Septic Systems
The Big 3
How High Tech Is Your Home?
Hidden Home Defects to Watch For
10 Questions to Ask a Home
Inspector
What Your Home Inspection Should
Cover
What Not to Overlook on a Final
Walk-through
How Comprehensive Is Your Home
Warranty?
5 Property Tax Questions You Need
to Ask
10 Questions to Ask Your Condo
Board
5 Things to Understand About
Homeowners Insurance
10 Ways to Lower Your Homeowners
Insurance Costs
5 Things to Understand About Title
Insurance
What to Keep From Your Closing
Tips for Packing Like a Pro
Does Moving Up Make Sense?
Septic systems are prevalent in Forsyth County. A safe and effective waste management
approach, with proper maintenance and care they will last 20 to 30 years. This link will take you to a good
educational document about Septic Systems. It is recommended that a family of four
have the typical tank for a five bedroom home (1,500 gallons) serviced about
once every four years. This service
costs about $350 to $450 dollars.
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You should be knowledgeable about
these three classes of building materials. They may arise as inspection
“defects” during the home buying/selling process.
Polybutylene
Plumbing – Explanation and pictures about this plumbing.
Synthetic Stucco - Explanation about this exterior
cladding.
Hardboard & OSB
Siding - Over
20 million single-family homes are clad with exterior hardboard and OSB siding
products that are the subject of class-action lawsuits. Search for
"hardboard" to find the information.
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If the latest technology or
entertainment options are important in your new home, add the following questions
to your buyer’s checklist.
1.
Are there enough jacks in every room for cable TV and
high-speed Internet hookups?
2.
Are there enough telephone extensions or jacks?
3.
Is the home prewired for a home theater or multi-room audio
and video?
4.
Does the home have a local area network for linking computers?
5.
Does the home already have wiring for DSL or other high-speed
Internet connection?
6.
Does the home have multizoning heating and cooling controls
with programmable thermostats?
7.
Does the home have multi-room lighting controls,
window-covering controls, or other home automation features?
8.
Is the home wired with multi-purpose in-wall wiring that
allows for reconfigurations to update services as technology changes?
Visit the Consumer Electronics
Association (www.ce.org/techhomerating)
for a complete Tech Home ™ Rating Checklist.
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No home is flawless, but certain
physical problems can be expensive. Watch for:
1.
Water leaks. Look for stains on ceilings and near the
baseboards, especially in basements or attics.
2.
Shifting foundations. Look for large cracks along the
home’s foundation.
3.
Drainage. Look for standing water, either around the
foundation of the home of in the yard.
4.
Termites. Look for weakened or grooved wood, especially
near ground level.
5.
Worn roofs. Look for broken or missing copings and
buckled shingles as well as water spots on ceilings.
6.
Inadequate wiring. Look for antiquated fuse boxes,
extension cords (indicating insufficient outlets), and outlets without a place
to plug in the grounding prong.
7.
Plumbing problems. Very low water pressure, banging in
pipes.
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1.
What are your qualifications? Are you a member of the American
Association of Home Inspectors?
2.
Do you have a current license? Inspectors are not required to
be licensed in every state.
3.
How many inspections of properties such as this do you do each
year?
4.
Do you have a list of past clients I can contact?
5.
Do you carry professional errors and omission insurance? May I
have a copy of the policy?
6.
Do you provide any guarantees of your work?
7.
What specifically will the inspection cover?
8.
What type of report will I receive after the inspection?
9.
How long will the inspection take and how long will it take to
receive the report?
10.
How much will the inspection cost?
Portions adapted from Real Estate Checklists and
Systems and used with permission.
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ü Siding:
Look for dents or buckling
ü Foundations:
Look for cracks or water seepage
ü Exterior
Brick: Look for cracked bricks or mortar pulling away from bricks
ü Insulation:
Look for condition, adequate rating for climate
ü Doors
and Windows: Look for loose or tight fits, condition of locks, condition of
weatherstripping
ü Roof:
Look for age, conditions of flashing, pooling water, buckled shingles, or loose
gutters and downspouts
ü Ceilings,
walls, and moldings: Look for loose pieces, drywall that is pulling away
ü Porch/Deck:
Loose railings or step, rot
ü Electrical:
Look for condition of fuse box/circuit breakers, number of outlets in each room
ü Plumbing:
Look for poor water pressure, banging pipes, rust spots or corrosion that
indicate leaks, sufficient insulation
ü Water
Heater: Look for age, size adequate for house, speed of recovery, energy rating
ü Furnace/Air
Conditioning: Look for age, energy rating; Furnaces are rated by annual fuel
utilization efficiency; the higher the rating, the lower your fuel costs.
However, other factors such as payback period and other operating costs, such
as electricity to operate motors.
ü Garage:
Look for exterior in good repair; condition of floor—cracks, stains, etc.;
condition of door mechanism
ü Basement:
Look for water leakage, musty smell
ü Attic:
Look for adequate ventilation, water leaks from roof
ü Septic
Tanks (if applicable): Adequate absorption field capacity for the percolation
rate in your area and the size of your family
ü Driveways/Sidewalks:
Look for cracks, heaving pavement, crumbling near edges, stains
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Be sure that:
ü
Repairs you’ve requested
have been made. Obtain copies of paid bills and any related warranties.
ü
All items that were
included in the sale price—draperies, lighting fixtures—are still there.
ü
Screens and storm
windows are in place or stored.
ü
All appliances are
operating.
ü
Intercom, doorbell, and
alarm are operational.
ü
Hot water heater is
working.
ü
HVAC is working.
ü
No plants or shrubs have
been removed from the yard.
ü
Garage door opener and
other remotes are available.
ü
Instruction books and
warranties on appliances and fixtures are there.
ü
All personal items of
the sellers and all debris have been removed.
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Check your home warranty policy to
see which of the following items are covered. Also check to see if the policy
covers the full replacement cost of an item.
ü Plumbing
ü Electrical
Systems
ü Water
Heater
ü Furnace
ü Heating
Ducts
ü Water
Pump
ü Dishwasher
ü Stove/Cooktop/Ovens
ü Microwave
ü Refrigerator
ü Washer/Dryer
ü Swimming
Pool (may be optional)
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1.
What is the assessed value of the property? Note that assessed
value is generally less than market value. Ask to see a recent copy of the
seller’s tax bill to help you determine this information.
2.
How often are properties reassessed and when was the last
reassessment done? Generally taxes jump most significantly when a property is
reassessed.
3.
Will the sale of the property trigger a tax increase? Often
the assessed value of the property may increase based on the amount you pay for
the property. And in some areas, such as California, taxes may be frozen until
resale.
4.
Is the amount of taxes paid comparable to other properties in
the area? If not, it might be possible to appeal the tax assessment and lower
the rate?
5.
Does the current tax bill reflect any special exemptions that
you might not qualify for? For example, many tax districts offer reductions to
those 65 or over.
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Before you buy, contact the condo board with the
following questions. In the process, you’ll learn how responsive—and
organized—its members are.
1.
What percentage of units
is owner-occupied? What percentage is tenant-occupied? Generally, the higher
the percentage of owner-occupied units, the more marketable the units will be
at resale.
2.
What covenants, bylaws,
and restrictions govern the property? What grandfather clauses are in place?
You may find, for instance, that those who buy a property after a certain date
can’t rent out their units, but buyers who bought earlier can. Ask for a copy
of the bylaws to determine if you can live within them. And have an attorney review property
docs, including the master deed, for you.
3.
How much does the
association keep in reserve? How is that money being invested?
4.
Are association assessments
keeping pace with the annual rate of inflation? Smart boards raise assessments
a certain percentage each year to build reserves to fund future repairs. To determine if the
assessment is reasonable, compare the rate to others in the area.
5.
What does and doesn’t
the assessment cover—common area maintenance, recreational facilities, trash
collection, snow removal?
6.
What special assessments
have been mandated in the past five years? How much was each owner responsible
for? Some special assessments are unavoidable. But repeated, expensive
assessments could be a red flag about the condition of the building or the
board’s fiscal policy.
7.
How much turnover occurs
in the building?
8.
Is the project in
litigation? If the builders or homeowners are involved in a lawsuit, reserves
can be depleted quickly.
9.
Is the developer
reputable? Find
out what other projects the developer has built and visit one if you can. Ask
residents about their perceptions. Request an engineer’s report for
developments that have been reconverted from other uses to determine what shape
the building is in. If the roof, windows, and bricks aren’t in good repair,
they become your problem once you buy.
10.
Are
multiple associations involved in the property? In very large developments,
umbrella associations, as well as the smaller association into which you’re
buying, may require separate assessments.
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1.
Look for exclusions
to coverage. For example, most
insurance policies do not cover flood or earthquake damage as a standard item.
These coverages must be bought separately.
2.
Look for dollar
limitations on claims. Even if you
are covered for a risk, there may a limit on how much the insurer will pay. For
example, many policies limit the amount paid for stolen jewelry unless items
are insured separately.
3.
Understand
replacement cost. If your home is
destroyed you’ll receive money to replace it only to the maximum of your
coverage, so be sure your insurance is sufficient. This means that if your home
is insured for $150,000 and it costs $180,000 to replace it, you’ll only
receive $150,000.
4.
Understand actual
cash value. If you choose not to replace
your home when it’s destroyed, you’ll receive replacement cost, less
depreciation. This is called actual cash value.
5.
Understand liability. Generally your homeowners insurance covers you for
accidents that happen to other people on your property, including medical care,
court costs, and awards by the court. However, there is usually an upper limit
to the amount of coverage provided. Be sure that it’s sufficient if you have
significant assets.
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1.
Raise your deductible. If you can afford to pay more toward a loss that
occurs, your premiums will be lower.
2.
Buy your homeowners
and auto policies from the same company. You’ll usually qualify for a discount. But make sure that the savings
really yields the lowest price.
3.
Make your home less
susceptible to damage. Keep roofs and
drains in good repair. Retrofit your house to protect against natural disasters
common to your area.
4.
Keep your home safer. Install smoke detectors, burglar alarms, and
dead-bolt locks. All of these will usually qualify for a discount.
5.
Be sure you insure
your house for the correct amount.
Remember, you’re covering replacement cost, not market value.
6.
Ask about other
discounts. For example, retirees who
are home more than working people may qualify for a discount on theft
insurance.
7.
Stay with the same
insurer. Especially in today’s tight
insurance market, your current vendor is more likely to give you a good price.
8.
See if you belong to
any groups—associations, alumni
groups—that offer lower insurance rates.
9.
Review your policy
limits and the value of your home and possessions annually. Some items depreciate and may not need as much
coverage.
10.
See if there’s a
government-backed insurance plan. In
some high-risk areas, such as the coasts, federal or state governments may back
plans to lower rates. Ask your agent.
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1.
It protects your
ownership right to your home both from fraudulent claims against your ownership
and from mistakes made in earlier sales, such as mistake in the spelling of a
person’s name or an inaccurate description of the property.
2.
It’s a one-time cost usually
based on the price of the property.
3.
It’s usually paid for by
the sellers.
4.
There are both lender
title policies, which protect the lender, and owner title policies, which
protect you. The lender will probably require a lender policy.
5.
Discounts on premiums
are sometimes available if the home has been bought within only a few years
since not as much work is required to check the title. Ask the title company if
this discount is available.
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ü
The Real Estate
Settlement Procedures Act (RESPA) statement.
This form, sometimes called a HUD 1 statement, itemizes all the costs
associated with the closing. You’ll need this for income tax purposes and when
you sell the home.
ü
The Truth in Lending
Statement summarizes the terms of your mortgage loan.
ü
The mortgage and the
note (two pieces of paper) spell out the legal terms of your mortgage
obligation and the agreed-upon repayment terms.
ü
The deed transfers
ownership of the property to you.
ü
Affidavits swearing to
various statements by either party. For example, the sellers will often sign an
affidavit stating that they have not incurred any liens on the property.
ü
Riders are amendments to
the sales contract that affect your rights. For example, if you buy a
condominium, you may have a rider outline the condo association’s rules and
restrictions.
ü
Insurance policies
provide a record and proof of your coverage.
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1.
Develop a master “to do”
list so you won’t forget something critical.
2.
Sort and get rid of
things you no longer want or need. Have a garage sale, donate to a charity, or
recycle.
3.
Don’t throw out everything.
If your inclination is to just toss it, ask yourself how frequently you use an
item and how you’d feel if you no longer had it.
4.
Pack like items
together. Put toys with toys, kitchen utensils with kitchen utensils.
5.
Decide what if anything
you plan to move yourself. Precious items, such as family photos, valuable
breakables, or must-haves during the move, should probably stay with you.
6.
Use the right box for
the item. Loose items encourage breakage.
7.
Put heavy items in small
boxes so they’re easier to lift. Keep weight under 50 lbs. if possible.
8.
Don’t over-pack boxes
and increase the chances they will break.
9.
Wrap every fragile item
separately and pad bottom and sides of boxes.
10. Label every box on all sides. You never know how
they’ll be stacked and you don’t want to have to move other boxes aside to find
out what’s there.
11. Use color-coded labels to indicate which room each
item should go in. Color-code a floor plan for your new house to help movers.
12. Keep your moving documents together, including phone
numbers, driver’s name, and van number. Also keep your address book handy.
13. Back up your computer files before moving your
computer.
14. Inspect each box and all furniture for damage as soon
as it arrives.
15. Remember, most movers won’t take plants.
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Answer these questions to help you decide whether
moving up makes sense.
1. How
much equity do you have in your home? Look at your annual mortgage statement or
call your lender to find out. Usually, you don’t build up much equity in the
first few years of paying a mortgage, but if you’ve owned your home for a
number of years, you may have significant unrealized gains.
2.
Has your income increased enough to cover the extra mortgage
costs and the costs of moving?
3. Does
your neighborhood still meet your needs? For example, if you’ve had children,
the quality of the schools may be more of a concern now than when you first
purchased.
4.
Can you add on or remodel? If you have a large yard, there might
be room to expand your home. If not, your options may be limited. Also, do you
want to undertake the headaches of remodeling?
5.
How is the home market? If it’s good, you may get top dollar
for your home.
6.
How are interest rates? A low rate not only helps you buy more
home, but also makes it easier to find a buyer.
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2005. All rights reserved. www.REALTOR.org/realtormag
