With Harold's Purple Crayon My Dream Home Would be a Snap!

When I was in grade school, I loved reading the story of Harold and the Purple Crayon. It was a picture book written by Crockett Johnson. I wanted to be like that little bald kid who drew out his dreams in his footy pajamas. Though not fond of the color purple, I always wanted one of those special violet Crayola type sticks to draw what I was dreaming of! Imagine if life were only so simple…

Today many people are sitting on the fence dreaming about their perfect home but aren’t certain that they have the tools necessary to take advantage of this unprecedented $8000 tax credit for first time buyers and amazing affordability in the Twin Cities home market. Maybe they are looking for one of Harold’s purple crayons too so they can draw out a path to a perfect new home…

Draw YOUR perfect REALTOR® Grab that magic purple crayon and sketch out your ideal of a trusted professional REALTOR®. The first step in owning a dream home is to find the agent of your dreams to represent you throughout the process. Make certain to sign the buyer’s representation agreement for with a blue ink pen not a purple Crayola.

Draw Your Preapproval letter. Pre-approval is an important step before you begin looking for a home. It not only determines how much home you can afford to spend on a home, it guarantees that you are ready to write up the offer when you find your dream home. The letter will serve as notice to the sellers that the bank has committed to lend you a specified amount based on your financial history. This gives you significant buying power as a seller recognizes you are approved for a loan. Your professional REALTOR® can assist you in locating a qualified loan officer that will work with you to make your dream home a reality.

Draw YOUR perfect home! Draw YOUR perfect home! Here’s the drawing you have been waiting for...glide that purple crayon across the page and sketch out your dream home. Your perfectly depicted purple REALTOR® will set up an MLS search for homes that meet the needs and price you have drawn up. As perfect homes hit the market, showings will be set to view the homes in person.

Draw up a Purchase Agreement and happy seller! Draw up a Purchase Agreement and happy seller! Use that magic purple crayon to draw up a contract on your dream. Okay the contract will have to be completed in something other than that crayon, but here is where you draw up contract including all of the details such as what you want to pay for the home, what personal property is to be included as well as the date you want to close and move in.

Draw a Qualified Inspector. To be certain that you didn’t miss any important details when you sketched out the beautiful purple palace, draw a home inspector that is qualified to check out your new purchase.

Draw up a SOLD sign. A big purple "SOLD" sign will announce to the world that this is YOUR dream home! It will stay on the sign while the home is "pending" the closing. During this period prior to closing, your purple professionals work closely together to ensure that details such as the appraisal and updating the title are handled in a timely manner. It is your job to use your purple crayon to mark off the days until you get to the closing table!

Draw the Keys to your new front door! Draw the key to your new front door! One final purplish piece of art will complete the home buying process—Sketch up a set of house keys! When closing day arrives, be prepared to attend with your state issued picture identification, a 10 year address history, your checkbook, and all other information requested by the closer. At the end of this hour meeting, you will be handed the keys to your new home.


Copyright 2009 Teri Eckholm http://www.terieckholm.com/

Say Vern…How much Earnest Money Do You Need to Buy a House?

I don’t know if Ernest ever went buy a house in the series of comedies Jim Varney made in the 1980’s but it could have made a good story line. However when buying a home, understanding real estate terms is no laughing matter In fact, it is serious business as a misunderstanding can make or break an offer and but a buyer’s money at risk.

When buying a home, the words thrown around can often be as confusing for a home buyer as Ernest often seemed to be. Home buyers want to be focused on the esthetics and mechanics of the property (the color of the paint and nuts & bolts of the structure) while the structure of the offer is often left to their REALTOR®. So I am never surprised by the silence when I pose the question, "How much are you prepared to write the earnest money check for?”


Earnest money is different than a down payment. These are funds submitted with the offer to the sellers’ real estate broker while a down payment is paid at the time of closing to the bank or mortgage company. The amount of the earnest money is something that the buyer determines based on the property. The amount will vary with each purchase agreement. A buyer must first understand the purpose of the earnest money to determine the right amount to include with the offer.


Earnest money is a term used for the funds that a buyer puts down to demonstrate to the seller their seriousness about buying a home. It should be an amount sufficient enough to indicate to the seller that the buyer will not walk away from the deal without good reason. In Minnesota, 1% of the purchase price is customary. But a buyer can offer more and a seller can ask for a higher amount as well. A lower amount may be acceptable in some circumstances; however it is important to be realistic.


Only a couple of years ago, a potential buyer wanted to write up an offer on at an open house of a home I had on the market in Forest Lake. The acreage home was set up with stables and a newer home. It was priced in the $300,000 range. This wheeling and dealing buyer wanted to impress the sellers with a whopping $100 earnest money check. The seller was significantly less than impressed. They knew the deal would be on shaky ground as with this unreasonable amount, the buyer could easily walk away from the deal.


Generally the earnest money funds are in the form of a check. If the offer is accepted, the money will be deposited into the listing broker’s trust or escrow account. In Minnesota, the funds must be deposited within three days of an offer having been accepted in writing. Yes, there needs to be money in the bank because that the check WILL be cashed after the offer has been accepted in writing.


If the offer is accepted, the earnest money will be applied to the down payment and/or the closing fees when the closing takes place. If your offer is not accepted the check is not cashed and your original check will be returned to you.


However, if the offer is accepted and the check cashed and then for some reason all contingencies are not met or other situation arises where the sale does not proceed, the buyer does not automatically receive a refund of the earnest money. Nor, does the seller automatically keep the down payment. The funds are disbursed as outlined in the purchase agreement or in some cases; the Buyer and seller must reach an agreement for the cancellation of the agreement before the funds can be disbursed.


Copyright 2009 Teri Eckholm

Home Buyers Can Make a Great DEAL in this Changed Real Estate Market!

Howie Mandle isn't the only one giving people the opportunity of a lifetime....You CAN Make a GREAT Deal if you buy a home now. For the past couple of years now, the term "Buyer's Market" has been synonymous with the real estate market. Obviously this is the opposite of the "Seller's Market" term that had been used for the prior decade. I also made a practice of tossing around these descriptions. Awhile back, I decided when I use these terms, I negatively affect half of my clients.
A buyer's market, defined as a market with many sellers and few buyers, gives the impression that all buyers are winners making the sellers the losers. Likewise, in a seller's market, with fewer sellers than buyers, there was an implication of the sellers getting the upper hand in every deal.
But here's the rub: In this market, not ALL sellers lose and not ALL buyers win.
A seller that purchased a home in the early 1990's, maintained it properly, diligently made payments and didn't refinance out all of their equity can sell a home today at a handsome profit. This seller is in no way a loser.
A buyer who purchases a foreclosed home from a bank without a disclosure for a price well below the value of neighboring properties then discovers toxic black mold in the walls costing, a failed septic system or cement in the plumbing with unexpected repairs in the tens of thousands is not a winner.
These situations are part of today's CHANGED real estate market. Yes, that is how I describe the market now. I avoid the phrases, "buyer's market" and "seller's market" and used "changed market" instead. Face it, the market has changed. But there can be winners on both sides of the transaction.
Here's a case in point: A savvy young couple, who wanted to take advantage of the glut of new construction models on the market last year in the Forest Lake area and sell the Anoka County starter home they had outgrown, were winners! They negotiated with a major builder on a perfect model and saved over $30,000 on the price. Then after making all necessary repairs, they listed their home at a rock bottom price equal to what they had paid for it four years earlier, and sold it in less than 60 days.
Did they lose money on the sale of their previous home? Some might think so, but this educated couple realized they were not losers. Their gain from the builder far outweighed the money they supposed “lost” on their sale. Had it been a hot "Seller's Market" they might have sold their starter home for a few thousand more but the builder would never have negotiated the drastic price reduction. All parties in this transaction were winners all the way around...The buyer of the starter home got a great deal. The move up couple sold quickly and got and awesome deal. The builder reduced their home inventory. Win. Win. Win.
This is just one example of the success stories I have witnessed this past year in this CHANGED real estate market. I know of dozens of examples of other individuals and families, both buyers and sellers, who are winners in this market.Is it your turn to be a winning home buyer? If you are thinking that now is the time to make a move but the constant gloom and doom of the media has you sitting on the fence about buying, contact a REALTOR® to help you assess your situation. Getting professional real estate assistance from the get-go is the best way to "MAKE A GREAT DEAL" in this changed market.
The young move-up couple in the previous story had contacted me months prior to finding their dream home to figure out a plan of action. I give sellers throughout the north and east Twin Cities metro area realistic facts about how to get their homes ready and where they need to be priced. They were prepared and ready to negotiate realistically with buyers when an offer came in on their property.
When I meet first time buyers, I give them a packet of information on how to buy a home so they are prepared for what to expect in the process. Before we start deciding whether to look at homes in Forest Lake, Ham Lake, Blaine or Hugo, I make certain my buyers are pre-approved for a loan with a reliable mortgage broker who will get the job done. Clients understand exactly what they can afford and what their payment will be. Then I discuss with my buyers the opportunities and pitfalls when looking at foreclosed homes, short sales, new construction and owner occupied homes. Prepared clients are then ready to jump on the perfect house and when the situation arises. With my expert assistance, buyers understand how to finesse a low offer as a starting point to negotiations so they can get their dream home at a price acceptable to both parties.
Are you ready to make a move? Team up with a great REALTOR® and get educated!
When buying a home in today's market, you can make a GREAT deal. Win-win sales are not only possible, they are my goal in every transaction!

Copyright 2009 Teri Eckholm 

Buying a Home on Minnesota Wetland--Affordable Beauty and Privacy!

As I browsed through the Q&A section of the real estate website, Trulia one day, I ran across a question from a Twin Cities resident who was considering purchasing a home on a Minnesota wetland. This homebuyer was wondering whether buying a home with environmental lakeshore would be a huge mistake.

I found this question very interesting. As a Realtor who works mainly in the Anoka, Chisago and Washington County areas there is an abundance of wetland and lakeshore homes. From Hugo to Wyoming and throughout the communities of Ham Lake, Lino Lakes and Blaine, there are properties abutting wetlands and natural environmental lakeshore. Many Minnesotans find these properties extremely desirable but as with any home it is a personal preference.

So how do you decide if a wetland or natural environmental (NEDS) lake home is for you? Take time to consider some of the positives and negatives.

Positives:

Wildlife-White-tailed deer, raccoons, turtles, ducks, loons, eagles, and a host of other animals have been spotted living near Minnesota wetlands.

Privacy-Whether the wetland is 20 acres or 200, it cannot be built upon so a property with a wetland or NEDS lake shoreline will limit neighbors.

Affordable-NEDS lakeshore and wetland properties are significantly less costly than lakeshore on a full use recreational lake.

Activities-Though there could be some limits on the use, wetland ponds, environmental lakeshore and NEDS Lakes have been used winter skating, summer canoeing or kayaking and more depending on the water depth.

Negatives:

Mosquitoes-Yes, wetlands are known to attract the other Minnesota State bird too.

Drainage Issues-If the home is on a smaller lot, the owner must pay special consideration to the foundation. A drain tile system and sump pump could be required. Also homes on private septic systems would have special DNR (Minnesota Department of Natural Resources) considerations if the system were to fail.

Copyright 2008 Teri Eckholm 

Dreaming of Life on Minnesota Acreage? Teri Eckholm, REALTOR® Gives Must have INFO Before YOUR Move!

Just over a decade ago, my family came across a home being renovated on 3 acres in the country. It was a bit of a drive from North St. Paul and Maplewood, the quiet little suburbs where we had spent most of our lives. But there was something intriguing about the beautiful landscape with dozens of towering oaks and pines. We loved the idea that our two preschool boys could play hide and seek and ride their bikes right in our own yard. We made the leap without considering all of the differences that faces us switching from a city to a rural life.

As a REALTOR® in the north metro, I show homes to other families looking for the same escape from the city that we sought a decade ago. I notice that the same questions continue to come up whether considering a hobby farm in Columbus, an acreage lakeshore home in East Bethel, a horse property in Scandia or an executive estate in Ham Lake. Though the properties that are being considered are only 15-20 miles from the nightlife of downtown Minneapolis, there are significant differences in the way of life out in the country. Here are some important questions and considerations that face my clients as they make their move from the city to the acreage in Anoka and Chisago Counties.

**Does the home have a Septic or Private Sewer system?

Most rural homes have a private septic system. Not all systems are created equal. They are designed for the specific property and size of the home. Even a new septic system can fail if not properly maintained. How do you know if the septic system is working? Require the seller to supply a report of compliance from a certified septic inspector in your purchase agreement. If you have never lived on a home with a septic system, it is important to educate yourself on how to best maintain your system. Additional information on Septic Systems.

**Does the home have access to city water or a private well? Do I need a water softener or other water treatment system?

Families new to the concept of well water have many questions regarding its safety. Traditionally, well water is tested for bacteria and nitrates at the time of sale by the seller. A lead test for well water is required only for FHA loans. If you want the well test for your property to include other contaminants, it must be specified in the purchase agreement. Annual water testing is recommended for all home owners with wells. Additional information on Private Wells. Locate your MN Unique Well Number.

One question often asked by home buyers considering a property with a private well is about water treatment options available. Many homes with private wells have water softeners to treat the water in the home. Some will go one step further and have a reverse osmosis water treatment system in the kitchens as a drinking water supply. Additional information on Water Softeners and Reverse Osmosis Drinking Systems.

**Is there a natural gas supply to the home or will a propane tank be located on the property?

Often people looking at acreage will have questions about the huge propane fuel tank located near the home. These tanks are usually see only at gas stations where homeowners fill their small propane tanks for the weekend BBQ. In the country, the large tanks are in many backyards as the source of fuel to heat the home and run appliances. As a fuel source the differences are not noticeable. Propane is the least expensive cleanest fuel if a home does not have access to natural gas. Additional information on the differences between natural gas and propane.

**Does the home have access to cable or high speed internet or will a satellite connection be required? Can I get high speed internet through the phone line? Does the property have cable access? What are the alternatives if DSL is not available through the phone or cable lines? Will the new Digital Television come in or will I require an antenna?

A decade ago, these were not questions that few people cared about in the rural communities. Today our interconnected world brings these questions to the forefront. There are many homes in Lino Lakes, Ham Lake, Forest Lake and East Bethel that do not have cable lines or high speed internet available through the phone lines. If your family lives on the internet and could not live without a high-speed connection, it is essential to find out whether a home has access. Also, the new digital television can require additional antennas in areas too far from the signal or on a property with dense trees. Ask questions prior to writing an offer if being connected is important to you. The alternatives can be significantly more expensive.

**Is the road frontage paved? If the road is not paved, how often is it maintained by the city/county?
When our family first moved to our home to a rural area in MN, the road was not paved. We were nearly a mile down this soft, sandy dirt road. We moved in the late fall and had no idea of the extremely poor condition of the road in the April rain of spring. It was treacherous at times. The regrading was done by the city on a schedule so we would have a pot-holed road for days. Our road has been paved for years now but the memories still remain.

If you are considering acreage, remember many rural roads are not paved. Try to visit the property on several occasions and under differing conditions to determine the condition of any unpaved road. Talk to the city and county to understand the maintenance schedule for the road. Also be sure to ask if there are any plans to pave the road in the future and what would be assessed per property owner for the project.

**Is there wildlife?

Well maybe not lions and tigers, but we have had bears and cougars seen near our home in Anoka County. We also have pheasant, hawks, bald eagles, raccoons, foxes, several varieties of squirrels and deer. A flock of 18 wild turkeys have made their home in our neighborhood and continue to nest year after year. And an owl and a hawk both nest in trees in on our property. I rarely saw blue jays, cardinals or hummingbirds in the city, but in our rural home we see them on a daily basis. While exciting, the downside is sometimes the wildlife comes in. I don't know anyone that hasn’t had an occasional field mouse enter their home.

**Is hunting allowed?

In some rural areas hunting is still allowed depending on the amount of acreage, the development restrictions and city and county rules. It was a rude awakening for us to discover our neighbors were allowed to hunt. Imagine our shock that first deer opener when the hunters came out in blaze orange to hunt in the woods next to our home. The property owner, at our request, posted the land and the hunters left. The land has since been developed but it is something everyone moving should understand before buying any acreage home. Check with the city and county for all ordinances regarding firearms.

**Where are the schools?

The public school districts in rural communities can be vast. In the Forest Lake School District 831, students come from communities as far west as Ham Lake, as far south as Lino Lakes, as far east as Scandia and as far north as Stacy! It you drive from the western border to the eastern border of the district, it takes almost 45 minutes, one way! There is only one high school in the district, so your children's best friend from school could literally live almost an hour from your home. But the opportunities to get to know kids from all areas can outweigh any negatives. Bottomline, it pays to research the school district prior to any housing decisions.
Also school alternatives can be limited. Communities in the city have dozens of private and charter school options. These options are much lower in rural areas due to the smaller population. Additional information on Educational Alternatives in the North Metro.

**Can we have a bonfire and burn all this debris?

There are strict state and local restrictions regarding burning of construction debris and yard waste. There are restrictions on the size of the fire and what can be burned. Many construction materials cannot be burned because they release chemicals into the air that pose an environmental hazard. There are times of the year where burning is only allowed by permit and sometimes not at all. Before burning it is best to check the local restrictions as well as the DNR. More information on MN Fire Restrictions.

**Where do we shop? How far to the nearest corner store, gas station, shopping center and mall?

Depending on how often you like to shop, this may or may not be a big concern. But it is always nice to know how far you will have to go for a gallon of milk for breakfast or a gallon of gas for the lawn mower.

**How long does it take to cut the grass?

If your yard is over an acre with few trees, you might consider a lawn tractor. Many people on acreage only cut certain areas leaving the rest to grow to a natural prairie. Another consideration would be whether or not to install an irrigation system for the sod near the home.

**Wow! There are a lot of trees! Do I have to worry about oak wilt?

Oak wilt is a big concern in Anoka and Chisago counties. Many of the communities have information and programs to help protect and save the oak trees from this disease. 

**What about emergencies? How far to the nearest hospital? Where is the nearest fire station? Who provides police protection?

No one wants to think about these things when moving but accidents and illnesses do happen. It was a long hour drive to Children's Hospital in St. Paul when my 6 year old fell and needed stitches in his upper lip. If the nearest fire station is staffed with volunteers and over five miles away, it will seem like a lifetime during those 5-10 minutes while you wait for the fire truck to show up to YOUR home. Many rural communities do not have police officers but are patrolled by the county sheriff's department. Understand your options before an emergency occurs because it will likely take a bit longer if you are in a rural area.

With a little planning your move to a home on acreage can be a great one!

Copyright 2008 Teri Eckholm