Do you have any questions? I can help!

Iveth Caruso, your REALTOR in the North Atlanta Area

Want to fetch top dollar for your home and walk away with as much money in your pocket as possible? Of course you do. You’ve gone through the time-consuming process of setting your asking price, staging your home, promoting your listing, and preparing for open houses — and should be rewarded for your efforts.
Your first instinct may be to just pick the highest bid on the table. But the offer price isn’t the only thing worth considering.
When vetting offers, evaluate these five areas in addition to price:
1. The earnest money deposit. One important consideration when weighing an offer is the size of the earnest money deposit. The EMD is the sum of cash the buyer is offering to fork over when the sales agreement is signed to show the person is serious (i.e., “earnest”) about buying your home. This money, which is typically held by a title company, will go toward the buyer’s down payment at closing.
A standard EMD is 1% to 3% of the cost of the home (so, that would be $2,000 to $6,000 on a $200,000 house). If a buyer tries to back out of an offer for no good reason, the seller typically keeps the EMD. Therefore, the higher the earnest money, the stronger the offer.
2. The contingencies. Most offers have contingencies — provisions that must be met for the transaction to go through, or the buyer is entitled to walk away from the deal with their earnest money. Contracts with fewer contingencies are more likely to reach closing, and in a timely fashion.  
Here are five of the most common contingencies:

• Home inspection contingency. This gives the buyer the right to have the home professionally inspected and request repairs by a certain date — typically within five to seven days of the purchase agreement being signed. Depending on where you live, you may be required to make home repairs for structural defects, building code violations, or safety issues. Most repair requests are negotiable, though, so you have the option to haggle over which fixes you’re willing to make.
• Appraisal contingency. For a mortgage lender to approve a home buyer’s loan, the home must pass appraisal — a process during which the property’s value is assessed by a neutral third party. The appraisal verifies that the home is worth at least enough money to cover the price of the mortgage. (In the event the buyer can’t make their mortgage payments, the lender can foreclose on the home and sell the property to recoup all — or at least some — of its costs.) Generally, the home buyer is responsible for paying for the appraisal, which typically takes place within 14 days of the sales contract being signed.
• Financing contingency. Also called a loan contingency or mortgage contingency, a financing contingency protects the buyer in the event their lender doesn’t approve their mortgage. Although the timeframe for financing contingencies can vary, mortgage lenders report that buyers generally have about 21 days to obtain mortgage approval. 
• Sale of current home contingency. Depending on the buyer’s financial situation, their offer may be contingent on the sale of their home. Usually, buyers have a window of 30 to 90 days to sell their house before the sales agreement is voided. This contingency puts you, the seller, at a disadvantage because you can’t control whether the buyer sells their house in time. 
• Title contingency. Before approving a mortgage, a lender will require the borrower to “clear title” — a process in which the buyer’s title company reviews any potential easements or agreements that are on public record. This ensures the buyer is becoming the rightful owner of the property and the lender is protected from ownership claims over liens, fraudulent claims from previous owners, clerical problems in courthouse documents, or forged signatures.

These contingencies are standard for most real estate sales contracts. There’s one exception: the sale of current home contingency, which tends to be used more often in strong buyer’s markets, when buyers have greater leverage over sellers. 
That being said, contingencies are always negotiable. (The caveat: Mortgage lenders require borrowers to have appraisal financing contingencies, or they won’t approve the loan.) It’s up to you to decide what you’re comfortable agreeing to, and your agent can help you make that decision.
3. The down payment. Depending on the type of mortgage, the buyer must make a down payment on the house — and the size of that down payment can affect the strength of the offer. In most cases, a buyer’s down payment amount is related to the home loan they’re taking out. Your chief concern as a seller, of course, is for the transaction to close — and for that to happen, the buyer’s mortgage has be approved.
Generally, a larger down payment signals the buyer’s financial wherewithal to complete the sale. The average down payment, according to the NATIONAL ASSOCIATION OF REALTORS®, is 10%. Some mortgage products, such as FHA and VA loans, allow for even lower down payments. 
If, by chance, the appraisal comes in higher than your contract’s sale price, the buyer with a higher down payment would more likely be able to cover the difference with the large amount of cash they have available.
4. The all-cash offer. The more cash the buyer plunks down, the more likely the lender is to approve their loan. That’s why an all-cash offer is ideal for both parties. The buyer doesn’t have to fulfill an appraisal contingency — whereby their lender has the home appraised to make sure the property value is large enough to cover the mortgage — or a financing contingency, which requires buyers to obtain mortgage approval within a certain number of days. As always, having a sales contract with fewer contingencies means there are fewer ways for the deal to fall through.
5. The closing date. Settlement, or “closing,” is the day when both parties sign the final paperwork and make the sale official. Typically, the whole process — from accepting an offer to closing — takes between 30 and 60 days; however, the average closing time is 42 days, according to a report from mortgage software company Ellie Mae. 
Three days before closing, the buyer receives a closing disclosure from the lender, which he compares with the loan estimate he received when he applied for the loan. If there are material differences between the buyer’s loan estimate and closing disclosure, the closing can’t happen until those amounts are reviewed and approved. But this is rare.
Some transactions can take more time, depending on the buyer’s financing. For example, the average closing time for a Federal Housing Administration (FHA) loan is 43 days, according to Ellie Mae. 
Whether you want a slow or quick settlement will depend on your circumstances. If you’ve already purchased your next home, for instance, you probably want to close as soon as possible. On the other hand, you may want a longer closing period — say, 60 days — if you need the proceeds from the sale to purchase your new home.

Depending on the circumstances, you may be in the position to make a counteroffer. But every transaction is different, based on the particular market conditions and your home. In some circumstances, you can be gutsy with your counteroffer. In others, it might serve your goals better to give in to the buyer’s demands. Your agent can provide helpful insight about when and why a counteroffer will be the right thing for you.
For instance: If you’re in a seller’s market — meaning that homes are selling quickly and for more than the asking prices — and you received multiple offers, your agent may recommend you counteroffer with an amount higher than you would have in a buyer’s market. 
If you choose to write a counteroffer, your agent will negotiate on your behalf to make sure you get the best deal for you.
A caveat: In many states sellers can’t legally make a counteroffer to more than one buyer at the same time, since they’re obligated to sign a purchase agreement if a buyer accepts the new offer.
Do you have any questions? I can help!
Have a Great week!

Iveth Caruso
706.974.4577

Home inspection is a crucial step in the home-buying process. After finding the perfect house, you will want to ensure that there are no hidden faults that may require lengthy and expensive repairs or renovations down the line.

To prepare you for this process, here are the top four things you need to know.

1. The buyer is responsible for the inspection. Make sure you give yourself ample time to find a reputable, certified home inspector by asking for referrals from your real estate agent, friends, and family and do your research online. Plus, don’t forget to factor in the cost of the inspection into your budget.
2. Home inspectors are usually generalists. They will evaluate most areas of your home, such as the foundation, basement, plumbing, electrical systems, heating and cooling systems, walls, floors, ceilings, and attics. But, if your home is equipped with special features, like a pool or chimney, you may need to hire a specialist.
3. Buyers can attend the inspection. In fact, a lot of inspectors suggest it! This is an opportunity for you to get any outstanding questions regarding the condition of the house you are purchasing answered.
4. You have options if the inspection uncovers a problem. If the problems discovered are serious, like structural damage or safety issues, the seller is legally required to fix them. You also have the option to back out of the purchase without facing any consequences. If the problems are smaller, you can submit a formal request for repairs and negotiate for them to cover some or all of the cost.

Do you have any questions? I can help!

Have a Great week!

Iveth Caruso
706.974.4577

Adjustable rate mortgage, counteroffer, principle... the list goes on and on. Many sellers and buyers may struggle to remember the meaning of these, and other commonly used real estate terms. Get ahead of the confusion by equipping yourself with this helpful Real Estate Terminology guide. Don't forget to download it!

Click on the link below to download the PDF version of the file.

Have  a great week!
Iveth Caruso

Here are six reasons you should own your home instead of renting one:
Happiness - The feeling of owning your own home is unmatched. You can fix it up, make it your own, get a dog, or plant a tree if you want. Doesn't that sound exciting!
Tax Savings - The government rewards homeowners by providing excellent tax benefits. The interest paid on your mortgage and other home-related expenses can generally be deducted from your income.
Appreciation - Home values have a well-documented history of going up over time. This increase becomes equity you can benefit from when you refinance or sell.
Equity - Renting has often been compared to paying 100% interest, but when you own a home and a mortgage is in place, a portion of your payment goes toward the principal balance on your loan. This builds your equity and acts as a savings account.
Roots - People who own rather than rent stay in their homes 4 times longer. This provides an opportunity to get to know your neighbors and connect with your local community.
Education - Research shows children of homeowners earn higher test scores and graduate at a higher percentage than those of renters.
If you are looking to buy or sell your home, call me.

Iveth Caruso
Providing the most professional, dedicated, informative and loyal service you can find in Real Estate!

Dreaming of buying your first home?  The Georgia Dream Home-ownership Program fulfills home-ownership dreams by providing affordable mortgage financing for eligible home buyers. Are you a first time home buyer?  You may be eligible for $15,000 for down-payment, closing costs and prepaid costs to purchase your home.
If you are interested in purchasing a home through the Georgia Dream Program, contact me and I will get you started!

The term due diligence generally refers to any period of time where an asset for sale is examined. In real estate it usually refers to a period of time where a buyer can examine or otherwise consider a property for which they're under contract - and pull out of the transaction if they find something unsatisfactory or undisclosed.

In Georgia, when you enter the due diligence period, in which, the buyer, does all relevant inspections and decide whether or not you would like to proceed with the sale.  The seller is bound to the buyer and cannot enter into other contracts for the sale of the home (except as backup)– but the buyer is free to terminate the contract with no penalty and get the earnest money back.

During this period the buyer should independently verify any information provided by the current owners with a third party source because many owners, even if well-intended, are unaware of certain factors that may affect your decision. Remember, it is the buyer's responsibility to conduct their own research during this period and to verify all information.

During this period, the buyer should schedule the home and termite inspections, order the survey and research information about flood plains, power lines, and zoning. If you are buying a home with an HOA or a condo, make sure that understand the bylaws of the homeowner's or community associations and that you know what the annual or monthly required fees are and what services are included in those fees.

Equally important is to inspect the neighborhood, some things to research during the due diligence period include proximity to any places or facilities that you might find troublesome such as a landfill, prison, cemetery, etc. It’s important to research local schools, crime rates. Additionally, you might also want to find out more information about your potential neighbors, including a violent sex offender search at the Georgia Bureau of Investigation website.

Generally speaking, the most common reason that a buyers terminates a contract during due diligence is that the inspection uncovers an issue that the seller is not willing to fix.  But remember, the buyer can terminate the contract for any reason and they get the earnest money returned.

Don’t be afraid to make an offer in a home, you could be the backup contract but remember, there is a lot of competition in the market right now for homes in the lower price points (especially those purchasing below $150,000) Because simply there are not enough homes listed.

So if you want to beat the competition, it’s highly recommended to present your best offer as quickly as possible, with proof of funds or pre-qualification letter and use the due diligence period to fully investigate it and ensure you want to go forward with the purchase of the property.
Please do not hesitate to contact me if you have any questions or for a free consultation.

Iveth Caruso
Providing the most professional, dedicated, informative and loyal service you can find in Real Estate!

If you don’t think that your FICO® scores are important, think again. The interest rate you can expect to pay for a loan is dependent on these scores. The difference between a FICO® score of 620 and 760 can often be tens of thousands of dollars over the life of your loan. A low score can cost you money each month or even cause the home you want to be unaffordable.
Basically, the higher your FICO® scores the less you can expect to pay for your mortgage loan.  Learn to take control of your FICO® score and save money on your mortgage payments.

FICO scores range from 300 to 850. If all three FICO scores are viewed on the same day they will typically vary between zero and fifty points. The purpose of the score is to predict the likelihood of 90+ day delinquency over the next 24 months. As of (April 2017) data, the national distribution of FICO credit scores is as follows:

FICO Credit Score Tidbits

• Six payments are required on an active loan to generate a FICO score for the first time,
  
• A denied loan request has no impact on a FICO credit score.
• Debit card payment history is not part of a credit score.
• Credit counseling is treated as a neutral factor, neither helping nor harming the FICO score,
• The model is not offended by a large number of credit card accounts.
• A bankruptcy filing is the single worse thing you can do to a FICO credit score,
• Chapters 7, 11 & 12 Bankruptcies will remain on a credit report for ten years, A Chapter 13 Bankruptcy will remain on a credit report for seven years.
• All other negative information on a credit report will remain on the credit bureau for seven years.
  
• In current versions of the FICO score, all authorized user accounts on a credit report are included in the score.
• If you have co-signed for a loan and the account is on your credit report, then it is in your credit score.
• When payments are due on student loans they are part of the credit score calculation. When payments are not due, they are not included in the score.

Payment History
When assigning points gained or lost for payment history information, the FICO score looks at four separate components:

• Frequency
• Severity
• Amount Owed
• How Recent is the Event

Here is how Fair Isaac assigns the severity of a credit problem according to the time it has been on a credit bureau:
Percent Negative Impact
Most recent 12 months                                 93%
Prior 12 to 24 months                                   60%
Prior 24 to 36 months                                   44%
Prior 36 to 48 months                                   33%
Older than 4 years                                        22%
Source: Credit Scores & Credit Reports, Evan Hendricks, Privacy Times, Inc

Capacity is King
Almost as important as how you pay your bills is the amount owed on your various accounts (i.e. capacity), The FICO model considers three separate components of your credit when assigning capacity points=
1. Your installment balances compared to the original loan amounts.
2. Your revolving account balance compared to your revolving credit limit on an account-by-account basis; and
3. Your total revolving account balances compared to your total revolving limits.
By far, the total revolving limits available (#3 above) carries the most potential points and the potential loss of points.
Why does capacity carry so much weight in tie FICO scoring model? Because the FICO model knows that the majority of Americans who go bankrupt charge up their cards to the limits before they file.
In order to understand capacity, you must understand the math problem that determines how this large number of points is gained or lost.
% Revolving          Dollars Available on Total Revolving Accts.
Available               Total Reported Limits on Revolving Accts.

Keys to Capacity Success

• You want your "% of Revolving Available" number to be as high as possible.
• You accomplish this by keeping your revolving balances as low GS possible and your limits as high as possible.
• It is very easy to get all of your capacity points (but it rarely happens).
• Don't close revolving accounts.
• Some HELOC (A Home Equity Line Of Credit ) loans are in the capacity calculation, but some are not.
  
• For scoring purposes, it is better to have small balances on a number of cards than to have a large balance on a single card.
  
• Please note that paying off your balances in full each month does not guarantee a great capacity calculation.
  

Items that Hurt a FICO Score

• Late payments and derogatory public records.
• A low level of "percent available" on individual revolving accounts and total revolving accounts (Le capacity).
• Closing revolving accounts,
• Having a lender lower the limit on a revolving account or not reporting the limit on a revolving account,
• Multiple new revolving accounts in a short period of time.
• Settling a debt for less than the full balance (because the settled date is more recent than the original date).
• Having loans at "second tier" finance companies.

Checking your credit rating before you talk to a lender when purchasing your home will give you time to correct reporting errors and to prepare your score.
I help clients to make informed decisions when pursuing the dream to buy a home. Contact me and we'll get you started!

Iveth Caruso, your KW REALTOR in the North Atlanta Area

Iveth Caruso, your REALTOR in the North Atlanta Area