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Resolutions For Housing Consumers
 
By: Broderick Perkins

A New Year has dawned and, for many, with it comes the daunting task of acquiring, retaining, selling a home or tapping the equity of what's likely to be your most valuable asset.

A select group of real estate professionals were recently asked what should be at the top of housing consumers' resolution lists.

In no particular order, here are the results -- a hodgepodge of frequently suggested resolutions for housing consumers in all walks of life.

Potential home buyers

"An absolute New Years resolution would be to get prequalified by a lender, since this service is free and comes with no obligation," says Anthony Hsieh, CEO of the HomeLoanCenter.com in Irvine CA.

That's a good resolution for first-time home buyers, move-up buyers, even second-home buyers.

A prequalifying lender or mortgage broker will take a look at your income and expenses and determine how much home you can afford -- pending a full credit check and verification of your income, expenses and other financial matters.

"Even if you are not ready to purchase a home now, it will help you understand how much home you can afford and how your credit ties to a future home loan. Most people will be surprised at how affordable a home is today, the affordability index has not been better in 25 years" said Hsieh.

The prequalification can also come with a credit check which will get you a look at your credit report -- something you should pull once a year (or more frequently if you are an active credit user) to guard against identity theft and to check for errors or inconsistencies.

A mortgage broker or lender performing the prequalification can also advise you what you must do to acquire savings for a down payment and other costs, help you seek out special loan programs, grants and other financial assistance, assist you in cleaning up your credit report, if necessary, and otherwise help prepare you financially for home ownership.

"Make an appointment or call a lender to go over what you need to do in order to successfully purchase a home," said Stephanie Noryko, a loan broker with Granite Financial, in Cupertino, CA.

First-time home buyers

"Do your homework, research (loans, neighborhoods, schools, crime, commute length, your credit rating, etc.) before you buy, says Mary Pope-Handy a real estate agent with Intero Real Estate Services in Los Gatos, CA.

Education is the key to successful home ownership. Studies show that consumers well educated in home buying and finance issues are the most successful homeowners who are less likely to lose their home to foreclosure.

Consumer Credit Counseling Service of Los Angeles says few home buyers learned money management skills in school or college -- unless they were business administration majors. The service says to seek out independent, credible sources. Good bets are college classes, university extension workshops, seminars and events. Also community, social and consumer advocacy groups that focus on housing issues often provide home ownership counseling. Budgeting, cash flow management, credit, debt, credit reports, saving investing and retirement planning skills are all invaluable skills homeowners will need.

"Read, read, and read again," said Mary Ann Morrar, a broker with RE/MAX Executive in Fremont, CA.

Renters

"The best resolution that a renter can make is to get together the money to make a down payment on a home," said Leonard W. Williams a CPA from Sunnyvale, CA.

Housing markets appear to have avoided bursting in a bubble of falling prices, interest rates are forecast to rise away from record lows buyers and borrowers have enjoyed for the past few years and a home comes with a host of tax benefits renters don't have.

"Despite the recovery of the stock market and the overall upbeat economic news, investors will not bail from real estate. People who rode out the stock market slump by buying real estate have reaped the benefits and are not likely to abandon ship. Prices are rising because the demand is there. As the economy continues to recover, demand will only increase," says Colin F. Watson, CEO of Mortgage Money Lenders in Valencia, CA.

Second-home buyers

"Ask yourself, 'How often will I really use that (second home) property?' before purchasing it," said Stephanie Noryko, a loan broker with Granite Financial in Cupertino, CA.

Second-home buyers often make the mistake of buying a home that's too far away for it to be a practical vacation home.

"Would you prefer a time share that allows you to switch locations?" Noryko asked.

Buying a time share -- part-ownership in the use of a property -- can be a good way to check out just how much you will use a property in a given location, without laying out the full cost of a second home.

Home improvers

"Visit your city's planning department to find out what you are allowed to build and hire an architect to design your dreams within the allowed limitations," says Judith Wasserman, an architect with Bressack and Wasserman Architects in Palo Alto, CA.

Zoning codes may restrict the height and size of your addition or improvement, how close your improvement can come to your front, side and rear property lines, how much you can increase the size of your existing property's footprint, even how much of a neighbor's view you can or can't block.

A professional designer can help you build within, around, over or under those restrictions and perhaps help you obtain a zoning variance.

Keep in mind, a growing number of disaster-prone areas are legislating tougher building codes to add fire resistance, wind resistance, flood protection and seismic safety to homes.

Home sellers

"Sellers, plan to hit the ground running and you'll have better success," says Pope-Handy.

She says a home that's ready to sell is a home that sells first and for the most money.

"Get your home inspected, price it correctly and make sure that your home gets maximum marketing exposure, but don't put your home on the market until it's 100 percent ready. Buyers need to see it in the best light at the very beginning. If you sell it fast, you will catch more enthusiastic buyers and you will fetch a higher price," she says.

Home equity borrowers

"Resolve not to run up those credit cards again," said Joette Joseph, branch manager and vice president with Alliance Title Co. in San Jose, CA.

Equity loans should be used for capital investments that provide a return on your money -- home improvements, education, business start-ups and the like -- major financial emergencies in a pinch, and debt consolidation -- provided you swear off such expensive credit.


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