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Your Home Value – Zillow.com Debunked
A recent article in Fortune Magazine (2/7/07 edition) talked about the explosive growth in the use of Zillow.com by both buyers and sellers of real estate to estimate the market value of homes in their community The problem is that Zillow.com completely ignores the fact that you simply can not estimate a propertys market value given the limited public information available, such as the age of the home, location, number of bedrooms or bathrooms, or square footage. Many factors such as whether it has been remodeled, the desirability of the floor [...]
Construction Costs
How much does it cost to build a home now?The average cost to build a single family residence can range over a considerable amount depending on the custom features, type of construction, etc. An example of this type of fluctuating costs depending on the quality of the work involved can be seen in my page describing home improvements (you can also see the approx. cost of various type of home improvements such as adding a bedroom or bath, a kitchen remodel, etc.). New home construction can cost from $100 (in some [...]
Moving Tips 3
Easing the Transition to Your New Home Use the right boxes, and pack them carefully Professional moving companies use only sturdy, reinforced cartons. The boxes you can get at your neighborhood supermarket or liquor store might be free, but they are not nearly as strong or padded, and so can't shield your valuables as well from harm in transit. Use sheets, blankets, pillows and towels to separate pictures and other fragile objects from each other and the sides of the carton. Pack plates and glass objects vertically, rather than flat and [...]
Home Warranty
It is common for buyers to request that the sellers provide a home warranty. Standard Home Warranty packages includes protection against breakdowns in numerous systems of the home, including the following: Plumbing System, Plumbing Stoppages, Water Heater, Heating System/Heat Pump, Ductwork, Electrical System, Garage Door Opener, Central Vacuum System, Ceiling Fans, Doorbells, Pest Control, Dishwasher, Garbage Disposal, Built-In Microwave Oven, Range/Oven/Cooktop, Trash Compactor A trade service call fee per repair visit (usually about $55) or the actual cost of service, whichever is less, is typically charged. A disposal fee for replacement [...]
Fico Scores
FICO Scores are a 3 digit score used by credit agencies to rate a potential borrowers credit worthiness. The FICO score was developed by Fair Isaac Company (therefore the acronym FICO) in the 1950's and has been universally adopted by the three main credit rating agencies, Equifax, Experian, and Trans Union. FICO scores range from 300 to 850. The credit rating agencies do not disclose how this score is derived, however the following factors are known to affect the score: Payment History: Does the borrower make their payments as agreed? Is [...]
Residential Home Financing
RESIDENTIAL HOME FINANCING With a fixed rate mortgage (FRM), your monthly payments will be steady. In contrast, with an adjustable rate mortgage (ARM), your payments will vary over time. Adjustable rate mortgages typically have an initial fixed rate lower than the rate of a comparable fixed rate mortgage. The initial fixed rate period is followed by adjustment intervals. For example, a "3/1 ARM" is fixed at an initial low rate for the first 3 years, and then adjusts every year based on an index. Common ARMs are: 1/1, 3/1, 5/1, 7/1, [...]
Calculation of Property Taxes in the South Bay
Property Taxes in the South Bay of Los Angeles County are computed by the standard 1.0% of the property's assessed valuation (in accordance with Proposition 13, a property's assessed valuation is the original purchase price, plus the cost of improvements, based on the value of permits pulled, plus an increase in valuation of 2% per year) plus additional tax rates for voted bonded indebtedness, plus direct assessments such as school parcel taxes. Copies of building permits are sent to the Assessor. New buildings, additions, and other structures require an appraisal. Structural [...]
Income Tax Issues
CAPITAL GAINS ON SALE OF RESIDENCE: The Federal capital gains rate for long-term (property held for more than 1 year) capital gains for the sale of real estate for most tax payers is 15% (See Capital Gains Rates for a discussion of Federal capital gains tax rates, particularly the 28% rate for depreciation recapture). Capital gains in California are taxed at ordinary income tax rates (up to 13.3%). For the sale of a personal residence, if it meets certain requirements (see the links below), up to $500,000 of the gain ($250,000 [...]
Home Inspections
General Home Inspection: A home inspection, conducted by a professional home inspection company, is a necessity when purchasing a home, town home, or a condo. This inspection provides comfort to the buyer that the home is in generally good condition, and that the home's main systems are in good operational order, or will disclose to the buyer what repairs may be needed. The inspection report serves as the basis for the home buyers request for repairs to be conducted by the seller before closing escrow. Home inspection procedures generally include inspection [...]
Closing Costs
Closing Costs Paid by Either Buyer or Seller: Allocation of costs associated with ownership of the home: These costs include the following: Property Taxes: Property Taxes in California are placed as a lien on a property July 1st of each year, and are for taxes for the period 7/1 through 6/30. These taxes are due and payable by 12/15 and 4/15 of the taxable year. At closing, property taxes are either allocated to the buyer or seller depending on the date of closing and the time that the last property tax [...]
Escrow & Title
Escrow is the process which facilitates the transfer of title, the funding of a new mortgage, the payoff of an existing mortgage, the issuance of new title insurance, the proper payment of all fees and expenses and the proper pro rations between buyer and seller. The escrow agent acts a third party to insure that all parties to the transaction have met their obligations prior to the recordation of any documents relating to the sale. The escrow agent performs the following tasks: 1. Escrow Instructions: Obtains copy of the purchase agreement [...]
Purchasing Contract
The California Residential Purchase Agreement (California Association of Realtors form RPA-CA) is a standard form purchase contract There were significant changes made in the revised forms released in 11/14 and 12/15 , with changes in language in many paragraphs. Initial Offer: The initial offer that a buyer makes to acquire a property is made on the RPA-CA standard form Residential Purchase Contract. Some of the important items which must be included in the contract are the following: 1. Purchase Price, Financing, and Deposits: The purchase price, the amount of the deposit [...]