The Boston2.com Real Estate Blog

How Much Does it Cost to Buy a Home? Know Your Closing Costs.

What are the costs to expect from going under agreement to signing the closing paperwork and having keys in your hand?

Home Inspection

The first cost we generally see prospective home buyers occur is the home inspection cost. Not all buyers do a home inspection and it is not required, but this is something that we highly recommend. The home inspection itself will cost around $500, however there are other inspections other than the traditional home inspection that a prospective home buyer may occur.

We have seen these other inspections (which cost additional money) include a Radon Inspection, Pest Inspection and Well Water Inspection.

Application Fee

The Application fee is a fee that is paid upfront when applying for a loan. This application fee is used to cover the cost for a 3^rd party independent appraisal of the property that the prospective buyer has an accepted contract on. This application fee is generally in the range of $500 to $700.

Title Insurance

There are two types of Title Insurance. There is lender’s title insurance and the homeowner’s title insurance. Title insurance is one of the most expensive parts of a home buyers closing costs. Title Insurance insures against financial loss from defects in title to reap property and from the invalidity or unenforceability of mortgage loans. This insurance will defend against a lawsuit attacking title or reimburse the insured for the actual monetary loss incurred up to the dollar amount of insurance provided by the policy.

The Lender’s Title Insurance is a requirement by the lender in order for them to give the mortgage. The Owner’s Title Insurance policy...

How to get rid of Private Mortgage Insurance (PMI)

Private Mortgage Insurance is required in most cases when getting a loan if you do not put more than 20% down on a home loan (i.e. have a 20% equity position in a property).

It is an insurance premium that is provided by a 3^rd party for the bank which covers the loss up to that 20%. This insurance premium is what motivates a bank to lend and at the low rates to a borrower with less than 20% down.

In order to get rid of PMI, either the house needs to have appreciated to have a 20% equity position or the borrower needs to have paid down a portion of the principal balance to give the house that 20%. Appreciation can come from just regular market gains or from improvements to the property that a home owner has made.

There are three ways to remove PMI. You can either provide a new appraisal to the bank to show the new value, wait until you have paid down 78% from the original appraised value. Or refinance the property which really only makes sense if interest rates have not increased.

Bank’s don’t really want to remove this premium. So, you as a homeowner needs to nudge the bank in order to get them to do it.

At 78% of that original appraised value, a bank should automatically roll off the Mortgage Insurance Premium. Should. You will want to call them to verify if this is the case.

If you think the market has appreciated to give you that 20%, then the first thing you should do is call your Realtor to verify the market comps. Your Realtor can do this at no cost and this way you will have actual comps to provide to an appraiser.

Once you have figured out that you believe you have enough equity, then you will want to call your bank and talk with them about the process of hiring an appraiser. Do...

Things to Know When You are a First Time Home Buyer

The first thing to consider is the ‘Big 3”. The Big 3 is Credit, Employment and a Down Payment or Equit. In order to buy a house, a person needs to have a good credit score (what is a good credit score? We will talk about this in a couple seconds), employment and the down payment or equity in a current property that would be used as a down payment.

Down Payment

Most home buyers believe in the myth that in order to buy a house you need 20% as a down payment. This could not be further from the truth! The minimum down payment for a Fannie Mae or Freddie Mac loan is 3%. FHA loans have minimums of 3.5% while VA loans (Loans for active or past military) are able to put 0% down. These programs are used for Single Family homes as well as 2 or 3 family properties that are going to be owner occupied.

Credit Score

Know your credit score. Don’t be afraid! A great tip is to go to Experian.com. Experian is one of the three credit agencies that will give you a free credit score once per year. Your mortgage banker can also pull your credit score. It’s important to find out the credit score in order to be able to evaluate where you are and areas for possible improvement. If the credit score comes in a lower, then talk with your mortgage banker about creating a game plan that will help increase it.

Keep in mind that a Mortgage Credit Inquiry will not hurt your credit score. Now, if you were to make multiple mortgage credit inquiries then that would begin to affect your score. The credit agencies know what type of inquiry is being made and looks at a mortgage inquiry as favorable debt. A mortgage is considered secured debt vs. a credit card which is unsecured debt.

Know your Budget...

Met with a Realtor, What’s next?

While it isn’t actually the hardest step of the home selling process, calling a real estate agent is often the most prolonged! It’s tough for many as they “know” what they need to get done, but it’s never easy hearing it. I feel the same way when I go to my Doctor! I know she is going to say I am overweight… I don’t need hear it!

So, what’s next? You have met with an agent and you want to move forward with the process.

Step 1: Selecting Your Agent - Let the agent know that you would like to work with them (If you haven’t already done so in the appointment). Real Estate Agents are a lot of things… But mind readers we are not!

Step 2: Choose Your Marketing Package - Generally, after you have acknowledged that you would like to move forward, you will select the marketing program and commission structure that work best for you (Here is an example of our Fee Structure).

Step 3: Sign the Listing Agreement – This is an important step as it solidifies the relationship between you and your Broker. At this point, the agent is contractually required to work for you and to always have your best interests at heart. They may also start spending some of your marketing budget with pre-marketing as well as hiring a stager for a staging consultation.

Step 4: Recalculate Your Net Proceeds - Once you have that, you will want to go over how much it costs to sell a house (Click here to see the breakdown of expenses) with...

The Best Real Estate Agents in Plymouth

Each year, we at the Chubb Homes Team meet with a lot of homeowners as well as potential home buyers who are thinking about Buying or Selling a home in Plymouth. If you don’t know where Plymouth, MA is, then you probably were not listening during American History Class! And because so many people know our thoughts and feelings on all things “Real Estate”, they often ask who are some of the other top Real Estate Agents and competitors we have in the Plymouth.

Since we are never ones to shy away from being blatantly honest with respect to competition and we want our customers to be the best informed… Here is a list of some other top Real Estate Agents in Plymouth who will also do an amazing job representing you in the purchase and/or sale of your Plymouth House. So for those that asked the question of "Who are the Best Real Estate Agents in Plymouth?, here is the answer! 

And yes… I guess we are a little crazy! We want to ensure that the clients who choose to work with us are the best-informed consumers out there! And in order to do that, we have no issues pointing out our competitors. We love what we do!

1. Shawn Costa
Shawn is a team member of the Seagate Properties Team and is one of Plymouth’s top agents. He is a lifelong resident on the South Shore and is an active member in the community.

2. Beth Tassinari
Having more than 30 years of experience in Real Estate, Beth is a broker/owner of the local Century 21 office. She is a second-generation real estate agent specializing in Residential sales.

3. Michael Mulligan
Michael who works with Coldwell Banker is one of Plymouth’s top agents helps both buyers and sellers with their Plymouth Real Estate needs.

Who Are the Best Real Estate Agents in the Back Bay?

Each year, we at the Chubb Homes Team meet with a lot of homeowners as well as potential home buyers who are thinking about Buying or Selling a home in the Back Bay, a Boston Neighborhood. And because so many people know our thoughts and feelings on all things “Real Estate”, they often ask who are some of the other top Real Estate Agents and competitors we have in the Back Bay.

Since we are never ones to shy away from being blatantly honest with respect to competition and we want our customers to be as informed as possible… Here is a list of some other top Real Estate Agents in the Back Bay who will also do an amazing job representing you in the purchase and/or sale of your Back Bay Home.

And yes… We are crazy. We have no issues pointing out our competitors. We love what we do and we want to ensure our clients are the best-informed clients out there!

1. Tracy Campion
Tracy Campion has been one of Boston’s top selling Real Estate Agents for closing in on decades. Tracy has been named as one of the most 50 Powerful Women in Boston and is ranked in REAL Trends as well as the Wall Street Journal.

2. Beth Dickerson
Beth has been selling real estate for nearly 30 years and is one of Boston’s top selling Real Estate Agents. She has received national acclaims and has represented some of Boston’s most prestigious residents and properties throughout Massachusetts.

3. Robert Cohen
If you know Back Bay Real Estate, then you would know that Rob is one of the more familiar names on the Back Bay Real Estate scene. With more than 20 years of market knowledge, he is considered one of the top agents in Boston....

How much does it cost to sell a house? This is a question we get a lot! Selling a home in Massachusetts does have some fixed costs, but many of them are variable based on the specific situation of the seller. Below is a breakdown on the expenses of selling a home.

Click here to get a copy of our Blank Seller Net Proceeds Sheet

Loan Payoff: The first expense to be calculated is the loan payoff and pay off any equity lines that a homeowner may have. This expense is a variable expense that changes with each homeowner. Some homeowners may not have a mortgage.

Real Estate Commissions: The Commission owed to Real Estate agents is broken down as two separate fees. Most people when selling their home consider them one, however this is incorrect as the fee is broken down with a portion going towards the Marketing Fee as well as the Co-Broker Fee. By law, the seller pays the total fee to the broker they have retained to represent them in the sale of the property who then in turns pays the other brokerage for their representation of the buyer.

The marketing fee is the portion of the commission that is paid to the seller’s broker. This fee compensates the brokerage representing the seller for their marketing expenses, negotiation expertise and time spent managing the transaction.

The Co-Broke fee is what is paid to the brokerage that is representing the buyer. This brokerage is being compensated for introducing the buyer to the property and managing the transaction.

It is against the law for a Real Estate Agent to say that the Standard Commission charged is X. It is also against the law for two agents to discuss commission structures charged to other competing agents in other brokerages.

...

Is buying a condo different then buying a Single Family home? Jeff & Jason discuss some need to know items when buying a condo.

The mortgage market is always constantly changing which is why it's so important to talk to Jeff and/or Jason about your real estate goals when buying a condo in Massachusetts.

Things to think of:
- The buildings Owner Occupancy Rate
- Investor Concentration
- A condo association budget and Reserve Account
- Condo Document Restrictions
- A condo association approved by FHA/Fannie Mae
- Adding the condo fee into the monthly payment obligations

In this video, Jeffrey and Jason breakdown the main points of consideration when buying a condo. Each transaction is always different, but these generalities are a great starting point.

Should you have any questions, then reach out to Jeffrey at 617-480-2600.

How long does it take to buy a house when you are getting a mortgage? This is a question that we hear quite often from clients who are looking to buy a home.

Each state is different, but here in Massachusetts the average is about 45 days from offer accepted to closing. It is important to remember that closing dates are always negotiable between a buyer and seller, however a bank does need a certain amount of time to process a loan in order to be able to close.

Jeffrey and Jason breakdown what happens throughout the transaction and what a buyer (or seller) can expect and when. Each transaction is always different, but these generalities are a great starting point.

How can I Make My Offer More Competitive? This is something that we hear often from home buyers who are looking to get a competitive edge when it comes to buying a home.

The Buyer Power Checklist empowers home buyers who are looking for an advantage when it comes to getting their offer accepted to buy a home. It is especially helpful to first time home buyers who have never gone through the process before.

The Buyer Power Checklist breaks down an offers buying power into three different categories. A buyer's offer will either be in the 'Low', 'Average' or 'High' Buying Power category.

Offering Seller Free Occupancy (A Seller Rent Back)

How can I Make My Offer More Competitive? Offering the seller free occupancy through a rent back is a great option for home buyers who have a little flexibility as to when they need to be in the house. A home buyer who is renting a home before has a distinct advantage on offering this competitive advantage.

A buyer should always ask a seller what their preferred closing date is. An idea is to offer them to close a couple days before they intend to close on their next house and rent them the house back at $1 for a short period of time.

How does it help? Well it makes the process a little less stressful for a seller. By closing a couple days before it guarantees that everything will stick to their timeline and that their closing will be seamless.

If you are financing, the agreement with the bank does say that you will...

A Pre-Commitment can make an offer to a homeowner more attractive and thereby increase the chances of getting your dream home!

In this video, Jeff & Jason talk about the power of the Pre-Commitment and what it could mean for you and the seller. While it is often very hard to compete with a Cash offer, an offer with a Pre-Commitment will give you a fighting chance.

If you are thinking about buying or selling a home, then Jeffrey Chubb of the Chubb Realty Group and Jason Bonarrigo of RMS Mortgage can help guide you through the process. Give Jeff a call at 617-480-2600 or send hi an email at [email protected]. You can reach Jason at 617-413-5038 or by email at [email protected].

Transcript:

- Hi, I'm Jeff Chubb with the REN network, and today we're here with Jason Bonarrigo of RMS mortgage and we're talking about the pre-commitment. Now there's a difference between pre-qualification, pre-approval and then this pre-commitment. That's where we really want to dive in today. Ultimately, why should I get a pre-commitment? Who is it for? So, tell me what is a pre- commitment?

- Well, first of all, it's just a little bit more extensive than your normal pre-approval.

- Okay. Which is obviously just kind of not a quick certification, but we can do that pretty quickly. We can do that in 10 minutes sometimes or in 24 hours.

- And you're doing that? It's just, you?

- It's just me. No, exactly. Great point. So the difference between obviously the pre-approval and the pre-commitment is we're actually taking the time and we're sending it into the underwriting department to truly have it underwritten and stamped.

- Right.

- There...

Small Business Spotlight - The Cohasset Learning Studio

On this episode of the Business Spotlight on the REN Network, Jeffrey sits down to talk with Abigail Sullivan of the Cohasset Learning Studio.

Abigail discusses how she is making a difference in the community by helping kids learn how to read, write and do math. She is able to recognize any possible issues a child may have before they become an issue and work on closing the gap while it is easier and more natural for a child to learn.

Abigail offers private and semi-private tutoring, group classes and even zoom classes and tutoring.

Visit the Cohasset Learning Studio by clicking here. https://cohassetlearningstudio.com/

Transcript of Video:

- Hi, I'm Jeff Chubb with REN Network. On this week's business spotlight We're at the Cohasset Learning Studio with Abigail Sullivan talking about everything she does to help kids in the community. So Abigail, tell me. So how did the Cohasset Learning Studio, how did it start? I mean, how did you get here today?

- Well, I'm a former public school teacher and I'm adjunct faculty at a couple of colleges in Massachusetts. So I have a lot of experience in education and the theory and best practices and actually what's happening in the public schools and what isn't happening in the schools. After my first daughter was born I started my private practice in Cohasset and Hingham and supported kids working out of the...