Veterans and active servicemembers often have unique needs when looking for a home, and REALTORS® are committed to helping ensure those needs continue to be met following the real estate practice changes that went into effect on August 17, 2024. Here is what you need to know:
I’d like to take advantage of my Department of Veteran Affairs (VA) Home Loan benefit. Am I allowed to pay for a REALTOR® under VA rules?
Yes. On August 10, 2024, the VA enacted a temporary policy allowing buyers with VA home loans to pay for REALTOR® representation.
Why is the policy only temporary?
The VA will decide if a formal rulemaking is necessary to make this policy permanent.
Why am I being asked to sign a written agreement?
Written buyer agreements lay out the services your REALTOR® will provide and what they will be paid for those services. The practice changes require written agreements for many REALTORS® nationwide. You are in the driver’s seat with these agreements, which are fully negotiable. You should not sign anything that includes terms you do not agree with or do not understand. For more information on written buyer agreements, click here.
How does my buyer’s agent get paid?
This is determined in your written buyer agreement. Methods of paying a buyer’s agent may include, but are not limited to, the seller or their listing broker offering to compensate the buyer’s agent, the buyer requesting that the seller pay the buyer broker as part of the purchase offer, or the buyer paying their agent directly out of pocket.
Why should veterans and active servicemembers work with a REALTOR®?
REALTORS® are obligated under NAR’s Code of Ethics to work in your best interest. Additionally, many REALTORS® have obtained NAR’s Military Relocation Professional (MRP) certification to better prepare them to work with veteran buyers. Find a REALTOR® who has earned the MRP certification here.
https://buysellownchicago.com/wp-content/uploads/2024/12/BuySellOwn-Blog-Headers-13.png10801920Katie Howellhttps://buysellownchicago.com/wp-content/uploads/2021/07/BSOC-Logo-300x102.pngKatie Howell2024-12-18 15:59:462024-12-18 15:59:48What Veterans Need to Know About Buying a Home
When you begin working with a REALTOR® and touring homes, you will be asked to sign a written buyer agreement. But what if you are just attending an open house? Here’s what you should know:
I am attending an open house without a REALTOR®. Do I need a written buyer agreement in order to tour the home?
No. If you are simply visiting an open house on your own or asking a REALTOR® about their services, you do not need to sign a written buyer agreement.
Is a REALTOR® who is hosting an open house required to enter into written agreements with the potential buyers who attend the open house?
No. In this case, since the REALTOR® is only there at the direction of the listing broker or seller, the REALTOR® is not required to have a written agreement with the buyers touring the home.
When will I be asked to sign an agreement with a REALTOR®?
After you begin “working with” a REALTOR® and at any point before you tour your first house together.
What does “working with” a REALTOR® mean?
A buyer is “working with” a REALTOR® as soon as the REALTOR® begins to provide services, such as identifying potential properties and arranging tours. REALTORS® who are simply marketing their services or speaking to a buyer—at an open house or by providing a buyer access to a house they have listed—are not considered to be working with the buyer.
What does it mean to “tour” a home?
Under the terms of the settlement, a “tour” is when a buyer who is working with a REALTOR® enters a home that is for sale or directs their REALTOR® to enter the home on their behalf. This includes when the buyer’s agent provides a live, virtual tour to a buyer not physically present.
What is the purpose of written buyer agreements?
Clarity and transparency. Written buyer agreements lay out the services your REALTOR® will provide and what they will be paid. Buyers should not sign anything that includes terms they do not agree with or do not understand. These agreements are fully negotiable.
https://buysellownchicago.com/wp-content/uploads/2024/12/BuySellOwn-Blog-Headers-12.png10801920Katie Howellhttps://buysellownchicago.com/wp-content/uploads/2021/07/BSOC-Logo-300x102.pngKatie Howell2024-12-10 15:34:522024-12-10 15:34:57Open Houses & Written Agreements: What You Need to Know
When buying or selling a home, your REALTOR® will use a Multiple Listing Service (MLS) to find homes for sale or market your property. Here is what you need to know about them:
What is an MLS?
MLSs are online platforms that compile home listings from brokerages in a given market. They enable REALTORS® to see available homes for sale efficiently, get helpful marketplace data and share listing information to national and local websites that advertise properties. There are many MLSs across the U.S., and each has its own rules to make sure its information is complete, accurate and transparent.
What value does an MLS provide?
MLSs allow real estate professionals to see, share and promote homes for sale so the largest pool of potential buyers can find them. MLSs provide the most accurate, reliable and detailed information about properties (this includes properties that have been sold and are for sale), including listing price, address, features, disclosures and square footage. MLSs also help promote fair housing and equal opportunity by giving REALTORS® and their clients access to consistent information.
As a buyer, how can an MLS help me buy a home?
Using a Multiple Listing Service allows your agent to access many homes for sale and connect with REALTORS® working to sell their clients’ homes.
As a seller, how can an MLS help me sell my home?
MLSs are the most trusted source for real estate data because their information is verified by REALTORS®. Listing on an MLS will help a seller reach the largest pool of buyers and potentially attract the best offer.
Am I required to market my home through an MLS?
No. You should discuss the pros and cons with your REALTORS®. If you decide to have your REALTOR® not list your home on an MLS, you may be asked to sign a document verifying that you have made this choice.
Can I make an offer to compensate a buyer’s agent on an MLS?
An offer of compensation is when the seller or the seller’s agent offers to compensate another buyer’s agent for bringing a buyer to successfully close the home purchase. As of August 17, 2024, offers of compensation are no longer allowed on MLSs. However, offers of compensation can still be made off-MLS and shared through common marketing vehicles such as flyers, signs, emails or other communication mechanisms.
Can I offer concessions on an MLS?
To attract more buyers, sellers may offer concessions, which are certain costs associated with the buyer’s home purchase that a seller agrees to pay. MLSs may allow communications about a sellers’ concessions, but it depends on local rules.
How do I access Multiple Listing Service information?
Many MLSs share data with websites that consumers can access. If you are a buyer, your REALTOR® will provide you with MLS property listings that may meet your criteria. For both buyers and sellers, when you work with a REALTOR® who has access to an MLS, you can discuss how the MLS can benefit you. Remember, REALTORS® are guided by ethical duties under the Code of Ethics, including the pledge to protect and promote the interests of their clients. Your REALTOR® will help you to weigh your options and develop a strategy you are confident in.
https://buysellownchicago.com/wp-content/uploads/2024/11/BuySellOwn-Blog-Headers-10.png10801920Katie Howellhttps://buysellownchicago.com/wp-content/uploads/2021/07/BSOC-Logo-300x102.pngKatie Howell2024-11-22 14:55:422024-11-22 14:55:44Multiple Listing Services (MLSs): What You Need To Know
When you begin working with a REALTOR® to buy a home, you will be asked to sign a written buyer agreement. Here’s what you need to know about these agreements:
What is a written buyer agreement and what does it do?
A written buyer agreement is an agreement between you and your REALTOR® that outlines the services your REALTOR® will provide you, and what they will be paid for those services.
In some places, yes. Many states have required them for years, while some, including Illinois, have not. As a result, it is entirely possible you or others you know have not used them in the past. Regardless, they are now a nationwide requirement for many REALTORS®.
Are these agreements negotiable?
Yes. You should feel empowered to negotiate any aspect of the agreement with your REALTOR®, such as the services you want to receive, the length of the agreement and the compensation, if any. Compensation between you and your REALTOR® is negotiable and not set by law. In the written agreement, the compensation must be clearly defined (e.g., $0, X flat fee, X percent, X hourly rate), not open-ended or a range. It is important to sign only an agreement that reflects what you have agreed to with your REALTOR®.
How do I benefit from these agreements?
These agreements clearly lay out what services you, as a homebuyer, expect your REALTOR® to provide, and what your REALTOR® will be paid. These agreements make things clear and reduce any potential confusion at the outset of your relationship with your REALTOR®.
When do I need to sign an agreement?
You will be asked to enter into a written buyer agreement with your REALTOR® before touring a home with them, either in-person or virtually. If you are simply visiting an open house on your own or asking a REALTOR® about their services, you do not need to sign a written buyer agreement.
Does this mean I have to pay my REALTOR® out of pocket?
Not necessarily. While you are responsible for paying your REALTOR® what is outlined by your agreement, you can still request, negotiate for and receive compensation for your REALTOR® from the seller or their REALTOR®.
Do agreements dictate a specific type of relationship I need to have with my REALTOR®?
No—you are allowed to enter into any type of business relationship with your REALTOR® that is allowed in the state law where you live.
Can I change or exit an agreement?
Yes. You and your REALTOR® can mutually agree to change your agreement. Agreements may have specific conditions under which they can be exited, so read the text of the agreement and speak with your REALTOR® if you would like to change or exit your agreement.
https://buysellownchicago.com/wp-content/uploads/2024/11/BuySellOwn-Blog-Headers-8.png10801920Katie Howellhttps://buysellownchicago.com/wp-content/uploads/2021/07/BSOC-Logo-300x102.pngKatie Howell2024-11-08 13:09:172024-11-08 13:09:20Written Buyer Agreements: What You Need To Know
Recently, the National Association of REALTORS® (NAR) reached a settlement agreement that will change the homebuying and selling process. While a REALTOR® will still be there to help you through the journey, here’s an overview of the changes that will go into effect on August 17.
As a buyer, you will have to sign a written agreement with your REALTOR® before touring a home. Before signing this agreement, you should ensure it reflects the terms you have negotiated with your agent and that you understand exactly what services and value will be provided, and for how much.
Your buyer agreement must include the following four aspects surrounding compensation:
A specific and conspicuous disclosure of the amount or rate of compensation the real estate agent will receive or how this amount will be determined.
Compensation that is objective (e.g., $0, X flat fee, X percent, X hourly rate)—and not open-ended (e.g., cannot be “buyer broker compensation shall be whatever the amount the seller is offering to the buyer”).
A term that prohibits the agent from receiving compensation for brokerage services from any source that exceeds the amount or rate agreed to in the agreement with the buyer; and,
A conspicuous statement that broker fees and commissions are fully negotiable and not set by law.
These written agreements apply to in-person and virtual home tours. However, if you are only speaking to an agent at an open house or discussing their services with them, no written agreement is necessary.
Sellers may still agree to offer compensation to your agent. This practice is permitted but the offer cannot be shared on a Multiple Listing Service (MLS)— MLSs are local marketplaces used by both buyer brokers and listing brokers to share information about properties for sale. Also, you can still accept concessions from the seller, such as offers to pay your closing costs.
To read more details about these changes, visit facts.realtor.
https://buysellownchicago.com/wp-content/uploads/2024/08/BuySellOwn-Blog-Headers-6.png10801920Katie Howellhttps://buysellownchicago.com/wp-content/uploads/2021/07/BSOC-Logo-300x102.pngKatie Howell2024-08-14 09:29:532024-08-14 09:29:55What Homebuyers Need to Know About NAR’s Settlement
It’s time. You’re ready to move on from following your landlord’s rules and ready to purchase a place you can call home. Follow these steps to make transitioning from renting to buying as easy as possible.
Consider Your Financial Situation
While buying a home may be a better way to build wealth, buying a home is a big financial decision. Take the time to consider your goals and plans for the future, and ask yourself some of the following questions
How will my finances look different if I buy as opposed to rent?
Do I have the means to maintain a home and the repairs that come with it?
Will I be able to make monthly mortgage payments?
Understand the Full Cost of Owning A Home
When you purchase a home, you need to pay more than just your principal and interest rates. Also lumped into your mortgage payment is what’s known as PITI: principal, interest, taxes and insurance.
You’ll also need to consider the extra costs associated with owning a home, including your down payment and closing costs when you first purchase your home, as well as other monthly payments like utilities and other maintenance needs.
Get Your Homebuying Team Together
When you’ve determined that you’re ready to buy, it’s time to put together your homebuying team who will help guide you through the transaction with ease. This includes a REALTOR®, lender, attorney and inspector. Click here for more details on these individual’s roles during the homebuying process.
Start Your Search
We’ve gathered five easy steps to follow in the beginning stages of the home buying process to make the journey to your new home as easy and seamless as possible. This includes creating a plan, researching, finding a REALTOR®, choosing a loan and getting pre-approved. Get more information on these important steps here.
https://buysellownchicago.com/wp-content/uploads/2023/11/BuySellOwn-Blog-Headers-5.png10801920Katie Howellhttps://buysellownchicago.com/wp-content/uploads/2021/07/BSOC-Logo-300x102.pngKatie Howell2023-11-02 14:05:252023-11-02 14:05:26What To Know: Transitioning from Renting to Buying
When purchasing a home, there are many things that come into consideration, however, some of the most common things that you might hear about purchasing a home might not tell you everything you need to know about purchasing a home. Here are some common myths you may hear about when purchasing a home and the real story behind them.
You need to put down a 20% down payment.
While it is true that a larger down payment can sometimes lead to a lower mortgage rate, it is not always necessary to put down a large amount of money. There are several programs available that allow homebuyers to put down as little as 3% or even 0% of the purchase price. In fact, the average first-time homebuyer puts down 7% on their home.
You need high credit to qualify for a mortgage.
Credit scores are a vital part of getting approved for a loan to buy a home. The better your credit score, the better your loan terms will be, although, you can get a mortgage with a lower credit score as low as 580.
You need a 20% down payment to avoid private mortgage insurance (PMI).
PMI is insurance that protects a lender if the borrower defaults on their mortgage. While it is true that a down payment of 20% or more will typically allow you to avoid PMI, it is not the only way. Some lenders offer programs that allow homebuyers to avoid PMI with a smaller down payment, or even with no down payment at all. Make sure to shop around for a loan, and ask them about PMI.
Closing costs are a one time payment that is made on your home on the day the sale closes. However, not all closing costs are created equal. Some are negotiable, while others are set in stone. Here is what you need to know about them.
Overview of Closing Costs
Closing costs, in short, is the money you must pay when you buy a house. These fees for a home can vary depending on the price and type of home you are purchasing. They cover every expense associated with buying a house — from legal fees to property taxes to an inspection.
There are several costs that you should budget for if you’re planning on buying a home.
Common Closing Costs
Loan Application Fee
Appraisal Costs
Attorney Fee
Closing Fee
Credit Reporting Fee
Escrow Funds
Homeowner’s Insurance
Loan Origination Fee
Title Insurance
Property Taxes
Transfer Tax
Underwriting Fee
Depending on how much money you’re putting toward a down payment, the type of mortgage, the type of home, the location of the home and other considerations, you may end up having to other additional fees.
Budgeting for Closing Costs
In general, closing costs are typically between 2% and 5% of the property’s purchase price. For example, if you are purchasing a home for $300,000, your costs could range from $6,000 to $15,000. However, it is important to keep in mind that this is just a rough estimate, and the actual amount you pay could be higher or lower depending on a variety of factors.
To determine how much you will have to pay, you should work closely with your lender and REALTOR®. They can help you understand the various fees associated with purchasing a home and provide you with a detailed list of anticipated costs. You can ask your lender for a loan estimate, which provides a similar breakdown of costs but also includes information about the terms of the mortgage.
Budgeting for closing costs is an important part of the homebuying process. To prepare for these costs, you may want to set aside a specific amount of money in a savings account. You may also be able to negotiate with the seller or lender to reduce the closing costs, although this may not be possible in all cases.
Ensure that you review all costs before signing the final purchase agreement to understand all the fees involved. By being prepared and budgeting for these fees, you can make the homebuying process as smooth and stress-free as possible.
https://buysellownchicago.com/wp-content/uploads/2023/04/Credit-Repair-page-assets-1.png10801920Katie Howellhttps://buysellownchicago.com/wp-content/uploads/2021/07/BSOC-Logo-300x102.pngKatie Howell2023-04-05 14:32:312023-04-05 14:32:32A Closer Look At Closing Costs
Congratulations! You’ve made it to your home inspection, which means you’re within reach of closing on your home. Unsure of what to expect? We (and your REALTOR®) here to help.
Why should you have a home inspection done?
Purchasing a home is a big commitment, and a home inspection is your way of knowing you’re making the right fiscal choice. An inspection will spot any current or potential problems within a home, providing safety and peace of mind in the purchasing decision. During the process, your inspector will identify problem areas, suggest solutions and write a report with all of the findings.
Also, many mortgage lenders require an inspection to be performed before financing a home, so it’s best to cover all of your bases by having an inspection completed.
How do I find an inspector?
It is the homebuyer’s responsibility to find an inspector to perform the home inspection. Typically, your REALTOR® will be able to recommend a professional. If you’re interested in looking for one on your own, you can search for a local inspector using the American Society of Home Inspectors’ (ASHI) Find a Home Inspector tool.
When talking with an inspector, here are some things you should look for:
They should have a home inspector license.
Ideally, hire someone who has at least five years of experience.
Make sure they can turn your report around within your required timeframe, as an inspection typically needs to take place within five to seven days of your offer being accepted.
What will, and won’t, an inspection cover?
As a rule of thumb, most inspectors will check a home’s:
Exterior, including walls, foundation, grading, roof and garage
Interior, including plumbing, electrical, heating, air conditioning, appliances and all rooms
And they will not check:
Swimming pools
Wells
Chimneys
Inside pipes or sewer lines
Inside walls
What happens on the day of the home inspection?
Both you and your REALTOR® should be in attendance on the day of your inspection. Depending on the size of the home, most inspections take between two and three hours to complete.
Yes, you can ask questions! The inspector will give you firsthand explanations of their findings, point out problem areas and answer any questions that may arise. Everything that is discussed in person will then be written up in their report.
What happens after an inspection?
Once the inspection is complete and you’ve received the report, discuss the findings with your REALTOR®.
Legally, the seller must fix structural issues, building code violations and safety issues. Beyond that, you are able to negotiate with the seller what other issues you would like fixed before purchasing the house. Your REALTOR® will submit a request for repairs that the seller will either agree to or counteroffer.
If the problems that arise from the inspection are too significant or expensive, you always have the right to step away from the purchase if your purchase contract has an inspection contingency. Usually, you have about seven days to make that decision.
While a home inspection may cost money upfront, it will also help you save money, and move forward with a greater peace of mind in the long run.
https://buysellownchicago.com/wp-content/uploads/2021/11/GettyImages-83590749-scaled.jpg17072560Katie Howellhttps://buysellownchicago.com/wp-content/uploads/2021/07/BSOC-Logo-300x102.pngKatie Howell2022-09-06 13:08:002022-08-29 13:09:03Your Home Inspection Questions, Answered!
If you’re interested in buying a condo, here are some helpful terms and things to consider.
No matter what, future condo homeowners should ask a few important questions when considering a unit:
Who runs the condo association?
What are the rules and restrictions for living in the building?
How much are the monthly fees and what do they cover?
Condominiums, aka condos, are a common building type in major urban areas, and Chicago is no exception. Living in a condo might not be for everyone, but they’re often an excellent choice for first-time homebuyers or for those who wish to live in a more urban setting!
KNOW WHAT MAKES A CONDO A CONDO
A condominium is an individually owned unit in a complex or building of units. You own the space inside your individual unit and share an ownership interest in the common property. This can be as extensive as roads and courtyards and as confined as a shared stairwell and roof.
What’s the difference between a condo and an apartment? The former is owned while the latter is rented. What about a condo versus a co-op? In a co-op, you buy shares in a corporation that owns the entire building and get a stake-hold to a specific unit.
MEET YOUR CONDO ASSOCIATION
Maintaining and managing the common areas of the condominium are run by an entity called a Condo Association. The whole condominium is governed by a set of rules called Covenants, Conditions, & Restrictions (CC&R’s), which operate much like bylaws.
A board runs the condo association and has the power to regulate and monetarily penalize owners for violations as decreed in the CC&R’s. Who sits on the board? Depends on the condo building. Some associations hire a third-party management company, which typically increases the cost of living in the building, and some are managed directly by the owners. Usually, buildings with fewer units are self-managed while large buildings with more units are managed by a company.
REVIEW YOUR CONDO DOCUMENTS
The Illinois Condominium Property Act requires the condo’s seller to provide a number of important documents to the prospective buyer prior to close. These include the declarations, the CC&R’s, the financials and more.
When you’re buying a condo, review these before making a final decision on your purchase! What should you look for in these documents? Here are a few questions to get started:
What are the rules about pets, remodeling projects, leasing units and use of common amenities?
Are there reserves, and if so, how much is in the reserves?
What were the most recent major purchases or renovations? Are there any upcoming special assessments to cover these maintenance projects?
What are the individual owners responsible for versus the condominium association as a whole?
Don’t hesitate to go over these documents with your REALTOR® and your attorney. They can supply additional expertise and advice!
UNDERSTAND THE HOMEOWNER’S ASSOCIATION FEES
Most people who know about condos know about HOA fees. As intimidating as they may seem, they serve a very specific purpose!
Homeowners Association fees, sometimes called monthly assessments or nicknamed “HOA fees,” are an additional cost beyond your mortgage or escrow payments that go directly to the condo association. They include several maintenance costs like water, trash, landscaping and beyond.
Why are some HOA fees so much more than others? Here’s an overview of HOA fees. In the end, you should ask about the included services in your monthly HOA fees and the portion that is sent to reserves.
If you’re buying a condo with many shared amenities like pools, gyms, rooftops, elevators, and movie theaters, anticipate higher monthly fees to maintain these features.
KEY TERMS TO HELP YOUR SEARCH
As you move forward with looking for your future condo, keep these key term definitions in mind. You’ll hear them a lot during the transaction!
CC&R’s: stands for Covenants, Conditions, & Restrictions which regulate living in the condo association.
Condo Association Board: the governing body which makes executive decisions about shared amenity renovations and repairs, monitors the reserves and determine if special assessments are required, and enforce the CC&R’s. They meet monthly.
HOA Fees: the monthly assessments or costs for living in the association.
Amenities: the shared features available to all association owners and residents.
Special Assessments: additional fees billed to the condo owners outside of the monthly HOA fees. They’re typically passed if a large repair is needed for a shared amenity that cannot be covered by the reserves.
Reserves: the condo association’s savings! These cover emergency repairs or regular maintenance costs for the shared amenities.
Property Insurance: this is the association’s insurance for the shared amenities and common spaces, but it does not insure each individual unit or their contents.
https://buysellownchicago.com/wp-content/uploads/2021/06/GettyImages-171582800-scaled.jpg17072560Cory Hallhttps://buysellownchicago.com/wp-content/uploads/2021/07/BSOC-Logo-300x102.pngCory Hall2021-09-21 04:30:002021-08-30 16:57:47What You Should Know Before Buying A Condo
