Why You Need A Top-rated RE/MAX Farmington Hills MI REALTOR®

Why You Need A Top-rated RE/MAX Farmington Hills MI REALTOR®

Why You Need A Top-rated RE/MAX Farmington Hills REALTOR®: Whether you are a first-time buyer or a seasoned veteran, buying a home in Farmington Hills MI can be one of the most exciting experiences of your life. It can also be a stressful undertaking. Fortunately, there are qualified real estate agents out there who can help you navigate the challenges of buying a home and help eliminate a lot of the stress. Overall, you’ll want to look for a REALTOR® and company you feel comfortable with and trust. Selecting the right one can make the difference between finding the right home for your lifestyle needs quickly and securing an offer or searching unsuccessfully for months.  

Tom Gilliam is a top-rated RE/MAX Farmington Hills MI REALTOR®  with over 17 years of experience. When you choose a RE/MAX professional like Tom Gilliam to help you with the home buying process, you can expect an exemplary level of service. Tom is a local market expert with access to a full complement of real estate tools and resources to ensure a successful home buying experience. With a trusted RE/MAX professional and the right support system, you’ll be able to make the most informed decisions. Tom’s comprehensive, high-quality services can save you time and money, as well as make the experience more enjoyable and less stressful.

Why Choose RE/MAX?

RE/MAX (short for Real Estate Maximums) has been in operation since 1973. The real estate company has since grown to encompass more than 100,000 sales agents working in franchise-owned and operated offices in more than 100 countries. A real estate powerhouse in its own right, and one of the industry’s most recognized brands, RE/MAX  is regarded as one of the country’s most productive real estate sales forces.  

  • When you look for the highest quality real estate service, look to a RE/MAX Associate. RE/MAX Associates are The Real Estate Leaders®. You can depend on RE/MAX Associates to make the sale or purchase of a home as effortless and seamless as possible.
  • RE/MAX agents are The Hometown Experts With a World of Experience®. They are the most knowledgeable agents, with the experience and community connections to assist you in the homebuying process. Across the globe, they are the people next door, or just down the block.
  • At RE/MAX, advanced education is a priority. RE/MAX Associates dominate the Accredited Buyer Representative (ABR), Certified Distressed Property Expert (CDPE), Certified Residential Specialist (CRS), and Seniors Real Estate Specialist (SRES) ranks.
  • Customer SatisfactionThe proof of quality service is in repeat customers and in customers who refer RE/MAX Associates to friends. RE/MAX Sales Associates typically generate a large percentage of their business from past customers and referrals.

Why You Need Top-rated REMAX Farmington Hills REALTOR® -Tom Gilliam 

For buyers interested in Farmington Hills MI homes for sale, Tom can help you every step of the way with real estate contracts, finding the best interest rate and loan programs, and even work with appraisers and home inspectors. If you are relocating to Farmington Hills from another part of the state or country, you’ll need a qualified agent to help you find the right home for your family. As a local expert, Tom can help educate you on the best neighborhoods and communities, the types of homes and features offered, schools, utilities, zoning, surrounding area amenities, commuting information, local community developments, and more.

As your RE/MAX Farmington Hills MI REALTOR®, Tom can go over different financing options and refer lenders that are best qualified to help you. He will take the time to investigate all available properties and has access to many resources to assist you in uncovering the right home for your family. Tom will arrange private showings for homes worth seeing in person based on your specific criteria and assist you in making the best purchase decision by providing objective information about each property. He can also help with negotiations and inspections and will guide you through the closing process to ensure that everything flows together smoothly.

Living in Farmington Hills, MI

 Farmington Hills is a northern suburb of Metro Detroit and the second most-populated city in Oakland County. Farmington and Farmington Hills are often thought of as the same community although the two cities have separate services and addresses. Downtown Farmington is a charming, walkable destination with over 160 businesses from banks, to photography and yoga studios to one-of-a-kind shops along with a variety of local eateries. 

Also located downtown is Riley Park and Walter E. Sundquist Pavilion, home to the popular Farmington Farmers & Artisans Market that is held every Saturday. The best-known park event is Rhythmz in Riley Park, attended by about 500 people every Friday between the months of June and August.  

Several major corporations are located in Farmington Hills including Nissan Technical Center and Nissan Trading Corp, Hitachi Automotive Services, Hino Motors Manufacturing, and branches of Panasonic, Mercedes Benz, and Greenpath. Other top Farmington Hills employers include Robert Bosch Corporation, Botsford Hospital, Quicken Loans, Cengage Learning Gale, and Chrysler Financial Services.  

Twelve Oaks Mall in Novi is located less than 6 miles from Farmington Hills. The mall is the destination of choice of metro Detroit and features nearly 200 distinctive stores and restaurants such as Apple, Coach, Michael Kors, The Cheese Cake Factory, and more.  

For parents with school-age children, most of Farmington Hills is served by the highly-acclaimed district of Farmington Public Schools, which is shared with nearby Farmington and filled with top-rated schools. School districts serving a smaller portion of the community include Clarenceville Public Schools and Walled Lake Consolidated Schools.

Private schools in Farmington Hills include The International School, Maria Montessori Center, Mercy High School, St. Fabian Elementary and Middle School, Schoolhouse Montessori Academy – Farmington Hills, and Steppingstone School. Institutions of higher learning include branches of Michigan School of Psychology, Oakland Community College mi, and Wayne State University.

Farmington Hills has several community parks and facilities, including Costick Activities Center, MI -Dog Park, Fishing Pier, Founders Sports Park, MI – Golf Club & Driving Range, Heritage Park, Ice Arena, Jon Grant Community Center, Longacre House, Nature Center, Riley Archery Range, Skate Park, Splash Pad, and Farmington Hills Community Center.

The 211-acre Heritage Park in Farmington Hills features 4.5 miles of trails for hiking and nature study which are also used for cross-country skiing during the winter months. The park features a large picnic area, splash pad, group picnic shelter, playground, in-ground grills, two sand volleyball courts, an in-line hockey rink, and six horseshoe pits. 

The Great Lakes are the dominant physical resource in the region and a number of inland lakes reinforce the popularity of water sports and water-based activities. Lake St. Clair, the Detroit River, and Lake Erie are all within an hour’s drive of Farmington Hills and attract boaters, swimmers and fishermen. The Upper Rogue River flows from Farmington Hills southward through the north and eastern portions of the City. 

For golfers, the Farmington Hills Golf Club’s pristine 175-acre course offers one of the best golfing venues in the area, with 18 challenging holes measuring 6,413 yards, manicured bent grass tees, fairways and greens, ponds, and gently rolling hills. Other golf courses in Farmington Hills include Copper Creek Golf Course (9 holes) and Glen Oaks Golf Course (9-holes).

Several major highways service the city: Grand River Avenue is a major east-west corridor through downtown Farmington. I-696 is about three miles north and I-275 about three miles west. The M-5 Freeway runs through the City and Eight Mile Road is on the southern border. Because of the excellent highway system, most sections of the metropolitan area are readily available to Farmington’s residents. Suburban Mobility Authority for Regional Transportation (SMART) operates local and regional bus services for Farmington Hills. The closest major airport is Detroit Metropolitan Wayne County Airport located about 30 miles from the center of town. 

Partner with REMAX Farmington Hills REALTOR® -Tom Gilliam 

Whether you’re interested in purchasing your first home, upsizing to a larger home with room for a growing family, looking to buy your dream home or the right investment property, why not take advantage of Tom’s 17-plus years of experience as a top-rated RE/MAX Farmington Hills MI REALTOR®? Tom will look out for your best interests, advocate for you, negotiate on your behalf, and do whatever it takes to ensure the best results possible. Get the homebuying process started today by calling Tom directly at (248) 790-5594 or you can reach him by email.

Tom Gilliam, REALTOR®
RE/MAX Classic
29630 Orchard Lake Rd.
Farmington Hills 48334
Direct: 248-790-5594
Office: 248-737-6800
Email: Homes2MoveYou.com
License #314578 

Farmington Hills MI 

Buying A Home in Farmington Hills MI? Getting A Pre-approval is Key

Buying A Home in Farmington Hills MI? Getting A Pre-approval is Key

Buying A Home in Farmington Hills MI? Getting A Pre-approval is Key: You may have been told that it’s important to get pre-approved at the beginning of the homebuying process, but what does that really mean? And why is it so important? In today’s market, with rising home prices and high buyer demand, it’s crucial to have a clear understanding of your budget and stand out as a serious homebuyer to sellers.

Once you get pre-approved for a home loan, the seller knows you’re a better prospect than someone who hasn’t begun negotiating with a lender. Pre-approval is also helpful when you’re hunting for a house. If you have a pre-approval amount of $240,000, for example, you know not to waste your time shopping for a $400,000 home.

Is Pre-qualification the same as pre-approval?

A pre-qualification is a good indication of creditworthiness and the ability to borrow, but a pre-approval is the definitive word. A mortgage pre-qualification is usually based on an informal evaluation of your finances. You tell the lender about your credit, debt, income, and assets, and the lender estimates whether you can qualify for a mortgage and how much you may be able to borrow.

Pre-approval is the next step if you get a thumbs up during pre-qualification. During the mortgage pre-approval process, a lender will pull your credit report and review documents to verify your income, assets, and debts.  If you are confident about your credit and financial readiness to buy a home, then you might skip the pre-qualification step and go straight to the pre-approval and start shopping for a home. 

Mortgage pre-approval

A mortgage pre-approval is an offer by a lender to loan you a certain amount under specific terms. Pre-approval is not a guarantee you will be given a loan and the mortgage can still be denied. A home appraisal must be completed before a loan can close to ensure you aren’t paying more for the home than it’s worth. 

Also, the lender’s offer may not stand if your financial situation changes between pre-approval and closing. Keep in mind that it can take several days or longer to get preapproved for a mortgage. The timeline varies by lender and how quickly you are able to provide the lender with the information it needs, including proof of your income and assets.

When you are ready to make offers, a seller often wants to see a mortgage pre-approval and, in some cases, proof of funds to show that you’re a serious buyer. In today’s competitive market, sellers have an advantage because of intense buyer demand and a limited number of homes for sale; they may be less likely to consider offers without pre-approval letters.

According to the National Association of Realtors (NAR), homes are receiving an average of 5.1 offers for sellers to consider. As a result, bidding wars are more and more common. Pre-approval gives you the advantage you need if you get into a multiple-offer situation, and these days, it’s likely you will.

When multiple buyers have made legitimate offers for the same Farmington Hills MI property, the seller can choose which one they want to accept. A pre-approval letter indicates to both real estate agents and home sellers that you’re financially able to buy a home, and it’s expected that a pre-approval letter will accompany any offer you make.

How to get pre-approved for a home loan

Start by requesting copies of your credit reports. Dispute any errors that might be causing your score to be lower than it should be. If you find delinquent accounts, work with creditors to resolve the issues before reaching out to a lender for mortgage pre-approval.

A credit score of at least 620 is recommended, and a higher credit score will qualify you for better rates. Generally, a credit score of 740 or above will enable most borrowers to qualify for the best mortgage rates. 

Calculate your debt-to-income ratio. Your debt-to-income ratio, or DTI, is the percentage of gross monthly income that goes toward debt payments, including credit cards, student loans, and car loans. Lenders prefer borrowers with a DTI of 36% or below, including the mortgage, though it can be higher in some cases.

Gather income, financial account, and personal information such as Social Security numbers, current addresses, and employment details for you and your co-borrower (if you have one). You will also need bank and investment account information and proof of income. 

Documents you will need to get a mortgage pre-approval letter include your W-2 tax form and 1099s if you have additional income sources and pay stubs. Two years of continuous employment is preferred, but there are exceptions.

Self-employed applicants will likely have to provide two years of income tax returns. If your down payment will be coming from a gift or the sale of an asset, you’ll need a paper trail to prove it.

Understand what the lender is offering you. Make sure you understand all the terms of your mortgage. If you don’t know what something means, the lender must explain it to you. The Truth in Lending Act requires all lenders to provide you with comprehensive loan cost information so you can comparison shop.

Comparing offers from multiple lenders can help you compare rates and fees and save you thousands of dollars over a 30-year mortgage. Going through the mortgage pre-approval process shouldn’t hurt your credit score. FICO, one of the largest U.S. credit scoring companies, recommends confining those applications to a limited time frame, such as 30 days.

Time your pre-approval. A pre-approval is typically good for 90 days. Wait until you’re ready to start hunting for your house before you request a pre-approval, otherwise, you are wasting both your time and that of the lender who’s preapproving you.

The bottom line

Every step you take to gain an advantage as a buyer is crucial in a market that’s constantly changing. Interest rates are low, prices are going up, and lending institutions are regularly updating their standards.

It is important to have the information, resources, and the right team of professionals such as a loan officer and a trusted Farmington Hills MI real estate agent to help ensure that you take the right steps. If you’ve been trying to decide if now is the right time for you to buy a home, let’s connect to discuss your options.

Partner with top-rated Farmington Hills MI REALTOR® – Tom Gilliam

With a passion for real estate, Tom Gilliam has been serving Farmington Hills and the surrounding Oakland County MI area for nearly two decades. Tom is known for his friendly demeanor, dedication, and professionalism. He will be able to quickly ascertain your needs and goals and create a plan of action based on your specific criteria. 

Tom’s clients appreciate his honesty and transparency and feel it helps them as they make important real estate decisions. He understands how important good communication is to every transaction and is available for his clients whenever they have questions or concerns, promptly returning all phone calls, texts, and emails.

Having someone like Tom by your side to advise and guide you means there is one less thing you need to worry about. He will protect your interests, advocate for you, negotiate on your behalf, and go the extra mile to ensure the best results possible. If you are interested in buying or selling Farmington Hills real estate or homes in the surrounding area, please give Tom Gilliam a call at (248) 790-5594 or you can reach him by email.

Tom Gilliam, REALTOR®
RE/MAX Classic
29630 Orchard Lake Rd.
Farmington Hills 48334
Direct: 248-790-5594
Office: 248-737-6800
Email: Homes2MoveYou.com
License #314578 

Map Farmington Hills MI

What is Motivating Americans to Move and Buy Homes Right Now?  

What is Motivating Americans to Move and Buy Homes Right Now?  

What is Motivating Americans to Move and Buy Homes Right Now? – Today, Americans are moving and purchasing homes for a variety of reasons. The current health crisis has reshaped our lifestyles and needs. It has prompted many of us to think more about what we truly want in a home and where we want to live. In the early days of the pandemic, many people escaped small apartments in crowded cities to the suburbs and more open locations to escape the deadly virus.

As remote work became an option for many, people suddenly felt they had more freedom to choose where they wanted to live, as they were no longer tethered to where their employers were located. And just like that, 2020 made moving a reality for millions of Americans. Some moved in with their parents to be around family and even save on rent. For others, it finally gave them a reason to focus on pre-pandemic dreams such as moving across the country in pursuit of a more quality lifestyle and cheaper cost of living.  

According to the 2020 Annual National Movers Study: “For customers who cited COVID-19 as an influence on their move in 2020, the top reasons were concerns for personal and family health and wellbeing (60%); desires to be closer to family (59%); 57% moved due to changes in employment status or work arrangement (including the ability to work remotely), and 53% desired a lifestyle change or improvement of quality of life.” 

With a new perspective on homeownership, here are some of the top reasons why people are reconsidering where they live and thinking differently about what they want and need in a home:

1. Remote Work 

What is Motivating Americans to Move and Buy Homes Right Now?  

According to the Census Bureau, the percentage of people who change residence each year has been declining since the mid-1980s and reached its lowest point just before the COVID-19 pandemic. This trend may have continued if not for the sudden and rapid adoption of remote work. Real estate brokerage firm Redfin found in a recent survey that a third of home buyers and sellers would consider moving to a different city or area if remote work becomes permanent. Remote work became the new norm, and for many, it’s persisting longer than initially expected. 

Apartment List notes: “The COVID pandemic has sparked a rebound in residential migration: survey data suggest that 16 percent of American workers moved between April 2020 and April 2021, up from 14 percent in 2019 and the first increase in migration in over a decade… One of the major drivers in this trend is remote work, which expanded greatly in response to COVID and will remain prevalent even after the pandemic wanes.  

Working from home was already gaining popularity before COVID but the pandemic accelerated the trend. According to the latest research, even after the pandemic subsides, the economy will contain significantly more remote jobs than ever before. And this newfound flexibility is getting people moving again. Many in the workforce are discovering they don’t need to live near their office and can get more for their money if they move further outside the city limits.  

Lawrence Yun, Chief Economist for the National Association of Realtors (NAR) notes: “With the sizable shift in remote work, current homeowners are looking for larger homes and this will lead to a secondary level of demand even into 2021.” If you’re renting a small space or recently tried to convert your dining room into a home office with minimal success, it may be time to make a change. The reality is, your current house may not be optimally designed for today’s lifestyle, making remote work and continued productivity very challenging.

2. At-home Fitness Space

What is Motivating Americans to Move and Buy Homes Right Now?  

Staying healthy and active is a top priority for many Americans. COVID-19 may have closed gyms for most of 2020, but it didn’t keep us from working out. Instead of going to the gym, many turned to home-based alternatives. From March to October 2020, health and fitness equipment revenue more than doubled, skyrocketing to $2.3 billion, according to data from market research firm NPD. Treadmill sales increased 135 percent, and stationary bike sales almost tripled, with Peloton reporting $1.8 billion in 2020 revenue.

Peloton chief membership officer Brad Olson told The Washington Post: “We do believe that the pandemic has compelled consumers to re-evaluate their fitness routines and many have discovered that the best, most connected workout can actually be experienced at home.” Buying their own equipment and accessing instructions through apps or teleconferencing is enough for them.

It’s expected that 59 percent of Americans don’t plan to renew their gym memberships post-pandemic, according to a TD Ameritrade survey. Many people, however, don’t have space for a dedicated home gym or even for exercise equipment. Having room to maintain a healthy lifestyle at home – mentally and physically – may prompt you to consider moving to a place that includes space for the healthy lifestyle you desire.  

3. Outdoor Living Space

What is Motivating Americans to Move and Buy Homes Right Now?  

For apartment owners and city dwellers, the experience of having to stay at home month after month during the pandemic has emphasized the desirability, importance, and value of having private outdoor space. You may be able to find small balconies or terraces in the midst of urban living, but larger backyards and space are more likely to be found, and more affordable, in the suburbs.

While outdoor space has always been considered an appealing feature to homeowners, many have emerged from quarantine with a new appreciation for a place to step outside, breathe in the fresh air, and have enough space for humans and pets to run around and be active. At the end of the day, it’s all about how we can make our homes the most comfortable and enjoyable place to live and pass the time, both inside and out.

An outdoor living space can take many different forms. It can be a few chairs around a fire bowl, a poolside gazebo, or a deck with a barbeque grill. It should have places to sit and tables for beverages and snacks. Think about when you’ll be spending time in the space. Do you need lighting? What about shade? For privacy, plant a hedge or a vine growing on a trellis.

Better Homes & Gardens recently released the outdoor living trends that are huge for 2021. Building on last year’s momentum, homeowners can expect to bring indoor conveniences outdoors with multipurpose add-ons, smart technology, and structures that allow us to be outside longer and more often throughout the year. Whether it’s a spot to grow herbs for homemade meals, a private patio with plenty of shade, or a place to do the cooking, outdoor living in 2021 is synonymous with more time spent at home.

  • Outdoor Kitchens – A 2021 design trends report by the National Kitchen and Bath Association (NKBA) found that 60% of homeowners are looking to add outdoor kitchens. 
  • Edible Garden: Millions of people began gardening during the pandemic. Motivations varied from the desire to be outdoors to wanting a new hobby to fill the time at home. One of the biggest reasons for increased interest in edible gardening was to supplement pantries with homegrown fruits and veggies.
  • Front YardsSocial front yards are the newest home “addition,” according to Blythe Yost, CEO, and co-founder of online landscape design company Tilly. Creating an outdoor living space at the front of the home is not only about maximizing available space for daily living—it’s for welcoming our communities, too. “Because of the pandemic and the change in our social lives, there is a desire to feel connected more than ever,” Yost says.
  • Secluded Spaces – As outdoor activity increases, so does the need for privacy, shade, and shelter from the elements. Whether it’s a secluded space to practice yoga or a place to use your laptop out of the sun’s glare, a mix of landscaping, hardscaping, and even furniture, can provide protection and add privacy to outdoor spaces.
  • Outdoor Technology – As people integrate the outdoors into everyday living, they’re “looking to incorporate all the technology they use on the interior, for the exterior,” says Joe Raboine, director of residential hardscapes with Belgard. Working from home has many people adding boosters to amplify Wi-Fi signals outdoors for home offices. “The pandemic really has driven great interest into creating outdoor office spaces,” he says.

For many homebuyers, having ample outdoor space Is the main consideration for moving.  

Bottom Line

If you are in need of more room to accommodate your changing needs and lifestyle, making a move might be your best option, especially while you can take advantage of today’s low mortgage rates. It’s a great time to get more home for your buck, just when you need it most. If you’ve been trying to decide if now is the right time for you to buy a home, let’s connect to discuss your options.

Partner with top-rated Farmington Hills MI REALTOR® – Tom Gilliam

With a passion for real estate, Tom Gilliam has been serving Farmington Hills and the surrounding Oakland County MI area for nearly two decades. Tom is known for his friendly demeanor, dedication, and professionalism. He will be able to quickly ascertain your needs and goals and create a plan of action based on your specific criteria. 

Tom’s clients appreciate his honesty and transparency and feel it helps them as they make important real estate decisions. He understands how important good communication is to every transaction and is available for his clients whenever they have questions or concerns, promptly returning all phone calls, texts, and emails.

Having someone like Tom to advise and guide you means there is one less thing you need to worry about. He will protect your interests, advocate for you, negotiate on your behalf, and go the distance to ensure the best results possible. If you are interested in buying or selling Farmington Hills real estate or homes in the surrounding area, please give Tom Gilliam a call at (248) 790-5594 or you can reach him by email.

Tom Gilliam, REALTOR®
RE/MAX Classic
29630 Orchard Lake Rd.
Farmington Hills 48334
Direct: 248-790-5594
Office: 248-737-6800
Email: Homes2MoveYou.com
License #314578 

Map Farmington Hills MI

 

Things to Know About Buying A Farmington Hills Home With Guest Unit

Things to Know About Buying A Farmington Hills Home With Guest Unit

Things to Know About Buying A Farmington Hills MI Home With Guest Unit 

For many homebuyers, a separate guest house or attached in-law suite is the ultimate home purchase wish-list item. There are so many advantages to owning a guest unit. Some homeowners may use it to host relatives for long-term visits throughout the year. It’s much more convenient to have separate accommodations for guests, allowing both you and them plenty of privacy and space. While others might use the unit to house elderly parents, as transitional space for older children, as a studio, home office, or gym, or as a source of passive income by renting it out.  

Multigenerational Housing

As the demand for multigenerational housing steadily increases, so has the interest in guest houses and in-law suites. It is estimated that 64 million Americans currently live in multigenerational households. Mostly associated with the millennial generation, more young adults are staying home and living with their parents for longer to give them the time to earn money and gain financial independence before they strike out on their own.

Guest homes are ideal in this situation giving both parents and the young adult plenty of privacy and personal space. An in-law unit can also be the perfect accommodations for elderly parents, providing a convenient and comfortable setting that allows for independence and privacy, and with added affordability compared to separate households. Considering the average cost of assisted living can cost as much as $4,000 per month, it’s easy to see how this option can be a win-win situation for everyone in the long run.

Passive Income

A guest unit can also be a great source of passive income through renting, whether for long-term renters or for short-term vacation rentals like Airbnb or VRBO. If you decide to take the renting route, you will need to check with your local city for any requirements regarding permits or zoning laws that may prohibit you from renting the space. In particular, vacation rentals using Airbnb have specific rules and zoning laws you must follow.  

Also keep in mind that with a vacation rental, you must pay to furnish and stock the unit, manage bookings and payments, hire a cleaning crew, keep up with landscaping and repairs, and find new ways to attract happy renters. Is your home is in a popular area? Will you even have renters that will want to stay there? Also, be sure to factor in vacancy when considering costs. How many renters will you need to be consistently renting the unit to make a profit, let alone break-even?

In order to make the home attractive to renters and prospective home buyers when it comes time to sell, the suite should have the ability to be closed and locked to the rest of the home for privacy and should truly function as an independent space with kitchen and bathroom facilities. Easy accessibility to the separate unit, as well as handicapped accessibility, improves the function of the independent living space and increases the value.

Will a guest house be included in the overall square footage? 

An additional structure that is not connected to the main house in any way will not be included in the overall square footage. An example of this is a guest house that is in the backyard and has its own entrance. These structures are considered Added Detached. This is because the livable square footage of a detached guest house isn’t included in the price per square foot calculations. Garages, pool houses, guest houses, or any rooms that require you to leave the finished area of the main house to gain access are not counted.

If the additional structure is attached to any part of the main house, it can be included in the square footage. This applies even if the structure has its own entrance. For example, a guesthouse or in-law unit that can only be accessed from its own door but shares a wall with the kitchen in the house.

Will a guest house or in-law suite increase your home’s value?

At some point, you may want to sell your home and in-law unit – perhaps you move for a job or want to downsize when you retire. Whatever the reason, you’ll want your home to have gone up in value so you can walk away with more cash in your pocket. Homes with separate guest houses or attached in-law suites are growing in popularity. More and more families are choosing to live in multi-generational homes either to care for their aging parents or because of financial reasons. 

However, while homes with guest units are increasing in demand, there is no hard figure on how much value they will add to your home because every real estate market is different. Buyers are looking for different features at different times, though an extra suite is likely to stand out for many reasons. If you want to calculate the value of your in-law unit, determine what it’s really worth including the value it will add to your own lives if you’re not planning on selling your home anytime soon. 

If you use it to save money on in-home caregiving or retirement homes, what would you have spent on these things if you didn’t have the suite? If you plan on making money through short-term rentals, what will that income amount to? Also, think about what it would cost to add an in-law suite in the future. These things can all mean extra value to the right buyer.  In-law suites and guest homes are highly sought-after elements, and when it comes time to sell, anything to make your property more desirable can tip the scales in your favor.

Final Thoughts

Buying a Farmington Hills home with a guest unit is a big financial decision that can quickly get overwhelming when you maneuver through the extra paperwork and city requirements. An experienced, Farmington Hills MI real estate agent can help you navigate the local market, city laws, and find an affordable property with an in-law unit that fits your budget so you have cash left over to cover any extra guest home expenses and upkeep costs.

Partner with top-rated Farmington Hills MI REALTOR® – Tom Gilliam

With a passion for real estate, Tom Gilliam has been serving Farmington Hills and the surrounding Oakland County MI area for nearly two decades. Tom is known for his friendly demeanor, dedication, and professionalism. He will be able to quickly ascertain your needs and goals and create a plan of action based on your specific criteria. Tom’s clients appreciate his honesty and transparency and feel it helps them as they make important real estate decisions. He understands how important good communication skills are to every transaction and is available for his clients whenever they have questions or concerns – promptly returning all phone calls, texts, and emails.

Having someone like Tom to advise and guide you means there is one less thing you need to worry about. He will protect your interests, advocate for you, negotiate on your behalf, and go the distance to ensure the best results possible. If you are interested in buying or selling Farmington Hills real estate or homes in the surrounding area, please give Tom Gilliam a call at (248) 790-5594 or you can reach him by email.

Tom Gilliam, REALTOR®
RE/MAX Classic
29630 Orchard Lake Rd.
Farmington Hills 48334
Direct: 248-790-5594
Office: 248-737-6800
Email: Homes2MoveYou.com
License #314578 

Map Farmington Hills MI

Buying A Home in Farmington Hills: 7 Things to Do Before Applying for a Mortgage

Buying A Home in Farmington Hills: 7 Things to Do Before Applying for a Mortgage

 

Buying A Home in Farmington Hills: 7 Things to Do Before Applying for a Mortgage

If you’re thinking about buying a home in Farmington Hills MI, applying for a mortgage is never simple, but it’s even trickier when you don’t know what to expect. If you are a first-time homebuyer, you can make the process easier by learning as much as you can ahead of time, before you’ve found your dream house.

Knowing what to expect allows you to plan ahead and improve your chances of getting a home loan with favorable terms. Here are 7 things to do before applying for a mortgage:

1). Review your credit report

Review your credit report to ensure there are no surprises long (several months) before you begin the mortgage process. Put simply, a low credit score will lead to a much higher mortgage rate, and even disqualification if it drives your monthly mortgage payment high enough.

When you submit a mortgage application, they’ll check your credit reports maintained by one or more of the three national credit bureaus (Experian, TransUnion, and Equifax), and the credit scores derived from those reports.

Lenders use credit information to help decide whether they’re willing to issue you a home loan and, if so, how much they’re willing to lend you and how much they’ll charge you in interest.

Farmington Hills MI Homes for Sale

Once a year, you can obtain a free credit report from all three credit reporting agencies at AnnualCreditReport.com. You’ll want to review each credit report carefully to make sure it accurately reflects your credit history and be ready to dispute anything on the report that isn’t accurate.  

2). Get familiar with basic mortgage terms

“Amortization,” “origination fee,” “earnest money” and other common terms used in mortgage lending might be phrases you’ve never even heard before. Since we are talking about your money and 10 to 30 years of your life, you’ll want to familiarize yourself with basic mortgage terms before speaking to lenders.

Everything you learn will position you to make the best choices for your finances and your future. Also, don’t be afraid to ask your lender or even your Farmington Hills REALTOR® lots of questions about the mortgage process, including mortgage terms you don’t understand.  

3). Know your budget

You don’t want to wind up with a mortgage you can’t pay – so it’s important to be realistic about your monthly income and expected expenses, and to leave some breathing room in your budget for emergencies or unexpected costs that might come up.

Most financial advisors agree that you should spend no more than 28% of your gross monthly income on housing expenses and no more than 36% on total debt. That includes housing as well as things like student loans, car expenses, and credit card payments.

The 28/36 percent rule is the tried-and-true home affordability rule that establishes a baseline for what you can afford to pay every month. To calculate how much 28% of your income is, simply multiply your monthly income by 28.

If your monthly income is $6,000, for example, the equation should look like this: 6,000 x 28 = 168,000. Now divide that total by 100. 168,000 ÷ 100 = 1,680.

Knowing what you can afford can help you take financially sound next steps. The last thing you want to do is jump into a 30-year home loan that’s unrealistic for your budget, even if you can find a willing lender.

If you want to qualify for a mortgage on your first try, it’s important to know how big of a loan you can reasonably afford. You can speak to a lender and go through a quick pre-qualification process to find out how much you can qualify to borrow and determine your budget for a home.

4). Improve your debt-to-income ratio

A high debt-to-income ratio (DTI) is the #1 reason why mortgage applications get rejected. Your DTI is all your monthly debt payments divided by your gross monthly income.

Most lenders typically offer loans to creditworthy borrowers with DTIs as high as 43-47%. That limit is based on policies by government-backed lenders like Fannie Mae, put in place to protect customers against predatory lending practices.

Simply put, the lower your DTI, the more financing options will be available to you.  If you have some flexibility on when you plan on buying, taking time to lower your DTI (and improve your credit score) can save you a lot of money over the life of your loan. 

A few DTI reduction strategies to consider:

  • If possible, pay off your car loan before applying for your mortgage.
  • If you plan on purchasing a car, considering waiting until after you’ve bought your home.
  • Start paying off your credit cards in full, one by one, but don’t close them out. 
  • If possible, refinance or consolidate current loans to reduce your monthly payments.
  • Consider adding a co-borrower with a low DTI and good credit history to your loan 

5). Consider various loan options

Not all home loans are the same. Knowing what kind of loan is most appropriate for your situation prepares you for talking to lenders and getting the best deal.

Understand how these choices affect your monthly payment, your overall costs both upfront and over time, and your level of risk. A loan “option” is always made up of three different things: loan term, interest rate type, and loan type.

Loan term 

Interest rates come in two basic types: fixed and adjustable. This choice affects whether your interest rate can change, whether your monthly principal and interest payment can change and its amount, and how much interest you will pay over the life of the loan.

With a fixed-rate loan, your interest rate and monthly principal and interest payment will stay the same. Adjustable-rate mortgages (ARMs) offer less predictability but may be cheaper in the short term. In the later years of an ARM, your interest rate changes based on the market, and your monthly principal and interest payment could go up a lot, even double.

Explore rates for different interest rate types and see for yourself how the initial interest rate on an ARM compares to the rate on a fixed-rate mortgage.

Interest rate type 

Interest rates come in two basic types: fixed and adjustable. This choice affects whether your interest rate can change, whether your monthly principal and interest payment can change and its amount, and how much interest you will pay over the life of the loan. 

With a fixed-rate loan, your interest rate and monthly principal and interest payment will stay the same. Adjustable-rate mortgages (ARMs) offer less predictability but may be cheaper in the short term. In the later years of an ARM, your interest rate changes based on the market, and your monthly principal and interest payment could go up a lot, even double. 

Explore rates for different interest rate types and see for yourself how the initial interest rate on an ARM compares to the rate on a fixed-rate mortgage.

Loan type 

 Mortgage loans are organized into categories based on the size of the loan and whether they are part of a government program (conventional, FHA, or special programs). This choice affects how much you will need for a down payment, the total cost of your loan, including interest and mortgage insurance, and how much you can borrow, and the house price range you can consider. 

Each loan type is designed for different situations. Sometimes, only one loan type will fit your situation. If multiple options fit your situation, try out scenarios and ask lenders to provide several quotes so you can see which type offers the best deal overall.

6). Shop around

You’ll want to compare all the costs involved in obtaining a mortgage. Shopping, comparing, and negotiating may save you thousands of dollars. Home loans are available from several types of lenders – commercial banks, mortgage companies, thrift institutions, and credit unions.

Different lenders may quote you different prices, so you’ll want to contact several lenders to make sure you’re getting the best price. You can also get a home loan through a mortgage broker with access to several lenders, giving you a wider selection of loan products and terms to choose from.

Keep in mind that brokers are not obligated to find the best deal for you unless they have contracted with you to act as your agent. Therefore, you should consider contacting more than one broker, just as you should with banks or thrift institutions.

Good agents know good lenders

Your Farmington Hills real estate agent can help you find a mortgage lender. Most agents have a plethora of lenders in their referral database, and a group of lenders that they have personally worked with before. Agents can be trusted to refer a mortgage lender with a proven record and who can close loans.  

The Real Estate Settlement Procedures Act (RESPA) prohibits agents from receiving a “thing of value” from a lender in exchange for sending you its way, and this inhibits them from entering into quid pro quo arrangements that might not be best for their clients.

Most homebuyers want their new home purchase to be handled thoughtfully. They want to close within the contract period. That scenario is more likely to happen if you use your agent’s preferred mortgage lender.

7). Pull together your financial documents  

It’s a good idea to start prepping your financial documents. Lenders will request paperwork for your mortgage application that proves things like how much money you make and your debts. 

 Depending on your financial situation, the documents you will likely need when applying for a mortgage include 2 years’ worth of tax returns, pay stubs, W-2s or other proof of income, bank statements and other assets, credit history, gift letters, photo ID, and rental history.

If you’re self-employed or have other sources of income (such as child support), you will need to show your lender proof through 1099 forms, direct deposits, or other means. 

If you have any blemishes on your credit reports such as a previous short sale or a foreclosure, be prepared to write a statement that explains any negative items. Lenders may look at one-time unavoidable circumstances differently from habitual delinquency. 

The takeaway

The more you prepare ahead of time, the easier it should be to get the loan you need on the home you want and can comfortably afford. Don’t forget to compare different loan products, such as fixed-rate mortgages vs. ARMs, and conventional loans vs. FHA loans.

Both have their pros and cons and should be carefully considered. There is no one-size-fits-all approach. Also, be sure to shop around and get rate quotes from more than one lender. By doing so, you’ll likely get a better interest rate, more favorable loan terms, and save money now and in the long term.

Speak with your Farmington Hills MI REALTORⓇ about referring a lender to you. Real estate agents who routinely close a lot of deals have experience working with multiple lenders and know which of them will deliver.

Partner with Highly-rated Farmington Hills MI REALTOR -Tom Gilliam

Whether you are interested in Farmington Hills MI homes for sale or it’s time to list your current property, experience matters most in a changing market. Serving Farmington Hills and the surrounding area for over 20 years, Tom is able to provide his clients with the kind of knowledge, skills, commitment, and personalized service they need and deserve.

An extremely down-to-earth person, Tom is someone you can trust and feel good about working with. His clients appreciate his honesty and transparency and feel it helps them as they make important real estate decisions. Tom makes himself available to his clients whenever they have questions or concerns and promptly returns any texts, calls, or emails.

Farmington Hills MI Homes for Sale 

As your Farmington Hills MI real estate agent, Tom will protect your best interests, advocate for you, negotiate on your behalf and do whatever is necessary to ensure the best results possible. Having a trusted professional like Tom by your side means there is one less thing to worry about.

To find out more about buying or selling real estate in Farmington Hills MI, or homes in the surrounding Oakland County area, please give highly-rated REALTORⓇ – Tom Gilliam a call directly at (248) 790-5594 or send him an email

Tom Gilliam, REALTOR®
RE/MAX Classic
29630 Orchard Lake Rd.
Farmington Hills 48334
Direct: 248-790-5594
Office: 248-737-6800
Email: Tom @ Homes2MoveYou.com
License #314578 

Farmington Hills MI Real Estate

 

 

 

Closing Costs To Consider When Buying A Home in Farmington Hills MI

Closing Costs To Consider When Buying A Home in Farmington Hills MI

Closing Costs To Consider When Buying A Home in Farmington Hills MI

Buying a home in Farmington Hills MI involves more money out-of-pocket than just the down payment. There are also closing costs to consider. Closing costs refer to the charges and fees that are paid when a house purchase is finalized.

Typically, the buyer’s closing costs include mortgage insurance, homeowner’s insurance, appraisal fees, property taxes, reserves to set up escrow, and various fees that lenders typically charge, among others – while the seller covers ownership transfer fees and pays a commission to their real estate agent.

Farmington Hills MI Homes for Sale

The total cost can often come as a shock to first-time homebuyers who may only be looking at coming up with the amount of their down payment. Understanding what closing costs cover and budgeting for them will smooth out the final stretch of the home buying process. Lender fees can be the most significant of all closing costs.

How much can a buyer expect to pay?

Average closing costs for the buyer will typically run between 2% and 5% of the loan amount.  On a $300,000 home purchase, for example, you could expect to pay from $6,000 to $15,000 In closing costs. Much depends on the points and origination fees a lender charges to make the loan. The points, together with any origination fee will be included in the Origination Charges section of your Loan Estimate.

The government requires lenders to list closing costs and the amount of cash you’ll need to have on hand at the time of settlement on every mortgage applicant’s Loan Estimate. The lender should provide the loan estimate to potential borrowers within three days of submitting an application. The Loan Estimate details the terms of your loan, including:

  • Expenses, with clear “yes” or “no” answers to important questions, such as whether each amount can increase after closing, whether your loan includes a prepayment penalty or a balloon payment, and which expenses are included in your escrow account 
  • The projected monthly mortgage payment, including taxes, insurance, and other assessments 
  • Estimated closing costs and the amount of cash you’ll need to have on hand at the time of settlement 
  • Information on services you can, and cannot, shop for — such as pest inspections, survey fees, and the home appraisal 

The Closing Disclosure provides the same information as the Loan Estimate but in final form. This means that it contains the locked-in costs of your loan and the specific amount you’ll need to pay at closing. You’ll receive this document three days before your scheduled loan closing.

Non-recurring and recurring closing costs 

There are over 35 closing cost items that you may be required to pay, which can be separated into two categories: non-recurring and recurring:

Non-recurring closing costs are paid once at closing and never again. Non-recurring closing costs are the fees that most mortgage borrowers are familiar with and may include the following items: 

  • Title policy
  • Escrow or closing
  • Appraisal
  • Credit report
  • Notary
  • Wire fees
  • Courier and delivery
  • Attorney fees
  • Endorsements
  • Recording
  • Jurisdictional transfer taxes
  • Home protection plan
  • Natural hazard disclosure
  • Home inspection
  • Fees paid to the lender in conjunction with the loan 

Although non-recurring closing costs are set by the specific service provider, you may be able to comparison shop and negotiate some of the fees to lower your closing costs.   

Recurring closing costs are those charges that you will pay again and again. They are paid either monthly or yearly as time goes on. Recurring closing costs include items such as:  

  • Fire insurance premium
  • Flood insurance (if required in your area)
  • Property taxes
  • Mutual or private mortgage insurance premiums
  • Prepaid interest
  • HOA fees

You will be required to pay a portion of these ongoing expenses when the loan closes. Additionally, depending on the time of year your loan closes and your local property tax rate, the amount of property tax you are required to pay at closing can be significant, especially if your loan closes earlier in the year and you’re required to pay several months of property taxes in advance.

If you are required to use an impound or escrow account after your loan closes for your mortgage payment, property tax, homeowners insurance, and other expenses, you may also be required to pre-pay certain expenses. These additional recurring closing costs are due at closing.   

Seller Credit  

Buyers with limited funds can utilize a Seller Credit to help significantly reduce their out-of-pocket costs and enable them to purchase a property they would be unable to buy otherwise. A seller credit also referred to as: sales concessions, seller paid costs, or seller contributions –  is money the seller gives the buyer to pay for closing costs. Some or all of the closing costs, including your property taxes and personal hazard/fire insurance, may be paid for by the seller. 

If the seller pays all your closing costs, you will only pay your down payment. By law, the seller cannot pay for any portion of your down payment. Also, homebuyers cannot receive cash from the seller – not even one dollar.

In order to get a seller credit, you must have it included in your Purchase and Sale Agreement.  The lender doesn’t handle the negotiation of a seller credit. Ask your Farmington Hills MI REALTORⓇ to negotiate it for you (it’s part of the price negotiation of the home).  

A seller credit allows the buyer to finance his closing costs into the new loan amount. The lender must approve the credit and the home’s value must merit the increase in the sale price as determined by an appraisal. Be sure to always check with your lender before you negotiate an offer that involves a seller credit because the lender might not allow it.

Lenders limit what the buyer and a seller credit can pay for. For example, the lender might limit your credit to 3% of the purchase price if you’re financing 100% of the purchase price. Or, depending on your FICO score and the amount of your down payment, the lender might allow a seller to credit you as much as 6% of the purchase price. 

Help with closing costs 

There are also grants and loans available to help with closing costs. If you qualify, you could receive thousands of dollars to help with your mortgage costs. Oftentimes, closing cost assistance is offered by a HUD-approved local or state housing commission, or a mortgage lender. These agencies set aside a certain amount of funds for closing cost grants for low-to-moderate-income borrowers.

Check out the resources below to locate and learn about programs you may qualify for:

Requirements to qualify for closing cost assistance vary by program, and income caps and maximum loan amounts are common. You don’t always have to be a first-time homebuyer to get financial aid.

Many programs are available to repeat buyers or former homeowners who haven’t owned property in the last 3 years. 

Partner with Highly-rated Farmington Hills MI REALTOR -Tom Gilliam

With over 20 years of real estate experience, Tom Gilliam is proud to be a trusted Farmington Hills MI REALTORⓇ – offering his guidance and expertise to area home buyers and sellers. Tom understands that buying or selling a home is a significant financial and life decision and that you are looking for someone you can trust.

Farmington Hills MI Homes for Sale

You can be assured that Tom will protect your best interests, advocate for you, negotiate on your behalf, and guide you towards the best results possible. Get the process started today by contacting Tom directly at (248) 790-5594 or you can get in touch with him by email.

Tom Gilliam, REALTOR®
RE/MAX Classic
29630 Orchard Lake Rd.
Farmington Hills 48334
Direct: 248-790-5594
Office: 248-737-6800
Email: Tom @ Homes2MoveYou.com
License #314578 

Farmington Hills MI

 

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