Sellers May Want to Offer Assumable Mortgage

One of the good way (especially now) to market you property is to offer assumabble mortgage

Sellers who can’t find a buyer should look at the terms of their mortgage and, if it is permitted in their area, offer to let a buyer assume their loan.

Utah Housing Loan is assumable loan.

Assumable mortgages made in recent years generally carry interests rates below current market rates. Plus, a buyer who can qualify with the lender can step into a mortgage without having to come up with a down payment or pay hefty closing costs.

It is definitely win-win for sellers and buyers.

The Website HomeAssume.com matches buyers and sellers. FHA and VA mortgages are assumable, as are many conventional adjustable-rate mortgages

Cost of a Home Warranty Insurance

Writing an offer? Don't underestimate the cost of a home warranty. Below is a refresher for how much you should be asking the seller to pay! Keep in mind, though, sellers may not agree with your request.

It's hard to keep up with ever changing warranty pricing. I have noticed that people are not putting a high enough price into the contracts when writing an offer.

So as a refresher, please see program info below.

Also remember to consider what additional options they want, like Garage Door System, Pest Control/ Termite Treatment, Orange Plus, Green Plus, etc.

$325 GOLD Plan - $55 service fee
Condo/Mobile Home: $315

• Includes all the basics, unknown pre-existing conditions, tankless water heaters, whirlpool bathtub,

$380 DIAMOND Plan– $75 service fee
Condo/Mobile Home: $370

• Includes all Gold Plan coverage, plus: tankless water heaters, kitchen refrigerator, washer/dryer, roof leak repair and premium upgrade

NEW BUYERS OPTION!
ORANGEPLUS – $75

• Covers code violations/permits up to $350
• Covers improperly matched and/or installed systems
• Covers removal of defective equipment
• Increases professional series appliances to $2500
• Increases toilet replacement up to $600
Please see contract for details.

NEW BUYERS OPTION!
GREENPLUS – $75

Replaces standard items with
ENERGY STAR EQUIPMENT
Dishwasher, refrigerator and clothes washer
Heating system replacement with 90% efficiency model

Water heater replacement with tankless water heater!
Please see contract for complete details!
**Garage Door System - $20 option, highly recommended!**
Have you watched HWA's video online presentation

I am back: Purchase Price in Real Estate Purchase Contract

I am back from Moab. Our friends had a reception in Wilderness House. Amazing view. Take a look at my picture.

Going back to business, and continue the discussion about one of the most important real estate document-Real Estate Purchase Agreement.


What is Purchase Price? If I represent buyers, I always recommend and do House Comparison before we submit our offer.

Keep also in mind that purchase price may be only one of few money terms in the agreement. Buyers may ask Seller to pay their closing costs. Buyers may ask for some repairs to be completed even before the inspection is done...In other words, if I represent Seller, I recommend patiently review the whole offer before making the decision if the offer is good or not.

For seller, it may be important Method of buyers Payment....you would think why? Seller will be paid cash after closing and recording anyway...the answer is time...b. If Buyer is applying for conventional mortgage for instance, seller is at assumed risk that buyer either would not get qualification, something can change in buyer's financial ability and the process usually takes about 30 days (that is why houses are usually under contract for about 30 days), some other mortgage make take only several days especially if buyer is already pre-qualified, if the buyer has cash, the closing can happen very quickly, and seller will get money probably within 2-3 days...

Tomorrow...I will review which closing costs buyer and seller usually pays...

EM (Earnest Money)+Loan+Balance in Cash=Offering Price

The right or obligation to do appraisal depends on Financing Condition

If Buyer applies for mortgage, the bank will require to do the appraisal. In my practice, I saw only once when bank waived its right (buyer had very large downpayment). Otherwise, buyer must agree to do the appraisal...It is buyer's obligation...

The Buyer may have a right to choose or not to choose to do the appraisal only if the buyer is a cash buyer.

Offer vs. Contract and everything about Earnest Money (Deposit)

Even though as a Buyer you are using the Contract Form to spell out all terms of your offer, this offer will not become a Contract until Seller accepts it.

What is Acceptance?

When Seller or Buyer, responding to an offer or counteroffer of the other do the following:

1. signs the offer and counteroffer where noted to indicate acceptance
2. and communicate to the other party or to the party's agent that the offer or counteroffer has been signed as required.

What if while you are waiting for Seller's response you have changed you mind, and do not want to purchase the property anymore?

Not a problem, as long as you correctly communicate that to the Seller...Talk more to me or your Agent about how it should be done.

What is Earnest Money (EM)? And as a Buyer, why do you need to submit it?

Earnest Money (also known as Deposit) is a promise that as a Buyer you will follow the rules and terms of the agreed contract. This money can be returned to you at the Title company during closing or become your downpayment.

Do you need EM to write an offer?

No, in state of Utah, you only need your good intention? However, if the offer becomes a contract, in other words upon Acceptance of the offer by all parties, this money shall be deposited in accordance with state law.

Where and When will it be deposited?

As a Buyer you should give check or cash to your agent who should request his/her broker to deposit it within three banking days after the offer acceptance to the bank. The bank account most of the time will not be interest bearable one.

As a Seller, you are interested prior to final acceptance of this offer or few days after-- request a Buyer to provide proof of the earnest money deposit as being received by Buyer's Agent.


Required amount?

While a lot of other states require earnest money to be at least 2-3% of the purchase price. Utah has no such requirement.It is personal decision between Seller and Buyer. Sometimes, you can see as little as $500 and as high as complete purchase price.

As a Buyer, because the Utah Purchase Contract is very much biased, if you play by the rules, you will not loose your Earnest Money.

As a Buyer, you can choose your deposit to be with Title company. The only thing keep in mind that title companies are regulated by the Department of Commerce, and they may have different release rules which have nothing to do with your agent.

What if EM check is returned as "NSF"? (not sufficient funds)

Very grey area, but Seller can cancel agreement if EM check bounces back.
As a Seller, good idea to specify this right in a contract.