What Goes Into Closing Costs?

Prior to the closing date, you (as either a buyer or a seller) will receive a closing statement that will lay out the line item details of the real estate transaction.  The items are set up as debits and credits, with the seller's on one side and the buyer's on the other.  The totals, showing what a buyer or seller needs to either bring or receive from closing, are listed at the very bottom of the last page.

Some of the detailed line items include (but not limited to) the sale price of the property, any credits (e.g. if a seller is paying toward closing costs), taxes, loan and processing fees, interest, the appraisal, certifications, homeowner's insurance, title fees, commissions, recording fees, loan payoffs, and home warranty (if applicable).

There can be variations in the line items.  For example, tax amounts can vary in different counties, there can be additional taxes for a particular city/neighborhood, commission is affected by the sales price, and the loan amount can affect the pro-rated daily interest rate that is paid.

There are attorney's fees for both the buyer and the seller.  The buyer has more closing costs with a loan; however, it is important to note that the seller has to pay a closing fee and a fee for deed preparation work.  This is for the attorney's work to essentially get the title transferred.  So, it is important to keep in mind, as a seller, that, even if you are paying toward the buyer's closing costs, you will still have title fees to pay at closing.

Give me a call with any real estate questions or needs.

Matt Gatewood

Realtor®

Keller Williams Louisville East

502-594-6582

www.gatewoodproperties.com

How Accurate Are Trulia, Realtor.com, and Zillow?

There are many great real estate search tools available on the Internet now.  A question of their accuracy comes into play when buyers are looking for properties.

There are two primary parts to the question I'm asking in how accurate are the on-line search tools.  One is how accurate is the data about the listings (status, price, etc.).  The second part is how much trust can be put into the estimated value of a property that some sites try to predict.

In regard to the first part, the websites are pulling data from another primary source, like the Multiple Listing Service (MLS) that Realtors use to list property.  The MLS has a local governing body to monitor accuracy, as well as self-policing from other licensed agents.  Sometimes, when data is pulled from the MLS to another site, issues occur (I've seen examples like contact information or the last sold date being inaccurate).  That doesn't mean that the sites are bad, it is just a forewarning to proceed with caution.    

In regard to the second part, there have been efforts in the past to automate what appraisers do in valuing property, but it has never come to fruition.  The simplest reason is because no two properties are ever the same (even new construction of the same style can be on a different size/type of lot).  It takes human intervention to try to assess market value of a property.

The sites have their merit and place.  However, one of the biggest reasons I tell buyers to use the MLS as the primary search tool over the other sites is timing.  I can set up a search that will notify buyers immediately when a new listing comes onto the market.  I have never seen the other sites get the information into the hands of the buyers so quickly.

If you have any real estate questions or needs, please give me a call.

Matt Gatewood

Realtor®

Keller Williams Louisville East

502-594-6582

www.gatewoodproperties.com

Home Safety Items

It isn't something that we like to think much about, but it is important to be prepared in case of an emergency or natural disaster.
Home safety can go into a lot more detail, but here are some suggestions for safety items around the house:

• First Aid Kit--these kits can be picked up at any major retail store.  It is also a good idea to keep one in each vehicle you own.
• Flashlights (with extra batteries)--while always helpful in finding missing Hot Wheels under the couch, they are also important to have around for the obvious in a disaster.  
• 72 Hours Worth of Water--because we all need water to live.
• Emergency Phone Numbers Posted in the House--911 is the obvious, but poison control and animal control are two good ones to keep handy as well.  Oh, and the pizza delivery number.
• Fire Extinguisher--make sure that you know how to use it.
• Smoke Detectors--that work.  If you live in Jefferson County, there is a smoke detector ordinance that states you must have either hard-wired or 10-year lithium-ion smoke detectors present in your home when you sell it.  
• Carbon Monoxide Detector
• Weather Radio (with hand crank)--there are many weather radio products available that also have a regular radio and even cell phone charging ports on them.  The hand crank is so that it is its own power source.  Well, your arm becomes the power source.  
• Fireproof Safe--for important documentation like wills, life insurance information, copies of marriage certificates, etc.
• Plan of Action--in case a disaster occurs where there is no contact available (e.g. cell phone coverage is down), it is good to have a place to meet communicated ahead of time.

For any real estate questions or needs, give me a call.

Matt Gatewood

Realtor®

Keller Williams Louisville East

502-594-6582

www.gatewoodproperties.com

Importance of a Good Loan Officer

The smoothness of a real estate transaction is very much dependent on the quality of the loan officer.
Before I started into real estate, I thought that it was simple--a buyer would go into a lending institution, and the loan officer on duty that day would take care of the process without much issue.  My assumption has [unfortunately] been proven wrong.

As a real estate agent, I manage the overall aspects of the contract-to-close period of a transaction (time from an accepted contract until closing) like a project manager would--coordinating and providing details.  That said, the one who holds the money to be lent gives the final go-ahead.  What this means is that it is important to have a loan officer who stays on top of your file, not letting anything drop along the way.  If an issue or delay of the closing date does occur, a loan officer who communicates well and works hard to get resolution is vital to help the transaction across the finish line.

Many of the loan products today are very similar.  It is important to find a product that works best for you, and a trustworthy loan officer will help guide you.

I am happy to go into any additional details regarding what I see in the loan process or answer any other real estate questions you have.

Matt Gatewood

Realtor®

Keller Williams Louisville East

502-594-6582

www.gatewoodproperties.com

What is the Good Faith/Escrow Check?

The good faith check is money that is put forward to show that the buyer is serious about purchasing the property.

Once a contract is accepted, the good faith money is deposited into the listing or selling broker's escrow account, depending on what is agreed upon in the contract.  There is no interest accumulated on the money.

A good faith check can be a personal check from the buyer's checking account.

It is important to keep in mind that the money is actually deposited, meaning that it will be money coming directly from the checking account.  The money will be either returned at closing or applied to the costs associated with the closing.

If the contract falls through on inspection, the buyer receives the good faith money back after the release document is signed.  However, the good faith money would be forfeited to the seller if a buyer backs out past the inspection period (there can also be other legal ramifications).

The amount can vary, typically depending on the price of the property.  Some situations (e.g. new construction) require a good faith deposit that is 1% of the purchase price.  That means that a $250,000 property would need a good faith check of $2,500.  The 1% is not a hard and fast rule, but it is important to note that a seller can counter an offer, requesting a higher good faith amount if they so choose.

If you have any other real estate questions or needs, please let me know.

Matt Gatewood

Realtor®

Keller Williams Louisville East

502-594-6582

www.gatewoodproperties.com

Favorite BBQ Places in Louisville

Right off the bat, I'm going to put out the disclaimer that there is a lot of good BBQ in Louisville, and I know I'm missing some hot spots.  These are just some that I know and enjoy (in no particular order):


Feast BBQ
Feast is one of those places where I think, "This is what happens when kids-at-heart make a restaurant.  There are tater tots and bourbon slushies on the menu."  Check out Feast for some good eats (go for the mac 'n cheese or tots, both wins) in a hipster environment.


Hammerheads
While not a "traditional" BBQ joint, the owners know how to smoke up some good meats, whether the ribs or sandwiches.  Remember the truffle fries.  Or Grippo fries.  Or both.



Mark's Feed Store
Always a winner for me, no matter which location in town.  The pork is my favorite, but their brisket and BBQ burger are also delicious.  Don't forget some some honey wings, fried pickles, or onion straws appetizer.  In addition, they do some great catering.







Fire Fresh
Whenever I am downtown, I try to swing by Fire Fresh for lunch.  Great sauce options, good sides, and red cream soda on tap.

Momma's Mustard, Pickles and BBQ
Momma's is one of those local places that feels like it came out of nowhere--and I mean that in a good way.  Gotta try the wings--at least one, or a dozen.

Smoketown USA
Good BBQ in a cool atmosphere.  Nuff said.  Oh, make sure and talk to Eric, the owner.

If you have any real estate questions (or additional BBQ questions), please let me know.

Matt Gatewood

Realtor®

Keller Williams Louisville East

502-594-6582

www.gatewoodproperties.com

Why Not Just Sell It Myself?

A question may arise from the listing side:  is using a real estate agent worth it?

Statistically speaking, agents get closer to asking price due to the understanding of the market and other factors.  Even though I enjoy the numbers, I don't want to overwhelm with statistics that you may or not believe.  I want to focus on the other parts of the transaction.

Here are some things that I find to be some of the biggest advantages in hiring an agent:

Agents live in the ever-changing real estate world every day.
I see what is going on with real estate trends on the national level down to the neighborhood level.  I am not looking at one transaction but see the big picture of what is going on.

Representation
The chance that someone will buy your property without an agent is extremely low.  That means that you are going to be going up against an agent that is looking out for his or hers client's best interest only.

Not dealing with the hassle of coordinating showings or the public
You would not have to be present for showings to present the property, and I can screen out random people from coming in off the street.

Safety  
I use a Supra Lockbox system, which only licensed agents can open.  The Supra box also keeps a log of who has entered the property and when.

Help with staging tips
I help talk through the best ways to set up your property for showings.

Good Photography
Good photography is good marketing.  I use high quality equipment and look for the best angles to show the property.


Before I became an agent, I thought that I would always sell my house myself.  After becoming an agent (knowing what I know/have seen now), I would not.  If you would like to know more details as to why not, give me a call.

Matt Gatewood

Realtor®

Keller Williams Louisville East

502-594-6582

www.gatewoodproperties.com

Favorite Ice Cream Places

One of the many things I appreciate about this city is its plethora of ice cream places.

There are many flavors and places to obtain delicious frozen ice, milk, and sugar.  These are my favorite spots in town (in no particular order).

Comfy Cow

Comfy Cow, while not an old establishment, has set itself up quickly, gaining national recognition.  The creative flavors (and names) are always fun, like the Simply Southern--chunks of pecan pie and Old Forester bourbon mixed together.  That said, I'm always happy with a regular chocolate in a cake cone due to the high quality.


Graeter's

While Graeter's is not officially local, the great people of the city of Louisville have adopted it in, not just because Cincinnati is close by but because it is good.  I mean, a black raspberry chip or some straight up strawberry are both delicious.  In addition, I cannot forget a seasonal flavor like peach.
Not only are the flavor choices a touch decision, but there are also many great locations in town--including St. Matthews and Douglas Loop, where you can walk the ice cream off in a near-by park...or not.


Homemade Ice Cream and Pie Kitchen
Always a classic favorite.  Great flavors and great options beyond ice cream (I'm thinking about you, snickerdoodle cupcake) leave me with no disappointments here.  There are lots of great locations to choose from as well--from stopping by after a nice drive at the end of River Road in Prospect to enjoying a treat after a Putt-Putt game in Fern Creek with all points in between, I wouldn't think less of you for stopping at all the locations.





Dairy Kastle
Like a beacon in the night, the Dairy Kastle knows how to bring people in as they serve up tasty treats at low prices.  One of the most significant items for me, beyond the orange and vanilla swirl, is the fact that they have real Slush Puppies.  Yes, not an imitation version.  And a heads-up, it is cash only.

Matt Gatewood

Realtor®

Keller Williams Louisville East

502-594-6582

www.gatewoodproperties.com

Favorite Ice Cream Places

One of the many things I appreciate about this city is its plethora of ice cream places.

There are many flavors and places to obtain delicious frozen ice, milk, and sugar.  These are my favorite spots in town (in no particular order).

Comfy Cow

Comfy Cow, while not an old establishment, has set itself up quickly, gaining national recognition.  The creative flavors (and names) are always fun, like the Simply Southern--chunks of pecan pie and Old Forester bourbon mixed together.  That said, I'm always happy with a regular chocolate in a cake cone due to the high quality.


Graeter's

While Graeter's is not officially local, the great people of the city of Louisville have adopted it in, not just because Cincinnati is close by but because it is good.  I mean, a black raspberry chip or some straight up strawberry are both delicious.  In addition, I cannot forget a seasonal flavor like peach.
Not only are the flavor choices a touch decision, but there are also many great locations in town--including St. Matthews and Douglas Loop, where you can walk the ice cream off in a near-by park...or not.


Homemade Ice Cream and Pie Kitchen
Always a classic favorite.  Great flavors and great options beyond ice cream (I'm thinking about you, snickerdoodle cupcake) leave me with no disappointments here.  There are lots of great locations to choose from as well--from stopping by after a nice drive at the end of River Road in Prospect to enjoying a treat after a Putt-Putt game in Fern Creek with all points in between, I wouldn't think less of you for stopping at all the locations.





Dairy Kastle
Like a beacon in the night, the Dairy Kastle knows how to bring people in as they serve up tasty treats at low prices.  One of the most significant items for me, beyond the orange and vanilla swirl, is the fact that they have real Slush Puppies.  Yes, not an imitation version.  And a heads-up, it is cash only.

Matt Gatewood

Realtor®

Keller Williams Louisville East

502-594-6582

www.gatewoodproperties.com

We Have a Signed Contract...Now What?

After the accepted offer celebration dust settles, the question arrises...now what?

This time between the accepted contract and closing is referred to as the contract-to-close period of the transaction.

Buying Side

On the buying side, your good faith money will be deposited into the appropriate broker's escrow account (according to what was written in the contract), and I will forward the contract to your lender to begin the next part of their process.

It is best to schedule the inspection as soon as possible.  You are able to choose the inspector you wish to use, and they will work with your schedule, theirs, and the seller's (to make sure the seller is not present).  Payment for the inspection occurs on the front-end.  You can go for the entire inspection or for the last part to review what the inspector has found.  It is important for you to be present for at least some of the inspection, and in most instances, it's fine to go near the end.

Once the inspection report is received, I will review it with you, and we will write up the repair request.

After the repairs have been negotiated, the appraisal will be ordered by the lender.  The underwriting department at the lender will review your file and the appraisal report.  After the loan is approved by the lender, a clear-to-close will be issued, which means that everything is ready to go to the closing table.

Once a closing date has been confirmed, you can contact the utility companies to transfer services out of your name at your current residence and into your name at the new residence.  In addition, you will want to coordinate your mail.  Don't forget your change of address for credit cards, driver's license (if moving counties), new checks, and any emergency contact information.

For closing, you will need a form of identification (driver's license or ID card) and a hand ready to sign.

Selling Side

As a seller, you will want to make sure your house is ready for inspection by ensuring that the inspector has clear paths to the heating and air conditioning units, hot water heater, and attic.  You are not to be present during any part of the inspection.

Once the repair request is sent, we will work to negotiate accordingly.  After it is completed, you will work to schedule all of the appropriate repairs.

Similar to the buyer, you will want to contact the utility companies to coordinate the transfer of the utilities out of your name once you know the day of closing.

The buyer will do a final walk-through to make sure that all agreed-upon repairs have been completed, and there hasn't been a change in the property.  When the buyer takes possession of the property after closing, it must be in broom-swept condition, meaning that all belongings have to be removed.

For closing, you will want to bring your driver's license and all keys to the property (including garage door openers).


Please let me know of any real estate questions or needs you have.

Matt Gatewood

Realtor®

Keller Williams Louisville East

502-594-6582

www.gatewoodproperties.com

Help Me Understand Commissions

Then comes that pesky business of paying the real estate agents...they do like to eat...

There is a common misunderstanding with commissions in a real estate transaction--many buyers think that they have to pay for their agent's services.  This is not the case.  The sellers are the ones who actually pay all of the real estate commissions in the transaction.  What this means for you as a buyer is that you do not pay out of pocket for the services.  So, the bottom line is that using a real estate agent as a buyer is free of charge.

The typical commission in the Louisville real estate market is 6% total.  The percentage is split to be 3% to the listing agent (agent for the seller) and 3% to the selling agent (agent for the buyer).  This percentage is based on the sales price of the property.  So, for example, a $100,000 property would have $6,000 in commissions paid at closing.  The $6,000 is paid by the seller, and it shows on the seller's side of the closing statement.  $3,000 goes to the selling agent, and $3,000 goes to the buying agent.

Some may wonder why the commissions are set up solely on the selling side.  The concept is that you, as a seller, are paying your agent for his or her services to properly list and market the property and negotiate the contract.  The other part of the commission is paid for the buyer's agent to bring the qualified buyer to the transaction.

Please let me know of any real estate questions or needs you have.

Matt Gatewood

Realtor®

Keller Williams Louisville East

502-594-6582

www.gatewoodproperties.com

The Kentucky State Fair

'Tis the season for the Kentucky State Fair.  Starting Thursday, August 18th, you can get your corn dog with pineapple whip going...followed by a funnel cake, chased with a lemonade shakeup, with a side of corn on the cob, and finished off with a deep fried Twinkie.

The Kentucky State Fair has a great slogan:  "All that you expect from a fair, and so much more!"  That's exactly how I feel whenever I go to the fair.  I expect the [unhealthy] food, [dangerous] rides, [smelly] animals, [more unhealthy, overpriced] food, [the best] people watching, and Freddie.  For those who have never been to the fair before, you can meet Freddie in front of Freedom Hall--you won't be able to miss him.

Some of the highlights for me are the photography section and midway rides.  There are plenty of other fun things to do, like educational exhibits, the vendor hall, free concerts, horse shows, agricultural products, and cooking contests.

I feel I would be remiss if I did not focus on the fair food, which is really the most important part.  There are pork sandwiches from the Kentucky Pork Producers, hot dogs, potato creations, fried anything (you name what you never thought you'd see fried, and it is there), pizza, pretzels, homemade ice cream, and burgers.  Speaking of, how about the Krispy Kreme burger?  While it is a combination of two of my favorite things, I haven't mustered up the courage for it yet.

Legit--the fair is a lot of fun; however, I must say that my re-enjoyment of the fair came in more recent years.  I went through a dry spell filled with fair snobbery (and probably some cheapness), but my wife reintroduced me to its greatness.  Don't let yourself be like I was and miss out on some great end-of-summer fun.

The Kentucky State Fair runs August 18th through the 28th.  Admission is $10 for each person.  Admission is free for children five and under.  Advanced tickets can be purchased through August 17th at Kroger for $6 each.  Parking is $8 per car, but advanced tickets are available for $5.  Ride wristbands can also be purchased in advance.

Gates open at 7:00 am.  Exhibits are open from 9:00 am to 9:00 pm Sunday through Thursday and 9:00 am to 10:00 pm Friday and Saturday.  The Midway and tents close at midnight.

For any additional detailed information, the fair website is:  http://www.kystatefair.org/index.html

Matt Gatewood

Realtor®

Keller Williams Louisville East

502-594-6582

www.gatewoodproperties.com

Increasing Curb Appeal for Sellers

Selling a house can be like an interview, and making a good first impression for buyers is important.  A way to think about presenting your property is like being appropriately dressed for an interview.  I made the mistake once of not dressing up enough for an interview (I wore a sport coat with tie instead of a full suit).  Even though I was a great candidate for the job, not dressing the part affected me negatively.  It's the same with a house.  You can have a great location and features, but it's important to "dress" appropriately as well.

Exterior

If you own a house, it's good to put out fresh mulch and pull the weeds.  If you have stones around your landscape, line them up if they've gotten out of place.

If the exterior doors, especially the front, need painting, now is a good time to touch them up or give them a full fresh coat.

Giving the windows a cleaning is always positive.   While broken windows can be taken care of with a repair request, having them fixed makes a big difference to buyers.

In an ideal situation, it is great to pressure wash the house and driveway, or at least the sidewalks.

Make sure to keep the grass cut and trimmed.  If you can edge the sidewalks before the listing, that is even better.  Also, trimming down the bushes is important.

Try to straighten up a garage or shed as much as you can.

If you have a pet, do your best to clean up after it while the house is on the market.

Interior

The basics can sometimes get overlooked.  Make sure the floors are swept.  Don't leave dirty dishes in the sink or dirty cloths out in plain sight.  Replace any burned out light bulbs. Take out the trash if you just put something in it that stinks.

Buyers can look in your closets, cabinets, and refrigerator.  Try to declutter as much as possible.

If you have some noticeable areas on the walls that need to be cleaned or touched up with paint, go ahead and take care of those.

Ideally, you will not have anything out on your kitchen countertops.

Keep the temperature at a comfortable setting.


Some of this may sound like common sense, but these are things can make a property stand out more, which can make a difference when you have two close candidates in an interview.

Matt Gatewood

Realtor®

Keller Williams Louisville East

502-594-6582

www.gatewoodproperties.com

Pre-Approval Letter/Proof of Funding

A pesky part of the property purchase process is...you have to pay for it in some way.

A lender will help guide you through your financing options.  This is very helpful, as it will help you figure out your comfort level with monthly payment.  During this time, you can talk through how long of a mortgage note you would like, what the downpayment options are, any questions on the loan process, and how long it typically takes for them to close a loan.  You will also talk through approximate amounts for taxes and insurance to put into escrow.

After your discussion and the lender pulls appropriate credit information, you will receive a pre-approval letter.  This letter is sent to a seller when an offer to purchase real estate is submitted to them.  It shows the seller that you have the ability to purchase the property.

For cash buyers, you will use a proof of funding letter that will come from your bank or credit union, showing that you have the cash readily available for the purchase.

Please contact me with any of your real estate questions.

Matt Gatewood

Realtor®

Keller Williams Louisville East

502-594-6582

www.gatewoodproperties.com