What to Know About Earnest Money 

 

Written by Ashley Sutphin Posted On Friday, 19 May 2023 00:00 

 

Earnest money is just one of the many terms to know when it comes to buying a home. It’s something you might initially overlook, but not understanding earnest money can create roadblocks in your process to buy a home once you’re ready to make an offer.

The Basics of Earnest Money

In simple terms, the earnest money is a deposit that you put down to show that you’re serious about buying a house. You want to show the seller that you really do want the home, and earnest money might be anywhere from 1% to 5% of the total purchase price.

It helps sweeten your offer to a seller and shows them that you want to take the necessary next steps to buy their home.

Then, in exchange for the earnest money, the seller will take their home off the market. They’ll start to work to arrange things like inspections.

Earnest money goes into an escrow account while you wait on your closing. The escrow account is with either the seller’s broker or title company, or an escrow company.

They’re essentially securely storing your money until your closing. Then, that earnest money is subtracted from the total you owe, and it goes toward your closing costs.

How Much Earnest Money Should You Offer?

Again, earnest money is typically anywhere between 1% and 5% of the price you agree on with the seller to buy the house. There’s a lot of variance in this, though. For example, in some locations, you might do a fixed amount and in others you could pay a percentage.

In very popular housing markets, you can see very high earnest money deposits. Your real estate agent will help you know what’s in line with your area.

Earnest Money Is Not a Down Payment

This can be an area of confusion for some buyers—earnest money is not a down payment. Your down payment is fully separate from earnest money and is anywhere from 10-20% of your home’s purchase price.

You need to make sure that when you’re thinking about how much a house will be, you’re adding up your earnest money and your down payment. Your earnest money is due when you make an offer, while your down payment and closing costs are due later.

Is It Refundable?

When you enter into a purchase agreement, it will outline contingencies. These are situations that are agreed upon where you can walk away from a deal and still get your earnest money back.

For example, you might have an appraisal contingency in case the appraisal is lower than the sale price.

Your real estate agent will help you decide the contingencies to put in your contract.

If you’re in a highly competitive market, you might agree to nonrefundable earnest money. That’s very risky because if your sale falls through, the seller gets to keep your money.

If you break the terms of whatever your purchase agreement is or you decide you don’t want to buy a house anymore, then the seller can keep your earnest money.

This is why it’s important to work with a qualified real estate agent. They’ll help you understand what you need to know before you sign anything because otherwise, you could end up giving up a lot of money that you potentially can’t afford.

As a final note, earnest money isn’t required. If you’re buying in a market that’s not very competitive, you may not need to worry about it. It’s instead a good way to beef up an offer, especially if you’re worried there could be multiple offers on the house you want.

 

 

 

 

5 Tips to Save in Your Kitchen Remodel 

 

 

Written by Cristina Miguelez Posted On Sunday, 21 May 2023 00:00

 

The kitchen is the hub of the household. It is where the family gathers daily to socialize and create delicious cuisine. Without a doubt, the kitchen is also one of the most important rooms to remodel to potentially increase the value of your home. In fact, a home that has undergone a kitchen remodel sells 8% faster, according to realtor.com studies. 

Historically, the kitchen was once hidden away from the main house for several reasons, such as to reduce excessive heat and to control smells. Nowadays that is no longer the case. The kitchen has made its debut as an integral part of the home and perhaps the most important room, which is why many homeowners are looking to upgrade the space. In this article, we will explore tips to save in your kitchen remodel. 

Top Ways to Save in Your Kitchen Remodel 

The average cost of a kitchen remodel in the United States is between $8,500 to $25,000. The figure might seem a bit wide-ranging, but if you are looking for ways to pinch your pennies, then rest-assured that with frugal decisions, you can cut costs to keep the total amount in the lower end of the spectrum. 

Choose mid-range efficient appliances 

Sure, it is tempting to pick only high-end appliances for your kitchen, but such high-dollar items are usually unnecessary. You can choose practical, energy-efficient appliances that boast acceptable warranties and look fabulous. 

A factor to consider when picking appliances is longevity. Refrigerators usually last only 15 years or less but a cooktop and range function last considerably longer. Also, if you have a large family then you are constantly washing dishes, so a large, efficient dishwasher becomes a mandatory investment.  

Whichever appliances you choose, try to stick with one brand and appearance. Stainless steel remains the most popular finish choice. If you want your home to appear modern, then you will want to pay close attention to design and appearance while still trying to avoid paying premium prices. Instead, settle for moderate workhorse appliances that provide you with looks, function, energy-efficiency, and longevity. 

Opt for affordable yet durable counter materials 

When you walk into a kitchen, you might believe your focal point is the cabinets but most people zero in on the countertops first. Perhaps it is the clean, sleek design or the sparkle of the surface. A showpiece countertop dictates the cabinetry, room furnishings, and color scheme. 

When picking countertop materials, remember you can pick granite with a rating of a level 2 grade (mid-grade) versus a level 3 (premium grade). The differences are subtle and usually missed by a novice who does not work in the granite business. Choosing a lovely, mid-grade granite countertop offers a greater return-on-investment. The cost of granite countertops runs from $35 to $500/sq. ft. 

Laminate countertops are another option. They mimic the appearance of granite without the high cost. Historically, you could not install an under-mount sink in a laminate countertop, but designs have changed and now you can. Laminate hovers at an affordable $5 to $30/sq. ft.

Quartz (an engineered stone) and concrete countertops are other cost-saving options. The average cost of quartz is $55 to $200/sq. ft. and concrete runs $75 to $200/sq. ft. 

Resurfacing an older countertop with tile is another option. This project typically costs around $10 to $70/sq. ft. 

Go for a cosmetic upgrade instead of a whole cabinet replacement

It’s tempting to purchase all new cabinets for the kitchen but that can become expensive with 30 linear feet of average cabinets costing from $6,412 to $11,400 for installation. However, resurfacing the existing cabinets is a great way to provide an instant facelift to the room. Many opt to carry out refinishing cabinets as a DIY project to save even more. 

You can also replace kitchen cabinets with veneer models instead of real wood. Budget cabinets range from $70 to $100 per linear foot. Handles, knobs, and pull are the crowning glory on your kitchen cabinets. However, that does not mean that you must spend a fortune on the hardware. Knobs can range from $1 to $100 and hinges from $1 to $15.  There is a huge range of prices so you can find your comfort zone within your budget. 

Install a backsplash with attractive, long-lasting materials 

Backsplashes look good and showcase not only the kitchen cabinets but also the countertops. There are a lot of different backsplash materials you can choose to create your perfect backsplash, but they aren’t all created equally. Depending on how much cooking you do, you’ll want to find a material that’s durable, stylish, and long-lasting.

Ceramic tile is very popular but it’s also costly, with the average price hovering at $5 to $100/sq. ft. However, you can pick a porcelain tile for $5 to $20/sq. ft. Also, why not cut costs by using large tiles that would usually be laid on floors as a backsplash? The bigger tiles require less grout and costly cutting. Deco-pieces like glass tiles are easy to fashion into eye-catching mosaics. 

Plan ahead by shopping around and doing some work yourself

Feel out your contractor’s schedule and get him at a slower time of year. Typically the middle of summer and the middle of winter are a little slower and could get you a better rate.

Next, check your local tile, stone, flooring, and bathroom fitting showrooms for odd lots. Odd lots are often left over or returned items. They’re just as good quality, but they go for rock bottom prices. The only catch is that what you see is what you get, so if you need 150 square feet of something, and they have 140, it won’t work. But, many times you can get lucky and find a thousand feet of something discontinued that you can get for pennies. This also goes for sinks and faucets - it really pays to check around, especially if you aren’t picky. 

If you need a small piece of stone for a vanity top, bar top, or table, also be sure to ask about remnants at the stone yard. 

Final thoughts

Yes, you can create the kitchen of your dreams on a shoestring budget with just a few of the ideas above. These tips to save in your kitchen remodel help you create an upscale remodel without spending an excessive amount of money. You can enjoy your beautiful kitchen while feeling good about the fact that you have potentially increased the value of your home, which is a great return on your real estate investment.

 

 

 

 

 

Are Letters to Sellers Illegal? 

 

Written by Ashley Sutphin Posted On Wednesday, 17 May 2023 00:00

 

The housing market has been intense for buyers, to say the least.

The inventory of available properties around the country is low, and demand is high. That leaves many buyers scrambling to figure out how they can set themselves apart in the eyes of a seller. Not everyone can raise their offer above asking. Even if they do, there’s no guarantee they’ll get the property.

That means many buyers tend to use other tactics to score a home, including writing letters to a seller.

It’s not inherently a bad idea, and it’s something that a real estate agent might recommend in some cases. The idea is that you can explain more about who you are and why you love the house. Many sellers have an emotional connection to their home, and they want to feel like someone else will enjoy it the way they have over the years.

At the same time, before you start writing a letter, check with your real estate agent because it could create a problem.

Oregon Bans “Love Letters”

During this past summer, would-be homebuyers in Oregon became prohibited from writing what was referred to as love letters to sellers.

Oregon Governor Kate Brown signed a bill into law, which was the first of its kind in the country, telling seller’s agents they have to reject this type of communication. The law went on to say that in general, there shouldn’t be information transmitted between buyers and people making a bid on a home outside of the traditional offer.

What’s the Problem?

Many might be wondering what the problem is with a seemingly harmless letter explaining why you’ve fallen in love with a home.

According to critics, the letters can create fair housing risks.

They might contain personal information or characteristics about a buyer, such as their race or family status. That information could intentionally or unintentionally affect a seller’s decision to accept or reject an offer.

National Association of Realtors Response

The National Association of Realtors (NAR) spoke out after Oregon took action banning letters to sellers. The organization said it wasn’t aware of any situation where these letters led to legal action or lawsuits. NAR said in the statement that real estate transactions should use only non-discriminatory and legitimate criteria when decisions are made.

What Can Realtors Do If Clients Do Want to Write a Letter?

Unless it’s explicitly banned where you work or where your clients are buying a home, in most places, they can still legally write a letter to the seller.

As a real estate agent, it’s essential to educate them about what they can and can’t include in these, however.

First, go over the details of everything your client should know about writing a letter, including the upsides and downsides. If you’re working for a seller, you should let them know you can’t accept letters as part of an MLS listing, and you need to remind your clients that whether or not to accept an offer should only be based on objective criteria.

If you have a client who wants to write a letter, don’t help to draft it, in addition to not delivering it.

Don’t read these letters, and document any offers received, as well as the seller’s reason for accepting one over the others.

Overall, in most cases, there’s not a legal issue with writing a letter to a seller unless it has some information that could be used in a discriminatory way. If you’re a real estate agent, make sure you’re up to date on everything you need to know about fair housing laws and your role if a letter is involved

 

The Importance of Home Inspections 

 

Written by Realty Times Staff Posted On Wednesday, 03 May 2023 00:00 

 

Being aware of any issues before purchasing a home is important, as it can help you budget what needs to be fixed or make the decision to rescind an offer. With a competitive housing market, buyers are forgoing home inspections now more than ever. While this can provide an edge in successfully closing on a property, waiving a home inspection can reveal major hazards within your home. 

Do you need a home inspection?

Home inspections cost anywhere from $300 to $400, however, if there are glaring issues within the home that can cost thousands of dollars, you can become aware of them prior to closing. The contingency is used in the case where a home inspection reveals issues, leaving the buyer the chance to back out within an allotted time frame or to renegotiate an offer.

Whether or not it’s worth the risk to skip a home inspection is up to you. Keep in mind, though, it’ll likely cost you less money to enlist a neutral, third-party professional to assess the home you are about to buy than it will to fix issues you missed later on.  

What does a home inspection cover?

A quality home inspection can provide a lot of information about the home you’re buying. Typical home inspections last 2 to 3 hours. It’s recommended that you’re present with the inspector during this process to ask any questions or clarifications while they are conducting the inspection.

While it varies, a home inspector is looking for issues that might affect the property’s value, and they typically cover:

• HVAC systems
• Electrical systems
• Interior plumbing
• Foundation
• Insulation
• Windows and doors
• Roofing
• Attics and basements
• Structural components (floors, walls, stairs, etc.)

Sometimes an area of the home is off-limits, either due to potential safety risks to the inspector or it is just behind locked doors. Any space that is not accessible will be noted by the inspector in their report.

Why are home inspections important?

Having your home inspected may uncover some critical issues that can become hazardous to your health. As you go through the inspection with your qualified home inspector, they will help you to identify certain toxins such as lead, mold, or asbestos-containing materials. These things are especially important to look for if you are interested in purchasing an older home. Exposure to asbestos can lead to mesothelioma cancer, which is a rare cancer caused by the inhalation of asbestos fibers and most commonly impacts the lining of your lungs. Exposure to lead can cause impairments in cognitive function, especially in developing children. If you’re aware of these potential risks prior to purchasing, you can save you and your family from potential health impacts.

Other safety issues that can be discovered during an inspection can be related to the structure of the home. Solid framing of walls and flooring are important to check so that all of your surfaces are supported for not only your weight but can take the typical weight of furniture and appliances. The indoor staircases and any outdoor steps can also pose potential risks. They should be checked for sturdiness, step width, and depth, and there should be a proper railing. Structural safety is even more important to pay attention to if you have children that may not be aware of hazardous situations.

A good inspection also may be able to save you money in the long run. If there are major issues that need to be addressed in order to meet safety standards of living, finding out ahead of time can allow you to put that financial burden on the seller as opposed to yourself. One way to do this is to make your offer contingent on the completion of certain changes. You can also choose to lower your offer, due to the cost you will incur by fixing the problems at a later date.

Deciding to invest in a home could be one of the largest financial decisions that you make in a lifetime. Having a complete picture of the house, prior to finalizing the purchase, can ensure the safety of you and your family and make you confident in the decision you’re making. 

 

Is Now a Good Time for Homeowners to Switch to Solar? 

 

Written by Charlotte Granville Posted On Monday, 01 May 2023 00:00 

 

 

If you’ve been considering making the switch to solar energy, you might be wondering if now is the right time to do so. Whether it’s cost or efficiency concerns that are the source of your hesitation, we’re here to solve any doubts for you. This article will explore the advantages and disadvantages of switching to solar energy in 2023, so you can make an informed decision about whether now is the best time for you to invest in solar panels for your home.

The Advantages of Going Solar in 2023

The benefits of installing home solar systems have been clear for quite some time now. So why is 2023 a particularly good time to go solar? 

• Reduces energy bills: With electricity costs continuously rising, solar energy can help you make significant long-term savings on your power bills. Thanks to net metering, your electricity costs can be offset with the energy generated from your solar panels, giving you credit that can be used to reduce your future energy bills. But some states are starting to change their net metering policies, so now would be a better time than any to switch to solar and lock in the best rates you can get for saving on electricity bills.  
  
  

• You gain energy independence: Another reason to go solar in 2023 is the energy independence that solar panels can provide. Solar panels can give you energy independence by allowing you to create your own energy and not have to rely on the power grid as much. A recent study found that a third of Americans are now concerned about power outages, and solar energy backed up with a storage system is a great solution in these scenarios. 
  
  
• More incentives: The IRA has recently increased the federal solar tax credit from 26% to 30%, meaning you can claim 30% of the costs of your solar panels back on your taxes. However, this tax credit is expected to drop back to 26% in 2033 and 22% in 2034, so installing solar panels is something that should be done sooner rather than later if you want to cut down the costs of going solar. 
  
  

• More affordable than ever: Switching to solar has never been so affordable. The cost of solar panels has dropped by 70% in ten years , making this year a better time than ever to go solar. Prices increased slightly in 2021 due to the pandemic, so installing solar panels now while prices have lowered again will reduce the risk of you having to face any cost increases due to unforeseeable circumstances. 

The Disadvantages of Solar Energy in 2023

• Solar is an intermittent energy source: Solar power doesn't generate power at night, and cloud, snow, or debris can affect the energy production of your solar panels. However, solar battery backup solutions have now become available, so you can store solar power and draw from it even if your panels aren't producing energy at that time. 
  
  

• The upfront costs can be high: Although going solar is now more affordable than ever, the upfront costs of installing solar panels can still be high. Not only will you have to pay for the solar panels themselves, but you will also need to consider installation costs. And if you’re planning on storing your energy by opting for a solar battery, costs can reach up to $9,500 for the battery alone. 
  
  

• Supply chain issues: Some supply chain issues are still ongoing since the rise in demand for solar panels and the delays the pandemic has caused. These issues may be starting to ease in 2023, but it still remains unknown whether supply will be able to keep up with increasing demand. 

So Is Now a Good Time to Switch to Solar? 

It’s clear that the advantages of installing solar panels currently outweigh the disadvantages. Besides, installing solar panels can increase your property’s value, meaning you may see a good return on your investment when the time comes to sell your home. However, if you’re planning on selling your home in the near future, consider that it takes a few years for your savings on energy bills to accumulate and make up for the costs of installing your solar panels, and once installed, you can’t take solar panels with you. 

Ultimately, whether you choose to install solar panels in 2023 or not, solar energy is an increasingly viable and cost-effective option if you’re looking to reduce your carbon footprint and save on energy bills. So if you're considering making the switch, remember that the sooner you invest in solar energy, the sooner you'll start reaping its benefits.

Your Ultimate Guide to Kitchen Backsplash Materials 

 

 

Written by James Stevenson Posted On Saturday, 29 April 2023 00:00 

 

Ceramic and porcelain are the traditional materials used for backsplashes, with 55% of new kitchens using one or the other. Both are durable, protective, and can look beautiful. But they aren't your only options. If you want to give your kitchen a new look, consider using one of these backsplash materials.

Tiles 

You have a few options when it comes to the type of tile you choose, ceramic, glass, or natural stone. Tile is a popular choice because it's impermeable and does a great job of protecting the wall. It's also easy to keep clean.

To know what type of tile you should use, you need to consider the style of your kitchen. Your kitchen cabinet company can help you design a custom backsplash that matches the design of your kitchen. 

White ceramic tile can look great in both modern and retro-inspired kitchens. Natural stone in marble can give your kitchen a luxurious feel. Glass can add a bright and funky feel. 

Glass

Instead of using glass tile, you could use a large sheet of tempered glass. This works great for adding protected lighting above your stove. It also allows you to use any wallpaper or paint you wish behind the glass. 

Chalkboard Paint 

A low cost and creative option is to paint your backsplash area with chalkboard paint. You can do this yourself as an easy DIY project. You can write notes, menu ideas, or create a shopping list that's easily seen. 

When you're ready for a clean slate, all you have to do is wipe it clean. One downside, though, is that the black paint may close your kitchen in and make it feel smaller. 

Mirror

If your kitchen is on the smaller side, then using a mirror as a backsplash can open up the space. They will reflect the light and make it bounce around the room. The more light, the more inviting the space. 

The surface of the mirror will be easy to clean, though it will end up taking more effort to keep clean as any little bit of grease or dirt will show. 

Wallpaper 

This material provides you with a fast any easy option but not the greatest amount of protection. You also need to think about how moisture will affect the wallpaper and cause it to peel. 

Stainless Steel 

Lining your backsplash with stainless steel will give it a modern feel and tie all of your stainless steel appliances together. It's ideal because it's durable, easy to clean, and resistant to high temperatures. 

Just be careful with acidic foods. The acid will ruin the finish if not immediately cleaned. 

Choose From These Backsplash Materials

Consider one of these backsplash materials for your kitchen. Think about the amount of cooking you do and the level of durability and protection you need. 

Some materials such as chalkboard paint or wallpaper you can apply yourself. Others, such as tile, marble, and stainless steel are best left to the professionals.