That said, that self-doubt manifests itself in several ways. When agents convince themselves that they cannot succeed, they stop taking the actions that are necessary for them to become successful. The most common thing that the agents stop doing is prospecting. Most people hate talking on the phone anyway, and that’s especially true when they are making cold calls. This task seems gargantuan to those who don’t believe that the calls will ultimately result in their success. The failure to prospect is the equivalent to failure to bring in business and, in turn, make money.

The next manifestation of a failure to believe in the chance of success is related to prospecting, but it is not quite the same. One of the axioms of business is that the fortune is in the follow-up. Especially when it comes to purchasing something as important as a home or building for a business, it is extremely important for buyers to build a level of trust with the person doing the selling. That means following up faithfully. Real estate agents who don’t follow up consistently lose business to those who do.

The post Why do real estate agents fail first appeared on Tribitat Homes.

The post Why do real estate agents fail appeared first on Tribitat Homes.

6 Questions to Consider Before You Buy
Your first step is to determine what your long-term goals are and how home ownership fits in with those goals. Perhaps you’re simply looking to transform all those “wasted” rent payments into mortgage payments that give you something tangible: equity. Or maybe you see home ownership as a sign of independence and enjoy the idea of being your own landlord. Buying a home can also be a good investment. Narrowing down your big-picture homeownership goals will point you in the right direction. Here are six questions to consider.

1. How’s your financial health?
Before clicking through pages of online listings or falling in love with your dream home, do a serious audit of your finances. You need to be prepared for both the purchase and the ongoing expenses of a home. The outcome of this audit will tell you whether you’re ready to take this big step, or if you need to do more to prepare. Follow these steps:

Look at your savings. Don’t even consider buying a home before you have an emergency savings account with three to six months of living expenses. When you buy a home, there will be considerable upfront costs including the down payment and closing costs. You need money put away not only for those costs but also for your emergency fund. Lenders will require it.

One of the biggest challenges is keeping your savings in an accessible, relatively safe vehicle that still provides a return so you’re keeping up with inflation.

If you have one to three years to realize your goal, a certificate of deposit may be a good choice. It’s not going to make you rich, but you aren’t going to lose money either (unless you get hit with a penalty for cashing out early). The same idea can be applied to purchasing a short-term bond or fixed income portfolio that will give you some growth, but also protect you from the tumultuous nature of stock markets.
If you have six months to a year, keep the money liquid. A high-yield savings account could be the best option. Make sure it is FDIC insured (most banks are) so that if the bank goes under you will still have access to your money up to $250,000.
Review your spending.You need to know exactly how much you’re spending every month—and where it’s going. This calculation will tell you how much you can allocate to a mortgage payment. Make sure you account for everything—utilities, food, car maintenance and payments, student debt, clothing, kids’ activities, entertainment, retirement savings, regular savings, and any miscellaneous items.

Check your credit. Generally, to qualify for a home loan, you’ll need good credit, a history of paying your bills on time, and a maximum debt-to-income (DTI) ratio of 43%.2 Lenders these days generally prefer to limit housing expenses (principal, interest, taxes, and homeowners insurance) to about 30% of the borrowers’ monthly gross income, though this figure can vary widely depending on the local real estate market.

2. Which type of home will best suit your needs?
You have a number of options when purchasing a residential property: a traditional single-family home, a duplex, a townhouse, a condo, a co-operative, or a multi-family building with two to four units. Each option has its pros and cons, depending on your homeownership goals, so you need to decide which type of property will help you reach those goals. You can save on the purchase price in any category by choosing a fixer-upper, but be forewarned: The amount of time, sweat equity, and money required to turn a fixer-upper into your dream home might be a lot more than you bargained for.

3. Which specific features do you want your ideal home to have?
While it’s good to retain some flexibility in this list, you’re making perhaps the biggest purchase of your life, and you deserve to have that purchase fit both your needs and wants as closely as possible. Your list should include basic desires, like size and neighborhood, all the way down to smaller details like bathroom layout and a kitchen fitted with durable appliances.

4. How much mortgage do you qualify for?
Before you start shopping, it’s important to get an idea of how much a lender will give you to purchase your first home. You may think you can afford a $300,000 home, but lenders may think you’re only good for $200,000 based on factors like how much other debt you have, your monthly income, and how long you’ve been at your current job. In addition, many realtors will not spend time with clients who haven’t clarified how much they can afford to spend.

Make sure to get preapproved for a loan before placing an offer on a home: In many instances, sellers will not even entertain an offer that’s not accompanied with a mortgage preapproval. You do this by applying for a mortgage and completing the necessary paperwork. It is beneficial to shop around for a lender and to compare interest rates and fees using a tool like a mortgage calculator or Google searches.

5. How much home can you actually afford?
Sometimes a bank will give you a loan for more house than you really want to pay for. Just because a bank says it will lend you $300,000 doesn’t mean you should actually borrow that much. Many first-time homebuyers make this mistake and end up “house-poor” with little left after they make their monthly mortgage payment to cover other costs, such as clothing, utilities, vacations, entertainment, or even food.

In deciding how big a loan to actually take, you’ll want to look at the house’s total cost, not just the monthly payment. Consider how high the property taxes are in your chosen neighborhood, how much homeowners insurance will cost, how much you anticipate spending to maintain or improve the house, and how much your closing costs will be.

6. Who will help you find a home and guide you through the purchase?
A real estate agent will help you locate homes that meet your needs and are in your price range, then meet with you to view those homes. Once you’ve chosen a home to buy, these professionals can assist you in negotiating the entire purchase process, including making an offer, getting a loan, and completing paperwork. A good real estate agent’s expertise can protect you from any pitfalls you might encounter during the process. Most agents receive a commission, paid from the seller’s proceeds.

The post First-Time Homebuyer’s Guide first appeared on Tribitat Homes.

The post First-Time Homebuyer’s Guide appeared first on Tribitat Homes.

KEY TAKEAWAYS
Real estate agents put buyers and sellers together; mortgage brokers put buyers and lenders together.
Depending on whom they represent, real estate agents help their clients purchase a property or sell a property, and mortgage brokers help their clients find financing for the property.
Mortgage brokers must study credit reports and lending contracts; real estate agents are less concerned with financial details (other than purchase prices).
Both jobs may require working nights and weekends; compensation for both careers is based on productivity.
Both jobs require obtaining the proper license by the state in order to practice, and keep the license up to date via renewals and further education and testing.
Real Estate Agent
Because the real estate industry can be extremely competitive, if you are want to become a real estate agent, an outgoing personality, a desire to be helpful, maturity, and trustworthiness are essential qualities. A residential real estate agent should also be able to present a house and sell the features it provides in a pleasing manner. A creative eye for design and detail can be a strong asset in this profession.

Depending on whether an agent is acting on behalf of a buyer or seller, the following responsibilities are typical:

show properties and homes
find properties and homes to sell or for buyers
negotiate in between and act as a liaison between buyer and seller
follow the local real estate market
provide financing guidance (in some cases)
The qualifications for becoming a real estate agent may include a background in sales or marketing and at minimum a high school diploma. Every real estate agent must have a license. Depending on the state and agency, additional education in financing and/or housing laws may be required.

The job often requires long hours, and many days of showing houses or commercial property to prospective buyers without a sale, so patience is also a must. If you like events to move quickly and need a paycheck every week, a commission-based real estate agent’s job may not be for you.

People with jobs or other obligations are often occupied during the day and do their house hunting on nights and weekends. As a result, real estate agents must be willing to make themselves available on short notice whenever their clients need them.

The post Real Estate Agent vs. Mortgage Broker: What’s the Difference? first appeared on Tribitat Homes.

The post Real Estate Agent vs. Mortgage Broker: What’s the Difference? appeared first on Tribitat Homes.

Of the two options, the bias often veers toward ownership. It’s big business for everyone from mortgage lenders to real estate agents to home improvement stores, and so we are bombarded with the message that being a homeowner is the key to happiness and part of the American dream. But owning isn’t universally better than renting, nor is renting always simpler than owning. Consider the pros and cons of each to figure out whether renting or owning is best for you.

KEY TAKEAWAYS
Renting offers flexibility, predictable monthly expenses, and someone to handle repairs.
Homeownership brings intangible benefits such as a sense of stability, belonging to a community, and pride of ownership, along with the tangible ones of tax deductions and equity.
Contrary to popular belief, renting doesn’t mean you’re “throwing away money” every month, and owning doesn’t always build wealth “in the long run.”
Renting
Renting means you can move without penalty each time your lease ends, but it also means you could have to move suddenly if your landlord decides to sell the property, turn your apartment complex into condos, or bump up the rent by more than you can afford.

The biggest myth about renting is that you’re “throwing away money” every month. Not so. First of all, you need a place to live, and that always costs money, in one way or another. Second, while it’s true that you aren’t building equity with monthly rent payments, you also aren’t building equity with much of the money you’ll put into owning a house.

When you rent, you know exactly how much you’re going to spend on housing each month. When you own, you might pay nothing more than your mortgage and regular bills one month, and an additional $12,000 on a new roof the next (which homeowners’ insurance may or may not cover). But you’ll never have to pay to replace your roof when you rent. Your monthly, home-related expenses, such as renter’s insurance, tend to be more predictable.

As a renter, though, you do face unpredictable rent increases each time your lease is up for renewal unless you live in a city with rent control and your apartment is covered by it. If you live in a desirable part of town, rent increases can be steep, while if you get a fixed-rate mortgage, your monthly house payments will never increase (though property taxes and insurance premiums probably will).

While homeownership is often touted as a way to build wealth, your home can lose value. Lots of value. The acceptable neighborhood you moved in could decline. A major employer can leave the area, causing a significant population decline and a surplus of housing, or there could be a residential construction boom, either of which keeps prices down. You might buy a house for $200,000 tomorrow and in 30 years find that it’s still worth $200,000, meaning you’ve lost money after inflation.

Another bit of misleading conventional wisdom: Get a mortgage to get the tax deduction. True, the home mortgage interest deduction reduces your out-of-pocket expenses for mortgage interest early in your loan term (and the property tax deduction reduces property taxes), as long as you’re itemizing.1 But tax deductions are not a reason to buy a house. Here’s why: For every $1 you spend in interest, you might save 25¢ on your tax bill. In short, you’re not coming out ahead. What’s more, as you pay down your mortgage and the proportion of your payment that covers interest decreases, so will the tax break.

Of course, renters get no mortgage tax deduction at all. But they can take the standard deduction that’s available to all taxpayers.

Do you like having your evenings and weekends to use as you please? Do you work long hours or travel frequently? If so, then the time commitment that comes with homeownership might be more than you want to take on. There are always projects around a house that you will need or want to take care of, from finding a plumber to replace a rusted-out pipe to repainting the bedroom to mowing the lawn. If you live in a community with a homeowners association, the HOA might take many of these homeownership chores off your plate for an additional cost of a few hundred dollars a month. But beware of the headaches that association membership can entail.

If you rent, your landlord will take care of all the repairs and maintenance, though of course they may not be done as quickly or as well as you would like.

Although not as universal as homeowners’ insurance, renter’s insurance is often recommended for those leasing homes and is increasingly required by landlords.

Owning
Homeownership brings intangible benefits such as a sense of stability, belonging to a community, and pride of ownership. However, it’s not good for restless or nomadic types. Real estate is the original illiquid asset. You might not be able to sell when you want if the housing market is down. Even if it’s up, there are significant transaction costs when you sell. Changing your mind about where you want to live is far more expensive when you own.

The overall cost of homeownership tends to be higher than the overall cost of renting, even if the monthly mortgage payment is similar to (or lower than) the monthly cost to rent.

Here are some expenses you’ll be spending money on as a homeowner that you don’t have to pay as a renter:

Property taxes
Trash pickup
Water and sewer service
Repairs and maintenance
Pest control
Tree trimming
Homeowners insurance
Pool cleaning (if you have one)
Lender-required flood insurance, in some areas
Earthquake insurance, in some areas
Perhaps the biggest throw-away expense is mortgage interest, which can make up nearly all of your monthly payments in the early years of a long-term mortgage. Take this typical scenario: You borrow $100,000 at 4% for 30 years. Your first monthly payment will be $477.42, of which $333.33 is interest, and $144.08 is principal. It will be about 13 years before more of your monthly payment goes toward principal than toward interest, and in total, you’ll lose $71,869.51 in interest (though, admittedly, you’ll recoup some of that in tax deductions).

Even renovation projects don’t often increase the value of your home by more than what you spend on them. On average, you’ll get back 66 cents for every dollar you shell out on a home improvement project, according to Remodeling magazine.2 The projects that recoup the most are not glamorous things you’ll be excited about doing. The best return (and the only one on Remodeling‘s list that comes close to recouping its entire cost) comes from replacing a garage door.

Once you add up all these costs, you might find that you’re better off financially by renting and investing the money you would have put into a home into a retirement account.

Special Considerations
Which option is best for you isn’t just about money, it’s also about comfort and your vision for your life. Ignore people who tell you that owning always makes more sense in the long run, that renting is throwing away money—or that it makes more sense to buy if your monthly mortgage payment would be the same or less than your monthly rent payment. Housing markets and life circumstances are too varied to make blanket statements like these.

Still, despite the added expense and extra chores associated with owning a home, many people chose it over renting. It provides a more permanent place to raise children and often it offers the only way to have, or create, the sort of residence people want. Ultimately, the decision to rent or to own is not just financial, it’s also emotional.

The post Renting vs. Owning a Home: What’s the Difference? first appeared on Tribitat Homes.

The post Renting vs. Owning a Home: What’s the Difference? appeared first on Tribitat Homes.

With no experience and a complex, emotional transaction on your hands, it’s easy for first-time home sellers to make lots of mistakes. But with a little know-how, you can avoid many of these pitfalls altogether. Read on to find out how you can get the highest possible price for your home within a reasonable timeframe—without losing your mind.

KEY TAKEAWAYS
Keep your emotions in check and stay focused on the business aspect of selling your home.
Hiring an agent may cost more in commission, but it can take a lot of the guesswork out of selling.
If you decide to sell on your own, set a reasonable sale price and keep the time of year in mind.
Prepare for the sale, don’t skimp on the visuals in your listing, and disclose any issues with the property.

The post Avoid These Mistakes When Selling Your Home first appeared on Tribitat Homes.

The post Avoid These Mistakes When Selling Your Home appeared first on Tribitat Homes.