Chelsea How To Buy A Home In Louisville

inHOW TLOoBuUisYvAilHlOeME CALL CHELSEA KUZEL 607-760-9353 The River Valley Realty Group - How to Buy a Home in Louisville, Kentucky

The River Valley Realty Group - How to Buy a Home in Louisville, Kentucky

Timeline for Buying a House While there are no absolutes on a time frame for buying a home, there are some general guidelines that can help with your overall planning. These time frames are based on our experiences in the Louisville area market and could be different if you bought a house in another city. In the spring and summer, you will need to move quickly in writing an offer so that you can get your first choice. The best homes sell the fastest, sometimes within hours of coming on the market. In the fall and winter, you may have the luxury of a bit more time to view homes before making a decision, as they are less likely to sell quickly. 2-4 months from moving-in date: Develop a personal checklist including what you’re looking for in your new home, your budget, and other details. Use this workbook to help define your goals. Start the mortgage pre-approval process. A mortgage loan officer (also called a lending officer) helps you ap- ply for the loan. The lender is the bank that loans you the money. You can go straight to a bank or go through a mortgage broker who compares different banks across the country to find the best loan program to fit your needs. Hire an agent from the River Valley Group. Your agent will spend time with you listening to what you want and your RVG agent will explain the home buying process. Begin your home search!—You can use our website, LouisvilleRVG.com, to search for available homes. It connects to the entire MLS, a database of all homes for sale in Louisville no matter which real estate company has it listed. 1-2 months from moving-in date: See the houses in person. You and your RVG agent can set up appointments to view homes on your schedule. Choose a home; one that “feels just right.” 30-45 days from moving-in date: Make an offer on the house you like best! Your RVG agent will help you through the offer process, paragraph by paragraph. When the offer is accepted, it becomes your purchase contract. Choose home inspectors, have the home inspected within the time written in your offer, and then either A) accept the house as it is B) ask the seller to make repairs or C) cancel the contract. It is your responsibility to call the home and termite inspectors, etc. Make sure you get the inspections done according to the number of days in the contract. Inspections are not required by Kentucky law, but recommended (some lenders do require inspections and appraisals). Arrange homeowner’s insurance. Call an insurance agent immediately after the offer is accepted. Call moving companies and make moving arrangements. Monitor the mortgage process and give your documents to the lender as needed. Check with them once a week to see what other documents they may need. Arrange any school transfers/registrations.

For Buying A House (Continued) 21-28 days from moving-in date: Start basic packing by boxing the little items. It’s okay to purchase some decorating items, like curtains for your new home, but do not open a credit card or line of credit to buy appliances. Opening a credit card could damage your credit score. Also, ask your mortgage lender before you use up your savings account. They may require a certain amount of reserve funds to be in your bank accounts. Don’t buy a new car to go with the new house. It will throw off your debt ratios and could cause your loan to be declined. Call your lending officer (also known as a Mortgage Loan Officer) to see if there is anything else they need. 7-14 days from moving-in date: Verify the moving company will arrive on the correct date! Make address changes with banks, credit cards, doctors, insurance, bills, the post office, friends, and family. Arrange for utilities at your new home. See the helpful numbers on page 32. Packing, packing, packing! 48 hours from moving-in date: Verify any final mortgage details with the lender and ask how much you need to bring to the closing in the form of a certified check. Your agent will provide you with the address of the place where the closing will be. Your agent will arrange a walkthrough of the house to make sure the sellers left the appliances, didn’t leave holes in the walls when they moved, and took out their trash. CLOSING DAY: Sign the deed and get the keys!

Financial Advice Pay off minor debts: If it is possible to do so without adversely affecting your down-payment situation, 1 pay off minor debts. The less debt you have the easier your mortgage process will be. Call your mortgage loan officer to ask if you should pay off any credit cards or close any credit card accounts. It is important to keep the cards with a small balance and low limit that you have had for a long time. Close high-limit cards you don’t use much, like department store cards. BUT WAIT! It’s good to have a little bit of credit to show banks that you have had loans and credit cards in the past, and that you have managed them properly. Consult a lender BEFORE you start paying off and closing your cards. We had a client once close down everything and then the lender said that he couldn’t get a good loan because he didn’t have a credit history. You might read books or hear talk shows talking about why you should be debt-free —well it’s not necessarily a good thing when applying for a loan. Banks want to see credit history. Two of these “open” lines of credit are good. An example of this is a car loan, and you should also have two small-balance credit cards that you pay every month on time. Do not incur any new debt: Many mortgage applications have been stopped in their tracks because the applicants 2 decided a week before the application that a shiny new car would look just perfect in the driveway of their new home. Since mortgages are based on debt-to-income ratios (the amount you pay out monthly versus the amount you bring in), a newly acquired debt could make your total monthly bills too high and throw off the ratios, which would make the mortgage unobtainable. Get pre-approved for a mortgage: 3 When it comes time to write an offer on your dream house, sellers typically won’t look at an offer without a pre-approval letter. It is just as important to choose the right lender as it is to choose the right Realtor® or closing attorney. Choosing the wrong one could result in delays that cause your contract to expire. If another buyer has put a backup offer on your dream home and your contract expires, you could lose the contract.

Mortgages & Finances Here’s some important advice: As soon as you have made the decision that you want to buy a house, one of your first steps should be to make certain that you have a clear picture of your financial situation. Find a lender that you feel comfortable with and that offers you the rate you need. Rates vary depending on your down payment, financial history, and credit score. After you have found the lender you would like to use for your mortgage loan, you can expect a lot of paperwork for the actual application. Your lender may or may not need the following items, but be prepared to find: Income tax returns from the previous year. Income and employment records. Collect W2 statements from the last two years and the last two pay stubs. Records of any past bad credit history that has since been paid off. Records of any supplemental income you may have, like alimony or child support. If you are self-employed, you will need all business records and tax returns for the last two years. Recent address(es): Make a list of all the places you have lived in the past two years, including how long you have lived there. Lists of assets: These include holdings such as stocks and bonds, IRA accounts, vested retirement plans, life insurance policies, cars, and other real estate properties. Bring all current balances, names, addresses, and account numbers when applicable. List of debts: These include credit cards, auto loans, school loans, and any other money owed. Bring current balances, names, addresses, and account numbers when applicable. Divorce papers and child support agreements. Paperwork from any extra income. This may be a part-time job, alimony, or rental payments made to you. Foreclosure and bankruptcy status. Disclose these items openly as any attempt to hide records like this will be viewed unfavorably. Gift letter: If someone is helping you with the down payment, you will need a letter stating that the money is a gift that is not expected to be paid back. Social security number. The actual card is recommended. VA documentation if you are applying for a VA backed loan. Even after you turn in all of your information, you might have to make two more trips to the lender with additional documents. There is always one more piece of paper they’ll need, and it varies by lender and loan program. Run a credit report to make certain there are no discrepancies or problems in your credit history. You can view your report online to fix problems, but your lender will still require their own. EQUIFAX.COM EXPERIAN.COM TRANSUNION.COM

Frequently Asked Questions How much money do I need to have to get started? Contrary to popular belief, you may not need to have a down payment to buy a house. You are, ? however, required to pay a certain amount of money, called a Good Faith Deposit, at the time of your offer to buy the house. This lets the seller know that you are serious about your offer. If the offer is refused, you get your money back. In addition to the Good Faith Deposit (approximately $500-$3,000 depending on the house price), there will be: ■ A home inspection fee (around $350-$700 depending on the house size and company) ■ A termite inspection fee (around $50-$125 depending on the company) ■ Radon test ($150) ■ An appraisal fee (around $350-$450) Overall, the average amount of money needed is about $1,000. The rest of the closing costs could potentially be paid for by the seller if requested in your offer. When should I buy versus rent? ? Consider renting if you think you’ll need to move soon. Given all costs associated with buying and then selling a home, and the 3% to 5% average appreciation rate in the Louisville area, if you don’t expect to hold on to your home for at least two years, you could lose money. On the other hand, if you make money, you’ll pay capital gains taxes. Ask an accountant about the tax benefits of buying a house and deducting the interest paid from the taxes due in April. You could save a lot of money at tax time by buying instead of renting, and your home could be your greatest financial investment. ? How do I choose a lender? We recommend getting someone local who is qualified and experienced in your type of loan. Ask your River Valley Group agent for a list of local, respected lenders whom our clients had great experiences with. ? What first-time buyer programs are available? Many first-time buyer programs are locally developed and administered, like the Kentucky Housing Corporation (KHC) grants. Some programs even have forgivable loans through Louisville Metro Housing. Ask a loan officer about gift and grant programs for homebuyers. Most of these programs have certain income levels to qualify, but it’s worth taking the time to ask!

FAQs (Continued) What is an escrow account? ? Sometimes mandatory, sometimes optional, an escrow account is like a savings account for taxes and insurance. You send in some money every month with your mortgage payment and the bank saves it for you in a special account and pays the bill when it’s time. If you do not have an escrow account, you will be responsible for paying your own taxes and insurance when they are due, usually in one lump sum, once a year. Your lender will tell you if an escrow account is required for the type of loan you are receiving. ? What mortgage options are there for those with poor credit? There are lenders available for many people with tarnished credit records. One of the mistakes commonly made by homebuyers involves their credit report. Some buyers assume that their credit is worse than it really is. Other buyers are unaware of problems in their credit report and need to scramble to get the problems resolved. You can avoid many of these hassles by getting a copy of your credit report up-front and examining it both for errors that need to be corrected and for accounts that need to be handled. ? What if I don’t have any credit? If you’ve never had a credit card or car loan in your name, some lenders will accept alternate credit, like cell phone bills, utility bills, and rent bills paid on time. ? I hear about these different “ratios” when qualifying for a mortgage. What are “front and back ratios”? Part of the mortgage application process will be the determination of how much house you can afford based on your income. The two ratios that will be computed are the front ratio and the back ratio. Front Ratio Back Ratio Total mortgage payment including principal, The total mortgage payment PLUS any car inter- est, taxes, and insurance (PITI) as well payments, credit card, and any other loan as any con- dominium or homeowner payments divided by your total GROSS income. association fees divided by your total GROSS Traditionally, this must be below 36%. income. Traditionally, this ratio must be below 28%.

Viewing Houses Address Strengths of House Weaknesses of House Overall Rating Consider the following: Once you have found some homes on the MLS that appeal to you, ask your agent to make appointments to Neighborhood/street view them in person. Most homeowners need at least a Outside appearance 24-hour notice before viewing. In our experience, Bathrooms—number, size? people begin confusing one house with another if they Kitchen tour more than three houses on the same day. Walk-in-the-door-WOW factor Yard—size, maintenance, Here’s a tip: write down what you liked and didn’t like slope? about a house while you are still in the home. Floor plan layout and flow Ready to move-in or needs renovation? Bedroom sizes and number of closets What else is important to you?

FAQs (Continued) ? How many homes will I see in a day? Well, that depends on your schedule and where you currently live. For someone in town, an average of 2-4 homes a day is normal. Often people who are relocating to the area only have one weekend to search for and find a home. In those cases, viewing 6-8 homes over an entire day is reasonable. ? How many homes should I see before making an offer? With the help of the online MLS system, the average number of houses seen before writing an offer is 5 to 6. Some of our clients only saw one house and loved and bought it. However, see as many homes as it takes for you to find one that feels like you could call it home. No house is perfect, but if it fits your needs and most of your wants— take it! ? Will I only be shown houses from your company? No, we can show you any house for sale in Jefferson County and all surrounding counties. This includes homes for sale by other real estate companies, for sale by owner, or through a new home builder, provided that the builders and for sale by owners are willing to work with Realtors®. Most of them are. In all of these cases, I REPRESENT YOU in negotiation with all of these people. If it happens to be one of my listings, I am already representing the seller. Ask me to explain dual agency. Because there are over 6,000 homes on the market, the dual agency rarely happens. According to the Greater Louisville Association of Realtors®’ Consumer Guide to Agency Relationships, “When a brokerage and its agents become ‘dual agents,’ they must remain loyal to both clients. They may not advocate the position of one client over the best interest of the other client or disclose any personal or confidential information to the other party without written consent.” Our goal is your happiness in a home. It doesn’t matter to us who represents the seller or if the seller even has an agent. We get paid the same no matter which house you choose. We make money when you find the right house and then tell your friends about the great service you received from our team! ? Does the basement square footage count in the total footage? If the listing agent/appraiser is using ANSI standards, they will NOT count a basement at all in the square footage of the home. You will see the basement area listed in the B.G. square feet, which stands for “Below Grade”, or in total finished square footage on some websites.

Before You Make An Offer... 1 Home Warranty This is optional and negotiable, and it is usually purchased by the seller. A typical warranty covers repairs on some of the major aspects of the house (roof, furnace, air conditioning) for one year. For questions about what is covered under your particular policy, call the warranty company. They do not cover pre-existing problems that occurred before you bought the house. Warranty companies do not cover problems due to neglect of maintenance, like a roof leak that occurred because you didn’t clean leaves out of the gutters. 2 Move-In Date If your new job starts in two months, set the closing date so that you’ll have time to move and get settled before you begin. Most lenders will be able to process your loan in 30 to 45 days. If you are paying cash, you can close and move in within 2-3 days of writing the contract. It is important that your agent knows your timeline in order to inform the closing company. Inspections 3 These are designed to find defects in the property that could affect its safety, condition or resale value. While a home inspection is not required by Kentucky law, RVG agents cannot em- emphasize enough the importance of inspections. Please get a home inspection and a termite inspection. Professional home inspections cost around $350-600, depending on the size of the home. Most lenders do require a termite inspection, and most termite damage (if any) can be treated and repaired before you move into your house. These run around $50. You may choose to test for mold, radon, lead-based paint, septic issues, and structural integrity. See the chart on the next page. The buyer pays for their own inspections. We do not suggest asking the seller to pay. It is your responsibility as a buyer to call and schedule the home inspection. It is a good idea to attend if possible so that you can ask questions. If you and the seller cannot agree on who should pay for repairs after the inspector finds flaws with the house, you can void the contract and get your good faith money deposit back. This must be done within the time period specified in the contract. Home Insurance 4 Unless you pay cash for your home, one of the requirements that will be made by your lender is proof of a valid homeowner’s insurance policy at the closing. Ask if you can get a multi-line discount for having your car and house with the same company.

Before You Make An Offer...(Continued) 5 Title Insurance Your lender will require you to buy a title insurance policy. The lender and you both own your home. Lenders’ Title insurance protects the lender in case someone makes a claim against your home. You should also get Owner’s Title Insurance for additional coverage. It is a one-time fee that is paid at closing. Ask yourself: ■ Do I want a survey to show where my yard ends? This is not required, but good to have so that you know your property lines. If there is a problem before closing, the seller cor- reacts to the problem. After closing, the buyer has to correct the problem. ■ Do I want an inspection for mold, radon, lead paint, septic, or a structural engineer- ing? A general home inspector does not necessarily check for the following items. If your home inspector will not be checking for these, you may need to call additional inspectors for your items of concern. MOLD RADON LEAD SEPTIC STRUCTURAL What is it? Organisms A radioactive gas A highly toxic metal Treats and An expert qualified commonly found on caused by the AC units, carpets, breakdown of uranium that was used for disperses by education, household potted and radium. Invisible, plants, etc. Easily odorless and tasteless. many years in the wastewater from training, and spread by walking, Seeps into homes via vacuuming, etc. cracks in walls or paint. Also found in the home using a experience in the Usually seen as floors, crawlspaces, discolorations. etc. dust and water. The four component behavior and Exposure can cause federal government system: septic tank, design of structure. lung cancer. banned the drain field, soil and production of lead- groundwater. based paint in 1978. And why would Can cause various Can cause various Can cause behavior A malfunctioning Inspector looks for a I care? respiratory respiratory problems, learning system can stable foundation problems and problems and disabilities, contaminate your and sound allergic allergic difficult pregnancy, drinking water. mechanical systems. symptoms. symptoms. seizure, or death. Replacement is Helps avoid costly very costly. The surprises in the septic system is the future. This helps responsibility of the to ensure safety of homeowner. home and family.

Answers to Other Questions ? Do I need the seller to pay my closing costs? If the seller pays your closing costs, you need to add that to your offer price. You’ll pay more each month on the loan than if you had paid your own closing costs and negotiated a lower price, but at least you won’t be taking money out of your savings for the closing costs, and you can spend that money on house repairs. Also, talk to your accountant about taxes on the sales price and tax deductions on the mortgage interest. ? I’m paying cash, so should I do an appraisal? You don’t have to have an appraisal, but if you should decide to do so, it costs around $350 or more. We can do a market analysis for you to help determine a fair sales price, but it is not the same an official appraisal. ? Can I move in before closing? Yes, if the seller agrees to it. It is customary to pay the owner rent to cover their costs of owning it during that period. ? Who pays for all the inspections? You, the buyer, should pay for your inspections because the inspector should be working for you, not the seller. ? What restrictions are there for the neighborhood? Can I have a six-foot wooden fence? You or your agent can find out neighborhood restrictions by going to the courthouse and asking for deed restrictions for a neighborhood. Or, ask the Homeowner’s Association for a list of regulations and bylaws. The Homeowner’s Association will be able to tell you what you can and cannot have. HOUSING AND URBAN DEVELOPMENT 601 W BROADWAY LOUISVILLE, KY 40202

The Sales Contract The sales contract, with attached forms states the following: Agents & Brokers Who is the buyer’s agent; who is the seller’s agent. Description of Property What property is being purchased, where it is located. Description of Appliances Which appliances and systems remain with the property. All appliances remain in as-is condition and are not guaranteed to work. Detailed Pricing The offered price, earnest money deposit, and good faith deposit. Financial Terms Purchase price amount. Good faith deposit amount. Type of financing the buyer will use to pay for the house and the specifics of the loan. If buyer is pre-approved, it lists the lender. A local lender with a good reputation will help an offer be accepted when compared to another offer that is not pre-approved, or is only approved through an Internet lender or a lender that is unknown. Appraisal If the buyer is taking a loan out, the bank will require an appraisal. If the property is paid for with cash, then an appraisal is not required. Closing Date The buyer asks for a specific range of days to close within, like 30-45 days or on a certain date. Possession of the Property Date The buyer and seller agree when the buyer will be allowed to move in, usually at closing. Sometimes the buyer has to move in early or the seller has to stay after the closing for a short time. Title Examination Prior to closing, the closing company will perform a title search to make sure there are no liens on the property, like tax liens if the seller didn’t pay taxes. Initial the waiver on the Title Insurance line if you are not buying the insurance (we strongly recommend that you do buy the insurance, and do not initial the line).

The Sales Contract (Continued) Seller Disclosure of Property The seller is not required to provide a full description of everything they know that has gone wrong with the house, even before they bought it. The seller’s agent is required to give this to the seller, but the seller has the right to refuse to sign it. Home Warranties If a house comes with a home warranty, the warranty will cover certain features of the house should they break within the buyer’s first year. Most builders give a warranty on new houses, but older houses can have warranties on them, too. Either you can buy it or you can ask the seller to buy it as part of the negotiated terms of the contract. It is not required. Inspections Inspections, such as home, termite, and radon, are highly recommended. Note, the appraiser works for the lender, but inspectors should work for you. We do not recommend asking a seller to pay for an inspection. Lead-Based Paint Disclosure If the house was built before 1978, the paint inside and outside the home may have lead-based paint. Agency Buyer’s and seller’s agents must each explain the laws of his/her agency and their obligations to the buyer and seller. This form must be signed, showing whom the agent represents. Signature Signatures are required by buyers and sellers. No verbal statements or offers can be enforced. Addendums Addendums could be required by your relocation company or could be a counter offer, or they could be a form saying “This contract is contingent upon the closing of my house that I have to sell first.” Smoke Detectors If the property is in Louisville/Jefferson County, the seller must install smoke detectors that are powered by non- removable lithium batteries, or hard-wired to the electrical system of the home. Mediation Any disputes must first go to mediation to work out any problems between buyers, sellers, and agents without threatening lawsuits.

Closing Checklist Whether you have moved once or a dozen times, it never seems to get any easier. Along with the culmination of all the emotions associated with looking for a home, negotiating terms, and applying for a mortgage comes another huge emotional challenge: moving! Call your moving company (or brother who has a pickup truck) and schedule them for your closing date or the negotiated possession date. Start planning early. Once you are reasonably confident that you will be proceeding with the purchase, start weeding out your current possessions. Toss (or give away, or sell at a yard sale) the things you no longer need. Compare moving plans. Are you going to want to do the entire move yourself? Will you want a professional mover to handle the entire process? Don’t wait until the last minute—or you may be doing the whole move on your own! Compare rates and services as well as availability. You can get free, multiple estimates from licensed and insured movers in your area at MoveDirect.com. Setting up your utilities. On the following page is a list of all the utilities that you might need at your new home. Call these companies as soon as you have a move-in date. Make a list of important items you will need for your new home. Examples of this would include draperies, blinds, shower curtains, and so on. Having these things with you on the day you move in prevents unnecessary stress. Whatever you do, do not open a credit card. Opening a new account could destroy the loan on your new house. Mark every box and carton with a thick black Sharpie. It makes it much easier if you need an item before you move and makes it much simpler after you move. Unpacking will probably be somewhat of a gradual process— this way you know where the most necessary items are located. Be detailed with labeling the contents so that you can quickly locate the essentials. And remember, START PACKING EARLY!

Utilities JEFFERSON CO. OLDHAM CO. BULLITT CO. SPENCER CO. SHELBY CO. Electric & Gas LG&E Energy Corp. LG&E Energy Corp. E. KY Power LG&E Energy Corp. Kentucky Utilities 502-589-1444 502-589-1444 859-744-4812 800-331-7370 800-981-0600 800-331-7370 800-331-7370 lge-ku.com lge-ku.com lge-ku.com Salt River Electric Shelby Energy 502-348-3931 E. KY Power 502-633- Kentucky Utilities 859-744-4812 4420 800-981-0600 LG&E Energy Corp. Atmos Energy (Gas) 502-589-1444 Blue Grass Energy 888-954-4321 800-331-7370 Cooperative Corp. lge-ku.com 859-885-4191 Salt River Electric 502-477-5133 Water Louisville Water Co. Oldham County Louisville Water Co. Taylorsville Water- West Shelby Water Sewer 502-583-6610 Water District Bullitt County Office Spencer County District louisvillewater.org 502-222-1690 502-569-3600 (502) 477-3236 or 502-722-8944 477-3235 Five Star Septic and MSD Oldham County Mt. Washington Taylorsville Water Excavating 502-587-0603 Sanitation Water and Sewer Works 502-644-9699 louisvillemsd.org 502-243-3215 502-538-4781 502-477-3235 La Grange Utilities Shepherdsville Commission Sewer Dept 502-222-9325 502-543-7339 Metropolitan Sewer District 502-540-6000 Septic Zaring Septic & Zaring Septic & Okolona Septic Reed’s Septic Tank Five Star Septic and Drain Service Drain Service Tank Service Service Excavating 502-241-8080 502-241-8080 502-969-5456 502-348-1478 502-644-9699 Television & AT&T Internet AT&T Internet Spectrum Spectrum Spectrum Internet 855-293- 855-293- 800-892-4357 800-892-4357 800-892-4357 7676 7676 igLou Internet igLou Internet Inside Connect Shelby Broadband Shelby Broadband 502-966- 502-966- Cable LLC shelbybb.com shelbybb.com 3848 3848 502-955-4882 888-364-4232 888-364-4232 Spectrum Spectrum 800-892-4357 800-892-4357

Closing The closing is simply a meeting, which takes about an hour, of the buyers, sellers, agents, lender, and closing attorney. There are title companies that can do a closing, but if you have a legal question, you need to be able to ask a lawyer. In Louisville, a law degree is not required to be a closing representative. If it is important to you, ask to have a title attorney do your closing. Your RVG agent has recommendations or you. At the closing, you will sign about 40 pieces of paper, promising to payback the loan and to comply with the laws of the city and federal government about what you can do with the property. Then, the seller signs the deed to the property to you. The seller and real estate companies get paid, and you get a house! What to bring to your closing: Driver’s license and second ID or credit card. Anything your lender informs you to bring. Insurance papers to provide proof that you do have homeowner’s insurance. Original copy of the Power of Attorney for someone, like your spouse, if he/she cannot be at the closing.

Breakdown of Costs Month-to-month homeowner costs: Mortgage payments— Your loan officer provides you with this amount. Homeowner’s insurance— Most of the time, the cost of homeowner’s insurance is paid at the same time as your monthly mortgage payment. Flood insurance is a separate, additional amount if needed. See the web- sites http://www.msdlouky.org/programs/crssite/fpindex.html and www.fema.gov and www.floorsmart.gov for more information. Property taxes— Also sometimes bundled with your monthly mortgage payment. Ask your lender if you will use escrow for taxes and insurance. This means taxes and insurance are collected monthly with your mortgage payment instead of billing you once a year for the full amount. If you have questions about these for a particular home, please ask! Taxes vary by city, county, and fire district. A good rule of thumb is to put a decimal point in front of the last two numbers of the sale price. If the house costs $200,000, taxes should be around $2,000 a year. Utilities— Electricity, gas, water, phone, cable, internet, security system. Garbage removal— Sometimes included under another fee such as a neighborhood association fee (HOA)or city taxes. Maintenance— Yard, roof, plumbing, furnace filter, gutters cleaned, grass cut, trees trimmed. Home updates— Includes paint, carpet, new faucets, air conditioner, furnace. Yearly homeowner costs: Termite contract— If you choose to have the company guarantee no termites. Furnace cleaning— Approximately $90. Home Warranty - If you choose to purchase a home warranty it's usually an annual fee. One-time homeowner costs: Down payment— This varies. It is possible to put no money down, however, to avoid a monthly fee, called PMI, most lenders require 20% of the total home cost. Ask your lender about an 80/20 loan with no PMI. Lender and attorney fees. A home inspection, and an inspection for termites and other wood-destroying organisms. Appraisal. Credit report. Other inspections as you choose (radon, mold, septic, structural). Title insurance for you and the lender.

General Home Maintenance Purchasing a home involves several new responsibilities. The maintenance of your home is a top priority to ensure that it is safe and that you are protecting your financial investment. Proper maintenance can also alert you to problems in your home before they become serious, which can be much more expensive. The following is a list of items that should be performed on a monthly, bi-annual, and annual basis: Check the air filter in the air conditioner/furnace and clean or replace monthly. Vacuum air supply and air return registers to remove dust. Vacuum your clothes dryer’s exhaust duct and refrigerator coils once a year. Check smoke and CO detector batteries. Clean garbage disposal with citrus fruit rinds and baking soda. Check for cracks and separations in caulking around sinks, bathtubs, toilets, countertops, and faucets. Seal cracks and gaps in doors and windows with caulk or weather stripping. Clean the gutters and be sure they are properly affixed. Drain and winterize exterior plumbing before the temperature dips below 32 degrees. Call a professional HVAC company every September or October to have the furnace serviced and cleaned. . Examine the roof shingles and chimney. Winter weather and the summer sun can cause damage. Examine your fire extinguisher. Ensure the gauge shows adequate pressure and is in good condition. Check the trees for interference with electric lines.

An Average Day for River Valley Group Agents So, what do River Valley Group agents do all day? Your agent’s goal is to help you navigate the purchase process so that you get a home that fits your needs and feels “just right”. Through patience, understanding, and quick responses via email and cell phone, your Realtor will help make your move as easy as possible. Having a Realtor on your side can help your move be smoother than if you were just going through the process unrepresented. When you choose a River Valley Group agent to be your Buyer’s Agent, we will provide you with the following services: ■ Narrow and broaden the neighborhood search according to the house specifications you give us. This will ultimately shorten your home search by going straight to the houses you specifically requested. Our goal is to ■ save you time, especially if you are limited on time. Email you the listings of all homes for sale that fit your wants and needs by sifting through the MLS online database of available houses—not just the ones offered by our specific company. ■ Set up appointments and show properties. ■ Provide knowledge of the local area and the real estate market. ■ Help you understand the Kentucky real estate purchase process and all the paperwork that comes with it. ■Help you understand the loan process, find the home that fits comfortably in your budget and help find the right local Louisville lender with a good reputation. A good lender can make the difference between a successful closing and a closing that is delayed by unnecessary problems. ■\\ Help you understand what a fair asking price is and negotiate the lowest price possible. ■ Write an offer on the property and complete all official paperwork. ■ Negotiate with the seller or the seller’s agent. ■ Ask the seller to make repairs and ensure that they have followed through with them by the closing day. ■ Get all the information necessary for the closing to the title company or closing attorney. ■ Set a time for the closing, considering everyone’s schedules and timelines in the contract. ■ Be the go-between for the buyer, seller’s agent, lender, and closing office. ■ Complete follow-up paperwork and stay in touch with clients after closing. How does a Buyer’s Agent get paid? In the Louisville area, most of the time a home seller pays the seller’s agent’s brokerage and the buyer’s agent’s brokerage. The agents’ commissions are included within the price of the home. The agents get paid by their bro- brokerage after the home sells. In the rare case that the seller does not have a realtor representing them, the buyer’s agent can still have their agent’s commission covered as part of the sales price. A third option is for the buyer to pay the agent’s brokerage directly, and not make the commission part of the price of the home. The brokerage does not pay for their agent’s gas. Most agents do not get a salary, they only get a percentage of the commission that their broker splits with them. Agents do not get reimbursed for the expenses by their brokers. More information is in the Buyer Agency Agreement form.

What Agents Don’t Do Realtors love to be helpful. We know a lot about the real estate market in and around Louisville. However, please know that your RVG agent is not the following: Your realtor is not an attorney. Consult an attorney with legal questions. Your realtor is not an insurance agent. Your realtor is not an appraiser. Your realtor is not a radon gas tester or mold analyst. Your realtor is not a home inspector. We recommend you call a professional. Your realtor is not a city official. We don’t have deed restrictions or city development plans. You may get these items downtown. Your realtor is not a structural engineer. We are not trained to detect which cracks in a house are normal settling and which cracks signal structural damage. Your realtor is not a tax accountant. Ask a professional tax accountant about deducting house mortgage interest from taxes. Your realtor is not a mortgage loan officer. We can help you estimate what your payments would be, but we can’t approve you for a loan. Your River Valley Group realtor is not paid referral fees from any of these people. We will ask questions when we don’t know specifics about the areas above, and we suggest you do the same.

Sources for More Information Crime information. When you have found a house that you are ready to buy, call the Louisville Metro Police Department at (502) 574-7111. Here the police can provide you with crime statistics for any neighborhood. To see Louisville crimes on a map, go to https://www.crimemapping.com/map/agency/211 Flood plain information. You may ask, “Is the house I want to buy in a flood plain?” If it is in a flood plain, your lender may require you to buy flood insurance, which we recommend if your house is in a flood plain or near water. Visit https://apps.lojic.org/msdflooddetermination/ Diversity concerns. The Louisville Urban League offers classes on home ownership and housing-related topics. They have a wonderful web resource on housing at https://lul.org/hfe/ Safe removal of lead-based paint. Lead is toxic. Exposure to lead dust can cause serious illness, such as brain damage, especially in children. Pregnant women should also avoid exposure. Find out how to protect yourself and your family by contacting the National Lead Information Hotline at 1-800-424-LEAD and/or visit www.epa.gov/lead Kentucky sex offenders. If you have found a house that you are ready to buyind out if there are any regis- tered sex offenders living in the neighborhood, the information is posted on the Kentucky Sex Offender Registry at: http://kspsor.state.ky.us/