Stratified real estate markets may sound confusing, but don’t let terms like stratification scare you.  It is simply taking an area like a city or region and dividing it out into similar or equal sections.  For real estate, you can take a city or neighborhood and break it out by the value of houses or specific house types.

The reason you want to do this is to help determine if you are about to enter into a buyers’ market or a sellers’ market.  By looking at your target area in stratified segments, it can help you to make a decision on whether it is time to buy or sell a home, or wait until the market changes to your favor.  Ready to learn more?  Here is how to stratify your area and determine what you should do if you’re looking at buying or selling a home.

What is a Stratified Market in Real Estate?

A stratified market in real estate is when you take a city and divide it into classes based on home value and type.  Because homes in many cities can have drastic differences in price (they can range between $20,000 and $1,000,000+), the buyer base and housing availability for that base can change making it harder to determine when to buy or sell.  The same can be said if you have condos vs. homes for families with kids, and what types of home buyers are moving in and out and at what pace.

To get a stratified market, start by looking at what the value of the home you want to buy or sell is.  Next take a random sampling of houses that match both the price range and type (single family, row houses, condos, beach homes, etc…) and look to see how many are on the market.

Now look to see how long they’ve been on the market, if the prices keep going up, stay steady, or have been getting marked down.  Now you know if the type of property you’re looking to buy is in demand (a sellers’ market), or if there are more for sale then there are home shoppers (a buyers’ market).

Using Stratification To Determine When to Buy or Sell

Once you have the area you want to buy or sell a property in broken out into groups, you can determine if you live in a buyers’ market or sellers’ market like we outlined above  If you are looking to buy a single family home for $250,000, but keep hearing it’s a sellers’ market, check first to see what is actually selling and what isn’t moving much.

It could turn out that there is demand for luxury homes over $750,000 that are on a golf course or the beach.  Within that same area, the homes which are close by the beach but not directly on the water, and that are in your price range may not have moved.  That means the luxury real estate market is for sellers and the regular price range is a buyers’ market.  That is why you may hear one real estate agent say it’s a sellers’ market and another say it’s a buyers’ market.  Both may be true, depending on the real estate market stratification.

By creating stratified groupings, it turns out that the luxury markets are for sellers because you have overseas investors buying them up, wealthy people moving to your area for work, or any number of reasons.  But a nice home that is within your price range, and stratified group, is a prime investment and now is the perfect time to buy.

These types of examples are more common along the coastal cities in Florida or California where it is easier for people in other countries to buy properties as investments in the USA and let them sit.  They want the land on the coast where their money can be stable while other people are looking for a place to live that is safe and has desirable amenities like schools, dog parks, and all of the things which would cause someone to want to live there.  But it also occurs in the midwest, the south and other regions of the United States.

If you’re looking to find out whether you should buy or sell, start by using stratification.  Once you have a stratified real estate market, it’ll be easier for you to determine what your next move should be.  Buy or sell a home, or wait for the right time when you can get the best bank for your buck based on your needs.

Staging a condo seems easy enough, but how can you use the space to turn more lookers into offers?  We’ve got you covered.  Below you’ll find nine unique tips to stage a condo (or home).  By using these unique strategies, you may be able to turn more lookers into offers on your listings.

• 9. Remove All Allergy Related Decor.

  Empty windows and tables with no accents or decor are dull.  But during allergy season, someone who suffers needs an escape from all plant life.  Instead of flowers which can be associated with sneezing, itchy eyes and being uncomfortable, think about things that create a calming and homelike feel.  Window ledges are perfect to stage a place to sit or as a space for books.  You could even place  a small table in front where you display a statue.  Dining tables can use candles and tasteful sculptures as a substitute instead of a bouquet of flowers or a plant.  The best part is these can be saved and reused where a plant will die and need replaced.

• 8. Use Window Blinds to Display a View and Close Off a Wall.

  Recently I was helping a realtor stage a condo, and the living room had two giant windows.  One with an open view and one with a partially blocked one.  Both windows were wide open which to me made the space feel smaller and less friendly.  I recommended we close the partial view window and place a large piece of furniture or changing screen by it so that as the buyer moves through, they see the view from the unobstructed window and not focus on the window which was half blocked by a brick wall.

  Potential home buyers were not discouraged from seeing the partial view, but we made sure to close the window blinds after they looked so when the next person comes in, and as the current potential buyer leaves, both see and remember the best of the condo and that is what sticks with them.  Not a partial brick wall and a partially obstructed view.

• 7. Use Mirrors and Open Doors.

  City life can feel claustrophobic and condos aren’t always the largest spaces.  By changing out some artwork for mirrors, you can help people feel like there is more space and they are less closed in.  The same goes for doors.  Keep them open, even the bathroom doors, can open the flow of the room.  But make sure to turn on the lights.  When the traces of light come in and out, you make the space appear to have more flow which can create a feeling like there is more room than there actually is.

• 6. Prevent the appearance of sloped, curved or slanted floors.

  It’s a bit awkward, even if there are zero foundation issues, to see floors which look or feel slanted and sloped.  I was walking through a condo with a real estate agent a couple months ago and notice the floors appear to travel down at an angle, but they actually weren’t.  By placing a large area rug at an angle, a couch not against the wall, and creating a sitting area that was not following the lines of the walls we got rid of the effect making the space feel more comfortable for potential buyers.

• 5. Do Not Overpower the Space.

  Condos and some houses have very limited space.  If the furniture and artwork you use to stage the rooms take away from the actual area, insteading of bringing the buyers eyes to the room itself, the deal could fall through.  Use decor and furniture to complement the area, not the other way around.

• 4. Use artwork and interesting items to hide flaws.

  No property is perfect.  Some units or rooms have flaws that can be easily fixed once the home is purchased like a scratch in a floor or broken piece of molding.  There is nothing wrong with adding something that has visual appeal to distract from these temporary and easy-to-repair flaws like an interesting lamp or conversation piece.  Just make sure it doesn’t also distract from the selling points like we mention in the tip above.

• 3. Use the Weather Outside to Create a Welcoming Atmosphere.

  If it is raining outside or chilly, provide hand warmers, paper towels to dry the visitors wet face or hands with, and some hot cocoa at the entrance to the unit.  If it’s sunny, place cold bottles of water, iced tea or lemonade with a bucket of ice, or other cool and refreshing consumables at the entrance.  If it is spring or fall and allergies are bad, have small packets of tissues the visitors can take with them that also have your business card.  By doing this you help to create a happy and welcoming feeling for the potential shopper as they enter their new home.  As they consider and remember what they saw, they’ll remember how warm and inviting it was from the time they entered to the time they leave.

• 2.  Remove Any Signs of Pets.

  From photographs on the walls to pet beds on the floor, pull them out.  This isn’t just about allergies, it is about potential buyers assuming there are pet smells even when there aren’t.  Our minds and senses play a lot of games with us.  If the potential buyer is not an animal lover, they could assume there is a smell that actually isn’t there and that could kill the deal.

• 1.  Bake Cookies.

  You can bring your own batter, or simply buy premade and sliced from the store.  Once you get to the condo, bake the cookies.  Not only does this create a pleasing smell, but it may help to drive a warm, happy and cozy feeling to a potential buyer.  Much like the pets creating fake smells, and city life feeling busy and claustrophobic, a warm childhood memory and the pleasant smell of a freshly baked cookie creates a lasting feel as the person leaves and could help to tip the scales into your listings favor when they make a decision on which home to buy.

Staging a condo is an art form.  You have limited space and you’re competing against a ton of other properties.  Instead of simply throwing in decor with mass appeal, think about how you can create a welcoming and happy experience that causes the potential buyer to feel at home.  By doing this you may be able to convert more lookers into full offers.

When you find the right home, or know what you’re looking to spend, you’ll need to find a mortgage lender.  But before you can get approved for a loan, you have to find the home that you want to buy.  This is when you’ll want a lender to provide you with a Good Faith Estimate (GFE).  A good faith estimate is a form that includes all of the fees, payments, and financial information that you will be provided with by that specific lender.

The Good Faith Estimate Process

The eight steps in the process for a good faith estimate include:

1. First you need to get prequalified by the lender
2. Now you can go house shopping
3. Next you put a contract on the house
4. Once the contract is in place, you submit the pre qualified letter
5. Now the contract is ratified (approved)
6. After ratification, you’ll fill out a 1003 (Loan Application)
7. Next you should get approved
8. Three days after approval, you must receive a GFE from the lender

Now that you know the process, here is some more information to help answer any additional questions you may have about good faith estimates.

You Can Get Multiple Good Faith Estimates

You are not limited to only one good faith estimate.  You can acquire a good faith estimate from numerous lenders and banks so that you can shop for a loan that helps you buy the property that you want and aligns more closely with your wants or situation.

If the first lender gives an estimate, but it won’t cover the home you want, you can get a good faith estimate from another lender who will cover the cost of the property and closing.  You can also use this document to prove that you’ll be able to purchase the property once you are ready to begin closing the deal.

What Fees Are Covered and Not Covered by a GFE

One common question is if a good faith estimate covers closing costs.  A good faith estimate does not contain all of the closing costs, but it may have an estimate.  If you already have the property you’d like to buy picked out, the estimate should be more accurate than if you are still shopping for a property.  Because you can choose your own closing agent, the price could vary which is why you get an estimate and not an exact number.

A good faith estimate does include the costs of the loan, the terms of the loan, and almost all other finances for buying a home and using a lender.  Other fees which will not be included in your GFE include a title insurance policy, additional inspections, and other miscellaneous items.

Talk to your real estate agent, or the closing and settlement agent to find out any additional fees which may not be covered by the lender or in the GFE.

Bonus tip: You get to choose your own title, closing and escrow companies.  By shopping around you can find a great deal and sometimes lower some of the expenses when buying a home.

In some cases, and depending on how you negotiate when shopping, the seller of the house may be willing to pick up some of the costs outlined in the GFE, but that will depend on how quickly the seller wants to sell and your specific situation.

Where to Download a Sample GFE Form

As mentioned above, the GFE is a form you are provided with.  You can find a sample and download a good faith estimate form on the HUD website by clicking here.  The good news is you do not have to fill this out yourself.  It is handled by the lender.

A good faith estimate is not as scary as it may look when you first see it.  Your real estate agent and closing company look at these regularly and should be able to assist with any questions you have.  If you don’t feel comfortable asking them, we are happy to help.  Contact us at info@atgtitle.com and one of our professional closing agents will be happy to alleviate any worries you have, and walk you through how we can help you with a hassle-free closing.

When buying a home, whether it’s your first or third, you’ll be asked if you want a title insurance policy, and probably be looking at homeowner’s insurance policies too.  Although they may sound the same, especially both the lender’s and owner’s title insurance when combined with the homeowner’s insurance, they each serve very different purposes.

• A homeowner’s insurance policy can protect your home and your belongings in case of damage, but only based on what you agree to when signing. It could be natural disasters, malfunctioning appliances, or losing your home and valuables to fire or burglary.
• A title insurance policy protects your ownership of the house itself, but not the property, land or the items inside. Just your ownership.  But there are two kinds of policies.
  • Lender’s title insurance – this plan protects the lender if you have a mortgage or took out money to buy the property.
  • Owner’s title insurance – this option protects you and your investment in case someone lays claim to the property.

Am I Legally Required to Buy Homeowner’s & Title Insurance?

No, you are not legally required to buy a homeowner’s or title insurance policy.  But there are many things which can go wrong, and if you want to have your house and your land protected, you will want to consider both policies.  With that said, it is also not legally required to get a lender’s title insurance policy either, but it may be required by the lender if you want their money.

Just like how you want to protect your property, money and yourself; lenders including banks and investors want to protect their companies and their assets.  By loaning you money, a lender’s title insurance policy provides them with a security blanket in case something goes wrong.  Many lenders add a stipulation to the loan that you must purchase a lender’s title insurance policy, but it is not a legal requirement.  However, if you don’t get it, they may not give you the money to buy the property.

Now that you know why they are both important, there is another frequent question that comes up.  Can the insurance policies transfer to someone else?

Whether it is a significant other, a child, a friend or a family member, your title insurance policy cannot transfer over, but they can purchase a new policy during the closing when they inherit or purchase the home from you.  Homeowner’s insurance on the other hand may not need to be repurchased depending on the situation.

If the other person’s name is already on the property, you can also have them sign or be added to the policy.  Now if the worst happens, you won’t have to worry.  The other question is about transferring the two policies.

Title insurance cannot be transferred to a new home if you move or buy a new house.  It only protects the deed on the property it was meant to cover.  Your homeowners insurance policy however could be applied to a new home.  The insurance company that wrote the policy may need to adjust it, but the process is pretty simple.

There are a lot of similarities in the names owner’s title and homeowner’s insurance, but as you can see they are very different.  One covers your home and the items inside, the other covers your ownership of the land and house.  Neither one is legally required, although this could change at some point, but they are both recommended.

When you find the right home, or know what you’re looking to spend, you’ll need to find a mortgage lender.  But before you can get approved for a loan, you have to find the home you want to buy so that you can find out if you’ll be approved for enough to cover the cost of the home.

Sounds like a double edged sword huh?  Don’t worry, it’s actually pretty easy because you can have a lender provide you with a Good Faith Estimate (GFE) as long as you have a reasonable idea of what you are willing on a house or property at a maximum.  It is a fairly painless and quick process.  Having a Good Faith Estimate or GFE also lets sellers know you’re serious and will have the capital to purchase the property.  This is especially important in competitive markets.

The Process of Getting a GFE is:

1. Get prequalified thru lender
2. Shop for and find house
3. Submit contract (k) for sale
4. K gets approved
5. Fill out loan app (1003)
6. Lender approves 1003
7. Lender has 3 days after approval to issue to borrower GFE
8. Covers estimated closing and most importantly estimated monthly payment

But what happens if you don’t get approved for the amount you need, or the loan estimate doesn’t seem fair, you don’t have to worry.  You are able to get multiple GFEs from multiple lenders.

What is a GFE and What Does it Look Like?

A good faith estimate is a form that includes all of the fees, payments, and financial information that you will be provided with by a lender. As stated above, you are not limited to only one good faith estimate.  You can acquire a good faith estimate from numerous lenders and banks so that you can shop for a loan that helps you buy the property you want and meets your specific needs.

Which Fees Are Covered and Not Covered by a GFE

One common question is if a good faith estimate covers closing costs.  Yes, your good faith estimate is inclusive of closing costs, the loan, the terms of the loan and almost all other finances for buying a home and using a lender.  Some of the fees may be an estimate if you do not already have the property picked out, but if you do, it should be close to accurate.

However, title insurance, additional inspections, and other miscellaneous items may not be included.  You’ll want to talk to your real estate agent, or the closing and settlement agent to find out if there will be any additional fees that may not be covered by the lender or in the GFE.  This is because you can choose who your title, closing and escrow companies are.  By being able to choose you can potentially save money, and because you may not have one picked out when getting the GFE, the lender will only be able to estimate based on industry averages.

In some cases, and depending on how you negotiate when shopping, the seller of the house may be willing to pick up some of the costs outlined in the GFE, but that will depend on how quickly they want to sell, and also on your specific situation.

Where Can You Download a Sample GFE Form?

As mentioned above, the GFE is a form you are provided with.  You can find a sample, and also download a good faith estimate form on the HUD website by clicking here.  The good news is you do not have to fill this out yourself.  It is handled by the lender.

A good faith estimate is not as scary as it may look when you first see it.  Your real estate agent and closing company look at these regularly and should be able to assist you with any questions or concerns you have with the good faith estimate form.  If you don’t feel comfortable asking them, we’re also able to assist.  Contact us at info@atgtitle.com and one of our professional closing agents will be happy to alleviate any worries you have, and walk you through how we can help you with a hassle-free closing.

One of the most common concerns people that do not buy title insurance policies have after they have purchased their new home is, “what happens if?”.

What if the person who sold it to me owed money and there is a lien on the house that wasn’t detected?  What if they bought the home from a previous owner who had a child out of wedlock, and that child was an unknown heir and decides to make a claim?  There are a ton of concerns that can make you regret not buying a title insurance policy before you close on the home.  That leads us to one of the most common questions.

Can You Buy Title Insurance After Closing?

Yes, you can buy a title insurance policy after you have already closed on your new home, and you can still purchase a policy after all of the paperwork has been completed.  But waiting until after you close is not always a good option.

If you wait until after the closing of the house is complete, any issues arise after the closing, and before you buy the title insurance policy may not be covered.  That in between time frame is a lot of the risk you take on.

That’s why you’ll be encouraged to purchase a policy before leaving the closing appointment.  Having the policy before closing isn’t just for you to have a peace-of-mind, it is to help protect you for that in between period where you weren’t sure if you wanted a title insurance policy or not.  Here are a few examples of where buying a policy before closing, instead of after, gives you the protection for those “what if” questions.

Suppose the title company checked public records like they are supposed to, and everything was clean.  The closing appointment takes place and the deal is done.  A few months or a couple years later it turns out that someone filed a few papers wrong and went back into the files to correct the issue.  Now there is room for a problem which was previously undetectable and the title can be challenged.  Because this filing error happened after the closing, and before you purchased a policy, you may not be covered.

Another situation is if a previous owner (it doesn’t have to be the person you bought the house from) owed a contractor some money.  It could have been for repairing the foundation, fixing a wall or anything.  The accounting team discovers there is money owed and places a lien on your home.  Because this was something the title company could not detect, and you did not buy a policy before they cleared the deed, your new title insurance policy which was purchased after your closing may not protect you.

In answer to your question, yes can you buy title insurance after closing.  But it is not recommended because you’re leaving yourself a gap where if something arises, you may not be protected.  By purchasing a policy before you close, you can reduce this risk and enjoy your new home with a peace-of-mind and help prevent those “what if” thoughts that can cause stress and worry.

When buying a home or new property, you’ll be working with both a title company and a settlement agent.  Both sound similar, or that there isn’t much of a difference between their responsibilities when it comes to a title company vs a settlement agent, but both of them have very different responsibilities during the house buying process.

The title company is responsible for finding issues that could arise when transferring the title (proof of ownership) of the house or property you are buying.  A settlement agent’s job is to do the actual paperwork for transferring the ownership of the land.  Depending on the area and state you live in, the Settlement Agent may or may not also have to be a licensed attorney or lawyer.

Now here’s where it could get confusing when comparing a title company vs a settlement agent.

The settlement agent may work for the title company, and the title company may also handle your escrow and closing services.  But this isn’t always the case.

You as the home or property buyer have the right to choose your own title company, and to choose your own settlement agent.  They do not have to be from the same organization.  If you do choose to hire your own title company or settlement agent, you can save money by shopping around.  But there are risks involved with doing this.

Not all title companies and settlement agents provide the same level of dependability and service.  It is also not recommended to choose a settlement agent outside of the title company as it adds more people to the mix.  It also places two separate groups of people together that may not be familiar with all of the processes from each other’s companies or operations. By choosing a settlement agent that works for the the same title company you are using, it can help to make the closing quicker and easier.

One reason for this is if the Settlement Agent forgets a document.  Because the settlement agent and title company are already at their office, and it is the same company with the same system, they should be able to access the missing document and print a new version on the spot.  That is why your real estate agent may recommend one that is more expensive.  It will be a settlement agent and title company that they have a previous relationship with and trust, or they’ll have two selected that can work together seamlessly.  Dependability and reliability are both important if you want a hassle-free closing.

In short, the title company has the job of making sure that the seller is the rightful owner of the property, and the buyer will have what appears to be a clean title and the right to own it.  Once this is done, the settlement agent will complete all the necessary paperwork to make sure that you become the rightful owner of the property.

If you have any other questions about the differences between a title company vs. a settlement agent, email us at info@atgtitle.com or call us using the number at the top of the screen.  And of course we’ll be happy to give you a quote for title insurance and assist with your title, escrow and closing needs.

When you’re closing on a home you’re already expecting mountains of paperwork, confusing contracts that will be presented in legal jargon, and a lot of people asking you to sign things. Some of these people may have titles and work for companies you have never heard of, and that is where closings can get a bit nerve wracking.

The good news is you’ll have people at your closing who are there to explain what each document is, and why it is important.  What may not be clear are the people who have similar job titles, why they work at different companies, and why you need all of them.  One example of this is the underwriters.

You’ll be hearing about the “underwriter” multiple times, but you’ll see different peoples’ names next to the job title.  That’s because there are two people involved.  One will be underwriting your title insurance policy, and the other will be underwriting your loan from a bank or financial institution.  Both work closely with the title company, but they do very different things.

The two types of underwriters you’ll hear about when closing are:

• The financial underwriter – this is the person who will authorize or decline your ability to take out and get approved for a loan. They review the risk the financial institution will take on by lending you money.
• The title underwriter – this underwriter will examine the title and check for possible issues that could arise during and after you get the title for the house, building or property. If they feel the title will clear and you can take control, they’ll be able to approve you for a title insurance policy.

Both of the underwriters work independently of each other, but each play a vital role in a real estate transaction.

First you’ll be hearing from the financial underwriter.  They’ll be looking into your credit history, how much you have in the bank, and all the things which impact you financially from car loans to student debt, and even your employment status.

Once cleared, and you have negotiated on a price to buy a property or home, you’ll select a title, escrow and closing company.  Many times, the title company will be able to handle the escrow and closing as well.  If you opt in to buying a title insurance policy, this is when you’ll come into contact with the title insurance underwriter.

Their job is to look at the total risk in writing a title insurance policy to help protect you in case someone lays claim to your home after you close.  But it is also important to remember that they work for the title insurance company, not for you.

Their job is to protect the title company, by also making sure the title you are going to receive is as clean as possible.  If you don’t have any issues arise, the title company is safe too.  Because of this, if they are open to writing a policy, it can be an extra peace-of-mind that there is less of a risk for someone making a claim on your home.

Although both of the underwriters will be thrown around synonymously, they both play an important, but different role.  If you have any questions about the underwriters and your closing, one of our trained staffed members will be happy to assist you.  Simply call us at the number on the top of the page, or email us at info@atgtitle.com.