FAQ
FREQUENTLY ASKED QUESTIONS
Categories:
BUYING
Is it smart to buy a house in this market?
There are opportunities for buyers to make a smart home purchase in every market. In some markets, interest rates are lower - which gives buyers the ability to secure a lower mortgage payment. But there may be less inventory to choose from, leading to less leverage to negotiate a lower price or repairs. In other markets, buyers might be subjected to higher interest rates, which could increase their monthly mortgage payment - but this might lead to more homes sitting on the market for buyers to choose from, putting them in a stronger position to negotiate a lower purchase price, credits for closing costs, repairs, etc. Ultimately, whether or not it is smart to buy a house in the current market depends on what is most important to the buyer, based on their unique situation and goals. But, generally speaking, it is always a smart time to buy the right house if it fits the buyer's criteria and budget, no matter what kind of market it is.
Do I need to get pre-approved before I can look at houses?
There is no ethical or legal requirement for a buyer to get pre-approved before they can start physically touring homes. However, many agents stress that it is in the best interest of the buyer to speak with a lender and begin the pre-approval process before diving too deep into searching for/viewing homes. Why? Because a pre-qualification letter and/or a pre-approval letter (there is a difference between the two) provides the buyer with a realistic idea of: 1) If they can even qualify for a home loan at the time of the inquiry and 2) What their maximum purchase price/loan amount must be in order to keep their monthly payment within their ideal range. This enables both the buyer and agent to set up realistic searches and home tours for properties that they can be confident that the buyer will actually be able to pursue financially, if they find the right fit. A buyer that finds the perfect home but hasn't spoken with a lender yet might end up being crushed with disappointment when they are told that they cannot qualify for the financing needed to be able to purchase that home. Having this conversation before starting the home search keeps everyone in alignment and makes for a much smoother/enjoyable experience from the very beginning.
What does it mean to be in a "buyer's market"?
A "buyer's market" simply means that the market is perceived as offering greater advantages to buyers than to sellers. A few factors contribute to this: 1) High inventory (plenty of available homes on the market for buyers to choose from) 2) Lower home prices (when supply/inventory is increased, demand decreases, leading to prices decreasing) 3) Longer days on market (properties sit on the market longer before selling because buyers have plenty of options to choose from and can take their time when a making a decision) A buyer's market also facilitates a more favorable negotiation position for buyers because sellers are competing for them, and therefore might be more flexible on price/terms.
SELLING
What is the best time of the year to sell my home?
There are many different opinions about what time of year is the best time to sell your home. Some believe that Spring is the best season to sell your home because the weather is getting nicer, the daylight lasts longer, buyers have had time to catch their budgets back up after holiday spending, and there is generally a perceived "new beginnings" sort of atmosphere still lingering from the new year. Many studies and data points also suggest that late Spring/early Summer are the best times to sell a home in terms of the efficiency of the sale and higher seller premiums.
What happens if I need the money from my home sale to purchase my new home?
It's fairly common for a home seller to need the proceeds from their home sale in order to successfully complete the purchase of their next home. As a matter of fact, the home sale might even be a condition of final approval for their loan on the next home purchase. There are a handful of ways for a seller to access the equity in their current home to use for the purchase of their next home, here are a few to consider: 1) Talk with a lender about some form of "gap" financing (for example: a home equity loan, a Home Equity Line of Credit aka "HELOC", a bridge loan, etc.). Note: These products may or may not be a great solution for every situation, so be sure to consult with a lender about your options. 2) A seller may be able to set up a temporary living arrangement for the period of time between the closing date of their current property sale and their new property purchase. This might mean putting their belongings in storage until the closing day of their purchase and finding a short term rental/hotel to stay in during the meantime. 3) A seller might be able to negotiate a "rent-back" arrangement, where they are able to temporarily rent their home that they sold back from their buyer for a short period of time until they close on their next home. This option tends to be accompanied by some sort of agreed upon per diem rent rate, or a flat fee. Similarly, a seller might be able to negotiate with the seller of their next home to work out a "possession prior to closing" arrangement, wherein, the seller of their next home allows them to move-in and start occupying the property even before the purchase is official. This option may be perceived as a bit more risky for all parties and needs to be handled very delicately - making it a less popular solution. The expertise and experience of your agent/broker/lender are absolutely essential when brainstorming any of these options. If you know that you will need to be using the money from your home sale to purchase your new home, make sure that whichever agent/broker/lender that you choose to serve you has experience with helping clients successfully navigate this very important decision.
What does it mean to be in a "seller's market"?
A "seller's market" simply means that the market is perceived as offering greater advantages to sellers than to buyers. A few factors that are indicative of a seller's market include: 1) Low inventory (there is a lack of available homes on the market for buyers to choose from) 2) Higher home prices (when supply/inventory is decreased, demand increases, leading to prices increasing) 3) Shorter days on market (properties do not sit long on the market before selling, so buyers tend to make a quicker decision about purchasing the property so that they don't miss out on it) A seller's market also facilitates a more favorable negotiation position for sellers because buyers are competing for the property, and therefore might offer an above-asking purchase price and/or be more lenient on their proposed terms like inspections, appraisal, seller's concessions, etc.
hiring an agent
Is hiring a real estate agent worth it?
When considering if hiring a real estate agent to help you buy or sell a home is worth it, the most important concept to consider is "value". It's crucial to understand that value is not necessarily the "cost" of a good or service. It is also not the quality of the good or service itself, it is the measurement of the amount of benefit (and/or quality) that a customer receives in exchange for the price they have paid, or will pay, for the good or service. That is the difference between what something "costs" and what something is "worth". In terms of hiring a real estate agent, an example of a benefit that a buyer client would receive is that they have an experienced representative working on their behalf that is equipped to tactfully negotiate with home sellers in order to get the best price and terms possible. A buyer that is not trained in negotiation and/or does not feel comfortable having these kinds of intense conversations might find this benefit to be extremely valuable. Likewise, an example of a benefit that a home seller might receive by hiring a real estate agent to list their home would be the social/digital exposure of the seller's home to the market through various platforms like social media, third-party syndicated listing sites, emails to prospective buyers within the listing agent's existing database, etc. If a home seller does not have the knowledge of how to effectively maximize the disbursement of their listing across multiple channels in order to increase exposure to potential buyers, then hiring a listing agent that excels in this area might prove to be very valuable to them. The buyers and sellers that believe hiring a real estate agent is "worth it" are the ones that believe that the level of service they have received from the agent they hired met or exceeded their expectations compared to the price that the service cost them. It all comes down to what services the individual client finds most valuable and if they are willing to pay the price to benefit from those services.
Who is my point of contact after I hire an agent?
Who your point of contact is after hiring an agent is going to largely depend on the particular brokerage, team, and/or agent you decide to hire. Some agents are subjected to the work flow of their team/brokerage that have set up a systematic funnel where you will be working with a different person throughout the various stages of the buying/selling process. For example, the original agent you spoke with/hired to help you purchase a home might conduct the first meeting with you, where you discuss your homeownership goals and desired criteria for your home purchase. Then, a different team member (possibly a showing assistant) might conduct the physical showings of the properties that meet your criteria. Another team member might help you write the offer on the property you like most, the next one ensures you filled out all of the correct documents, and so on. Other representation structures might be a "one-man show" approach, where you have one point of contact that is working on everything for you from the initial meeting all the way through closing and beyond. There could also be a combination of these structures where you have a main point of contact that you solely communicate with but they have a team behind the scenes taking care of various specialized tasks. These examples are certainly not exhaustive but should give you an idea of a few of the common structures that are out there - ultimately, the representation structure you select should reflect what is most important to you as the client. Be diligent when hiring an agent by asking, in advance, how your transaction will be handled at the various stages of the process. If having multiple points of contact for each stage feels overwhelming or concerning to you, and you value having one person to communicate with that is handles the various tasks themselves, you'll want to select an agent that operates accordingly. If having various points of contacts throughout the process makes you feel more confident that nothing is getting missed, for example, then you'll want to be mindful to search for an agent that operates within that type of workflow structure.
How much does it cost to use a real estate agent?
The cost to use the services of a real estate agent can vary greatly depending on if you're a buyer or a seller. However, no matter which type of client you are, a buyer or seller's agent's compensation is negotiable - in other words, there is no "standard" or "going" rate that agents/brokerages must charge. That said, it is very important for clients and prospects to understand that, ultimately, the agent or the company that the agent works for is the one that sets their individual fee structure for their services. For example, some compensation structures might be tiered and depend on the specific service package that a buyer or seller selects, some agents might charge a flat fee for a set of particular services, and some might be based on a pre-determined percentage of the final sale price of the home, to name just a few.
LENDING
How do I get pre-approved for a mortgage?
The first step to getting pre-approved for a mortgage is to connect with a mortgage loan officer - commonly referred to as a "lender". Although the actual lender is the financial institution that the loan officer works for (which could be a bank, mortgage company, etc.), a loan officer is often referred to as the lender because they are your direct point of contact when discussing your loan - but it is important to know the difference between the two. You may already have connections to loan officers that you know and trust, or your real estate agent might send you a few options that have successfully served their clients in the past, but it is completely up to you to decide which loan officer is the best fit for you. The loan officer will start by gathering various bits of personal information including your name, date of birth, etc. as well as some financial information like your income, assets, debts, etc. They may also ask if you already have a specific property or price range in mind for your purchase. All of this is usually gathered through a combination of your initial conversation with the loan officer and the information you include on your mortgage loan application. Additionally, they may request supporting financial documentation like W-2's, tax returns, bank statements, etc. They will use all of this information to work with underwriters to determine your official creditworthiness, and will ultimately let you know: 1) IF you qualify for a mortgage with that particular institution (and if so, what loan options you have), and 2) the monthly payment/purchase price that you qualify for based on the loan option you choose. Depending on your situation, there may be a broad price range and/or many different loan options that you could qualify for, but a great loan officer that has your best interest in mind will explain the difference between the maximum purchase price that you are approved for and the purchase price that most closely aligns with your expressed budget. In addition, they should be showing you the differences between the various programs you qualify for and the costs associated with each, if applicable. Once you have discussed all of this information with the loan officer and have picked the best price range and loan program for you, they will create a "Pre-Approval Letter" to share with you/your agent, which you can include with your offer when you find the home you would like to pursue. Nowadays, most sellers and listing agents will want to see this document before accepting an offer because it gives everyone confidence that financing has already been discussed and has less likelihood to be the reason a contract falls through. DISCLAIMER: This is a very general overview of the pre-approval process. Each lender, loan officer, and borrower's situation can be very different and it is best to consult with a loan officer to best understand the full details of the process. If you have further questions about this process, please contact GPS Realty and we will gladly connect you with one of our preferred lenders to walk through these details more in depth with you.
How much are closing costs?
One of the most commonly overlooked financial components of the entire home purchase process is paying closings costs. When buyers purchase a home using a mortgage loan, there are typically costs associated with that loan that the buyer may be responsible to pay for at closing. This includes, but is not necessarily limited to: loan origination fees, title fees, prorated taxes/insurance, etc. The amount of these fees can drastically vary depending on the purchase price, title services performed, type of loan program and many other factors. This makes it difficult to provide an accurate estimate of closing costs until closer to the closing date. However, once you've submitted a completed mortgage application, your lender is required to send you a Loan Estimate (L.E.) within 3 business days from the date they received your application. On this Loan Estimate document, there will be a portion that indicates the Estimated Closing Costs and the Estimated Cash to Close (this includes your closing costs, downpayment and any other necessary costs to successfully fund the closing of your purchase). According to Fannie Mae, "Closing costs usually range from 2% to 5% of the value of your mortgage and are paid in addition to your down payment." While this percentage range can equate to a difference of thousands of dollars, it's a starting place for buyers to get some kind of an idea of what closings costs might look like for their home purchase. The further they get through the process, the more clear the final closing cost number will become. As a quick side note, there are times when a buyer might be able to negotiate that a seller pays all or part of the buyer's estimated closing costs (up to the percentage allowed by their specific loan program) as part of the purchase agreement - seek the advice of your real estate agent and loan officer for more information on this strategy. DISCLAIMER: This is a very general overview of closing costs. Each lender, loan officer, and borrower's situation can be very different and it is best to consult with a loan officer to best understand the fees associated with a home loan purchase. If you have further questions about closing costs, please contact GPS Realty and we will gladly connect you with one of our preferred lenders to walk through these details more in depth with you.
Should I talk to a lender before I talk to a real estate agent?
There is absolutely no requirement for a buyer to talk with a lender or a real estate agent before they talk with the other. There may be a system that works best for a particular agent and/or lender that promotes efficiency for their specific workflow, but ultimately each situation could call for a different strategy. Therefore, for the purposes of this answer, we will discuss the process that has typically worked best for the clients of GPS Realty. We'll break it up into two parts: 1) Who to Talk to First 2) The Agent/Lender Relationship ............................................................ WHO TO TALK TO FIRST More often than not, GPS Realty buyer clients speak with us first as their agent before they connect with a lender. Generally speaking, we find this pattern to be the most effective for everybody involved, and here's why: As part of the initial planning stage of our Buyer Journey, we gather helpful information about the client, their financial situation, what type of property they are searching for, price range, etc. Doing this very early on in the process gives us a clear understand of who we are working with, what their situation looks like, and what they are looking for. We're then significantly more equipped to be able to confidently connect them with the lenders that we believe - based on our existing relationship with those lenders - may be the best fit for the buyer's personality, their situation, and their goals. Likewise, the lender has a head start on knowing if/how they can best help the mutual client right off the bat. To be clear, this is NOT to say that it is wrong or any less effective for a buyer to talk with a lender first before they speak with a real estate agent. Especially if the loan officer is local to the market the buyer is shopping in and is the single point of contact that they can consistently reach via phone call, text, email, etc. The lender may also have their own process of discovering the buyer's situation and goals, which could provide them with helpful insights that they could use to confidently connect the buyer with preferred real estate agents that fit them best. THE AGENT/LENDER RELATIONSHIP Again, as as a general statement, the quality of the agent/lender relationship is a very valuable benefit to the mutual buyer client. For example, when the agent and lender know each other, have worked with each other, and have open lines of communication with each other, there is a greater likelihood of a successful purchase transaction. Why? The answer might seem obvious, but it is important to cover nonetheless. When a real estate agent and a lender (specifically, a loan officer) have experience working with one another, especially if that experience resulted in one or many successful transactions, each understands how the other operates in terms of attention to detail, response times, punctuality with deadlines, clarity in communication, and so on. Therefore, the buyer can be confident that the two professionals that they interact with and trust the most during the purchase process are already on the same page before the process even begins. Not to mention, the streamlined communication between the two promotes the ability to anticipate and more efficiently overcome many obstacles that may arise throughout the journey. This protects the mutual client from being subjected to any unnecessary stress or anxiety that can come from having to find a solution between two members of their trusted team that can't get ahold of each other. In our typical experience, the Buyer Journey is much more efficient, effective, and enjoyable when the agent and lender work together well because the direct result is that the buyer client is served with the highest degree of excellence - and that is always the primary goal, no matter who the buyer speaks with first.
GPS REALTY
What makes GPS Realty different than other real estate companies?
GPS Realty is a real estate brokerage that is extraordinarily intentional about not only thoroughly guiding our clients through every stage of their buying/selling journey, but actively seeking out ways to bless and support clients outside of the course of their real estate experience as well. We believe that the real estate journey has the power to radically enhance lives - through the obvious blessings of buying a new house to host loved ones and make memories in, for example. Or selling a home that might yield a life-changing profit and/or simply no longer serves the needs of a growing family. But deeper than that, when you invite GPS Realty into these monumental moments of your life, we view that invitation as an opportunity to search for ways to serve you beyond the normal expectations of our representation agreement. Because of our faith in Jesus Christ, we believe that every person/family that we are able to connect with is put into our lives for a reason, and us into theirs. For us, that reason is to bring glory to God. As servants of the Lord, we believe that this is His company, and He has trusted us to manage it with excellence. We strive to operate with that truth as our guiding focus every single day. Unlike many other real estate companies, our ambition is not to have the most agents, sell the most homes, or generate the most sales volume/revenue, because ultimately those accomplishments are fleeting moments of happiness that tend to distract us from what really matters. To be clear, there's nothing wrong with wanting those things as long as they don't consume you, but they just aren't our primary focus. Instead, our joy is rooted in delivering an excellent experience through every stage of the buyer/seller journey and beyond - not for our own glory, but to the glory of God who has blessed us abundantly. Because this is who were are and how we're committed to doing business, you can always expect us to stay true to our promises of Honesty, Integrity, Humility, and Servant-Leadership, to name a few. In summary, the answer to: "What makes GPS Realty different than other real estate companies?" is that we're not striving to take over the world. We're striving to take excellent care of the people and communities that we are trusted to serve in this world, as a reflection of our commitment to serve our Savior who has overcome this world. In doing so, we have built and will continue to build relationships that will last a lifetime and consistently see lives get better and better. We like to say, "We're not in the real estate business - we're in the life enhancement business. You just happen to get a house out of the deal." For more information about GPS Realty, check out the "About" page on this site and/or fill out the contact form under the "Contact" tab. We'd love to share more about who we are and why we do what we do.
How do I know if GPS Realty is a good fit to assist me with buying and/or selling?
The best way to know if GPS Realty is a good fit to assist you with buying and/or selling a home is similar to just about any other service-based business. It all starts with a conversation. Some call it an interview, some call it a consultation. We call it a MAP Session. "MAP" stands for: Motivation, Aim, and Plan. During this initial session we focus primarily on discussing those 3 factors because nearly everything we need to know about you is discovered during that time. And likewise, our response to those important topics should hopefully tell you everything you need to know about us and if/how we can help you. Because of how effective this session has been at helping us connect with our prospective clients right off the bat, while still providing tremendous value to those clients as they begin their journey, it's become a standard, non-negotiable component of our operating procedures. If it's important for you to have your needs heard, and to have the opportunity to determine if your real estate agent has a genuine desire to serve you (both of which should be very important to you), then the MAP Session is the perfect place to determine if GPS Realty is a good fit for you. Contact us today through the "Contact" page or by texting/calling 417-708-4883 to learn more about the MAP Session and/or to get yours scheduled.
Does GPS Realty only work with Christians?
GPS Realty does NOT discriminate against any person or persons on the basis of race, color, religion, sex, disability, familial status, national origin, sexual orientation, or gender identity. Therefore, GPS Realty does not ONLY work with Christians. In fact, to provide/deny services to any protected class on the basis of any characteristics listed above would not only be in violation of the NAR's Code of Ethics, Federal Laws, and the personal convictions of the owners of GPS Realty, but doing so would be in direct opposition to one of the fundamental commandments in Scripture which is to "Love your neighbor as yourself." (Matthew 12:31) GPS Realty does, however, reserve the right to deny services to any person that directly or indirectly threatens the safety and security of any member of our firm. There will be no tolerance for and no obligation to provide services to any person that facilitates a hostile or unproductive working relationship, regardless of if an agency agreement has been signed or not. GPS Realty has and will continue to welcome clients from all different backgrounds, worldviews, and walks of life. We are bold in the truth that we believe in and will never shy away from our faith in Jesus Christ, but we will NEVER force those beliefs on anyone. We will only exemplify those beliefs through service. This might mean that some clients may decide they do not want to work with us, and though we would love to serve everyone, we understand that people connect with each other in different ways. There may be fundamental beliefs that we do not agree on with every single client, but our commitment to providing an excellent buying/selling experience in order to enhance the lives of our clients surpasses all differences, as long as we are able to maintain an environment of mutual respect and cooperation.