|
Landed property, is very simply any fixed asset property that is
located at a very specific geographical region of the world. Such
properties consists of ordinary land, condominiums, cooperatives,
residential homes and Apartment complexes, town houses, and
residential communities.
Making the Purchase Decision
The purchase of a landed
property is usually motivated by investment reasons even when the
property being bought is a personal residential home. As the world
population grows as such, the demand for residential home grows. Similarly services provided
through any form of property also grows as with the world
population.
Residential homes purchase decisions, however, are often made on
the emotional level when someone reaches a particular age or income
bracket, or because the person wants to also have assets.
Unfortunately, such purchase decisions must be very carefully made.
Very often, the decision is made casually on the assumption that the
amount of rent currently being paid towards a rented property is so
much that the renter might just as well buy a home; and then the
decision is made. However, the decision ought to be based on
rational analysis of the financial state of the prospective buyer.
In particular, care must be given to the unpredictable expenses that
comes with the purchase of homes, so making such decisions on a whim ordinarily
must be avoided.
A more rational approach to making the decision should be
adopted. Basing purchase decisions on no more than 25% of adjusted
gross income is a more reasoned approach. On the basis of the said
amount, a prospective buyer should determined based on location the
amount of mortgage, real estate taxes and insurance and to have the
sum total of these expenses to be no more than 90% of the amount.
Actually keeping these cost at about 85% is recommended, and the
balance is for the unpredictable expenses.
|
The buyer should then select a mortgage company and a loan
officer to help determine the
actual mortgage
amount the buyer can assumed based on the earmarked amount of the 85% to 90% of a quarter of the
adjusted gross income. This contact with a loan officer should also
answer or the buyer whether or not the buyer would qualify for a
mortgage to purchase any property.
Mortgage-Based
Purchase Financing
Very simply, mortgage is a loan granted to a buyer to purchase
a landed property, that is secured by the property. The amount of
the loan granted is usually less than the value of the property. The
buyer is often required to pay a downpayment: 5% -
20% of the property
selling price, to force, on the risk of losing the downpayment, the
commitment of the buyer to make
payments to the lender.
Scouting the Purchase Property
After the decision has been made, on the recognition that 85%
to 90% of a quarter of the
adjusted gross income can purchase a property of the liking of the
buyer then, the buyer should now develop a relationship with a
real estate agent who would make available to the buyer the many
properties that are on the market in the area that the buyer
wants to buyer the property.
Engaging a real
estate agent should be done by referral by friends as this can be a
very risky relationship. Often, an agent in a real estate agency would be engaged in the search
for an acceptable property and the accumulation of the relevant
documents.
Remarkably,
though there are now also Internet based Real Estate Agencies of
varying specialization and the Internet savvy buyer could just as
well establish an account with one such agency after careful
research of as much information as possible on the agency.
Such agencies,
however, as the brick and mortar types, also provide large choices
as a result of multiple listing by sellers.
|
However, local title search
company needs to be retained to perform a search on the property as
to determine all the lien and liabilities associated with such
property before the buyer invests too much time and money on the
property.
Pre-Closing Repairs
Properties for sale often require repair
works which the seller, given the decision to sell, may have
decided to to undertake. At times these repairs are so serious that
they must be made before the sale, and in other cases the buyer may
choose to have the purchase price discounted in proportion to the a
firm quote for the repairs.
In general a buyer should invite in a
local General Contractor to inspect the property for a qualified
report on the state of the property. The contract should also be
asked to provide quote for the critical repair works that must be
done either before or after the purchase of the property.
Closing the Sale
Finally, on a set date, the seller, buyer and their respective
attorneys, and possibly the Real estate agent meet at the office of
one of the attorneys to sign the purchase agreements, and the sale
is closed.
Of course, this is merely a
synopsis of the process and a buyer should be plan for a possibly
lengthy process.
|
