Chris Sloan Tooele Real Estate

A couple of weeks ago I posted this rent to own article on the Weekly Salt Lake Tribune offering for our Utah folks.

We had a ton of comments, as both Utah home buyers and home sellers saw a possible way out of a variety of Real Estate dilemas.

I encourage everyone to examine Rent to Own, and lease options as a strategy to weather the Real Estate storm.

I also encourage everyone to seek adaquate legal opinion as to whether it is a legal strategy in your case and how to best protect your interest.

I hope this gives you some good ideas.

Rent-to-own agreements expand real estate purchase options

President's Message

Chris Sloan

With larger down payments and higher credit scores required to obtain mortgage financing in today's post-subprime era, an increasingly popular rent-to-own agreement may be the solution for cash-strapped buyers looking to take advantage of today's competitively priced real estate.

Called a lease option, the arrangement is where a buyer agrees to rent a property and then purchase it at a later date. The agreement is a cross between a typical purchase contract and a lease, and is essentially like having a purchase contract with a delayed closing.

In these deals, a buyer will typically agree to pay an upfront fee for the "option" of purchasing the property at a later date for an agreed-upon price. In other words, the buyer is simply buying the option to purchase the property itself at a later date. This fee will eventually go toward the buyer's down payment if he or she decides to go through with the purchase; the money will be non-refundable if the buyer decides to back out of the deal.

The contract will also stipulate a monthly rent payment, often with a portion of the rent going toward the buyer's future down payment. During the rental term, often one to three years, the buyer will have time to save money for a down payment as well as work on improving his or her credit score. For example, if a buyer paid $5,000 for the option to buy a $200,000 home and $400 of the $1,400 rent payment went to the purchase, the buyer will have saved $9,800 after one year and $19,400 after three, according to a CNN Money article.

Along with the opportunity to save money and improve their credit scores, buyers also have the major advantage of getting to know the neighborhood and the area before actually purchasing the property. If a buyer discovered he hated the neighborhood after a few months, he could decide at the end of the lease term not to buy the property, losing only his upfront payment and the portion of the rent payment that would have gone toward the purchase.

Lease options are ideal for homeowners who have purchased another home and are having difficulty selling their first home. The lease option allows them to receive monthly cash that can help offset mortgage costs, and they know the tenants are more likely to take better care of the property because they have a stake in it.

Nevertheless, because a lease-option transaction can be more complicated than others, it's important for both buyers and sellers to work with an experienced Realtor and understand the risks of this type of agreement.

Buyers should take several steps to make sure they are happy with the property and are working with a credible seller. Before the contract is finalized and the upfront option money becomes non-refundable, buyers should conduct a thorough inspection of the property to find out about any potential problems, like a leaky foundation or a damaged roof. Buyers will also want to get a title report to make sure there aren't any problems that could prevent the homeowner from selling the property at the end of the lease period. Excessive liens on the property could be one red flag. Buyers should also look for any signs that the property is headed toward foreclosure.

Risk reduction steps for the homeowner include making sure the agreement requires the tenant to provide notification of his or her intention to purchase the property 30 to 60 days before the lease expires. This is because the seller always risks that the buyer will decide not to purchase the property. If the seller knows the tenant is not going to exercise his or her option to purchase, the seller can begin marketing the property before the lease expires.

Most importantly, both buyers and sellers should make sure they work with professionals and understand the terms and agreements of their contracts. A real estate attorney can help you avoid any legal pitfalls, and a Realtor will help you negotiate the purchase of the property. To learn more about Utah real estate and to find a Realtor, visit UtahRealtors.com.

Published Monday, July 06, 2009 3:06 PM by Chris & Berna Sloan

It's that time again, the 4th of July !!! YOUR INVITED !!!

Independence Day in Tooele.

For those of you that have been reading this blog awhile, you will know the drill. For those of you that don't, here we go.

The day starts off at Saturday morning @7am with the annual Tooele Chamber of Commerce breakfast.

By 8am, Berna & I and a bunch of real dedicated neighbours will have served nearly a thousand meals of ham & eggs with all the fixin's. Folks will still get done in time to get a good spot to watch the Tooele City parade on Main St.

After that will be the traditional fun and games at City Park, or for you parade junkies, time to make the short trip to Grantsville for their parade.

An afternoon of car shows and real rodeo fun will get you to the fun part of the evening.

This year, it's the Nitty Gritty Dirt Band, performing on the Tooele High School football field, followed by an awesome fireworks show.. Tickets are still available at Tooele City Hall or at Macey's, and for 5 bucks you'll have a tough time beating the 4th in Tooele County.

I do want to plug another County as well as the Cache Valley Cruise-in car show is also this Thursday, Friday, and Saturday. I mention this one because it's the biggest car show in the State with close to 1000 cars and bikes of all kinds. They also have a great auto-mobilia swap meet.

It's not Tooele, but.....Have a great 4th!

Published Monday, June 29, 2009 6:59 PM by Chris & Berna Sloan

Loan pre-qualification can prevent home-buying headaches

President's Message

Chris Sloan

Because most Utah home buyers purchase real estate using a mortgage, one of the most important steps in the home-buying process is securing affordable financing for your Utah home purchase. And with today's tighter lending standards, knowing that you'll be able to secure a mortgage with favorable terms and conditions is more important than ever.

The earlier you know where you stand in terms of your home financing, the better. It can be frustrating for buyers to find the home of their dreams only to learn they don't qualify for the mortgage they thought they would, especially if the buyers have spent money on a home inspection, survey or other due diligence.

One way to prevent these types of problems is to get pre-qualified or pre-approved for a mortgage before you shop for a home.

In basic terms, a pre-qualification is when a mortgage lender will tell a buyer before his or her official application how much he or she can afford to borrow. This amount is usually determined by the buyer's income, current debt, estimated down payment and credit history.

Even better is a pre-approval where a lender will commit to lend the money as long as the buyer still qualifies when he or she is ready to borrow. Securing a pre-approval is a little more difficult than getting a pre-qualification because more documentation is required. Nevertheless, a pre-approval provides more certainty that your financing will be in place when you need it. Once pre-approved, you may even be able to lock in your interest rate so you don't risk having your financing costs increase while you're shopping for a home.

One of the biggest benefits of pre-qualification or pre-approval is that you will know your price range as you shop for homes. Not only will this save you time since there will be fewer properties to consider, but it will make your purchase offer look more attractive to a seller because it is less likely that your financing will fall through. Sellers will know they are working with a serious buyer who has taken the time to get his or her financing in order.

Knowing a price range also helps you decide what home features are most important to you. For example, when you have a price you cannot exceed, it may be easier to decide that you don't really need granite countertops and would rather put the money toward having a garage. Just knowing how much you can afford helps you distinguish your wants from your needs.

When you talk to a lender early in the process, you will also be able to discover, and possibly solve, any issues that could prevent you from getting a loan. For example, if an incorrect item was listed on your credit report, you would have time to contact the entity that made the mistake. Other problems, such as an insufficient down payment, could also be resolved by being discovered early in the home-buying process.

As you work to get pre-qualified or pre-approved, you'll want to shop for a lender and a loan. One way to start is by getting the names of three Utah lenders with whom your Realtor has previously worked. Talk to each of the lenders and compare their costs using the Good Faith Estimate that each will provide to you. If you are considering using an out-of-state mortgage lender or an Internet broker, be particularly careful when comparing costs because their fees can be higher.

As you shop, ask the lender questions. The National Association of Realtors suggests asking the following questions when shopping for a loan: "What is my credit score? Can I have a copy of my credit report?", "What is the best interest rate today? Do I qualify?", "Is the loan's interest rate fixed or adjustable?", "What is the length of the loan?", "What are the total loan fees?", "What is the total monthly payment? Does this include property taxes and insurance?", "Is there an application fee? Is so, what is it, and how much is refundable if I don't qualify?", and "Are there any prepayment penalties? If so, what are they are how long do they last?"

Also remember that you don't have to spend the amount for which you are approved. Make sure that you are comfortable with the monthly payments and are confident they will fit in with your lifestyle, regardless of how much the lender says you can borrow.

For more home-buying tips and other information about the benefits of pre-qualification and pre-approval, contact your local Realtor.

Published Monday, June 29, 2009 6:21 PM by Chris & Berna Sloan

Deseret Peak Complex living up to it's potential In Tooele?

I remember not too many years ago, when many of us around here were questioning the logic of building a huge, multi-purpose recreation facility between Tooele and Grantsville UT.

How could we justify all of the recreational stuff in a county our size? Indoor arena, outdoor arena, huge outdoor swimming pool (in Utah where it can only be open for 3 months a year!), BMX/Motocross track, Fireman's Museum, softball complex. etc.

It has been a drain on the County budget since it was built, but I've come around.

I spent a VERY rainy Friday and Saturday out there watching my niece ( and a few hundred of her closest friends) play in a very wet softball tournament.

Most of the girls were here with a ton a family. The place was packed with people. There were also dozens of RV's and trailers parked in the campground.

Parking was definitely full, not just with softball players, but there was a rodeo going as well. Add the hardcore demolition derby folks saving their seats for Saturday's derby, and it was a buzz of activity, even with the lousy weather.

When you factor in the car and motorcycle racers just over the chain-link at Miller motorsports park, and you have quite a weekend of recreation at Deseret Peak.

It appears I was wrong (again!)

Tooele County has another jewel, for the families, and that's just one of the reasons for considering a move to Tooele.

If you would like more information about moving your family to Tooele, Grantsville UT, Stansbury Park or adjoining places, stop by our website @ Tooele Real Estate.

We'd love to talk to you about a great place to raise a family.

Published Monday, June 22, 2009 10:30 AM by Chris & Berna Sloan Filed under: Grantsville, Tooele, Stansbury Park, Utah

President's Message

Chris Sloan

As condominium and townhomes choices have increased in recent years, many buyers have turned in their lawn mowers and garden tools in exchange for the ease and convenience of multi-family living.

While single-family homes are still the majority of homes purchased overall in Utah, a fair segment of buyers are turning to condos and townhomes as a maintenance-free way of living. In fact, the National Association of Realtors reported in its "2008 Profile of Home Buyers and Sellers" that 22 percent of all buyers surveyed did not purchase a detached single-family home.

Condos and townhomes can be smart purchases for many buyers, but because most developments include certain restrictions and some shared ownership, it's smart to thoroughly do your research before buying. Start by taking the following steps, and ask your Realtor for additional information and tips.

Consider Your Lifestyle

When considering buying a condo or townhome, start by looking at your lifestyle. If you hate yard work and desire amenities like a swimming pool or fitness center, one of these developments could be a perfect fit. However, if you prefer a more private location and personal outdoor space, you may be better suited with a single-family home.

Also take into account that condos and townhomes are part of homeowners' associations that require monthly fees for maintenance and include restrictions on what you can do with your property. While the restrictions are designed to protect both you and the other owners in the development, they may not fit your particular lifestyle.

Carefully read the associated covenants, conditions and restrictions (CC&Rs) before deciding to buy a particular unit so you know exactly what will be expected of you. Also see if there are any grandfather clauses in place that may restrict you from conducting activities that earlier buyers are allowed to do.

Understand the Types of Ownership

There are several types of property ownership that could apply to property within a condo or townhome development.

In general with a condo, the owner holds the title to his or her individual unit, but does not own the land underneath or the air above the unit. All the condo owners in a particular development hold title to shared areas that are used by multiple owners, such as hallways, walkways, clubhouses, swimming pools, etc.

The property ownership of a townhome may or may not be the same as that of a condo. For example, in some developments, the owners own the land beneath their units; in others, they do not. Because of the variations from development to development, make sure you understand beforehand what your purchase includes. As with condos, the owners typically share title to the common areas, and an owners' association collects fees for maintenance.

Research the Homeowners' Association

Find out as much as you can about the homeowners' association before you buy. Make sure you understand what your monthly payment covers and how often the association can raise fees.

A careful look at the association's finances and minutes could reveal red flags. If there are unresolved maintenance issues, find out if the association plans to take care of the problems. Also determine whether there are adequate funds available to pay for the repairs. If not, there could be an upcoming assessment that condo/townhome owners will be required to pay. Any litigation issues could also signal problems.

These are just a few of the issues you should review when considering the purchase of an attached home. Because buying a condo or townhouse can be complex, make sure you are working with an experienced Realtor who can guide you through the process and help you avoid potential pitfalls.

If you don't have an agent, but would like to see how to to look for one. Stop by our web site @ Utah Real Estate and take a look.

Or you can call, 435-840-5029. We'd be happy to help.

Published Monday, June 22, 2009 9:39 AM by Chris & Berna Sloan Filed under: Real Estate, Utah