Homebuying 102: How to Win in This Market

Homebuyer 102

1-How to win in this market!

a-fast closing

b-appraisal gap coverage up to a certain dollar amount

c-personal letter with pictures

d-escalation clause up to certain amount

2-Appraisal Gap- what does it mean and how does it affect me

a-lenders use the appraised value or purchase price whichever is lower.

b-house is listed at x and that is what the seller and realtor think the value is… offering about that by 15k or 20K could result in the appraisal not having data to support what you offered…you pay the difference in cash!

c-3% or 5% down pay the difference in cash… 10%, 15% or 20% can do mi and not increase cash out of pocket.

3-What will my Return on Investment be on the home purchase..?

200k purchase price 

160k mortgage

5% appreciation

$10k growth

$40k invested=25% Return on Investment

200,000 free and clear home

$200,000 equity

5% appreciation

$10k growth

$200k invested=5%Return on Investment

4-Appreciation expected..

Historical and Forecasted..

Last 61 years average appreciation annually- 4%

Forecasted appreciation over next year 4.62%

5 year cumulative appreciation= 18.1%