.

Homebuyer’s Credit Gets New Life

It is now official – the first time buyer tax credit extension has been signed into law.  The $8000 First Time HomeBuyer Tax Credit has been extended for buyers to secure an accepted purchase contract by April 30, 2010 and then close on that contract by June 30, 2010.  The only change is that the income levels have been raised to $125k/year for singles and $225k/year for married and the maximum purchase is now $800k.  They also added a $6500 tax credit for “move-up buyers” that have owned their current primary residence they are vacating for 5 of the last 8 years and are buying a new primary residence. The same purchase dates and income levels apply to the “move-up buyer.”  There will likely be a lot of “what if’s” for qualifying for the move-up buyer tax credit.  The initial sanity check on the move-up buyer will be that their tax returns have shown their current primary residence address for the past 5 years.  The tax credit is an IRS tax related issue so a buyer would likely want to consult a tax advisor with specific scenario questions on whether their situation would qualify.  Loan underwriting guidelines still state that a move-up buyer needs to qualify with both mortgage payments unless the primary residence that the borrower is vacating has 25%/30% (FHA/Conventional) equity along with a rental contract and proof of security deposit.  Two good websites for info on the tax credit are www.federalhousingtaxcredit.com and http://www.irs.gov/newsroom/article/0,,id=206294,00.html (IRS site still needs to be updated for the move-up buyer tax credit).

Not sure what will happen in the future… act now so you don’t miss this great chance.

When it comes time to find a loan officer to speak with regarding your mortgage options is it better to find a local Arizona loan officer or work with a national bank and a call center?

The truth is, it all depends on what you prefer.

Without knowing the pros and cons, it would be something that would be easy to mess up — meaning you could use someone who is based in Orlando, Florida as your loan officer to buy a house in Chandler, Arizona and end up having it be a disaster. Or, just as likely — you could blindly use a local Arizona loan officer who turns out to be far less competitive with their interest rates, points and fees than a larger, national lender.

There is at least one simple thing that you can do to avoid either of these situations — ask around.

Start by asking your Realtor. Chances are good that your Real Estate Agent will know some great loan officers: both local and national.

After getting a recommendation from your Real Estate Agent, interview at least three different loan officers. It is not all that uncommon to discover that each loan officer is quite different — and not just as it relates to interest rates and fees. Some loan officers really have no clue and some are stone-cold-experts and know what they are doing. Some are funny, some are boring. Some are easy to work with, some are abrasive. In the end, you want to find someone who you feel will be easy to work with and is knowledgeable about mortgages in general – so the first step is to interview at least a couple so you can compare and contrast. Again, your Real Estate Agent should have at least a couple of names for you.

After shopping for a local mortgage lender, you may also be well served to speak with a national lender with a loan officer who works somewhere  out of Arizona. When speaking with any out of state loan officer, the best way to find out if they are going to know about helping someone who is buying a house in your local AZ market is to ask them one question:

How soon can you get the paperwork that is required by my Real Estate Agent? The required document that you will need to put in an offer on a home in Arizona is called an LSR – Loan Status Report. In other states they are sometimes referred to as a pre-approval letter. If the out of state loan officer does not know what you are talking about – that should put an abrupt end to your interview.

A good loan officer will make all the difference in whether you get your mortgage and the mortgage that is best for you. Again, most real estate agents know a few qualify loan officers that deliver good mortgage products and customer service. Make sure you ask for referrals as you begin looking for an Arizona based loan officer.