Category Archives: First time home Buyer

Protesting Your Property Taxes

Hello Austin area residents/home owners!

Earlier this week I sent out an email to all my past clients about disputing their property taxes.I decided to go ahead and post the same note on the blog, given that, it’s some really helpful information.

protesting taxes scales

Option 1:

Log onto our website and if you don’t have an account, create one. From there, try to search your neighborhood by name or better, draw a polygon on the map of your area and homes similar to yours. If you have already verified your email on our site you should be able to see accurate SOLD pricing. If not, click the link next to the sold box on the status tab to “unlock sold pricing.”

From there, you will hopefully gain enough evidence that when you are arguing your value you can write in the box your counter offer and explain why. (ie other similar homes sold for $__ and are much newer/larger/in better condition etc) If your home has any sort of defects the county says those are big items they take into account, so compare it to others.

As an FYI–they ask you to submit evidence after you hit submit on the counter, however I have discovered they will counter back your offer before you have submitted any evidence, so do not feel the need to do that as soon as you submit your counter.

Option 2:

If your appraised value went up, you might consider hiring a professional like Texas ProtaxFive Stone Tax or O’Connor Associates to help you protest your taxes. They only charge a percentage of the money you save and are experts at dealing with the County Tax Assessors.

{My friend works for Five Stone Tax and she did say if they don’t end up saving you money, it will cost you nothing (so you have nothing to lose by giving this a shot)!}

Option 3:

If you would prefer to protest your taxes on your own, you can use our Home Valuation Tool to get a rough estimate of your home’s current market value using this tool as well and recent nearby sales.  

Reach out if you would like help finding recent sales to support your tax protest hearing. Don’t delay, as the deadline to file your tax protest electronically is May 24th, and May 31st if filing by paper.

**Also,if you purchased last year and taxes are above what you actually paid–you can show your closing statement to get the assessed value down to purchase price, however, remember– Tx is a non-disclosure state so you do NOT have to show what you paid for your home**

And if this is your primary residence, don’t forget to file your homestead exemption!

Hope you found this little post helpful and best of luck!

 

Ashley Brinkman

2017 broker signature

Austin Real Estate Forecast 2017 (Recapped from Ted Jones)

Dr. Ted Jones is the Economist for Stewart Title. (Twitter Handle is @drTCJ)

He gives a great presentation and holds your attention and packed with a few funnies along the way. This morning I wanted to re-cap some of the things he discussed and presented on regarding the future of Austin’s Economy.

Despite the election, Ted started off with reminding of us two things:

1. Brexit was the first sign that things were already changing and

2. Don’t let yesterday take up too much of today.

No matter the outcome of the election, traditionally speaking, each election year, right before the election, things typically slow down due to market uncertainty–then they pick right back up (again, regardless if there’s a conservative  or dem in the white house, statistics usually demonstrate this).

Let’s start with Millenials (they are an important part of our Economy, especially here in ATX):

Things to Know: The top 3 Markets with Millenials are:

  • Charlotte 30%
  • Houston 17.4%
  • Austin, Tx 16.4%

76 Million Boomers, 83 million Millenials between 19-35 and 91 million Millenials between 16-35.

75% of Millenials polled say they can live without the call function on their cell phones, 76% prefer texting>talking and 19% never check their voice mail. (guilty a lil, right here).

The above statistic is funny to me. I don’t think of myself as a Millenial, but according to the year I was born, I am. But I will say I have traits from the generation before and after me combined.

{Fun fact: 70% of Millenials prefer shopping in store v. online, due to instant gratification/satisfaction. This is why company’s like Amazon are trying to speed delivery, do drone drops etc–Millenials want it NOW.}

HERE is a great little article on best housing markets FOR Millenials.

Now, let’s talk Non-Renewals/Dead on Arrival/Items already going away:

  • Mortgage insurance deductability
  • Mortgage debt forgiveness
  • Residential energy savings
  • Obama care (or some form of it)
  • Wind and Solar tax breaks

Soon to Happen Changes/Items in the works ??:

  • US has the highest corporate tax rate and we are one of the Top Developed Countries
  • Capital Gains tax cut
  • Middle class tax changes (some up and some down)
  • Carried Interest Elimination
  • US Overseas corporate profit repatriation
  • Corporate tax cut (35%–>15%)

{Fun fact: in 2000 Germany corp tax rate was around 42% in 2016 they are now at 15.8%. Did you know that every BMW x3,x4,x5,x6 was made in South Carolina due to the corp tax rate? It is the largest plant and they make BMW for worldwide-read more on that here.}

Things to note: Currently, and for the last several years leisure and hospitality spending is at a rate higher than job growth–which means a steady market, when we see a drop in leisure and spending is when we hit a recession.

Top States with Job Growth:

  • Florida
  • Washington
  • Utah
  • Oregon
  • Nevada
  • Hawaii
  • Idaho
  • South Dakota
  • Georgia
  • California

Now let’s turn to the states at the bottom of this list (decline in job growth) and look at what they all have in common:

  • Alaska
  • Oklahoma
  • North Dakota
  • Wyoming
  • Louisiana
  • Kansas

They are all Oil and Gas based economy (ok maybe not Kansas, but what’s going on in KS…not a lot). Note, Tx isn’t on this list.

Tx is around 1.77% for job growth, we fall in the top half of the list. “This is the best oil turn down Texas has ever seen.” Jones said. And when you look at the greater Austin area: our market survives from: Tech, Education, Healthcare…Which leads me to…

2016 Stock Market Trends:

  • 13% up for Dow Jones Industries
  • 9.5% S&P500
  • 7.5% Nasdaq Composite
  • 45.2% crude oil

Mega Themes for 2017:

  • More Jobs before the election than ever before in History
  • Retail boom is on a 14 yr run
  • Entry level home buyers are returning
  • High end housing is retracting
  • Commercial Sales
  • Inflation potential (ie UPS increased rates 4.9% 12.26.16)
  • 2016 Commercial Sales were at an all time high in Austin Tx, this is different (above average) than the National record, and Austin is only at a 4% vacancy rate.
  • Rent has been increasing about 5% year over year.
  • Oil most likely stay about the same around $60/barrell (saving the average driver about $550/yr)

2017 Positives and Concerns:

  • Return of ARMs and Second rate loans
  • Faltering high end residential sales
  • Retracting commercial sales (Austin a little different)
  • Inflation
  • Midwest Land value increasing
  • Oil sub $60/barrel

Jones also predicted mortgage interest rates ranging from 4.7%-5.3%, but a 5yr ARM starts at 3.5% currently, “people will just have to get creative.”

Toward the end of the presentation we touched base on Property Taxes (and how outrageous they are and heavily based on our education system–another issue itself on how we pay and grade our teachers and schools, but I will digress).

What did I gather overall from attending Ted Jones’ Economic Forecast? In Sum:

  • Austin will be strong and steady this year, especially for those already here with jobs, he predicts Austin, Seattle and San Jose will not have a declining luxury market, however our (the company I work for, Realty Austin) Broker, Jonathan Boatwright differs on this a little, when he was quoted in the Statesman last week (article HERE and he says the numbers don’t lie)
  • Due to affordability in Austin, people will start getting a little more creative with their loans–perhaps 7 and 10yr ARMs (adjustable rate mortgages) for those who know they won’t be in a house for longer than that…these are for savvy, good credit buyers, wanting to get in their price point and save a quarter on the interest rate (the “scary” part is not knowing where rates will be in 7yrs)
  • Job growth is declining here in Austin (not by much, not rapidly, but it is becoming harder for those to find a job relocating here) Went from 5%-2%, so not by much, but slowing
  • We are NOT overbuilding. While it sometimes may seem like we are, we are still at 2.1mo of inventory. A balanced market is at 6mo of inventory and a seller’s market is usually around 4mo. So basically things are still pretty crazy here in Atx.
  • Will there be growth in 2017? Yes.
  • Will the Fed’s interest rate effect our market here in Austin? Not so much (they do correlate, but not impacted directly).

What’s Next? This is where I insert my plug. “If you are thinking of buying an investment property, leasing or selling your current place, buying your first home, selling a home…well get to it–call me.”

As always thanks for reading and I hope you found this re-cap informative!

-Ashley Brinkman

ashleybrinkman@realtyaustin.com-signature

 

Filing Your Homestead Exemption: Austin, Tx and surrounding areas

Did you buy a home last year?

Do you want a tax break?

Good, here is what you need to do to get that tax break…

First-write down on your “to do” list: File Homestead Exemption

Secondly, actually take about 10 minutes to do it.

Isn’t it funny how the most mundane tasks get put off and shoved to the side? When you put that stamp and send it in (or fill it out online) you think, “oh that really wasn’t so bad, afterall, why did I wait so long to do it?” {still on my to do list by the way}

So, my Austin area peeps:

Below are the links to information on how to download the necessary forms to claim your exemption-based on what county you purchased your home in:

  • Travis County 
    Mailing Address: P.O. BOX 149012, Austin, TX 78714-9012
  • Williamson County or File Online
    Mailing Address: 625 FM 1460, Georgetown, TX 78626-8050
  • Hays County
    Mailing Address: 21001 IH 35 North, Kyle, Texas 78640
  • Bastrop County or Call 512-303-1930 ext. 22
    Mailing Address: P.O. Box 578, Bastrop, TX 78602
  • Burnet County
    Mailing Address: P.O. Box 908, Burnet, TX 78611-0908
  • Llano County
    Mailing Address: 103 E. Sandstone St., Llano, Texas 78643

As Austin and surrounding areas home pricing increases, so will taxes. Typically (yet not always) your tax value is a bit behind your actual appraised value of your home.

**Remember your tax value and assessed home value by your lender are two different things. And as some say– You want the taxing authority to think you live in a shack and your loan provider to think you live in a mansion (wink, wink)**

So at the start of the year, by April 1, you need to have your homestead exemption filed if you are currently living in the home you purchased the year prior.

EVALUATION PHASE:

Jan-late March is the evaluation phase. Around April you will get a letter in the mail with your tax appraised value if:

  • the appraised value of the property is greater than it was in the preceding year $1,000 or more;
  • the appraised value of the property is greater than the value rendered by the property owner; or
  • the property was not on the appraisal roll in the preceding year

EQUALIZATION PHASE: 

April through July for the most part–

After you get the letter in the mail, you may protest your taxes.

If you paid less for your home than what the taxing authorities are saying it is worth, it is fairly easy to get your taxes reduced by showing them your final closing statement.

**However!! Fun Fact: Texas is a Non-disclosure state! So let’s say after you close on your home you get a piece of paper in the mail, it looks official and it asks, “What did you pay for your home?” send this back in to us…You, as a Texas Resident do NOT have to report what you paid for the home.**

There are two hearings to arguing your taxes-an informal and a formal. Basically if you don’t get your way in the informal (which you can send in the piece of paper- ON TIME), you can request a formal. You present your comparable sold properties and explain your case as to why you should not be taxed as much as you were. (This is where I come in! As your/a realtor, I can try to help you find homes similar to yours and what they sold for to help your case).

DISCOVERY PHASE

And finally August through the end of the year is the discovery phase for the following year.

After the inquiry/protest season concludes, the appraisal process transitions to the data collection and analysis phase. During this time, appraisers may be seen throughout the County in neighborhoods and commercial areas as they are measuring new residential or commercial construction, reviewing and updating characteristics of existing construction and/or land parcels, and reviewing, updating, or adding inventory of present or new businesses. Yearly updated aerial imagery, digital field devices for data collection, and GIS analysis tools are utilized to assist in staff efficiency, and ensure proper valuations and equitable results during the assigned/limited time for this phase. This process requires collection and analysis of three types of data:

General data, which affect values on national, state/regional, or neighborhood levels.
Specific data, about the site and improvements of a property.
Comparative data, which regards recent sales, cost, and income information for similar properties.

If this is still all over your head, this chart may help explain and is where I got most the information above from (along with past experience): Here is a great Tax Calendar visual to explain.

When your tax bill comes due, depending how your loan is set up will depend on how you pay it. If your money is with an escrow account–meaning you make a payment to your lender that covers: PITI–> principal, interest, taxes,  (home owner’s) insurance. If the value of your home goes up, so will your payment, as your lender will try to “pad” your escrow account so you don’t end up owing more when your bill comes due. Some home loans allow you to make your payment online–and choose if you want to pay extra and if it goes toward your escrow account or principle, which is nice. Or if you don’t have an escrow account (not required for those who put down more than 20%) you can manage your taxes yourself and pay the bill as it comes due.

Hope some of that information helps and if any additional questions, feel free to drop me a line.

AshleyBrinkman@realtyaustin.com

As always, thanks for reading!

Adventures of Air BnBing

As some of you know, if you follow me on Insta and the like…I bought a home this year.

I had no intentions of getting a roommate really (I have lived alone for so long, there sure are a lot of perks to living solo!) But then a friend of mine was relocating down here, so I said she could stay with me until she found a new job.

Welllll, her home hasn’t sold yet (Sorry Amber!) so in the meantime I thought–hmm. I should put my house/room on Air BnB and see what happens.

airbnb logo

Well, a lot has happened, actually. And here’s my experience…In a nut shell.

nutshell

A: Aren’t you afraid of getting murdered or someone stealing your stuff??

Q: No, not really.

If you know me, I am pretty trusting aka naive-whatever adjective you prefer. I approve who stays by seeing their profile photo, their reviews from other hosts, how long they have been a member and how many verifications they have. They pay a $500 deposit (this can be altered based on the reservation) if something were to happen and I make a claim within 48hrs, however most people are visiting and just need a place to crash. To be honest-I think the kitchen has been used maybe four times since I started renting it out back in October.

Q: Don’t you have to have a permit or something in Austin?

A: Yes, yes you do.

You can find the STR permits here on the City of Austin website. FYI they are still issuing permits for people who are the primary resident, but if you own an investment property and don’t have one yet-I hear there’s a wait list until 2017, but that may be hearsay. Because I live by the Domain, when I checked the map, mine was in the area AND there were 46 permits left-so I was golden.

Q: How much do you make off Air Bnb?

A: It varies, really.

December I only made around $350, but I also didn’t feel like renting out my space, I was swamped with work, holiday crafts and hosting my own friends. However, in November because I was gone for 10 days I rented out my home three different times, paid a friend to check on it in between guests and change sheets (what a peach!) and rented out the bedroom here and there-that month I made $775!

Q: So, wait-you rent out a bedroom WHILE you live there.

A: Yep.

Again, I like people, I don’t mind it. I like giving people tips on where to go and what to do. If I get the creepy vibe–(which I haven’t yet)–I have my own office, my own huge master with attached bath, so it’s not like we are on top of one another. And again, I have found most my weekday guests are contracted to do work, they’re gone all day as I work from home most the day. Then when they come back to the house in the evenings, I am usually showing properties, at the gym, grocery shopping our eating with friends, so I don’t see much of my guests when they are here.

DSC_1461

Q: Aren’t you worried about your dog?

A: Only her getting stolen.

Everyone loves #GoodGollyMissMollyMaltipoo. I have a disclaimer before I rent it to ANYONE–“I have a dog, she does not shed, she is super sweet, but if you leave the door open she will come in and steal a sock or lick you to death-she is a puppy still. You can feel free to play fetch with her and pet her or just ignore her.” I think after people check out they like her more than me, but Molly has never had a bad review, thankfully. Once, a guest got to my house before I did, I texted him asking if everything was ok. He texted me back a picture of him on my couch on his laptop and Molly snuggling next to him. Another guy from Louisiana came to stay a few nights. I never say him the first day, but the second evening when I got home he helped me string lights for my Halloween party in the back yard, we talked about everything and he took about 4 photos of Molly and sent it to his wife saying “we need to get a dog like this.” haha. I love it and honestly I think it is good for her! She is so social and loving. Ever since installing the doggy door-that is a nice big help too!

IMG_0137

(I know, I am ridiculous, but how can you not like that lil fur ball?)

Q: You are a single female and you rent your spare room to men? Are you nuts?

A: I do. And maybe?

I didn’t want to at first, but truth is, more of them are traveling for work. I usually get a “they aren’t a murderer” vibe and check reviews, then rent to them. I once got an inquiry from a guy to stay a few days and he didn’t have a photo nor reviews. I wrote him back and said, “I am sorry at this time I do not feel comfortable renting to you but best of luck.” It’s as simple as that. And honestly, I didn’t have to even write him. I could have just hit “decline.” But maybe my note will make him realize he needs to get a profile picture and more on his profile! He did write me back saying he had two daughters and he understood.

Q: Do you have to keep your home all clean?

A: It helps with reviews.

The good news is renting out the room and house to various people helps keep me in check. I do keep cleaner, but I like it! I will say renting out your home before you leave on vacation can be a bit extra stressful. Laundry, packing, making sure biz is covered AND cleaning up house, taking out trash, leaving directions, re-making beds and locking up my items–it’s a lot to do.

packing stress

 (This isn’t me, but let’s pretend it is. Thanks Google images-a girl stressed from cleaning and packing, like me…before a trip)

Q: So, you let strangers sleep in your bed?

A: Yeah, it’s not that weird to me.

Not in my sheets though. I bought some extra sheets, blankets, pillow cases and throws for my guests and so I can keep my own for me. I installed a key lock on my master closet, office and pantry (hey, can’t have the guests getting into my Tito’s), with that I keep valuables, my sheets, work stuff, and for some reason toilet paper and paper towels all locked up (hey I can’t have them stealing more than what they need). I realize some people think that is weird, but ever stay in a hotel? Remember your dorm room mattress? Wonder how many people slept in that thing before you…

Q: Do you have to pay taxes on the money you make?

A: Yep!

If you rent out your home for more than 14 days in a year you do have to pay taxes. I fortunately have a CPA, she told me to save ALL my receipts related to the rental. I am already used to paying a shit ton of taxes, so this is nothing new. I keep track of my Tuesday Morning and Marshall’s purchases (where I buy all my bath towels, sheets, blankets etc). And yes, sometimes I go there just to buy guests items because shopping for home stuff is fun.

Q: Any bad experiences yet?

A: Actually, nope!

I went to a short term rental seminar/class a few years back and a I picked up a few pieces of advice that I use(d).

  1. I keep the house really clean upon arrival, fresh sheets, vacuum, clean dishes, dusting even.
  2. I personalize it some but not fully. {For example: If you were renting my home you’d know what I look like, where I traveled and see a few family pics. You will not find the pics of me partying, with my friends on a boat or at ACL–I take those down. Reason being, people tend to respect someone’s space when they get a feel for who they are/what they are like and that someone lives in the space, which I already make known in my replies to an inquiry
  3. I leave little notes for my guests everywhere! {Notes such as “help yourself to anything in the fridge but eat at own risk!” or “feel free to use any travel toiletries in bottom drawer, extra blankets and sheets are in trunk in living area.” I also instructions on how to use the remote/ TV in living area, reminders to turn off back patio lights, etc. I also write a note to the guests when I leave wishing them a good time, etc. with my cell in case they need anything. I think it helps.

DSC_1438

Q: Do you use professional photos or anything?

A: They aren’t “professional” per say.

I used my camera and flash one night after having the place all cleaned up. I took a bunch of photos and used those, then if I set up an air mattress or something I take a photo and add to the folder. It’s been a slow and steady process. The more you have, the more likely people are to stay with you. I also have photos of things near my home (Domain, metro, etc) and I used the fact it was on HGTV as a selling point!

DSC_1521

domain2

 

kramerstation1

Q: Isn’t it weird having people use your stuff-has anyone taken anything?

A: Not that I am aware of.

I could eat my words in the future here, but it’s just “stuff” at the end of the day..then again my place isn’t super decked out in anything crazy expensive or nice, but things are things and they can be replaced (some of them anyway). Would I be upset if something happened? Absolutely, but I try not to focus on the bad and the “what if’s.”

Q: What about home owner’s insurance?

A: I spoke with my insurance agent, I am good.

I heard crazy stories and started thinking absurd things that could happen to my house while out of town…so I gave her a call and between that, the Air BnB policy and the fee I charge to hold for damages etc, I am good…maybe not totally covered if something crazy happens, but are we ever in life??

Q: How do they get in once in Austin?

A: We keep in touch, but I usually shoot instructions over just once.

After you accept them as a guest on Air Bnb you then have their phone number etc. I usually text or keep messaging through the app, but I have a key pad on my door. The code will get them in the door and then I have a spare key once here in case that doesn’t work. I really want to get the new August locks. You can get in with your phone, it is bluetooth and I can easily change the code when I want, I don’t have the best method right now. But I do have an alarm.  I also have a Nest so I can monitor thermostat from my phone (not that I would change it on my guests, but good to see!)

August locks

Q: How do you know what to charge?

A: Honestly, Air BnB has some suggested pricing, so I typically go by that.

After the first three guests stayed with me they had all made comments about my place being nicer than other places they stayed and how I should charge more. So I bumped up pricing a few bucks here and there and then I definitely increased it for heavy weekends like SXSW, ACL etc. Sometimes if I have an inquiry for a weekend that I wasn’t planning to go out of town (ie graduation weekend in May) you can write them back a “special offer.” It has worked for me twice now. I explain why I want more and that I am still cheaper than a hotel. Boom, Booked. Maybe those are my real estate negotiation skills coming into place

Q: Where do you stay when your home is rented out?

A: Well, I stay with friends or I am out of town/the country.

I will say I stretched myself last year (weird, I never do that–sarcasm) thinking it wouldn’t be a big deal to crash with friends for a few days. I even worked out a deal with my best guy friend, offering him a cut when my place was rented and I could crash on his couch. After the second weekend rental I decided that’s no way to live! What was I… 22? I felt like I was burdening my friends and living out of my car and it’s not like I was making a mortgage payment in two days or anything. In fact, a cold front blew in one weekend and I had to go back to my house to get the right clothing, fortunately my guests didn’t care. So, my new 2016 method: Only rent the house on weekends I plan to go out of town and keep my calendar up to date. Which is difficult. I already have it rented out two weekends where I have no plans to leave town (but all the more reason to book a weekend trip, right?!) I will say it was really nice in November when I was in Central America getting Air BnB texts that money was being transferred into my account and my friend telling me the home was spotless. Yay!

Q: Are you planning on using Air BnB as a traveler?

A: Absolutely!

I find having a bunch of reviews, as a host or traveler is beneficial. I had inquired about a condo in Tahoe, asking a question and the woman approved me off the bat, so that helps. Portland, Seattle and Vancouver I used Air Bnb and I really enjoy staying in the neighborhoods, visiting local spots in the area, it can be better than staying in a hotel downtown (and cheaper) depending where you are going.

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(the darling neighborhood we stayed in Portland, on Air BnB)

Overall Air BnB has been a positive experience for me, but I also enjoy meeting new people. Some people are so nice, text me on their way in “do you need anything, I am grabbing ice cream.” And leaving nice little notes in my little notebook I have on the entry table. I like to talk to people that travel, see where they have been (though most aren’t that far away and looking for a little getaway) and I want people to enjoy Austin (but please don’t move here, haha). I like to tell them where to go, what to do and I recommend Localuer to them as well, as I like to travel. Is it always the most convenient? Now, at times I remember I have a guest and can’t blast the music as I get ready in the morning, or I tip toe in late at night so my shoes aren’t loud on the wood floors, but in the grand scheme of things, it’s been good to me. It’s like the perks of having a roommate sometimes, without having a full time roommate-it’s pretty awesome. They pay you. They aren’t home all the time, they typically leave it pretty clean, never use the kitchen or WD and have loud music playing etc. and you only have them in your home when you want them. I’d say it’s a pretty sweet deal!

localeur

(Localeur logo–which actually was created before Air BnB updated their logo, FYI).

I can’t really think of anything else I haven’t covered, but if you have any additional questions-feel free to ask, PM me or email me (AshleyBrinkman@gmail.com)

How to buy your first home: A Breakdown of the Process of becoming a Home Owner

Even though these steps are already listed on another tab on my website, I thought it couldn’t hurt to also blog about the steps since I seem to be working with so many buyers right now, which is great because it is only January, interest rates are still low and Austin is still doing great!

I love working with buyers.

There’s always a few obstacles, but there’s something about researching to find the best option for my clients that I love (of course, there are always those who have already done their homework online and know what they want), but I’d say the hardest part is the “break up.” I mean it is kind of awkward. You spend so much time emailing, discussing options, driving and looking at properties together, then you make an offer, wait until it closes and then that’s it. I don’t really see or hear from my clients anymore but always want to and try to keep in touch. I guess it could be considered a “friendly/on good terms” breakup, and those are the best kind.

First off, before the 8 steps, can I just add that due to the financial situation we are in (the “lending crisis”, the “housing crisis” you hear mentioned on the news), lending regulations and guidelines have strengthened and there is a lot more red tape that comes into play when getting a home loan. Austin and Texas in general have remained strong and economically are better off than the rest of the US…so that is always good to hear.

For example: you will want at least 3.5% saved up to put down on a home…and really, you want more, for 1. reserves and 2. closing costs.
How will I know what I am approved for? 
A lender will tell you based on income, debt to income ratio and overseeing your credit and employment history as well.
Is it ok if I talk or shop more than one lender?
Absolutely. You can always start with your bank (if you have banked with them for a long time), but in my personal experience have found it is better to deal with a mortgage broker. Often times I recommend a few lenders to any first time buyer, whom they feel more comfortable with regarding confidence, personality and rates is up to the buyer to move forward with in helping them process their home loan.

What are closing costs? And what do they usually run me?
Closing costs are “the cost of doing business” and the money you need to bring at closing (when signing a million documents to your new home purchase).
Estimate for closing costs 4-6% of the sales price. It will vary if a seller or buyer pays for closing. Often times if a seller refuses to pay for closing costs, a buyer can roll it in to the price of the loan, should they not want to bring that much to the table (aka closing).

What else will I need to prove to buy a home?
Depending on the loan program, you will need a credit score around 640. If your credit is lower, than often times it can take someone reviewing your credit report, and anywhere between 3-9mo to establish better credit.
Tips for maintaining great credit: Several different lines of trade (i.e credit card, car payment, furniture lines). Paying on time (this is the BIG one, that can really hurt you if late). Paying over the minimum amount. No delinquencies. Keeping your credit card balances at 30% or less of the total limit. If you have a credit card open, but never use-charge at least one item per month on the card and pay it off. Lines of trade that aren’t recent (the longer established lines of credit show that you can month after month manage credit, pay on time and be responsible for your charges). No debt in collections.

What are some other costs, as a buyer, I will be expected to pay?
Once you find the home you like, it is a very good idea to get in professionally inspected. You are looking at a few hundred dollars, depending on the size of the home, and arranged between the buyer and inspector. Even if the home was recently pre-inspected, it is always a good idea to still get another inspection.
Also, the appraisal. Once under contract and inspection looks good, the lender will need to make sure the home they are about to lend on appraises for that amount, this is usually charged to the buyer as well and arranged between buyer and lender.

You will also need proof of income. Independent contractors and small business owners/people who work for themselves, need to have income proof of at least two years to buy a home. Steady income can be hard to prove to receive a loan, so make sure you keep an accurate track record of your finances, while also accounting for taxes and saving for your first home purchase. You also don’t want to make a big career change right before you buy (after perhaps), but if you do decide to make a change, it is much easier and more explainable if in the same field.

So, you have had steady income, your credit looks stellar, you are tired of apartment living and rent going down the drain, what’s next?

Steps To Buying Your First Home:

1. Decide to Buy
  • There is never a wrong time to buy the right home. The key is finding a good buy and taking the time to carefully evaluate your finances.
  • A home purchase is an important step in the path to long-term wealth. Purchasing your own home is a great investment that provides specific financial advantages, including equity buildup, value appreciation potential and tax benefits. It’s also an automatic savings plan that you cannot get from renting!
  • You don’t have to know everything. Let me help you and walk you through the process.
2. Hire an Agent
A great real estate agent will:
  1. Educate you about the current conditions of the market.
  2. Analyze what you want and what you need in your next home.
  3. Guide you to homes that fit your criteria.
  4. Coordinate the work of other needed professionals throughout the process.
  5. Negotiate with the seller on your behalf.
  6. Check and double-check paperwork and deadlines.
  7. Solve any problems that may arise.
3. Secure Financing
Ultimately, your lender will pre-approve you for a certain amount, but YOU will decide what you’re comfortable paying every month. Remember, your lender only sees your finances on paper. It’s up to you to decide how much you’re willing to stretch your budget in order to get into your dream home.

Be sure to follow these six steps to financing your home:
  1. Choose a loan officer (your agent may be able to recommend a few)
  2. Complete a loan application and get PRE-approved.
  3. Determine what you want to budget monthly and select a loan option.
  4. Submit to the lender an accepted purchase offer.
  5. Get an appraisal and title commitment.
  6. Obtain funding at closing.
4. Find your Home
So you are pre-approved and ready to begin your search. But how or where do you begin? There are a lot of homes out there and diving in without a guide can become overwhelming and confusing. A great agent will help you more accurately pinpoint homes that fit your criteria and budget. The right home will meet all your important needs, and as many of your additional wants as possible. An agent can guide you in the right direction if you are unsure.
You’ll learn as you look at homes, your priorities will probably adjust along the way.
5. Make an Offer
Once you’ve found a home you love, the next step is making a compelling, educated offer. While emotions are probably in high gear once you’ve found a home you love, it’s important to remember that a home is an investment. Your agent will research similar properties in the neighborhood to help you determine the market value, and fair price, for your home. Look to your agent to explain and guide you through the offer process.
  • 3 basic components of your purchase offer: price, terms and contingencies.
  • Price is the dollar amount you are approved for, willing and able to pay.
  • Terms cover the other financial and timing factors that will be included in the offer.
  • Contingencies are clauses that let you out of the deal if the house has a problem that didn’t exist or which you weren’t aware of when you went under contract. They specify any event that will need to take place in order for you to fulfill the contract.
6. Perform Due Diligence
Just because you love a particular property doesn’t mean that it’s perfect. In fact, this is where reason has to trump emotion. You’ll need to have a property inspection (which your agent can recommend a few, and they will go over their full report in detail and any hidden issues). This way you’ll know what you are getting into before you sign closing papers.
  • Your main concern is the possibility of structural damage. This can come from water damage, shifting ground, or poor construction when the house was built.
  • Don’t sweat the small stuff. It’s the inspector’s job to mark everything discovered no matter how large or small. The inspectors report may be long, but, things that are easily fixed can be overlooked for the time being.
  • If you have a big problem show up in your inspection report, you should bring in a specialist and if the worst-case scenario turns out to be true, you might want to walk away from the purchase.
  • Even if your home passes inspection, you’ll still need to buy a home owner’s insurance policy that protects you against loss or damage to the property itself and against liability in case someone sustains an injury while on your property.
7. Close
Once you’ve made your offer and have completed the inspection process, you’re in the “home” stretch! But, in order to ensure that you don’t put your closing date, or your mortgage at risk, you have a few pre-closing responsibilities that you’ll need to be mindful of. These include:
  • Staying in control of your credit and finances. If you are tempted to make any large purchases during this time, it’s best to talk to your lender first.
  • Keeping in touch with your agent and lender, returning all phone calls and completing paperwork promptly.
  • Communicating with your agent at least once or twice a week, and verifying with your lender that all mortgage funding steps are completed.
  • Conducting a final walk-through of the home with your agent.
  • Confirming with your agent, home insurance professional, and lender that you have the settlement statement, certified funds, and evidence of insurance lined up prior to closing.
8. Protect Your Investment
Congratulations, and welcome home! The home-buying process is complete, but just like any big process, there’s a maintenance plan! It’s now your responsibility, and in your best financial interest, to protect your investment for years to come. Performing routine maintenance on your home’s systems is always more affordable than having to fix big problems later. Be sure to watch for signs of leaks, damage, and wear.And remember, just because the sale is complete, your relationship with your agent doesn’t need to end! After closing, your agent can still help you – providing information for your tax returns, finding contractors and repair services, tracking your home’s current market value and when you are ready to buy again and sell!

I reiterate these steps on my website as well, and maybe all this reading can seem quite overwhelming, but so long as you are ready to take on the financial responsibility, and can afford to, as I mentioned before–there’s never a bad time to buy the right home. You can find reviews from some buyers (first time as well), by clicking on my reviews on the Zillow website here! First time and in the Austin area? Call me, I am happy to help and walk you through the process. I love helping buyers.

Area 2 Under 2

In the Austin market there are many great neighborhoods. And when people start to catch on…and they have for many years now, these neighborhoods get more expensive. I have a lot of friends that are first time buyers. A lot of my first time buying friends have got a bang for thier buck and moved South, or to up in Pflugerville. What is their biggest complaint? “We are too far from town now.” I see my friends less because they had to move to an area they could afford…or so they think.

Well, there are many parts of Austin that appeal to certain Austinites and lately, I have had my eye on a particular area. And though I don’t currently live in the area now, I used to, I am still pretty close and I think highly of it. Area 2 (according to the MLS area for Realtors) is the North Central part of Austin. Confined by Hwy 183, I-35, MoPac and 2222/Koenig Ln. It is comprised of several different neighborhoods, easy access to convenient highways and roads to get where you need to be, as well as your favorite Austin restaurants (for me, Phil’s Ice House, Trudy’s) and shopping spots, and just  minutes from downtown, the Arboretum and a hop to get on 183 to the Airport. Recently I have featured some of these houses (unremodeled and remodeled) on my Real Estate Facebook Page called Area 2 Under 2 ($200,000 that is). I am going to do my best to feature (with permission of course) the area’s homes. For those first (and second time looking to take advantage of the extended tax credit), looking to be in an affordable area, with homes of charm and no charm, older and newer, fixer uppers and already remodeled. Here is  one now and you can find a few others featured on my facebook real estate page as well and the photos of the properties.

www.facebook.com/pages/Austin-TX/Ashley-Brinkman-Austin-Tx-Real-Estate/107679068028