Real Estate Information Archive

If you're planning to buy a home in Albuquerque, earnest money is just one of the terms you need to be aware of. It is often overlooked by buyers, but not understanding it can cause roadblocks once you’re ready to make an offer.

The Basics of Earnest Money

Simply put, earnest money is a deposit that the buyer makes on the property to indicate that he or she is serious about buying it. The earnest money might range from 1% to 5% of the total purchase price.

After accepting the earnest money, the seller will take the home off the market. This will enable them to start getting things ready, such as inspections.

While you wait for your closing, your earnest money goes into an escrow account. The escrow account is held by either the seller's broker or title company, or by an escrow company.

The earnest money is kept securely until closing. Then, the earnest money is deducted from your total payment and applied to closing costs.

How Much Earnest Money Should You Offer?

The earnest money is typically between 1% to 5% of the total purchase price. However, there are many causes for variance. For instance, some cities might require you to pay a fixed amount while others may prefer a percentage.

It is not unusual for earnest money deposits to be very high in highly regarded housing markets. Your real estate agent will help you know what to expect in your area.

Earnest Money Is Not a Down Payment

Many buyers are confused by the idea of earnest money—it is not a down payment. Your down payment will be anywhere from 10-20% of your home's purchase price.

Think about the price of a house after adding your earnest money and down payment, and then figure out how much you need to pay for the house down payment and closing costs later. Your earnest money is usually due with your offer, while the down payment and closing costs come later.

Is It Refundable?

You should make sure your purchase agreement includes contingencies. These are situations in which you may walk away from a deal and still be able to get your earnest money back.

As an example, you might stipulate a contingency for appraisals that are lower than the sale price.

In a market that is highly competitive, you could agree to a nonrefundable earnest money deposit. That can be very risky since the seller may hold the money if your sale collapses.

The seller can keep your earnest money if you break the terms of your purchase agreement or decide that you do not want to buy a house anymore.

That is why hiring a skilled real estate agent is crucial, like the ones on the Sandi Pressley Team. They will make sure that you fully understand what is involved before you sign anything. Otherwise, you could end up forking over a lot of money you cannot afford.

If you’re buying in a market that’s not very competitive, earnest money isn’t a requirement. It is however a good way to beef up an offer, especially if you expect there will be multiple offers on the house you want.

Contact us today to help you buy or sell your next home in Albuquerque. Looking for the perfect home for sale in Albuquerque? Our easy-to-use home search tool can help you start the process. Join us twice a week on our blog for more real estate advice and great reasons to buy a home in Albuquerque and the surrounding area. Follow us on Facebook for the latest Albuquerque real estate updates.

HOT HOME LISTING OF THE WEEK!

1004 NOVAK Lane NW, Albuquerque, NM 87114  $898,000

4 Bedrooms / 4 Bathrooms (3 full, 1 half) / 4235 Square Feet

North Valley Renaissance Custom Masterpiece! Situated in a gated community close to Rio Grande/Alameda. Highlights include a well thought out floorplan with both formal & casual living spaces. Exceptional features include wood beam raised ceilings; travertine floors; quality wood doors; wood trimmed windows; custom paint; floor to ceiling fireplace; & more! Well appointed Kitchen w/Wolf & Subzero appliances; Alderwood cabinets; gorgeous granite counters; kitchen island; large walk-in pantry; kitchen nook; & eat at bar. Privately located Master Suite offers portal access, luxurious en suite w/snail shower, jetted tub, ample walk-in closet w/built-ins. Three additional bedrooms-one could be In-law Suite. Large covered portal w/relaxing spa & cozy fireplace. See Feature Page for more details!!

Contact the Sandi Pressley team for additional details! 

Get your Morning Inspiration with the Sandi Pressley Team

If you want to buy a home in Albuquerque, one of the options you might come across is rent-to-own. It may sound like a great deal at first, but as with anything, there are pros and cons. The real question boils down to if it’s the best way for you to go in order to own a home.

Here are some important things you should know before you get into a rent-to-own agreement.

The Basics

While rent-to-own properties can be appealing, there are also risks involved.

This type of agreement basically tells you that you’re going to rent a house for a certain amount of time until you gain ownership. The time you rent can range from a couple of months to a few years, depending on your contract.

A company or an individual can be the owner of a property.

A predetermined amount of each rent payment is retained by the seller. That money will go toward the equity at the time of sale.

A lease-purchase agreement and a lease-option agreement are both categorized as rent-to-own agreements. When you follow the lease option agreement, you can opt to buy the home after the time you agree upon. On the other hand, with a lease-purchase agreement, you have a legal obligation to buy the house.

The Process

While every process might have its own unique elements, some of the things to anticipate in a rent-to-own transaction include:

• An agreement will first specify a purchase price, which may be based on the current value of the home, or perhaps on the estimated future value. Perhaps a buyer and seller agree to a price during negotiations, while the purchase price is decided when a lease expires.
• Your monthly rent payment then becomes a part of your contract. Since a portion is being set aside toward your future purchase, the rent payment will likely be more than comparable rent prices in the neighborhood.
• The seller can require you to cover the entire cost of maintenance, so when you enter into one of these agreements, it’s important to understand exactly what you’re agreeing to.
• The seller usually collects a one-time fee that isn't refundable, and some sellers will apply it to the equity balance. The fee is usually calculated based on a percentage of the sales price of the house.
• Your contract will dictate a specific lease term.
• At the end of your lease term, if you intend to purchase a house, you’ll have to obtain financing. So there will be a closing date.

The Pros of Rent-to-Own

For buyers, the upsides of rent-to-own agreements include:

• By progressively accumulating your down payment, you’re avoiding having to come up with a large sum upfront.
• There will be no competition from other buyers when you are ready to buy.
• It is not necessary to qualify for a mortgage right away, so you can build your credit score over a period of time.

The Cons of Rent-to-Own

Rent-to-own deals might sound great, but there are a lot of downsides to them.

• Because you are being forced to set aside a down payment, you will pay more rent than you would for a comparable home. On the other hand, you could rent a home at a lower price and then put a portion of your own income into a savings account.
• If your deal doesn’t work out, you still have to pay the option money, which is not refundable.
• There is a good chance that you will be forced to pay all the maintenance and repairs on a home that you do not yet own.
• You might end up with a purchase price in your agreement that is much too high if the home’s value goes down.
• A foreclosure is one example of situations beyond your control that could cause you to lose your equity in the home.

It is important to weigh the pros and cons of your personal financial situation and determine what is best for you.

The traditional route rather than rent-to-own can be more advantageous as a home buyer in Albuquerque, especially if you have good credit.

Contact us today to help you buy or sell your next home in Albuquerque. Looking for the perfect home for sale in Albuquerque? Our easy-to-use home search tool can help you start the process. Join us twice a week on our blog for more real estate advice and great reasons to buy a home in Albuquerque and the surrounding area. Follow us on Facebook for the latest Albuquerque real estate updates.

HOT HOME LISTING OF THE WEEK!

1261 MONTERREY Road NE, Rio Rancho, NM 87144  $539,000

4 Bedrooms / 3 Bathrooms (3 full, 0 half) / 3007 Square Feet

Stunning custom Tuscan style home in a highly sought-after Rio Rancho location. With beautiful Mountain and City views!! This luxurious home has a fantastic layout perfect for entertaining. Grand iron Double Entry Doors. Beautiful beamed ceiling also boasts gorgeous marbled tiled barreled ceilings. Kitchen is a chefs dream with granite counter tops, pantry, SS appliances and huge island. Large Owners suite has balcony access, fireplace and a spa like bath equipped with a jetted tub. This home has to many amenities to list, come see for yourself!!

Contact the Sandi Pressley team for additional details! 

Get your Morning Inspiration with the Sandi Pressley Team

When you decide to buy or sell a home in Albuquerque, you need to first decide who you’re going to have on your side to help you complete your transaction succesfully. Albuquerque real estate professionals come in three types - agents, brokers, and Realtors. So what really is the difference between them, and why does it matter?

There are overlaps between all three, but at the same time, distinctions.

Agents

A real estate agent is a person working in the field who has studied for and passed the relevant real estate courses. They are also licensed to practice in the state of New Mexico.

An agent represents either the buyer or the seller in a transaction. Some specialize in working with buyers, others with sellers, others do both.

An agent's job description includes collecting offers and counteroffers, negotiating, and assisting clients with the paperwork. Real estate agents are able to provide their clients with additional services that aid in tying up loose ends, such as arranging any necessary home inspections. They usually receive a commission on a successful transaction, so they receive a percentage of the sale price.

Brokers

A real estate broker is someone with more education than is required to become a real estate agent and has obtained their broker license. A real estate broker might need to complete courses in topics like insurance, taxes, and ethics. Brokers also learn topics like property management and real estate investments. The coursework is more in-depth compared to what agents are required to complete.

There are three types of brokers.

A principal or designated broker is a person who works in every real estate office. They make sure the legal compliance of the office. Additionally, they get a commission of the sales their agents make. Next, there’s a managing broker, who may have greater influence over the agents at the office. An associate broker works under a managing broker but usually doesn’t supervise others.

Real estate brokers can work for themselves. They can also hire agents who work under them.

After passing a broker's exam, you can continue to work under another broker, in which case you will be called an associate broker. This was briefly touched upon earlier.

Brokers and real estate agents share the same responsibilities. The main difference is that a broker may earn more money than an agent by having a team under their management.

Realtors

Realtor is a third term often used to denote an agent or broker. Realtors belong to the National Association of Realtors or NAR.

NAR members agree to adhere to NAR’s strict ethical guidelines. Besides agents, Realtors can also include other professionals in the industry. For instance, property managers and appraisers can be Realtors since it's a profession that originates from a group membership.

When you become a Realtor, you can use the trademark as part of your title.

This trademark has been assigned to Sandi Pressley since 1979. Sandi has listed and sold more homes than any other agent throughout New Mexico. Through her dedication and hard work, she has been able to help over 12,200 families buy or sell their property. Sandi has been the top realtor in Albuquerque as well as in the state of New Mexico for 35 consecutive years. Sandi and her dedicated team of real estate professionals stand ready to help you realize your real estate goals in Albuquerque.

Contact us today to help you buy or sell your next home in Albuquerque. Looking for the perfect home for sale in Albuquerque? Our easy-to-use home search tool can help you start the process. Join us twice a week on our blog for more real estate advice and great reasons to buy a home in Albuquerque and the surrounding area. Follow us on Facebook for the latest Albuquerque real estate updates.

HOT HOME LISTING OF THE WEEK!

14319 MARQUETTE Drive NE, Albuquerque, NM 87123  $399,000

4 Bedrooms / 3 Bathrooms (3 full, 0 half) / 3000 Square Feet

Impeccably Maintained Home Ready for its new Owners! Nestled in the Foothills on a great corner lot, this home will not disappoint. Main level features two living areas, with both formal & informal dining options; a galley kitchen with dining nook; great guest bedroom next to a full bath; & closed in porch/sunroom ideal for home gym or game room. Upper level features a very roomy master suite & en suite, plus two additional bedrooms & full bath. Great curb appeal on a large corner lot & easy access to Hwy, close to hiking/biking trails, & conveniences.

Contact the Sandi Pressley team for additional details! 

Get your Morning Inspiration with the Sandi Pressley Team

When you buy a home in Albuquerque, the last step is usually the final walk-through. This is an important step in the buying process, as you and your agent will need to carefully look at the condition of the home before you close the deal.

How does this process work, and what should you look for?

A walk-through happens just before settlement. It's your time as a buyer to check the property and make sure any work has been done on the home that was part of the negotiations. The seller and listing agent usually won't be there during the walk-through. That way there won't be as much pressure on you as a buyer as you inspect the property.

What should you check during the walk-through?

• Inspect the outside for any obvious damage
• Run the AC
• Turn on and off all the lights
• Test all appliances
• Run the faucets and check for leaks
• Flush the toilets and check for leaks`
• Open and shut all the doors and windows
• Verify that any agreed upon repairs have been made
• Verify that any fixtures that are supposed to be left behind are still in place

As you check these items, make a list of questions about how systems in the home work and anything else you need clarification on. 

Also, make sure you give yourself plenty of time for the inspection. This is your last chance before you complete the purchase, and you won't have another chance to make sure the home is up to your expectations.

You should also have your Agreement of Sale and inspection reports handy to make sure that anything that needed repaired has been taken care of. You should also take photos of items that have not been taken care of so that you can further negotiate repairs.

A successful walk-through may take time and effort, but it's worth it as it could save you many headaches after you've finalized the purchase.

Contact us today to help you buy or sell your next home in Albuquerque. Looking for the perfect home for sale in Albuquerque? Our easy-to-use home search tool can help you start the process. Join us twice a week on our blog for more real estate advice and great reasons to buy a home in Albuquerque and the surrounding area. Follow us on Facebook for the latest Albuquerque real estate updates.

HOT HOME LISTING OF THE WEEK!

9423 MORROW Avenue NE, Albuquerque, NM 87112  $220,000

4 Bedrooms / 2 Bathrooms (1 full, 1 half) / 1475 Square Feet

Excellent location across from SNOW PARK!! 4BDR/2BA/1CG! TPO Roof! New Swamp Cooler! Newly updated kitchen! Wood floors! Great room features cozy wood burning fireplace, wood floors and is open to the dining room. Beautifully remodeled kitchen featuring new cabinets, granite countertops, SS microwave & dishwasher, refrigerator, new tile flooring! Separate utility room and washer & dryer stay! Close to shopping, restaurants, parks, transportation and Uptown!

Contact the Sandi Pressley team for additional details! 

Get your Morning Inspiration with the Sandi Pressley Team

Now that you've found the perfect home for sale in Albuquerque, the next step is to determine how much you want to pay for the home. This leads to getting a signed offer to purchase to the seller. While the whole purchase agreement is important, there are some parts that are critical to understand before you sign. Here are 3 of those parts.

Earnest Money Deposit

The earnest money deposit is the amount of money you’ll be giving the seller when you submit your offer to purchase (or shortly after it is accepted) to show you are serious. This is not the same as a down payment, which is what you give to your lender.

Usually you pay about 1% of the price of the home to the seller, and the money is kept in the broker’s trust account or with the title company. If the seller accepts the offer, the earnest money will be applied to the purchase of the home.

Personal Property

Personal property is anything that is not permanently attached to the house. Sometimes personal property is included in the sale to sweeten the deal. These items will be listed in the purchase agreement or in a separate addendum.

Items of personal property commonly included in home sales include:

• Appliances
• Yard equipment
• Furniture

Closing Date

There are various strategies when it comes to choosing a closing date. Some people feel it’s best to close escrow as late in the month as possible. This is because prepaid interest, which you’ll need to pay at closing, is prorate from the date of closing to the end of the month.

If you're keeping a tight leash on your cash flow, you may want to close escrow early in the month. Your prepaid interest charge will be higher. Yet, because mortgage interest is paid in arrears, you will skip two mortgage payments instead of one.

That said, there are some times that are better for closings, for various reasons:

• Avoid closing escrow near the fall and winter holidays, especially Thanksgiving, Christmas Eve or New Year’s Eve. Real estate professionals, like everyone else, take time off to be with friends and family.

• If you are both selling and buying, you may need a simultaneous close, allowing both escrows to wrap up on the same day. This is a delicate process and it does have its shortcomings, which can be explained to you if you are in this situation.

Sandi Pressley and her team has the experience to walk you through the purchase agreement, line-by-line, to ensure you understand what you’re signing. 

Contact us today to help you buy or sell your next home in Albuquerque. Looking for the perfect home for sale in Albuquerque? Our easy-to-use home search tool can help you start the process. Join us twice a week on our blog for more real estate advice and great reasons to buy a home in Albuquerque and the surrounding area. Follow us on Facebook for the latest Albuquerque real estate updates.

HOT HOME LISTING OF THE WEEK!

13504 DESERT ZINNIA Court NE, Albuquerque, NM 87111  $1,050,000

4 Bedrooms / 4 Bathrooms (4 full, 0 half) / 4556 Square Feet

Highly Sought after High Desert Contemporary Southwestern Beauty. Custom built for Original owner. Well Situated on .86 acre lot to maximize the spectacular Mountain and City views! Incredible floor plan features 4 spacious en-suite bedrooms all with private bathrooms, Dual Masters, with the largest one on main level. Gorgeous, sunny kitchen with quartz counter tops, opens onto bright, light breakfast nook and family room. Complete with kitchen island, double ovens. Soaring ceilings throughout - with walls of windows to enjoy the views from every room. Approx 1500 sqft of wrap around decks/patios on front and back of home can be accessed from all bedrooms. Gorgeous serene courtyard with water feature. Spectacular low maintenance landscaping front and back! Newer TPO top of the line roof.

Contact the Sandi Pressley team for additional details! 

Get your Morning Inspiration with the Sandi Pressley Team

Are you thinking about buying a home in Albuquerque, but not sure if certain forms of income will help you qualify for a loan? Lenders want you make sure you can repay your loan comfortably. They can determine this by comparing your monthly income with monthly debt. If you work for an employer or for yourself, this can be done by reviewing recent paycheck stubs, W2 forms and/or tax returns. But if you're looking for additional income support to buy a home in Albuquerque, you may not be aware that there are other income sources that lenders can use.

Support Income

If you are receiving spousal or child support, this income can be used to help qualify. There needs to be a record of timely payments, which can be shown by providing copies of bank statements showing the monthly deposits being made and when. Spousal support payments need to continue barring the ex-spouse receiving the income has not married. Child support payments typically continue until the child turns 18.

Investment Income

If you have any investments, the dividends and interest can also be used. This is providing that the income is shown to be consistent over the previous two years. Also, your name must appear on the statement. Any other names on the statement will cause the lender to divide up the income among all who appear on the investment account. Income is averaged over the previous 24 months in order to arrive at a qualifying amount. 

Disability Income

If you are receiving disability payments due to an injury on the job, this can be used as well. This can be verified by reviewing a copy of the disability policy benefit statement. This income may also be used as long as the lender makes the determination the income will likely continue well into the future, for a minimum of three years. It can sometimes be the case that the disability is shorter term in nature, or the lender needs more information about the nature of the disability filing. 

Social Security Income

In order for the lender to use social security income, all that is needed is a copy of the social security awards letter. A request for this letter is made directly to the Social Security Administration either by the borrower or the lender.

Bonus Income

Like other forms of income, bonus income can be counted as long as there is a regular history of having received it. Bonus income should be both consistent and at regular intervals. Bonus income is averaged and should be paid monthly or sometimes quarterly. An annual bonus most often won’t be used. It’s thought that a holiday bonus in December may not be readily available in another time of the year. Verification of the terms of the bonus can be obtained directly from the employer.

Part Time/Seasonal Income

With a two year history of receiving part time income as well as seasonal work, such as during the holidays or during the summer, this income can also be counted when adding up qualifying income. The part time income should also be relatively consistent. Seasonal income may be counted, depending upon the lender’s internal guidelines, again with evidence of receiving it for the most recent two years and paid out in a consistent manner.

Contact us today to help you buy or sell your next home in Albuquerque. Looking for the perfect home for sale in Albuquerque? Our easy-to-use home search tool can help you start the process. Join us twice a week on our blog for more real estate advice and great reasons to buy a home in Albuquerque and the surrounding area. Follow us on Facebook for the latest Albuquerque real estate updates.

HOT HOME LISTING OF THE WEEK!

13504 DESERT ZINNIA Court NE, Albuquerque, NM 87111  $1,125,000

4 Bedrooms / 4 Bathrooms (4 full, 0 half) / 4556 Square Feet

Highly Sought after High Desert Contemporary Southwestern Beauty. Custom built for Original owner. Well Situated on .86 acre lot to maximize the spectacular Mountain and City views! Incredible floor plan features 4 spacious en-suite bedrooms all with private bathrooms, Dual Masters, with the largest one on main level. Gorgeous, sunny kitchen with quartz counter tops, opens onto bright, light breakfast nook and family room. Complete with kitchen island, double ovens. Soaring ceilings throughout - with walls of windows to enjoy the views from every room. Approx 1500 sqft of wrap around decks/patios on front and back of home can be accessed from all bedrooms. Gorgeous serene courtyard with water feature. Spectacular low maintenance landscaping front and back! Newer TPO top of the line roof.

Contact the Sandi Pressley team for additional details! 

Get your Morning Inspiration with the Sandi Pressley Team