Essential Real Estate Terms You Should Know

Essential Real Estate Terms You Should Know

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Every industry has its own acronym and real estate is no different. Real estate is full of jargon that can add confusion to an already elusive process. Whether you're selling or buying here are the essential real estate terms you should know.

Asking questions should not be intimidating. Would it help you to know that you’re not alone? Real estate is intimidating and overwhelming for most people. My goal is to make it as simple for you to navigate as possible. Let's dive in:

1) Pending

Once a residential buyer and seller have reached a mutual agreement on the terms of a sale, the property will then be moved from “Active” to “Pending” or “Pending Inspection”. The contract timelines are very important. 

2) Earnest Money (EM)

Once a buyer and seller have reached a mutual agreement on a contract, the buyer will then deposit a set amount into an escrow account. This earnest money (EM) shows the seller that the potential buyer is EARNEST about buying the property. When the property closes, the EM is then put towards the buyer’s down payment or returned.

3) Escrow

Escrow is a term that refers to a third party that is hired to handle the transaction, the exchange of money and any related documents. Placing Earnest Money, for example, into escrow means to place it in the hands of a third party until certain conditions are met; once the transaction has closed the escrow company will disburse the funds appropriately. 

4) Appraisal

An appraisal is an assessment done by a certified appraiser to determine the value of the property. The appraisal is usually based on an analysis of comparable sales of similar homes nearby. 

5) Dual Agency

Dual Agency is when one agent represents both the buyer and the seller, instead of just one or the other. Depending on state laws, real estate agents are able to represent both the buyer and the seller in the same transaction. There are some states that do not allow dual agency.

6) Bank Owned & Short Sale

When a property owner defaults on their mortgage, the lender will sometimes allow the seller to sell as a short sale. That means that the bank has agreed to let the home be sold for less than the balance on the current owner’s loan. A bank-owned property is when a  lender won’t agree to sell the property for less than what is currently owed on it, so the property has been foreclosed on and is now “Bank Owned.”

7) Comparative Market Analysis (CMA)

A CMA is an analytic report to help real estate agents strategize what the hyper-local market is doing in order to determine your property value. The analysis is conducted based on the active, pending, and sold values of similar properties in the same area within a specific time frame. The CMA report should help you in understanding what a realistic listing price is, and whether or not you’re buying a property for the right price.

8) Commission

Real Estate agents are paid on commission. This is an agreed-upon % of the sale price which is then divided between the selling and listing agent, it is typically 6%. Once a transaction closes, the seller will pay the originally agreed-upon percentage of the purchase price from the net proceeds of the sale. In Washington State, the seller pays 100% of the real estate commissions.

9) Equity

A property owner’s Equity is the difference between the fair market value of the property and the amount still owed on its mortgage or other liens. It is common for people to borrow against their equity to do property improvements. 

10) Encumbrance

An encumbrance is a claim against, limitation on, or liability against real property. Encumbrances can restrict the owner’s ability to transfer title to the property or lessen its value. Having an awkward conversation is worth it, guys.

Helping you understand real estate lingo is one of my favorite topics because it is SO important. If you have any Real Estate questions or pain points in your Real Estate journey, I would love to break it down into bite-sized pieces and serve you up a hot plate of awesome.

Leave a comment with any other terms or resources that you would find helpful!

All the best,

Carmen Neal Signature

 

 

 

P.S. Be sure to follow me on Facebook and Instagram if you don't already. Don't miss out on the tips, tricks, and sometimes just plain funny items I share on social media!

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5 Common Landlord Mistakes and How to Avoid Them

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5 Common Landlord Mistakes and How to Avoid Them

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Staying up to date with Washington State landlord-tenant laws takes a lot of time. Knowing what and how to prioritize can be daunting. With the goal of a high return on your rental investment, you’ll want to keep these 5 common mistakes in mind:

1. Having a non-existent or weak lease

Gone are the days of handshake deals. In Washington State contracts are void unless in writing so having an ironclad lease is so important. A property management company will have a standard lease that they use and making sure it has all the important pieces pertaining to your specific property is key.

2. Not conducting a thorough move-in and move-out walkthrough

A written checklist that clearly states the condition of the property prior to occupancy should be done before every new tenancy. When the checklist is completed the landlord or property manager and tenant should sign off on it. At the end of the lease term, both parties will need to review the property to see if there are any repairs needed and if any damage expenses should be deducted from the security deposit.

3. Renting to someone without a thorough screening

When you’re looking for a tenant you’ll want to do a thorough background check. You’ll want to research the new tenant and make sure you’re fully informed about what you are and are not allowed to ask.

4. Not knowing important and legal timelines

Keeping up to date with the most recent laws and rental agreement requirements could keep you from being sued. Knowing and reviewing the Washington state landlord-tenant laws is the best way to stay up to date on best practices.

5. Avoiding routine inspection

The best way to make sure your rental property is being well cared for is by conducting an annual inspection. Using the written checklist from the move-in can be a good guide.

At the end of the day, every property is different and has unique circumstances. If you need someone to speak with I’d be happy to help.

All the best,

Carmen Neal Signature

 

 

 

P.S. Be sure to follow me on Facebook and Instagram if you don't already. Don't miss out on the tips, tricks, and sometimes just plain funny items I share on social media!

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How to sell or buy real estate without losing your mind

How to buy or sell real estate without losing your mind

How to sell or buy real estate without losing your mind

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Selling or buying real estate can come with a lot of headaches. Those headaches can quickly turn into a real migraine once you start thinking about the laundry list of “To-Do’s”. I’m dedicated to guiding you through how to sell or buy real estate without losing your mind.

It IS a lot of work to get top dollar when selling. Knowing where to start can be super overwhelming if you don't do this every day... But we do. The truth is that overwhelm does not need to be apart of the process. I want to completely eliminate the overwhelm and frustration of selling your property and/or buying your new home. Let’s create a plan that will help you save thousands of dollars and eliminate the headache of reaching your goal.

Three steps to eliminating overwhelm: 

1- Analyze your goals

2- Create a custom strategy

3- Execute and see results

Analyze your goals

No one knows your circumstances better than you. What is it that you want? Ideally, where will you be once this transaction is done? Why are you wanting to make this move? How will you know which property is THE property? The general market affects the value of your real estate investment and your specific goals should be taken into consideration too. 

Understanding and writing down your needs and wants is the best way to assure you stay on track. There are a lot of questions to ask when selling and buying a new home so knowing how to filter through the questions to find which will actually move the needle is important.

Honestly assess your answers to these questions and use your answers to create a clear path forward in Step 2. If it’s difficult for you to answer those questions then I would suggest speaking to a licensed agent that you trust. 

Create a custom strategy

Once you know what your overall goals are, how will you get there? What is your next action item? First and foremost, find a real estate professional you can trust to guide. A custom timeline that is created around your specific goals will give you the leverage to get what you want, where you want, and for the price you want. Here are some key prompts to creating your strategy:

Execute and see results

After you have your strategy, this is where it gets real. Your agent will use the road map you designed in Step 2 to start curating properties to present to you. Once you have chosen a property on which to make an offer, your agent should go to bat for you to get you the home. Once an offer is accepted, they will walk with you through the paperwork.

Your real estate agent should be your advocate so working with someone you trust who can help guide you is so important. 

All the best,

Carmen Neal Signature

 

 

 

P.S. Be sure to follow me on Facebook and Instagram if you don't already. Don't miss out on the tips, tricks, and sometimes just plain funny items I share on social media!

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How Time Works In Real Estate

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How Time Works In Real Estate

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Misunderstanding how time works in real estate can cost BIG! 

One hour late and you could lose your earnest money AND the property. How time works during a real estate transaction is different than how time works in our day to day lives so I’m breaking it down in bite-sized pieces and a fun pop-quiz. 

Whether you’re a first-time homebuyer or a seasoned seller, you’ll want to know how time works in a real estate transaction, including facts such as: 

  • Any period of time starts on the day following the event commencing the period.
  • Time periods of 5 days or less do not include weekends or legal holidays.
  • Time periods of more than 5 days include weekends and legal holidays.
  • Time periods end at 9:00 pm on the last day of the specified period.
  • If the last day of the time period is on a weekend or a legal holiday, it moves to the next day that is not a weekend or legal holiday.
  • Time periods are not delayed by a missing legal description; time periods begin from the date of mutual acceptance.

Since we all love a good story, let’s look at how these rules apply to our friends John & Jane’s homebuying experience. 

On Friday, January 3rd, John, and Jane submitted an offer on their dream home. It was accepted the same day! Their timeline was tight since they only had 5 days to conduct their inspection, so they were eager to get started. The inspection was done on Thursday the 11th and we gave our response back to the seller on Friday the 12th.

Using the rules listed above see if you can answer these three questions: 

  1. When was day one of the time period? 
  2. Did John and Jane give their inspection response to the seller within the allotted time period?
  3. When was the latest time and day they could have given their response back to the seller?

How did you do?

 

All the best,

P.S. Be sure to follow me on Facebook and Instagram if you don't already. Don't miss out on the tips, tricks, and sometimes just plain funny items I share on social media!

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Washington’s Safe Start Proclamation

Washington’s Phased Reopening

Washington’s Phased Reopening Approach- Pierce County

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On June 1st Governor Jay Inslee’s office put out the “Safe Start Proclamation” for Washington’s phased reopening approach, putting Pierce County in Phase 2. Covid-19 is effecting every county differently so Washington state so they have put out the  Safe Start application for each county. Although Pierce County is approved to enter Phase 2, social distancing is still required.

Tips for selling a property during Phase 2: 

Yes- real estate is still selling. 

We may be in the middle of a pandemic but selling real estate does not have to be a daunting task. Here are some tips if you're in this boat.

  • For owner-occupied homes, discuss the pros and cons of limiting showings, especially if there are young, elderly, or immunocompromised people living in the home.
  • Make sure your listing has a 3D virtual tour so buyers can easily view it.
  • If the property is occupied, disinfect all surfaces after each show.
  • Have hand sanitizer, masks, gloves, and a note to the person entering requesting that they use the provided materials while viewing.

Tips for buying a home during Phase 2: 

Home Buying can be a daunting task, especially for beginners but the Washington State Eviction Moratorium will help a lot of first time homeowners that are transitioning from renters to owners.

  • Consider viewing houses via "virtual showings."
  • Wear cloth face coverings.
  • When showing homes, touch as few surfaces as possible while in the home, and use sanitizer and wash your hands. Keep your hands in your pocket whenever possible.
  • Asking for a walk-through video or conference before you go and see it in person will help cut down on properties you may not want to see. 

In-person activities during Phase 2:

-All meetings must be by appointment only and virtual whenever possible.

- Real estate brokers and industry partners (e.g. appraisers, inspectors, photographers, stagers, etc.) must wear cloth face coverings and should encourage clients and customers to do the same.  

- No more than three (3) people including the broker may be at the property at any one time. Brokers may only bring two other people at a time into a property.

- Those people must strictly follow social distancing guidelines by remaining at least six feet apart at all times. 

Frequently Asked Questions:

  • Can inspectors conduct inspections? Yes. 
  • Can appraisers conduct in-person appraisals during Phase 2? (Revised June 5, 2020) Yes.
  • Can buyers’ brokers conduct “buyer walk-throughs” prior to closing during Phase 2? (Revised June 5, 2020) Yes.
  • Can real estate brokers input new listings in the MLS system during Phase 2? Yes. 
  • Can professional photographers take photos and create virtual tours during Phase 2? Yes. 
  • Can stagers stage homes and remove furniture from a listing during Phase 2? Yes. 
  • Can moving companies move buyers into a property and move sellers out of a property? Yes. 
  • Can brokers hire signs installers during Phase 2? Yes. 
  • Can contractors make repairs associated with an inspection response? Construction practices are permitted and regulated under a separate order from the Governor. You’ll want to consult with any contractor hired to complete repairs to ensure that the contractor is in compliance with all protocols required of the contractor. 
  • Are property management services included in Phase 2? Yes.
  • Can lenders, title, and escrow continue to operate? Yes. 

Please visit the CDC's website and the Washington State Department of Health's website for the latest updates about the pandemic. 

All the best,

P.S. Be sure to follow me on Facebook and Instagram if you don't already. Don't miss out on the tips, tricks, and sometimes just plain funny items I share on social media!

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Washington State Eviction Moratorium

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Washington State Eviction Moratorium

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Being a landlord during a pandemic is not for the faint of heart.

Washington State Governor Jay Inslee put an eviction moratorium in place on March 18th, 2020, with the intent of preventing an increase in homelessness during the ongoing coronavirus pandemic. The moratorium, which legally prohibits landlords from evicting tenants for non-payment of rent, was set to expire the first week of June but has now been extended through August 1st. With limited exceptions, the moratorium also does not allow late fees to be charged on unpaid rent, and landlords are required to offer residents a repayment plan on unpaid rent.

The office of Washington State Attorney General Bob Ferguson has received hundreds of complaints from tenants stating that their landlords are insisting on payments with the risk of eviction if not paid in full. 

Some community members are in agreement that rent forgiveness is essential while landlords are left to clean up the mess… both metaphorically and literally. If you are a landlord and need help navigating this difficult time, reach out now. 

For more information regarding COVID-19 and resources available to you, please visit the following:

Landlord resources: The site for Fannie Mae can be found here. The site for Freddie Mac can be found here.

WA State Department Of Health

https://www.doh.wa.gov/Emergencies/Coronavirus

WA State Department Of Financial Institute

https://dfi.wa.gov/coronavirus-financial-resources

If you need to reach us regarding COVID-19, please call or email. We will do our best to return all emergency calls and emails the same day. 

All the best,

P.S. Be sure to follow me on Facebook and Instagram if you don't already. Don't miss out on the tips, tricks, and sometimes just plain funny items I share on social media!

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