Home Buying Guide2007...which you choose to look for a home matches your lifestyle and personality....

X|ÄxxÇ YtÄäxçíVÜt|z? REALTOR®, GRI, ABR

512.289.1985 • [email protected]

X|ÄxxÇ YtÄäxçíVÜt|z PPrreesseennttss::

TThhee HHoommee BBuuyyiinngg GGuuiiddee Congratulations! The decision to buy your own home is an exciting one. The experience should be enjoyable as well as get you the perfect home with the least amount of hassle.

X|ÄxxÇ YtÄäxçíVÜt|z is devoted to using her expertise to make your transaction successful! Purchasing a home is a very important decision. X|ÄxxÇ YtÄäxçíVÜt|z would like to help you with honest, accurate information so you can make well-informed decisions regarding the purchase of your home. This booklet will give you an idea of what to expect during each phase of your transaction. It also contains reference pages, note pages, deadline information, etc., and is useful as a reference guide even after the transaction is closed.

Please keep this booklet during all house hunting related activities: meetings, house hunting trips, etc. Use it to take notes and to keep track of deadlines. You can even staple cards to relevant pages to keep related materials together. Making this transaction as easy as possible for you is my job. I am happy to serve all your real estate needs!

X|ÄxxÇ YtÄäxçíVÜt|z

(512) 289-1985 [email protected]

www.EileenCraig.com www.ElegantAustinHomes.com



Scout out the Neighborhood! It is important that you scout the neighborhood in person. You live in more than your house. Talk to people who live there. Drive through the entire area at different times of the day, morning, afternoon, evening, and late at night, as well as going during the week and on weekends. Look carefully at how well other homes in the area are being maintained, are they painted, are the yards well cared for, are parked cars in good condition, etc.

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There are many factors to consider when selecting a neighborhood that is right for you. Below are just a few of the many factors to consider- you may think of others that are important to you. Please write them on your Requirements List so they do not get forgotten. Neighborhoods have characteristic personalities investigate to determine that the neighborhood in which you choose to look for a home matches your lifestyle and personality.

Neighborhood Factors to Consider -- Look for things like access to major thoroughfares, highways, and shopping. Listen for noise created by commerce, roads, railways, public areas, schools, etc. Smell the air for adjacent commerce or agriculture. Check with local civic, police, fire, and school officials to find information about the area. Research things like soil and water. Look at traffic patterns around the area during different times of the day and drive from the area to work. Is the neighborhood near parks, churches, recreation centers, shopping, theaters, restaurants, public transportation, schools, etc.? Does the neighborhood belong to a Homeowner’s Association?



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New Home Warranties — When you purchase a newly built home, the builder usually offers some sort of full or limited warranty on things such as the quality of design, materials, and workmanship. These warranties are usually for a period of one-year from the purchase of the home. At closing, the builder will assign to you the manufacturer’s warranties that were provided to the builder for materials, appliances, fixtures, etc. For example, if your dishwasher were to become faulty within one year from the purchase of your newly built home, you would call the manufacturer of the dishwasher – not the builder. If the homebuilder does not offer a warranty, BE SURE TO ASK WHY! Resale Home Warranties — When you purchase a resale home, you can purchase warranties that will protect you against most ordinary flaws and breakdowns for at least the first year of occupancy. The warranty may be offered by the Seller as part of your agreed contract to purchase your new home. Even with a warranty, you should have the home carefully inspected before you purchase it. A home warranty program will give you peace of mind, knowing that the major covered appliances in your home will be repaired if necessary. For more details about home warrant packages,

1. Home Warranty of America - HWA http://www.hwahomewarranty.com 1-888-492-7359

2. America Home Shield http://www.ahswarranty.com 1-800-827-4636

3. Old Republic Protection Co., Inc. http://www.orhp.com 1-800-455-6999

(This list does not represent an endorsement or recommendation, but has been compiled for convenience only.)

HOME WARRANTY



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Why should I use an Agent to purchase a new home?

The advantages of having an Agent like Eileen Craig to help you purchase a new home are the same as those for purchasing a resale home…knowledge of the market, help in finding the perfect home quickly, expertise in contract writing/negotiation, and closing assistance. The builder has a professional representative watching out for his needs, and you need the same expert representation.

Buying a new home is a little more difficult and time-consuming than buying a resale. Eileen can professionally guide you through this process. Eileen has experience working with builders, has access to a database of information about subdivisions, floor plans, etc. I am also familiar with new home warranties and builders purchase contracts.

It is very important that your interests be professionally represented when you are entering into a contract for a semi-custom or build-to-suit home. These transactions are complex and the contract details must be exact in order to protect you and to ensure you get exactly the home you want!

Is there any advantage to not using an Agent to purchase a new home?

No. There is no financial advantage for you to buy directly from the builder. Builders have a “single-price” policy, meaning you will be charged the same price whether your interests are represented by an Agent or not. Just as in any resale, the Seller pays your Agent’s fee.

REMEMBER – the Builder requires that your Agent accompany you on your first visit to the Builder’s sales office, or they will NOT PAY your representative’s fee!

This article originally appeared in the Denver Post

“Should You Use a Realtor When Buying a New Home? YES!”

Think of planning a trip to Europe without the help of a travel agent…or how about buying insurance without an insurance agent? Then imagine being involved in a major league business dispute, and you’re representing yourself in front of the judge and jury. If you depend on people in the service industry for travel needs, filing a claim for hail damage to your roof, or handling legal matters, then why would you want to represent yourself in the most expensive and probably most important purchase of your lifetime…your new home? It is a common conception that buying a new home directly from the builder, without the assistance of a Realtor, will save you money. Not so! The price of a new home is the same whether you have a Realtor or not. Since this is the case, common sense would tell you to utilize a professional to help you with contract negotiations, researching loans, or helping you to decide which lot is best suited for you! Phyliss Sinclair, a broker associate, has been on both sides of the fence. For 10 years she represented builders as an on-site salesperson. During the past three years she has represented both buyers and sellers in resale and the purchase of new homes. Sinclair sums up new homes sales as, “A one price policy…buyers receive all of the services and don’t pay them any extra, but they also don’t receive any discounts. I always felt concern for buyers who weren’t associated with a Realtor, as they didn’t have the support system they deserve in such a major lifetime transaction.” In our current, fast-paced real estate market, there are many new home communities to choose from. You need to ask yourself some pertinent questions when looking for a new home. Is this a good builder? Does he have a solid reputation, years in business, etc.? How does the quality of his product compare to that of other builders? What are the existing inventories of the various builders? How do builder models meet your needs (floor plans, square footage, and location)? If I sell in a few years, what upgrades should I include to be competitive? When you find the answers to these questions, ask yourself if the time spent in researching these answers was time well spent – put a dollar value on your time. Real estate professionals can be a valuable asset in collecting information in areas which may affect your decision on the purchase of a new home. If builders rely on real estate professionals to sell their homes, then why wouldn’t you, the buyer, take the same precautions in assuring yourself the best service and expertise in making this important decision?



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Is an inspection necessary? You have the right to request an inspection of any property you are thinking of purchasing by a professional inspector of your choice. You should always exercise your option to have the physical condition of the property and its inclusions inspected. Many of the more severe and expensive problems such as mechanical, electrical, structural and plumbing are not noticeable to the untrained eye. If repairs are needed, we may negotiate these in your contract offer. A professionally conducted home inspection followed by a written evaluation is becoming standard procedure in home buying because of increased buyer awareness and savvy. Are inspectors licensed? Since an increasing number of buyers are requesting property inspections, there has been a rapid increase in the number of people entering the inspection field, the State of Texas does require testing and licensing of inspectors. What does an inspection entail? A qualified inspector will follow Standards of Practice in conducting their inspection. The inspection consists of a physical inspection of the home with the purchaser present, followed by a written report detailing their findings. They report on the general condition of the home’s electrical, heating, and air systems, interior plumbing, roof, visible insulation, walls, ceilings, floors, windows, doors, foundation, and visible structure. The inspection is not designed to criticize every minor problem or defect in the home. No home is perfect. It is intended to report on major damage or serious problems that require repair for the well being of the home and that might require significant expense.



Inspectors List

Approved Inspections & Energy Audits

Amir Yesamos Ph# 288-6633 Email: [email protected]

Mr. Inspector – Glen Burton Ph# 423-6369

Email: [email protected]

Excel Inspectors - Rick Reynolds Ph# 258-8642

Aspec Inspectors - Nev Nicholson Ph# 328-0995

Pillar to Post - Marvin Lewis Ph# 970-9379

(This list does not represent an endorsement or recommendation, but has been compiled for convenience only.)



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When you are ready to begin looking at various houses to find your dream home, you need to prepare all of the necessary materials to present to the lender. Your lender will tell you exactly what you can afford so that you do not spend time looking at “too much” home. There are three key factors that you will need to consider when determining how much home you can afford. These are 1.) the down payment, 2.) your ability to qualify for a mortgage, and 3.) the closing costs associated with your transaction. Down Payment Requirements:

Most loans today require a down payment of between 3.5% and 5.0% depending on the type and terms of the loan. If you are able to come up with 20-25% down payment, you may be eligible to take advantage of special fast-track programs and possibly eliminate mortgage insurance. It is often thought that bigger is better when it comes to down payments. In many cases, this may be true. However, the arithmetic will differ from case to case. A bigger down payment means smaller monthly payments and lower interest expense for as long as you remain with a mortgage. This can be an important factor for many people. But if you can put your available funds to work for you so that they can earn more than the interest rate on your loan, you could be dollars ahead with a smaller down payment. Also, a smaller down payment may allow you to keep your extra cash liquid and available for an emergency. Closing Costs: Don’t forget to think ahead carefully. In addition to the down payment on your dream home, you will be required to pay fees for loan processing and other closing costs. These fees must be paid in full in cash at the time of the final settlement, unless you are able to include these in your financing. Typically, total closing costs will range between 2-5% of your mortgage loan. A more detailed schedule is included herein in the section detailing your closing. Qualifying for the Mortgage: Most lenders require that your monthly payment range between 25-28% of your gross monthly income. Your mortgage payment to the lender includes four items….the PITI. These items are discussed in detail on the page entitled, “Predicting Your Monthly Payment (The PITI).” Remember, when you buy a home all interest maybe tax deductible, so you could qualify for a major tax advantage that will effectively increase your take-home pay. Your total monthly PITI and all debts (from installments to revolving charge accounts) should range between 33-38% of your gross monthly income. This is a general rule of thumb, but other key factors specifically determine your ability for a home loan. These factors are: INCOME: History of employment, stability of income, potential for future earning, education, vocational training and background, and any secondary income such as bonuses, commissions, child support, etc. CREDIT REPORT: History of debt repayment, total outstanding debt and total available credit. If you have concerns about your credit report, consider contacting one of the major credit bureaus for a copy of your file: TRW (1-800-422-4879), Trans Union (1-602-933-1200), and CSC Credit (1-800-759-5979). ASSETS: Cash on hand, other liquid assets such as savings, checking, CDs, stocks, etc. PROPERTY: The home you are buying must be appraised to determine that it has adequate value and is marketable to ensure it will secure the loan.



PPrreeddiiccttiinngg YYoouurr MMoonntthhllyy PPaayymmeenntt ((TThhee PPIITTII)) Your monthly payment (PITI) is the sum of four items – the principle on the loan (P), the interest on the loan (I), property taxes (T), and homeowner’s insurance (I). To predict your monthly payment for a 30-year fixed rate loan, use the following table to determine the principal and interest part of the payment. Simply divide the loan amount by 1,000 and then multiply that figure by the appropriate interest rate factor from the table below. To that sum add 1/12th of the amount of your yearly taxes and 1/12th the amount of your yearly insurance. For example: If your mortgage loan amount is $150,000 and the interest rate is 12%, your monthly “PI” would be:

$150,000 = 150 1,000

150 x 10.29 = $1,542.50

Then add your monthly insurance premium (approximately $25-$75) and your property tax to your principal and interest and this is your monthly payment.

PRINCIPAL AND INTEREST PAYMENT TABLE If your interest is: Your PI Factor is:

6.00% …………………………………… 6.00% 6.50% …………………………………… 6.32% 7.00% …………………………………… 6.65% 7,50% …………………………………… 6,99% 8.00% …………………………………… 7.34% 8.50% …………………………………… 7.69% 9.00% …………………………………… 8.05% 9.50% …………………………………… 8.41%

10.00% …………………………………… 8.78% 10.50% …………………………………… 9.15% 11.00% …………………………………… 9.52% 11.50% …………………………………… 9.90% 12.00% …………………………………… 10.29% 12.50% …………………………………… 10.67% 13.00% …………………………………… 11.06%

All property owners must pay general real estate taxes. These taxes are also called “ad valorem” taxes because the amount of the taxes varies, according to the value of your property. General real estate taxes are levied for the operations of various governmental agencies and municipalities. Other taxing bodies may include school districts, drainage, water, sanitary, and recreation districts. Each agency or municipality determines how much money is needed for the budget. They receive these funds through mills levied against properties in their counties. The state limits how much the mill levy can increase each year without voter approval. Each mill is equal to one-thousandth of one dollar ($.001) of assessed value or $1 for every $1,000 of assessed value. The actual tax is calculated by multiplying the assessed value by the current mill levy. General taxes are a lien against your home as of January 1st, the year of the tax, even though they are not due until the following year. Properties are valued or assessed by the county assessor. The land and buildings are usually assessed separately. The assessed value is approximately 12-15% of the true value (percentage value is determined by state law). If an owner feels the assessed value of their property is incorrect, they can present their objection through the local taxing authority on an annual basis.

Hazard Insurance covering your home for its contract value is required by your mortgage lender. You are at liberty to choose any insurance company and agent you wish. Ask your agent to quote you a policy for insurance coverage.



NNooww wwee CCLLOOSSEE yyoouurr TTrraannssaaccttiioonn!! What is a Real Estate “Closing?” A “closing” is the meeting between the Buyer, Seller, their respective agents, along with a representative from the lending institution (optional) and Title Company wherein the actual transfer of title to the property occurs. The purchase agreement or contract you have signed describes the property, states the purchase price and terms, sets forth the method of payment, and usually names the date and place where the closing or actual transfer of the property title and keys will occur. This meeting is also referred to as the settlement. The title company transferring ownership of the property to you will prepare a new deed. Your lender will require you to sign a document, usually a promissory note, as evidence that you are personally responsible for repaying the loan. You will also sign a mortgage or deed of trust on the property as security to the lender for the loan. The mortgage or deed of trust gives the lender the right to sell the property if you fail to make the payments. Before you exchange these papers, the property may be surveyed, appraised, or inspected, and the ownership of title will be checked in county and court records. What Should I do to Prepare for the Closing? As previously mentioned, you should have already conducted any inspections, etc. you wish to have done on the property. There are two kinds of title insurance. A lender or mortgagee’s title insurance policy protects only the lending institution. Lenders require this type of insurance and require the borrower to pay for it. That does not mean that the borrower will receive its protection. An owner’s policy is necessary to protect the owner against loss. You will also be required to pay all fees and closing costs in the form of “guaranteed funds” such as a Cashier’s Check. You will be notified of the exact amount by your escrow officer at closing. What is an Escrow Account?

An escrow account is a neutral depository for funds that will be used to pay expenses incurred by the property, such as taxes, assessments, property insurance, or mortgage insurance premiums which fall due in the future. You will pay one-twelfth of the annual amount of these bills each month with your regular mortgage payment. When the bills fall due, they are paid by the lender from the special account. At closing, it may be necessary to pay enough into the account to cover these amounts for several months so that funds will be available to pay the bills as they fall due. You may also be required to refund items prepaid by the Seller. For example, if the Seller has paid the special assessments or taxes for that year, you may be required to refund the value of the months remaining the year when you take possession of the property. An escrow fee is usually charged to set up the account.



Why Title Insurance?

The state of Texas regulates the sale of title insurance, such that the premiums are based on the sale price of the property and the premiums may not be discounted by the title companies.

Most sellers view the title insurance premium as an unnecessary cost of sale, which benefits the buyer only. In fact, providing title insurance to the buyer is equally important to the seller.

Transfer of real estate in the state of Texas must be evidenced by a “deed”. Types of deeds include: quit claim deeds, special warranty deeds and general warranty deeds, are a few of the most common. The TREC Contract forms require the seller to provide the buyer a “general warranty deed”. This type of deed is a unilateral contract evidencing the seller’s warranty of title to the buyer. The warranty period goes all the way back to the Texas land grants in the 1840’s. In the event a “cloud on title” surfaces at the time of the buyer’s future sale, the buyer has the legal right to sue the seller for breach of warranty of title to the property. Title insurance helps define the seller’s risk with respect to his warranty of title. Accordingly, such insurance is beneficial to both buyer and seller. Sellers benefit considerably when providing title insurance to buyers.

There are two kinds of title insurance. The above Owner’s Title Policy which is necessary to protect the owner against loss and which is customary for the seller to pay for. The second kind of title insurance being a Lender or Mortgagee’s Title Insurance Policy, protects only the Lending Institution. A lender requires this type of insurance and requires the borrower (the buyer) to pay for it. That does not mean that the borrower (the buyer) will receive its protection, the lender does.



Homestead Law in Texas

The “residential homestead” refers to the lot or parcel of land upon which the residence of the family or single adult is located and anything which is part of that land is subject to the homestead exemption laws of the State of Texas. Those laws primarily provide for the security of a family’s home, shelter, and earning of a livelihood free from the claims of all creditors, save and except the holders of purchase money liens, home equity liens and liens for improvements, taxes and federal tax liens. When purchasing a home that you will claim as your residence you are entitled to file a Residential Homestead Exemption. This form must be sent to the County Appraisal District after closing on your new home. The deadline for filing is April 30th of the current Tax Year. An exemption removes part of the value of your property from taxation and will lower your property taxes.

Community Property Laws

TEXAS IS A COMMUNITY PROPERTY STATE

Community property may be defined as all property acquired by either spouse during marriage, except that which is the separate property of either. Separate property may be defined as “all property owned or claimed by either spouse before marriage and also that acquired by gift, devise or descent.” Exactly what constitutes separate property is a question of fact, as property acquired during the marriage is generally presumed to be community property. Therefore, for the purpose of insuring title, should one spouse claim property to be separate in nature, that spouse must be able to prove it.



Processing the Sale A Realtor® has more responsibilities than listing and showing! You should be aware of what your Realtor®, Eileen Falvey-Craig does after the contract is signed: 1. Open Title.

2. Deliver Earnest Money Contract and check to the Title Company.

3. Obtain receipt for earnest money check from the Title Company.

4. To Prevent delays in closing; I will be in contact with you and your Loan officer to make sure that all the necessary documentation to process your loan is at the lenders office and you have ordered your Home Owners Insurance for your new House.

5. Keep you abreast of your loan application and the progress of the appraisal on your home.

6. Insure that you receive copies of all documentation pertinent to the transaction.

7. Review the Title Commitment with the Title Agent for clouds and make sure problems are disclosed early so closing is not delayed

8. Note all contingencies and attempt to remove them within the time limit provided or ask for an extension of time, if needed.

9. Help coordinate home inspections and meet with you at the end of the inpsection to discuss the findings:

A. Roof

B. Pest Control

C. Pool

D. Building

E. Slab if needed

10. Remind you to order any required termite treatment and obtain certificate.

11. Update you on the execution of any required repairs or estimates for repairs.

12. Verify survey has been ordered and completed.

13. Provide Title Company with any charges for HUD1.

14. Recommend that we have closing papers drawn before closing so that if any problems arise, we can solve them.

15. Coordinate the closing, move-in dates, and Remind you to transfer the Utilities to be put in your name so, that they are as convenient to both parties as possible.



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1. Price

2. Terms

3. Inclusions

4. Contingencies

5. Possession

6. Processing the Sale

We’ll work through all of these together! If

you have any questions along the way, I’ll

be here to help you & will be at the closing

of your new home.



WWee’’rree MMoovviinngg!! Now that you have a new address, send out all your change of address notices. Complete your Change of Address notices and mail them to the following. Keep in mind that the post office will forward your mail for 30 days but they do expect that you are sending notices to everyone who sends you mail.

Post Office Friends and relatives Magazine and mail order subscriptions Professional organizations of which you are a member Clubs, social or civic organizations with mailings Charge accounts, insurance carriers, and creditors Driver’s bureau to receive tag notices Voter Registration officials

Don’t forget the needs of your furry friends!

Do not transport your pets much farther than they have safely traveled in the past without consulting your veterinarian. To transport animals by air, you need an airline-approved animal carrier. A moving company can inform you of any state regulations for pet entry, vaccination or quarantine procedures. Ask about regulations, licenses, tags, etc. for pets. Also, do not forget to obtain a copy of your pet’s medical records. Keep detailed records – some moving expenses are tax deductible! Keep detailed records of all moving expenses if your move is job related. Many expenses, including house-hunting trips, are tax deductible. If your move is 35 miles or more from your home, you can deduct your family’s travel expenses, including meals and lodging; the cost of transporting furniture, other household goods and personal belongings; food and hotel bills for up to 30 days in the new city if you have to wait to move into your new home; and the costs associated with selling your old home or leasing your new home. Note: There is a ceiling on deductions which is outlined in detail in the IRS’s Publication 521, “Tax Information on

Moving Expenses,” available free form the IRS offices.



WWee’’rree MMoovviinngg –– CCoonnttiinnuueedd When you close on your new home, you should complete the following:

Ask your bank about electronically transferring your funds to a bank in your new area. Discuss branch options and arrange for check cashing in your new location.

Close out your safety deposit box.

Obtain travelers checks for traveling funds and for funds while you are settling into your new location.

Ask your insurance agent to transfer coverage to your new home. Make sure all coverage (life, health, automobile, personal belongings, etc.) is in force while you are en route.

Schedule a moving company to assist you or begin notifying people who are helping you of your planned move date.

Begin depleting your store of canned and frozen foods. Defrost your freezer and use charcoal to dispel odors.

Now that you have a new address, you can begin transferring or canceling home services:

Electric and Water, City of Austin (512) 494-9400

Telephone, AT&T (800) 464-7928

Trash, City of Austin (512) 494-9400

Gas, Southern Union Gas (512) 477-5981

Cable Television, Time Warner Cable: (512) 485-5550

Make arrangements for canceling home deliveries and services such as the following. Arrange for service at your new address.

Newspaper, Austin American Statesman: (512) 445-3500

Cleaning Service ( ).

Lawn Service ( ).

Laundry / Diaper Service ( ).



WE’RE MOVING ! !

List of Movers

All My Sons Moving and Storage They will move you locally, short hauls, long hauls,

all of Texas and Out Of State. Todd Harrison (Owner) Phone # (512) 443-3700

2337 Patterson Industrial Drive Plugerville, Texas, 78660

Blue Whale Moving and Storage They will move you ONLY within the State of Texas.

Phone # (512) 328-6688 8291 Springdale road

Suite 100, Austin, Texas, 78724

Greenbelt Moving A Local Austin Moving Company Ph# 1-866-403-0477

National Movers

Allied Van Lines – 1-800-823-0755 Global Van Lines – 1-800-246-5869 United Van Lines– 1 800- 299-1700

(This list does not represent an endorsement or recommendation,

but has been compiled for convenience only.)



Helpful Links

http://www.reliableremodeler.com Tips on minor repairs and remodeling

http://thecityofaustin.com/lawn Lawn service companies in Austin

http://www.txdps.state.tx.us

Texas Department of Public Safety

http://www.improvenet.com/ext/paths/8/index.html Have contractors in your area bid on your job

http://g.moving.com/Moving_and_Planning/Quotes

Compare movers in the Austin area

http://www.123movers.com/?se=goo15 Get competitive price quotes from movers in any areas

http://www.moving.bz/self_storage/texas/austin

Find storage in Austin

http://www.ci.austin.tx.us/library Find resources at the Austin Public Library

https://moversguide.com/?referral=USPS

U.S. Postal Service official Change of Address form

http://www.1800gotjunk.com

Phone # 1-800 Got Junk ( 1-800-468-5865 ) They will haul off any belonging on or in the property for

you. No Boxing or Bagging is necessary. Free Estimates. Their Pricing is Based on how much Volume

is loaded into their Truck.

Flooring Services



Stanley Steamer

Phone # 1-800 STEAMER (1-800-783-2637) Stanley Steemer will provide you with superior carpet cleaning. Most Stanley Steemer

operations offer a full menu of additional services to help you care for your home, such as tile and grout cleaning, air duct cleaning, carpet and flooring sales, hardwood floor refinishing, and even 24-hour water damage restoration

Crown Carpet Cleaning

Phone # 512-244-2199

Crown Carpet Cleaning offers residential and commercial carpet cleaning. They will steam clean and deodorize individual rooms or whole houses with an additional charge for stairs. Additional landscaping services are also available, including mowing, edging, and blowing.

Able Water Restoration and Carpet Cleaning

Phone # 512-671-8800 or 512-653-2300 Able Water Damage Restoration and Carpet Cleaning is available twenty-four hours a day,

seven days a week to restore your place to top shape. They have been serving Central Texas for over 20 years in the water damage restoration and carpet cleaning business. For your protection, they are bonded and insured.

America’s Carpet Outlet

Phone # 512-451-4202 7512 N. Lamar Blvd. Austin, TX Locally owned, they have all colors, styles, and grades - from rental property to high-end

designer. They also stock the unique and hard to find. They have remnants and roll ends as well as full rolls to do an entire house or office. They can offer savings of up to 50% off normal retail, because they are a true outlet store and buy carpet for much less than what it normally sells for. They can also set you up with professional installation, usually within a day or two.

The Carpet Stop

Phone # 512-419-1144 1542 W. Anderson Lane Austin, TX

Locally owned, they have a full service stocking warehouse offering the public the lowest prices on all types of floor covering everyday. They stock remnants as well as full rolls to do a room or the whole house. They offer professional installation, usually within two days.

This List does not represent an endorsement or recommendation.

(It has been compiled for your convenience only)

Glossary Of Real Estate Terms



ADJUSTABLE-RATE MORTGAGE (ARM): A loan with an interest rate that changes periodically in keeping with a current index, like one-year treasury bills. Typically, ARMs shouldn’t jump more than 2 percentage points per year or 6 points above the starting rate. AMORTIZATION: A payment plan which enables the borrower to reduce his debt gradually through monthly payments of principal. APPRAISED VALUE: An estimate of the value of the property offered as security for a home loan. This appraisal is done for financial lending purposes and may not reflect the actual market value. BRIDGING FINANCE: A short-term loan, usually at a higher rate of interest, taken out by people who have bought a house while waiting for theirs to be sold, or when a normal mortgage and their savings fall below the asking price. CAVEAT EMPTOR: Latin for “let the buyer beware”. This puts the burden onto the buyer to be satisfied with the item before purchasing the property. CERTIFICATE OF TITLE: Legal proof of ownership of a property carrying the owner’s name and other information. CHATTELS: Chattels are personal property. There are 2 types: Real chattels are buildings and fixtures; personal chattels are clothes, furniture, etc. CONVENTIONAL MORTGAGE: A mortgage loan not insured by HUD or guaranteed by the Veterans’ Administration. It is subject to conditions established by the lending institution and state statutes. The mortgage rates may vary with different institutions and between states. (States have various interest limits.) CREDIT REPORT: A report on the past ability of a loan applicant to pay installment payments in a timely manner. COMMISSION: Fee payable to real estate agent for selling the property by the person authorizing the sale; usually a percentage of the sales price. CONTRACT OF SALE: Written agreement setting out the terms and conditions of a property sale. COVENANT: Conditions affecting the use of land or property written into the title. DEPOSIT: Usually 10% of the purchase price of a property placed in trust as evidence of intention to buy. Nonrefundable after exchange of contract, the deposit goes towards the purchase price when the sale goes through. DOCUMENT PREPARATION FEE: A charge by an attorney for preparing legal documents for a transaction. EARNEST MONEY: The deposit money given to the seller or his agent by the potential buyer upon the signing of the agreement of sale to show that he or she is serious about buying the house. If the sale goes through, the earnest money is applied against the down payment. If the sale does not go through, the earnest money will be forfeited or lost unless the binder or offer to purchase expressly provides that it is refundable. ENCROACHMENT: When a building overhangs someone else’s property, or a fence is built over the dividing line between two properties. ENCUMBRANCE: An easement, mortgage or other liability on a property which impedes its use or transfer.



EQUITY: The difference between the market value of the property and any loans that are outstanding on the property. EXCLUSIONS: Any item that is specifically not included in the sale, e.g. an above ground pool, garden shed, etc. ESCROW: Funds paid by one party to another (the escrow agent) to hold until the occurrence of a specified event, after which the funds are released to a designated individual. FLAT INTEREST RATE: An interest rate that is based on the original amount of the mortgage for the whole term of the loan. FIXED-RATE MORTGAGE: A loan that carries an unchangeable interest rate over its entire term -- typically a period of 15-30 years. FREEHOLD: An owner’s interest in land where the property and the land on which it stands both belong to their owner indefinitely. HOMEOWNER’S INSURANCE: Protects the property and contents in case of damage or loss; must be for at least the loan amount or for 80% of the value of the improvements, whichever is greater. INCLUSIONS: Lights, curtains, blinds, ceiling fans, air-conditioning units, window screens, TV antenna, dishwasher, range hood, stove, fixed cupboards, clothes hoist or any other removable item that the vendor has agreed will be included in the sale. INTEREST: A charge paid for borrowing money. INTEREST-ONLY LOAN: Loan on which interest is only paid periodically and the principal paid at the end of the term. INSPECTIONS: An examination of property for various reasons such as termite inspections; inspection to see if required repairs were made before funds are received, etc. INVENTORY: List of items included with a property for sale; usually furniture, furnishings and other removable items. INVESTMENT: The purchase of an asset, such as real estate, with the ultimate goal of producing capital gain on the resale of the asset. JOINT TENANTS: Joint Tenancy is the equal holding of property by two or more persons. If one person dies, their share passes to the survivors. LAND TAX: Value-based levy applied to some property (exemptions include principal place of residence). LIABILITIES: Your outstanding debts or what you owe. LIEN: A claim by one person on the property of another as security for money owed. Such claims may include obligations not met or satisfied, judgments, unpaid taxes, materials or labor. LIMITED TITLE: Form or Torrens Title which applies to a property before it has been adequately surveyed. LOAN APPLICATION FEE: Paid to the lender at time of application: check with lender for amount. LOAN DISCOUNT: The points a lender charges; may be paid by either buyer or seller on conventional loans; number of points fluctuates with mortgage money market. MAINTENANCE FEE: Charged by the homeowner’s association as set out in the subdivision restrictions.



MATURITY DATE: The last day of the term of the home loan agreement. The home loan must then be paid in full or the home loan agreement must be renewed. MORTGAGE: Legal agreement on the terms and conditions of a loan for the purpose of buying real estate. (A mortgagee lends the money to a mortgagor, the borrower). MORTGAGEE’S TITLE POLICY: Required by the lender to insure that the lender has a valid lien; does not protect the buyer. MULTIPLE LISTING: System of selling the property through many agents. The buyer pays only one commission. This goes to the agent who lists the property on an official multiple listing form for other agents (if the agent sells the property), or is shared between the first agent and the agent who actually finds the buyer. OFFER TO PURCHASE: A formal legal agreement which offers a specified price for a specified property. The offer may be firm (no conditions attached) or conditional (certain conditions apply). OPTION TO BUY: Legal agreement giving the buyer the right to purchase property at a certain time and price. Option fee, usually one percent of the price, is payable and forfeited if the buyer does not go through with the transaction. ORIGINATION FEE: A fee the buyer pays the lender to originate a new loan. OWNER’S TITLE POLICY: Insures that the buyer has title to the property. PITI: Abbreviation for principal, interest, taxes, and insurance, all of which are lumped together in your monthly mortgage payment. POINTS: A one-time only fee you pay up front to your lender, sometimes in exchange for a slightly lower mortgage rate. One point equals one percent of the total amount you plan to borrow. PRINCIPAL: The actual amount of money that has been borrowed to buy a property. PRIVATE MORTGAGE INSURANCE (PMI): Insurance against a loss by a lender (mortgagee) in the event of default by a borrower (mortgagor). REALTOR FEES: An amount paid to the Realtor as compensation for his/her services. RECORDING FEES: Charged by the County Clerk to record documents in the public records. RESTRICTIONS: Certified copy of deed restrictions required by lender. SETTLEMENT: Completion of sale when balance of contract price is paid to the vendor and the buyer is legally entitled to take possession of the property. SURVEY: Confirms lot size and identifies any encroachments or restriction violations. TITLE INSURANCE: Protects lenders and homeowners against loss of their interest in property due to legal defects in title. TITLE SEARCH: The process of examining the land title to ensure the vendor has the right to sell and therefore transfer ownership. A title search details the names of the owners and other information about the property such as encumbrances or caveats on the title. VENDOR: Person offering property for sale. VENDOR STATEMENT: Statement setting out the particulars of the property, made by the vendor.

Home Buying Guide2007...which you choose to look for a home matches your lifestyle and personality....

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Transcript of Home Buying Guide2007...which you choose to look for a home matches your lifestyle and personality....