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Monroe County Real Estate, LLC. 2642 Route 940 Pocono Summit, PA 18342


The Buyer's Handbook: Purchasing Property in the Pocono Mountains Copyright Š 2011 Arthur Goode Co-Authored by Joseph P. Hanyon, J.D., L.L.M. All rights reserved. No Part of this book may be used or reproduced in any manner whatsoever without permission of the author. Printed in the United States of America Designed by Maryam Cristillo Published by Monroe County Real Estate, LLC. 2642 Route 940 Pocono Summit, PA 18342


Acknowledgments While this is not a 500 pg biography of a well known celebrity. I feel compelled to show my appreciation to several people. First to Joe Hanyon Attorney and Real Estate Broker, who really inspired me to write this book , Joe continues to be very helpful to me in my career. My wonderful Wife Regina who is the epitome of a good wife ALWAYS supportive, I can’t even imagine my life without her. My mother Thelma who really is responsible for my being able to comprehend, articulate and convey expressions at a very young age, due to her insistence that we (her children) read, read, read! Thanks Mom. My father Arthur senior who I probably quote in some fashion every single day, thank you for all that wisdom your words always stayed in between my ears Pop. My buddy Bruce Matula (James Brown was known as the hardest working man in show business Bruce IS the hardest working man in the selling business) who many years ago introduced me to the dynamics of selling products to a multitude of people on the spot, those experiences have no question played a role in my future endeavors. My childhood friend Keith Fitzhugh who never complained, and as far as I can remember always had encouraging words to say to me, this has been and still is the case for almost forty years My sister and brother-in law Juanita and Paris what you have gone through, strengthens me. My brothers Bobby and Forest, My youngest sister Thurma. All of my children Arthur III Antoine, April, Aaron, Andrew, Alexis and Austin and finally Lester Hill who if I had not acknowledged would think I lost my mind.

Now enjoy the book.


CONTENTS

Page No.

Introduction...............................................................................................ii Part 1 List of Seven Biggest Mistakes Buyers Make.................2 Buying a Home You Cant Afford............................................4 Overpaying For a Property....................................................16 Skipping Due Diligence............................................................18 Wrong Agent or Not Hiring One..........................................22 Financing......................................................................................32 Seeing Past Cosmetics.............................................................38 Buying the Wrong House.......................................................44 Part 2.........................................................................................................46 The Closing...................................................................................48 Home Sweet Home....................................................................51 Frequently Asked Questions..................................................52 Web Site Resources...................................................................56 History...........................................................................................60 About the Author........................................................................66

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Introduction Don’t believe the Hype! When people come to us for advice on buying a house, it is a daunting task. We have people coming from New York and New Jersey metropolitan areas who have a vague idea of what they want. We feel the pressure of selecting a great home for them. We see ourselves as advisors. With buyers, our role is to help clients find, negotiate, and purchase properties while avoiding critical mistakes in the process. Over the past 10 years of my career, I interviewed people from my team and my colleagues in the industry. The result is the Buyer's Guide to Purchasing Property In the Pocono Mountains. As always, feel free to contact us with any comments or questions. You can also reach me at 570-8390100. So you’re thinking of buying a house in Monroe County? Nice, after all that is the American dream right? Society has been able to convince most people that owning your own home amounts to success. In fact total happiness and complete fulfillment are contingent on your owning a home. IS that how you feel? Certainly owning a home suggests a measure of financial success, it is beneficial in many ways and can serve to provide a warm intimate habitat for family members to cherish for many many years. On the other hand it can become a burden, an insurmountable obstacle that stifles the very happiness its acquisition was deigned to achieve. Don’t let this happen to you.

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My observations of the real estate market and personal experience working with buyers has revealed both sides of the home purchasing fence. While most experience all of the positive aspects of the new home purchase, far too many (especially ones that bought within the last 5-6 years) have not been so fortunate. For many home ownership has been equivalent to having an anchor around their necks, robbing them of joy and peaceful mindsets. Of course this eventually by those unfortunate new home buyers was not even remotely considered-at the outset. Have you ever heard the expression “People don’t plan to fail, they fail to plan? Thus, the reason for my writing this book. The potential regret associated with the purchase of a home might be non-existent if the common mistakes outlined in this publication are avoided. You may have come across an article or list outlining mistakes to avoid when purchasing a home, that’s ok, in fact one or more may have made my list, I will however address a few of the intangible reasons that while playing a large role in the mistakes people make are more often than not overlooked. There is an underlying dynamic associated with just about everything we buy, houses are no different, they simply cost more than most things. If we can identify and understand the motivation behind the decisions we make, we can harness the mistakes and avoid the pitfalls. Home buying then becomes what it was intended to be, a wholesome, enjoyable and beneficial experience. You will not find overly complicated self-imposed ideologies in this book, you will find the basic reasons why common mistakes are made, more importantly you will find the practical and simple ways these mistakes can be corrected, better yet avoided.

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Some of the mistakes that are made can be avoided by the readjustment of our mindset or thought process. These mindsets are often times difficult to implement because they contain emotions within us and involve our being totally honest with ourselves, which in turn can be challenging, Let me illustrate

1. The situation » you need a car 2. The desire » you love the Lexus 3. The reality » you really can’t afford it

What is your mindset? Is it based on satisfying your emotional desires, your materialistic cravings? Or, is it based on practical reasoning. The latter would compel you to be honest with yourself and conclude...”I need a car I don’t need a Lexus”. Can you see the point? All too often we allow our emotional desires to override our power of reason, causing us to create ways to acquire things that we are either not in a position to acquire or simply don’t need. How does that scenario compare with my desire to purchase a home, you ask? Here’s how The thought process that goes into buying a home accesses the same emotional reasoning that compel us to buy almost anything, The difference being, however, the cost of the purchase. If you discover later that you made a mistake because your compulsion was due to false reasoning, you may have unknowingly set yourself up for years of misery and struggles. Understanding and applying the tools to avoid mistakes outlined in this book, will enable you to avoid one of the biggest mistakes people make, which is buying under compulsion and emotion because they did not exercise their power of reason, and were outright too lazy to do their homework and find a good realtor. If I am your realtor, I will help you do your homework.

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Whether you decide to buy a home or not is a decision that should be made for more reasons than society suggesting that it is necessary to be fulfilled or that it will prove your success. It will be because you planned successfully and you are ready. Remember I am a Realtor, I want to sell you a home, but I want you to be happy and stress free because you did it right.

Read On

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PART I

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The Buyer's Handbook: Purchasing Property in the Pocono Mountains

The 7

biggest mistakes

Buyers

make

The Number 1 Biggest Mistake: Buying or Building a Home You Can’t Afford. How to avoid: By calculating all of The Costs

The Number 2 Biggest Mistake: Overpaying For a Property. How to avoid: Get a Comparable Market Analysis from Your Agent.

The Number 3 Biggest Mistake: Skipping Due Diligence on Location and Community How to avoid: Walk the Walk literally and figuratively and conduct independent research.

The Number 4 Biggest Mistake: Choosing the Wrong Agent or Not Hiring One. How to avoid: Interview 3 Agents using the Questions Provided in This Chapter.

The Number 5 Biggest Mistake: Failing To Do Your Homework on Financing. How to avoid: Choose The Right Mortgage Broker using questions provided in this Chapter with the help of a good Realtor.

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The Number 6 Biggest Mistake: Not Seeing Past Cosmetics and Following Your First Impression. How to avoid: Hire the Best Home Inspection Service You Can Find and Attend the Inspection Personally.

The Number 7 Biggest Mistake: Buying the Wrong House By Falling In Love With the First Property You See, and Compromising On Your Property Requirements. How to avoid: Make a List of Your Goals.

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The Buyer's Handbook: Purchasing Property in the Pocono Mountains

The Number 1 Biggest Mistake Buying or Building a Home You Can’t Afford

How

to avoid ?

By calculating all of the Costs

For example, “..who of YOU that wants to build a tower does not first sit down and calculate the expense, to see if he has enough to complete it?” Luke 14:28 Obviously, the idea of calculating the cost before proceeding with an endeavor is not new. Since buying a home requires, in most cases, a substantial amount of money, attention to details would be prudent. As discussed earlier, emotion plays a large part in the decision making process. There is nothing wrong with a little emotion, after all, things that we buy should and have to feel right. The hidden dangers, however, posed by a purely emotional purchase, is they sometimes obscure the realities associated with the

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purchase. Because we desire something so bad, that desire may cause us to overlook or downplay certain other factors.

Never Buy Anything Under Compulsion It never pays off...Trying to keep up with the Joneses. Who are the Joneses anyway that we have clichéd them as trend setters? They are the family that for a time is on our financial level, and then things occur in their lives that enable them to do things (good for them!) They are able to move forward, maybe hire a landscaper, they’re able to get a new car, perhaps have a pool installed, anything that we could not afford to do, at least at that particular time. You are probably thinking “I see where this is going, but I don’t let what others do influence what I do”. Honestly I can’t say that this mistake is something that YOU would have a problem with, everyone possesses different levels of motivations for the things that they do and while trying to keep up with the Joneses may not pertain to you personally, trust me it has been a huge motivating factor in the lives of millions of people. Consider this: I grew up in Hollis, Queens, NY. My neighborhood in the early 70’s was very well kept for the most part. Most homes were made up of families with 2-4 children, it was those children that kept the grass cut and the shrubs trimmed etc... For whatever reason the Joneses decided to, hire a landscaper to cut the grass and trim the hedges, so every two weeks for a standard fee these landscapers would arrive and perform their duties. What do you think happened shortly thereafter? That’s right! Almost everyone on the block had a landscaper cutting

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their grass, what is interesting is that many families still had children living home that were perfectly able to perform those duties. Eventually the Joneses decide to install a brick based wrought iron fence around the house. Guess what happened shortly thereafter? Almost everyone had some kind of fence installed around their home, quite a few actually had the exact same fence installed. Now in and of itself there is nothing wrong with following the lead taken by someone else, I am certain that both the landscaper and the fence contractor did their share of soliciting while in the neighborhood they were working in. The point I am making is that many, if not most, really could not afford these services and/or purchases at the time they had these things done. So why did they proceed? Because the Joneses did, they found a way to keep up. This same mental mindset or thought process has been the motivating factor used in buying a home...for many. People are inherently like sheep, this assertion is certainly not intended to insult the reader, sheep are actually mild and peaceful. These are qualities that all of us desire to possess. I am simply implying that people are relatively inclined to want to fit in. If they can make it work they proceed, even if there actions cause some discomfort. After all the Joneses did it Right? The mental mindset of people does not go unnoticed by the marketing moguls. In every venue they prey on the way people think, after all to them it is better to persuade the masses as opposed to persuading a few. So let’s for a moment, examine how the banking industry used the power of manipulation to influence the mindsets of people with regards to buying homes.

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I am sure you are aware of the state of the current economy, and by now you are probably aware of the roles the banks played in its demise. The housing market directly reflects the sad economic climate. I am not attempting to delve into the complexities of the banking industry and our economy, nor am I excluding the responsibilities’ that were ignored by many who allowed the banks to manipulate them. I am for the purpose for which this book is written, going to give you a brief overview of the connection between how our desire to keep up with the Joneses affects our decisions, even the big ones such as buying a home. The Banks created a mad rush to buy homes by the creation of the sub-prime loan. The reason so many people were able to take advantage of this new provision, was that the requirements were irresponsibly lax. Consider what the banks allowed in order to qualify for this type of loan:

1. Low credit scores 2. Very little, if any money down 3. Very lax job requirements (if your current job did not suffice jobs were fictitiously created.)

The leniency by the banks to approve loans was not really to help those achieve the “American Dream” who might otherwise have not be able to, it was simply to make lots and lots of money. You see the banks never intended to hold the notes at least not the bad ones, they were to be sold to entities, investors etc. They (Banks) knew that this opportunity would catch on, they were banking (no pun intended) on the fact that in a frenzy people will do what others do ( The Joneses). In a nutshell, they figured the mindset of masses of people in general would dictate the sheep-like, keep up with the Joneses’ attitude. “Hey, we have to make it work, everyone else is doing it!”

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It did for the larger banks responsible for its creation, because they made tons of money. Some were able to hold on to their homes and re-finance or have their loans modified. For many however, the foreclosure situation says it all. There were more than 2,000 foreclosures in Monroe County this year, an all-time high. You see when the interest rates kicked in on those subprime mortgages 2 years later, many were unable to pay the higher reflected mortgage amounts. Guess what they did? They walked away! Why not? There was almost nothing to lose, remember the down payment requirements in many cases were nothing. The many foreclosures on the market actually force the value of homes to decrease. In an ironic twist however it creates a buyer’s market from a different angle.

In a nutshell, the point I am making is this:

1. The banks created a buying

frenzy, by offering questionable loans

2. Millions took advantage of low criteria (the Joneses syndrome) for approval of these loans, only to walk away when the mortgage payments increased.

3. The result: millions of foreclosures’ nationwide. Let’s face it so many just could not resist the opportunity to jump in the home buying wagon, for many the thought was “this may be my only opportunity” I for one cannot judge those decisions, because it may well have been their only opportunity. All I am saying is that when big purchases are made because of compulsions rather than planning, the results can be devastating no matter how good the intentions.

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Keep up with the Joneses?...NOT! The first thing you should do is read your contract. I would venture to say that less than 5% of all purchasers of real estate read their agreement. When a potential purchaser reads their agreement, it will enlighten them about all of the costs involved, costs that first time buyers never realized existed. At the close of this chapter, I have included for your benefit all of the usual costs associated with the purchase of a new home. Sometimes there are intangible costs that arise from seemingly nowhere, the costs that you will not see on a Good Faith Estimate given to you by your lender or real estate agent. The following are some of the real HIDDEN costs that can have a devastating affect if they are not factored in.

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The Buyer's Handbook: Purchasing Property in the Pocono Mountains

Have

a

Reserve

I have worked with buyers who, after closing, literally had nothing in reserve; their reserves are their next paycheck. Some reason that “I’ll be fine, especially since my first mortgage payment is not due until the following month”. Planning to fail?... No....Failing to plan?...That’s obvious... Let’s illustrate what happens, if a week after your closing, your car breaks down. Transmission? No! It can’t be! You’re 90 minutes from home when this occurs, it’s going to cost you $150.00 to have your vehicle towed to the nearest repair shop. The news gets worse, the transmission will cost at the very least $2700.00, now it hits you! Not only do you not have the funds to get your vehicle repaired,-but every day that you miss work will cost you a day’s pay because you've used up all of your paid days. Payday is only two days away; however, it is only half of your car repair bill. What do you do? Maybe you can borrow the money, it still has to be paid back though. Let’s consider another scenario: Even though you have the good job which allows you to live two hours away, have you remotely thought about the wear and tear on your body? Your vehicle, if you drive? What about the sacrifice that your family suffers from because you’re always tired and very rarely seen, even though you live in the same house? My purpose is not to infuse every negative possibility into your home buying experience, rather to underscore the fact that things do happen! And, because we do not know when they WILL happen, it is pertinent on our part to at least in some measure, attempt to prepare for such occurrences.

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While it is true that one cannot be overly consumed with things that have not yet happened, here is a simple formula, that when applied, usually can allay any sudden financial surprise.

THE

6

MONTH RULE

Having enough set aside so that in the event of an unforeseen incident, and your income is interrupted, there will be funds to pay all of your obligations for six months. Of course that is the ideal situation, but isn’t it worth not having the aggravation associated with inadequate reserves? This should be a measure that both new home buyers and existing home owners strive for. Six months is not a cure all for all circumstances, but in many cases it will provide enough time for the homeowner to recover or make the needed adjustments to realign the financial state of affairs. Remember every practical application starts with our mental mindset.

Let’s re-cap before you purchase a home.

1. Calculate all the costs 2. Plan ahead for any unforeseen occurrences

3. Remember the six (6) month rule

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The Buyer's Handbook: Purchasing Property in the Pocono Mountains

Common

closing costs for buyers

The Lender (Bank or Mortgage Company) must disclose a good faith estimate of all settlement costs. The title company or other entity conducting the closing will tell you the required amount for the following items and whether they apply to your Loan:

Pre-Closing Funds 1. 2. 3. 4. 5. 6. 7.

8. 9. 10. 11. 12. 13. 14. 15.

Down payment Lender Fees Loan origination fees Points, or loan discount fees, you pay receive a lower interest rate Appraisal fee Credit report Property tax escrow, Insurance escrow for homeowner’s insurance, private mortgage insurance and home owner’s association dues if being paid as part of the mortgage. (Lenders keep funds for taxes and insurance in escrow accounts as they are with the mortgage, they then pay the insurance and taxes for you) City/town/county /school taxes. Commission/Division of Commission Deed recording fees Title insurance policy premiums Flood Insurance Survey. It’s not the Law in Pennsylvania, but this is recommended. Inspection fees, property inspections termites, radon etc Notary fees

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16. Pro-rations. This is a big item and includes for your share

17. 18. 19. 20. 21. 22. 23.

of items that have been pre-paid by the Seller which you are reimbursing at time of closing. This includes utility bills, oil in the tanks, property taxes, home owner’s association dues, sewer rents where there is central sewer, water rents where there is central water. Mortgage Insurance Home Owners Insurance Premium Flood Insurance. Transfer Tax (usually split 50/50) HOA fees Appraisal Fee Credit report

Monthly Expenses

starting

~~ ~~ ~~ ~~ ~~ ~~ ~~ ~~ ~~ ~~ ~~ ~~ ~~ ~~ ~~ ~~ ~~ ~~ ~~

After

the

Closing

Private Mortgage Insurance Home Owners insurance County/City Taxes School Taxes Township Assessments Central Water Rents or cost of maintaining private well Sewer Rents or costs of maintaining private sewer Home Owners Association Dues Home Owners Association Assessments Electric Bill Heating Costs Television Costs Home Maintenance Landscaping improvements and Maintenance Furniture and Furnishings Acquisition Commuting Costs * Opportunity Cost of Commuting Vehicle Maintenance and Costs. Gas Costs. This is a resort area. Generally Prices are a bit higher

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Note

regarding

Pro-rations

Because such costs are usually paid on either a monthly or yearly basis, you might have to pay a bill for services paid in advance by the sellers before the closing. Pro-ration is a way for the sellers to get paid back for bills they may have paid in advance. For example, the gas company usually sends a bill each month for the gas used during the previous month. Let’s say you buy the home on the 6th of the month. You would owe the gas company for only the days from the 6th to the end of the month. The seller would owe for the first 5 days. The bill would be prorated for the number of days in the month, and then each person would be responsible for the days of his or her ownership.

Note

on

Commuting Cost

Commuting costs from Monroe County anywhere east, i.e. New York or New Jersey will vary depending on what part of Monroe County you choose to live. The closer your home is to New Jersey, the more expensive it will cost to buy or rent a home for residential purposes. For recreational purposes, this may not be true as some of the prime vacation properties are located in more rural lake oriented communities in Monroe County and in the Poconos in general. Some estimate, that for every mile you travel west in Monroe County along Route 80, the cost of a home decreases by $1500 per mile. Obviously this is a general rule and we have no hard evidence to support this. The reason for this is that since many new home buyers commute east to work, homes closer to that destination are in greater demand, those in greater demands cost more money

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People are shocked at how little a home can cost when building or buying, whether in A Pocono County Place (25 miles from Delaware Water Gap) or Country Club of the Poconos (7 miles from the Delaware Water Gap). If these same homes were only a few miles from the Delaware Water Gap and close to Route 80 you would find the price substantially higher. But here is the catch. Some homes within Coolbaugh Township or Lehman Township are 30-40 minutes from the Delaware Water Gap. So whatever your commute is from Delaware Water Gap to the place where you work, you need to add the total minutes from the Water Gap to your new residence. It may be cheaper to buy the home, but you end up paying lots of money to commute plus the time you must give up to commute. Time is a valuable commodity.

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The Number 2 Biggest Mistake Overpaying For a Property How

to avoid ?

Get a Comparable Market Analysis From Your Agent.

Overpaying for a property. In the Pocono Mountains, many if not most buyers are from out of state. Compared to their home city, our local real estate can look like a tremendous bargain. Often sellers will toss out a high price to gauge the market. This also sometimes happens because the seller chooses an agent that agreed to list their property for the highest amount thinking that the real estate agent will be the most aggressive agent and will net them the most amount of money. On rare occasion this will happen, but it is far from the norm. Don’t be that victim. Don’t be the person who thinks the property is a steal only to find out six months later that you could have bought that property or a similar property for a lot less. What usually happens when a property is listed well above the market value is that it will sit on the market for two even three times longer than other properties that were reasonably listed just above or at market value. Eventually, the seller fires the agent because the property did not sell only to hire another agent that insists that the property be listed where it could sell.

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We know we have lost listings because we won’t agree to list a property for an unreasonable above market price, only to have that same seller come back to our office 6 to 12 months later, and re-list 10 to 15 percent less than what they listed for previously. Smart shoppers will ask their agent for a list of comparable properties that sold within the last six months to a year, before viewing homes and for more specific comparables, before putting in an offer. Even unrealistic sellers have been known to come back to reality when confronted with well documented comparable sales. What else has sold in the past few months that are similar to this property? What is currently on the market that matches this property’s characteristics? How long has your property been on the market? Only put in an offer after reviewing comparables and knowing the market. This step can save you thousands of dollars. It’s also something a good buyers’ agent should be willing to prepare for you.

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The Number 3 Biggest Mistake Skipping Due Diligence on Location and Community How

to avoid ?

Walk the walk, literally and figuratively and conduct independent research with the help of good Realtor. If you don’t know where you’re going, you will probably end up somewhere. Walking the Neighborhood. A lot of things can affect the enjoyment of your home that has little to do with the house itself. From the time it takes to commute to the quality of neighborhood schools to whether your property be impacted by the new transit oriented developments in Monroe County. Where is the nearest grocery store, post office, gas station, and City Park? Is there a landfill or factory nearby that might affect the air or water quality? Have you looked into the Megan’s Law database for Pennsylvania or contacted local authorities to check whether registered sex offenders might live nearby? Did you look at state rankings for the school district? The Poconos is a diverse area. Because of the size of the county and its rural nature the neighborhoods can be very different. It only makes sense that before a large purchase is made, there should be a measure of consideration given to

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research. You can do a lot of research online, but community character is nearly impossible to accurately determine from a website. Yes, there are many resources on the Internet including our blogs and a list of links and other resources we’ve collected. But that’s not enough. Before buying a home, you should invest the time to walk the neighborhood, talk to the neighbors, visit local schools, time your commute to work, and more. This kind of information is extremely valuable and may require several visits to the community. And it’s well worth it if you want to be happy long term with the choice you’re making.

Independent Research Who buys a lawn mower, refrigerator, stove, table saw, computer or anything that requires a sizable sum of money without at least making some inquiries such as:

1. 2. 3. 4.

Who is it made by? Who do I know that owns one? How long is the warranty? What does the consumer reports say about it? etc.

You get the point, right? The degree of research is usually directly related to whatever it is we intend to buy. Sadly when it comes to buying a home, you would be surprised to know that other than the use of our (5) senses, very little research is considered. All of the chapters outlined in the table of contents could actually fall under the broad title of research. Each stage of the home buying process has elements that you, the prospective home buyer, should be aware of and only at that time is it necessary to investigate, or ask questions, research.

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The research that I am addressing here is the type that if exercised properly will determine how happy you will be should you decide to relocate. In the Monroe County area there are more things to consider than just calculating the cost. Here are some questions that you might ask yourself.

1. What type of area am I looking to live in, rural or with homes close by?

2. Do I want to live in a gated community? 3. What are the advantages or disadvantages of living in a gated community?

4. How far away are the stores, my place of worship? 5. How far away are the schools? 6. Do the buses come in all the communities? 7. Is there public transportation? 8. How far are the hospitals? 9. Are there any local clinics? I have personally lived in the Pocono’s for over twenty five (25) years, I love the Pocono’s, but let’s face it, there really is no paradise on earth...not yet anyway. That being the case, here are some additional questions you may want to consider:

1. Is there much crime in the area I’m desiring to move into?

2. How do the neighbors appear to be, friendly? Indifferent? Mean?

3. In the winter, will I be snowed in? Does the community

plow for its residents? Do the ambulance and police respond quickly?

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Of course there are many more questions you could ask, and that is exactly my point, ask the questions and then pursue the answers. I know what you’re thinking That’s nice and honest, but where do I begin to get answers? You will be happy to know that for your benefit, I have included a section devoted to answers to the most commonly asked questions buyers should know when purchasing a home in Monroe County (Page 54). I have also included some beneficial history (page 62) and available websites (page 58) that you can go on yourself for additional inquiries. Doesn’t this sound better? I know where I'm going and I know what it will be like when I get there?...I thought so.

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The Buyer's Handbook: Purchasing Property in the Pocono Mountains

The Number 4 Biggest Mistake Choosing the Wrong Agent or Not Hiring One At All.

How

to avoid ?

Interview 2/3 Agents using the Questions provided in this Chapter. Saying and doing not the same thing.

Trying to deal with the seller directly. You could also buy real estate without an agent involved or just use the Seller’s agent. You could do your own taxes and your own plumbing. You might get the job done, but it will be fraught with mistakes. When it comes to something as specialized as buying Pocono Real Estate, get an expert. Sometimes the allure of contacting a seller directly is strong and without knowing much about the real estate, I probably would have once been tempted to make this common mistake as well. The idea most people have is that if they call the owner directly, they’ll save on the real estate commissions.

Oops! This is not usually how it happens. If the home is listed, the owner will probably refer you to their agent because (by the contract they’ve made) even if they do all the work, they’ll most likely still owe that agent a commission. Although certain

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sellers FSBO (For Sale by Owner) market their property, they nearly always offer a buyer’s agent commission. If you negotiate directly with a FSBO without an agent, they’ll try their hardest to pocket the commission themselves. After all, that’s why they are FSBOing in the first place. It’s not to save YOU money. It’s to save the FSBO money. Also in this situation, YOU have no representation or guidance through the process and your earnest money (and more) could be at risk. Can you save money? Perhaps. It is possible to catch something before it hits the market. My experience is most FSBO sellers have an inflated sense of what their home is worth. It takes an agent with knowledge of prices in the area to prove to the Seller that his or her price is out of touch with the market. In the worst case scenario, call the name on the sign or advertisement and you’ll be dealing with a seller’s agent. This person doesn’t represent you or your interests at all but still collects the buyers/transaction agent and listing agent commission. In this situation too, you have nobody on your side negotiating and watching out for your interests. Top executives and others who deal with large transactions nearly always hire agents to negotiate when dealing with personal matters. Why? It’s not because they aren’t capable of expert negotiation on behalf of their clients or company. They do this kind of thing every day, but they choose agents to go to bat when their personal interests are involved because negotiating directly in these circumstances rarely results in the best deal. The expert knows what is or isn’t a good deal. An experienced and professional agent will present your offer in the best possible light and get you a better deal. After other agents purchase real estate outside their area, they themselves use an agent. When you decide to buy a home, especially in a state other than the one in which you live, there is always the challenge as to who you should use to represent you.

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The Buyer's Handbook: Purchasing Property in the Pocono Mountains

5 Good Reasons Why You Should Always use an Agent 1. Real estate transactions are not always easy, there are specific disclosure forms, inspection documents, deeds, mortgage documents and multi-page government-mandated settlement statements. Imagine trying to sort all of this without the assistance of an agent.

2. The real-estate language is a language all by itself, CMA’S, HUD’s, PUD’s what do they stand for? Now you see the wisdom in working with someone who knows the language?

3. Realtors® have done it before, in fact experienced re-

altors have probably been in hundreds of transactions. Most people buy and sell only a few homes in a lifetime; even then there are few years between each purchase. Even if you have done it before laws and regulations change. Having an expert working with you is important.

4. As we discussed earlier, home buying is often an emo-

tional undertaking and usually is the biggest purchase most persons will ever make. Having a concerned yet objective, third party helps you keep focused on both the business and emotional issues that are important to you. A good realtor brings such objectivity.

5. Realtors® are members of the NATIONAL ASSOCIATION

OF REALTORS®, a trade organization of over a million members nationwide. Thus Realtors® subscribe to a stringent code of ethics that helps guarantee the highest level of service and integrity.

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Now that you have recognized the need for a REALTOR®, the question remains, "whom shall I choose?" Choosing a realtor to work with is not really a complicated issue; all it takes is some due diligence by you the prospective buyer. Before we highlight the necessary questions, you should ask an agent that you are considering using, try not to get too wrapped up in the size of the real estate companies or how much national exposure they have. It certainly is not a bad thing to have a large company, or to be a part of a large franchise, the fact is that the agent you choose should fit your criteria of what type of service you expect. Any Realtor that is a member of the NATIONAL ASSOCIATIUON OF REALTORS® has access to the MULTPLE LISTING SERVICE of their respective state, as a result they can show you all of the up to date homes that are available and that fit your criteria. Choosing a realtor is not dissimilar from choosing a builder, plumber or lawyer. Since the Poconos had a big boom in the last 20 years, there were 100’s of agents who got into the market that had little or no experience. Just like other professions a recession will weed out poor quality but many hang on. An unqualified real estate agent can hurt your chances of finding the right house for the right price. Treat meetings with agents like a job interview because that’s really how it works. Keep in mind that the person is going to be working for you. Talk to your friends who’ve sold houses and had good experiences with their particular agent, and go to open houses and observe how that agent interacts with other people. It’s also a good idea to meet with the agent in their office. It allows you to see how organized he or she is, what kind of environment they work in and whether that’s conducive to being able to do a good job for you.

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The Buyer's Handbook: Purchasing Property in the Pocono Mountains

Unless you are experienced in real estate in Monroe County, you need to hire a real estate agent There’s a lot more to buying a house than just shopping the classifieds or working out a deal with someone your know. It’s really important to have someone on your side who understands all the complexities. Whether that agent works out of a small office or a very large office, the service that you receive will be contingent on the individual agent you choose, in most cases an office that has many agents does not mean that they work together, the fact is most agents in an office are competing agents, not that they unethically compete against each other, just that they have their own clients. My point is this if you find a real estate agent that will work hard to find your dream house and will utilize the professional patience, integrity and available services for your benefit, it does not matter where he or she hangs their license. You know you have chosen the right REALTOR® when you will use him/her for all of your real estate needs, and will without hesitation refer all of your friends and family to them. Hiring the right agent can be the difference between making or losing money, selling or buying quickly or taking a long time, a trouble free transaction or a living nightmare. Unless you have experience interviewing people (especially real estate agents), you won’t know what questions to ask, or what answers will best suit your needs for buying or selling. So for your benefit here are 12 important and insightful questions that you should ask any real estate agent before you sign anything!

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Monroe County Real Estate

12 Powerful And Insightful Questions You Should Ask a Real Estate Agent Before You Sign Anything!

1. ARE YOU A FULL TIME REALTOR? Simple, I am about to make the biggest and most costly decision in my life, why would I put my trust in someone who works part time; I want an expert.

2. HOW LONG HAVE YOU PRACTICED REAL ESTATE? Some agents in business less than five years may have more experience than other agents in business ten years or longer, This question will reveal more than just years practicing, you will want to delve down into number of transactions, Brokers they have worked for, specialized areas and types of homes they have sold, in essence what experience they have that will apply directly to your real estate situation.

3. WHAT QUALIFICATIONS DO YOU HAVE TO SELL REAL ESTATE?

This question helps give you an idea of the level of commitment of the agent, whether or not they engage in the ancillary experience required for real estate.

4. TELL ME ABOUT YOUR PERSONAL REAL ESTATE OPERATION?

This is an open-ended question designed to get the agent to talk about their business, how much they have invested in their business, Do they have their own office? Do they work under a broker? Do they have any assistants? Etc.

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5. CAN YOU GIVE ME A LIST OF YOUR CLIENT REFERRALS? A reputable agent has accumulated a list of client referrals and should not have a problem with your calling them. Remember though, the referrals do not have to consist solely of past clients, they can be professional references, Bankers, mortgage lenders, Attorneys etc.

6. DO YOU HAVE A FORMAL AND WRITTEN PLAN FOR MARKETING HOMES?

This question applies more to sellers than buyers, however it speaks to how well rounded he or she may be.

7. WHAT SYSTEM DO YOU HAVE FOR TRACKING THE HOME MARKET?

This is a very important question, because as a buyer you want to know his or her experience in understanding values of certain areas. They also need systems to keep you continually up to date with opportunities in the market.

8. DO YOU GUARANTEE YOUR PERFORMANCE? This question should not illicit a blank stare; if it does, this is not the agent for you; here’s why: Smart agents guarantee their services for two reasons.

• They’re confident they can perform for you because of their commitment, experience and work ethic; and

• It’s smart marketing for an agent to guarantee his or her services. These days everyone must offer a guarantee to help stimulate a sale. Agents on the cutting edge of marketing guarantee their services.

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9. CAN YOU REFER ME TO A REPUTABLE MORTGAGE LENDER, BANKER, APPRAISER OR REAL ESTATE ATTORNEY?

This question reveals how active the agent is, how connected they are professionally. At some time in the buying process, you will need the services of reputable, competent lenders, appraiser’s, inspectors, and title company etc....A competent agent will have the names of persons in these positions at the drop of a dime.

10. WHAT PERCENTAGE OF YOUR BUSINESS COMES FROM REFERRALS?

Here’s the million dollar question! Competent, well-known agents get a large part of their business from satisfied past clients and members of their sphere of influence. If an agent gets less than 25% of their business from referrals it may be because:

• The quality of service they offer is not up to standard (people don’t feel compelled to refer them)

• They lack the marketing experience or skills required to market for referrals; or

• They don’t cultivate contacts in their business. 11. DO YOU PERSONALLY SPEND YOUR MONEY ADVERTISING YOUR SERVICES OR HOMES FOR?

This question pertains more to listings however, a buyer may want to ask it because it will determine an agent’s commitment to invest in the successful outcome of their clients.

12. WILL YOU PERSONALLY HANDLE CONTRACT NEGOTIATIONS FOR USE?

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Surprisingly, many simply submit or receive offers, and act as a conduit between you and the buyer (or seller). That is not good enough! You want an agent who has reasonable negotiating skills. You want an agent who’s committed to your interests.

These 12 questions should give you a feel for the commitment of the agent you’re thinking about using. Keep in mind that all agents are not the same. There are “Real Estate Agents” and then there are commited professionals, the question to you is, which one do you want representing your interests?

At Monroe County Real Estate, we are committed professionals and we are “Serious About Service”

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The Buyer's Handbook: Purchasing Property in the Pocono Mountains

The Number 5 Biggest Mistake Failing To Do Your Homework on Financing

How

to avoid ?

Choose the Right Mortgage Broker

It’s more than just your credit. If you choose the wrong mortgage broker a few things can happen. You could spend too much at closing in fees paid to the Broker and the Bank. You could have a life of frustration when you get directed to India to answer some questions on a very confusing bank statement. You could lose 10s of 1000s of dollars over the life of your loan by paying even a 1/8 higher % point of interest on your loan. Usually a good and reputable real estate agent can direct you to a great mortgage broker, however don’t forget your local bank has sweet deals also. Here you cut out the middle man and may get a better rate. You may also get significantly better service in the long run. The point is to speak to several lenders. What you want to do is find a mortgage lender who is MOTIVATED to take your loan. One who represents many different products, and can offer you many options for making your loan affordable.

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Here’s an important tip: Ask your REALTOR® TO REFER YOU TO ONE OR TWO MORTGAGE Brokers and one Local Bank. Why? Because agents have power over lenders because they send them lots of clients. It’s not you alone talking to them. Just think, if they don’t give you first class service, the agent that sent you will conveniently send their clients to someone else. So they are MOTIVATED to serve YOU. Make Sense? Also, the second you start having a problem with your loan, please, by all means, convey that to your agent, remember he or she has much more influence and leverage over the lender than you. Now the second thing you want to do is GET PRE-QUALIFIED, better yet PRE-APPROVED WHY? Because the first thing a home seller will want to know of any prospective buyer is: ARE THEY APPROVED FOR A MORTGAGE? A lot of potential buyers start the process by looking at homes while assuming they can get a loan. Sure, we like window shopping too but it’s helpful to do some financial homework. Start by doing the basic math yourself using widely available online mortgage calculators, including the ones we feature on our website (on pages with property’s details). You should also familiarize yourself with some financing basics. Before you start to setup showings and view properties with an agent, it’s smart to consult with a reputable lender and confirm your financial plans. You’ll find out how much house you can comfortably afford based on currently available loan programs. Importantly, after the initial consultation, good lenders will also be available to provide a prequalification letter matching any offer you might make - a critical element in strengthening an offer.

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The Buyer's Handbook: Purchasing Property in the Pocono Mountains

We always recommend clients check out several lenders and available loans because mortgages are largely commodity products. The right loan for you could be an ARM (adjustable rate mortgage), a fixed rate mortgage, cross collateralization with another property, or a plain vanilla FRM (fixed rate mortgage). Good lenders can help you find the best loan for your specific situation. A lender with access to the best programs can save you thousands of dollars over the life of your loan. Even when putting together an offer, a good lender can help structure the financing of your offer strategically and even help you present a stronger offer with a lower purchase price. Sadly, buyers typically do little due diligence with lenders.

10

questions that you can ask your

Mortgage Lender

1. WHAT ARE THE MOST POPULAR MORTGAGE LOANS YOU OFFER?

2. WHICH TYPE OF MORTGAGE PLAN DO YOU THINK WOULD BE BEST FOR US WHY?

3. ARE YOUR RATES, TERMS, FEES AND CLOSING COSTS NEGOITIABLE?

4. WILL I HAVE TO BUY PRIVATE MORTGAGE INSURANCE? IF

SO HOW MUCH WILL IT COST AND HOW LONG WILL IT BE REQUIRED. Note: Private mortgage insurance usually is required if you make less than a 20% down payment, but most lenders will let you discontinue the policy when you have acquired a certain amount of equity by paying down the loan)

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5. WHO WILL SERVICE THE LOAN? YOUR BANK OR ANOTHER COMPANY?

6. WHAT ESCROW REQUIREMENTS DO YOU HAVE? 7. HOW LONG IS YOUR LOAN LOCK-IN PERIOD (Time that the

quoted interest rate will be honored) WILL I BE ABLE TO OBTAIN A LOWER RATE IF THEY DROP DURING THIS PERIOD?

8. HOW LONG WILL THE LOAN APPROVAL PROCESS TAKE? 9. HOW LONG WILL IT TAKE TO CLOSE THE LOAN? 10. ARE THERE ANY CHARGES OR PENALTIES FOR PRE-PAYING THE LOAN?

Most of these questions will be answered at the closing table, however asking them early will only add to your understanding. A good mortgage broker will have no problem helping you understand the process and the terms, after all they want your referrals. Let me close out this chapter by giving you a jump on the loan process, if you have these 10 things prepared or ready BEFORE you even choose a mortgage lender, you will be ahead of the game (A lot of time can be spent gathering up these items)

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The Buyer's Handbook: Purchasing Property in the Pocono Mountains

10 THINGS A LENDER NEEDS FROM YOU

1. W-2 FORMS OR BUSINESS TAX RETURN FORMS IF YOU’RE SELF EMPLOYED FOR THE LAST TWO OR THREE YEARS FOR EVERY PERSON ON THE LOAN.

2. COPIES OF ONE OR MORE MONTHS OF PAY STUBS FROM EVERY PERSON SIGNING THE LOAN.

3. COPIES OF TWO -FOUR MONTHS OF BANK OR CREDIT UNION STATEMENTS FOR BOTH CHECKING AND SAVINGS ACCOUNTS.

4. COPIES OF PERSONAL TAX FORMS FOR THE LAST TWO TO THREE YEARS.

5. COPIES OF BROKERAGE ACCOUNT STATEMENTS FOR TWO - FOUR MONTHS AS WELL AS A LIST OF ANY MAJOR ASSETS OF VALUE E.G., A BOAT, RV, OR STOCKS OR BONDS NOT HELD IN A BROKERAGE ACCOUNT.

6. COPIES OF YOUR MOST RECENT 401K OR OTHER RETIREMENT ACCOUNT STATEMENT.

7. DOCUMENTS TO VERIFY ADDITIONAL INCOME, SUCH AS CHILD SUPPORT, PENSION, ETC.

8. ACCOUNT NUMBER OF ALL YOUR CREDIT CARDS AND THE AMOUNTS OF ANY OUT STANDING BALANCES.

9. LENDER, LOAN NUMBERS AND AMOUNT OWED ON OTHER INSTALLMENT LOANS---STUDENT LOANS, CAR LOANS, ETC

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10. ADDRESSES WHERE YOU LIVED FOR THE LAST FIVE YEARS, WITH THE NAMES OF LANDLORDS, IF APPROPRIATE.

Remember the dumbest question is the one you DON’T ask!

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The Buyer's Handbook: Purchasing Property in the Pocono Mountains

The Number 6 Biggest Mistake Not seeing past cosmetics and following first impressions How

to avoid ?

Hire the Best Home Inspection Service You can Find and Attend the Inspection Personally.

You’re almost there, don’t lose your focus now. So you have made it through the buying process well almost anyway. Even if you are an expert carpenter with many years in the trades, we recommend a professional building inspection. In some cases (like established neighborhoods with mature trees between the house and the street, which may be prone to root intrusions) we also recommend a sewer inspection with fiber optics/remote cameras. If there are signs of water damage or moisture in the home, we’ll recommend a mold inspection as well. The upfront costs for inspection can start as low as $250 and its a cheap peace of mind. Sometimes the best deals simply don’t show well. Maybe there are obvious visible blemishes or too much clutter. The dishes may not be washed. Walls may need to be painted and doors rehung. Maybe the basement even smells like cat urine,

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example: One house that was closed on was at least 10% under market value. When this house was first viewed it was a mess. There was mud on all the floors. Boxes were everywhere from the tenant that was evicted. The backyard was filled with junk. And yes, there were actual critter droppings of some sort in one corner of the basement. In a single word, the property was Nasty! Fortunately the buyers had vision. Through an inspection and negotiation a resolution was achieved, the whole house was cleaned from top to bottom. There were no leftover tenant belongings. The yard is clean. All the walls freshly painted. The kitchen was even recaulked and the smell, gone. The house looks like its true market value now and the buyer saw beyond all the cosmetic issues and literally saved himself thousands. There are a lot of things a home inspection can reveal about a property that are not visible to the naked eye, especially for Pocono Homes. Things are unique to the Poconos when compared to New Jersey and New York which include private wells, private sewer systems, crawl spaces, wet basements, mold due to lots of trees and shade, poor roads that are not maintained by the townships, cold winters, heavy snowfall and leaky roofs. Upper Monroe County is a mountainous and rainy region. Climate will affect a home’s longevity. Be sure to hire someone who comes with a good referral basis, who’s been in the business a while and knows what to look for. Look up the American Society of Home Inspectors and get a list of qualified home inspectors in your area. Once you find an inspector, insist that they compile a written report, complete with photos. Photographs are important because there are areas a home inspector will go that you might not look at. But don’t trust the inspector to do a great job. What if he inspects on a Monday after a tough weekend?

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The Buyer's Handbook: Purchasing Property in the Pocono Mountains

What you need to do is go to the home with your inspector with your own check list that you can find from him or from the internet and look over his shoulder every step of the way. This will not only insure a better inspection but you will learn some interesting things about a house that you may never have known. Especially learn about your furnace. A few tricks can help you out when your furnace goes out in the middle of a cold winter night. If everything up to now is going well and there appears to be no problem that’s a good thing but it is not time to celebrateWHY? Because if there is anything, that can end a real estate transaction it is the INSPECTION. What could go wrong you wonder? ....HERE’S WHAT:

• • • • •

RADON A CRACKED FOUNDATION FAULTY WIRING A MAJOR CONSTRUCTION FLAW MOLD

Need more? Here’s the point, some of these problems can be dealt with amicably by both buyers and sellers, however 1 said amicably. If the buyer decides “I want to walk based on the inspection report” and if he or she is within the legal parameters of a legal and binding contract they certainly can exercise that right. Where does that leave everything? Let me put it this way you’re back to ground zero. Now...this happens! It is the nature of the business however it is not the end of the world, there are more houses to look at. How do you choose an inspector? What should you watch for?

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Remember we discussed earlier, the important role your REALTOR速 plays in the home buying process. He or she will direct you by supplying you the names of two or three reputable inspectors that will guide you through the inspection process. The inspector as well as the agent work for YOU, it is your best interests that they have in mind. Having a home inspection in my personal opinion should never be waived, it will provide you with information concerning the home that could affect whether you proceed forward or not. Usually the inspector will want you (buyer) to go along while they inspect. they will point out things , that you need to know about , remember everything they find are not issues for concern, especially if the house you are buying is not new, if there are major concerns the inspector will point them out and include it in the report. Once the report is complete your REALTOR速 will direct you as to how to proceed based on the outcome of the report.

10 questions that you can ask a home inspector 1. What are your qualifications, and are you a member of the American Association of Home Inspectors?

2. Do you have A CURRENT LICENSE? (some states do not require an inspector to be licensed)

3. How many inspections do you or your company perform each year?

4. Do you provide references that I can call? 5. Do you carry professional insurance?

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The Buyer's Handbook: Purchasing Property in the Pocono Mountains

6. Do you guarantee your work? 7. What specifically does the inspection cover? 8. What type of report will I receive after the inspection? 9. How long will the inspection take and how long will it take for me to receive the report?

10. How much will the inspection cost?

What Your Home Inspection Should Cover • Siding: look for dents or buckling. • Foundation: Look for cracks or water damage> • Exterior Brick: Look for cracked bricks or mortar pulling away from the bricks

• Insulation : look for condition and adequate rating for climate

• Doors and Windows: Look for loose or tight fits, condition of locks, and weather stripping.

• Roof: Look for age, condition of flashing, pooling

water, buckled shingles or loose gutters or downspouts.

• Ceilings, Walls and Moldings: Look for water spots, drywall pulling away.

• Porch/Deck: Look for loose railings or step rot • Electrical: Look for condition of electrical panel, number of electrical boxes in each room.

• Insects, termites etc.... • Plumbing: water pressure, banking pipes, rust spots or corrosion that indicates leaks

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• Water Heater: Age, size adequate for house, energy rating.

• Furnace and /Air Conditioning : Age, Rating, Fuel utilization and energy efficiency

• • • •

Garage: Check floors, cracks etc. Basements: water leakage, rusty smell Septic Tanks Driveways/Sideways

These are the most common items that a good inspector will check, knowing a little about the inspection end what the inspector looks for will if nothing else give you good feeling that you have done your due diligence and should not experience any surprises. Remember the Inspector has your best interest at heart. They get paid whether the report is good or bad, they have no reason to keep anything they discover silent. Again your REALTOR® should have a few reputable inspectors that you can choose from. You have now proceeded to the final part of the home buying process.

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The Buyer's Handbook: Purchasing Property in the Pocono Mountains

The Number 7 Biggest Mistake Buying the Wrong House by Falling in Love with the First Property you see and Compromising on Your Property Requirements.

How

to avoid ?

The only way to avoid this is to work hard and do your due diligence by using the tools in this book.

Don’t Fall in Love With the First Property You See. Pocono communities, building qualities, and home styles are very diverse. The County was very rural for the most part of the 20th century. The County experienced a boom in the 80s and 90s that produced many poor quality homes as there were no building codes during those years. Many homebuyers, particularly first-time homebuyers, fall into the trap of falling in love with the very first house that they see and don’t really do there due diligence on a home. Pretty homes can be high maintenance. You need to at least look at three more houses in the area to get an idea of what the comparables are in that price range. You want your real estate agent to show you homes comparable to what you saw. At the end of the day, re-evaluate. If you’re building a home, interview at least three home builders.

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Compromising on your property requirements. We ask our clients to take the time to prepare a list of “must have” features in a home. Based on these criteria and their chosen location, we’ll set clients up with emailed alerts of modified listings and newly listed properties as they come to market. This is the most efficient way to get listings that fit a client’s needs. Many general websites feature out dated listings. With an MLS driven listing alert system, one that Monroe County Real Estate provides, when properly set-up can save you countless hours cruising the internet. For many, browsing the Internet for homes is enjoyable, sometimes clients even call to setup showings for homes they find online. We have no objection to showing these properties, as long as it fits their criteria.

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The Buyer's Handbook: Purchasing Property in the Pocono Mountains

PART II

Page no.

The Closing...........................................................48 Home Sweet Home.............................................52 Frequently Asked Questions...........................54 Web Site Resources...........................................58 History...................................................................62 About the Author................................................68

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The Buyer's Handbook: Purchasing Property in the Pocono Mountains

The Closing Finally we’re almost there. Well you have successfully completed the most important steps involved in the home buying process. When you think back, you realize, that from the initial desire to purchase a home, to this point at the closing table has taken (3 to 6) months. You are no doubt excited that it’s almost over and although things are going pretty smoothly, you’re really in no hurry to repeat the process anytime soon. The day of closing should be a day of excitement and eager anticipation, let’s face it when it’s over you will have the keys to your new home.

Let’s talk about the setting. Usually the closing will take place at the real estate office closest to the new home, however there is no rule it can’t take place at the title company, realtors for the buyer or sellers office, as long as both the buyer and seller agree, there is usually no issue (Who wants to put a wrench in the works at this stage of the game.) Those in attendance at the closing are usually the seller and the seller’s agent, the closing agent and of course you and the agent that represented you. Not always, but sometimes the mortgage broker for the buyer will attend.

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The title agent will explain all of what is on your HUD sheet, as well as all of your mortgage documents (there will be what seems like endless documents to sign). Just consider that to be the nature of the beast. Paying close attention to the closing agent will suffice, it is usually not necessary to read every line of every page of every document, as long as you are uncomfortable with how much your monthly mortgage payments are and for how long, the other documents that you will take with you can be read at your leisure.

Let’s summarize all the items you will keep from your closing:

• The Real Estate Settlement Procedures Act (RESPA) state-

ment. This form is usually referred to as the HUD 1 statement; it itemizes all the costs associated with the closing. You will need this for income tax purposes and for when you sell the home.

• The Truth in Lending Statement summarizes all the terms of your mortgage loan.

• The mortgage and the note (two pieces of paper that spell out the legal terms of your mortgage obligation and the agreed upon repayment terms.)

• The Deed, which transfers ownership of the property to you. • Affidavits, swearing to various statements by the party. For example: The sellers will sign an affidavit stating that they have not incurred any liens on the property.

• Riders are amendments to the sales contract that affect

your rights. For example, if you buy a condominium, you may have a rider outline the condo association rules and regulations.

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The Buyer's Handbook: Purchasing Property in the Pocono Mountains

• Insurance policies provide a record and proof of your coverage.

• Let’s not forget the keys, and any remote controls (garage) the seller has for you.

There! You did it. Congratulations!

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The Buyer's Handbook: Purchasing Property in the Pocono Mountains

Home Sweet Home

Monroe

Welcome to County, Pennsylvania

I have lived here for over twenty-five years and I personally have enjoyed every bit of my years here. The school system here has proven to be relatively conducive to my children’s education and the natural beauty of the mountains, woods, and wildlife of Pennsylvania has served as a relaxing and refreshing experience. As stated early on in this publication, the purpose of this book is to help you the new home buyer to experience the joy of purchasing a home. The joy is a result of your careful consideration of the motivations behind your decisions and the careful planning to assure a smooth transaction. Hopefully if you read this book prior to purchasing a home, we have been at least helpful to you in an informative way.

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The Buyer's Handbook: Purchasing Property in the Pocono Mountains

10 Most Frequently Asked Questions

Q. Is the train coming? AA Its been coming for more than 30 yrs. Who really knows, don’t count on it. Q. Are the taxes high?

AA That depends on the area you’re planning to move to.

It varies, often times compared to city taxes they are reasonable.

Q. How are the school systems? AA Fantastic! Many opportunities, activities, and learning benefits. Q. How close are the hospitals?

AA Of course that depends on where you live. However most areas are no longer than 15/20 min away. The only major hospital in Monroe County is Pocono Medical Center. The Lehigh Valley and Scranton/Wilkes-Barre area have many good hospitals. Palmerton Hospital serves the western portion of Monroe County.

Q. Are there enough police?

AA I think so, wherever they’re needed they seem to appear out of nowhere.

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Q. How is the employment market?

AA That depends on your individual experience. This area

certainly cannot compare with the surrounding cities and there rates of pay. However homes are much more affordable which is the reason why so many people commute.

Q. Is there an advantage to living in a gated community?

AA Many feel they provide a safer environment, especially if you commute. Others feel some communities can be too restrictive.

Q. How is the traffic flow in general?

AA Many have adjusted because they’re able to live here and

keep their jobs. The Pocono Mountains are well known as a vacation area. As a result there can be heavy traffic during major holidays.

Q. Are the winters bad?

AA This is the Pocono Mountains, yes they can be very bad. Sometimes though they are mild and tolerable. Proper preparation will enable anyone to endure the Pocono weather.

Q. Do the bears attack?

AA I have personally never heard of that. I have seen bears

many times, while some have been here for decades and have never seen a bear. Bears like trees, are a part of the Pocono Mountains, they should never be a factor in your decision to move here.

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The Buyer's Handbook: Purchasing Property in the Pocono Mountains

Additional questions can be answered by going to the appropriate websites, or you can call me personally (570) 839-0100.

READ ON

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The Buyer's Handbook: Purchasing Property in the Pocono Mountains

Online Resources for Consumers Here is a list of resources that should help you with your investigation.

www. monroecountyrealestate.com Committed to finding Buyers the perfect Pocono Mountain home. www.co.monroe.pa.us Includes history, elections, officials, departments and contact details. www.pavisnet.com/monroe Directory for visitors and travelers in the Pocono and Monroe County, PA www.800poconos.com Pocono’s vacation information on resorts, restaurants, things to do, travel guides, golf and skiing for the Pocono Mountains. www.PoconoRecord.com Stroudsburg and the Greater Pocono Mountains Region news from the online home of the Pocono Record. www.poconoshotel.com Pocono’s guide with resorts, hotels, inns and Pocono’s rentals.

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www.poconolakerealty.com Offering Lake Naomi Real Estate, Timber Trails Real Estate, Pinecrest Lake Real Estate and Vacation Rentals in the Pocono Mountains of PA. www.mhklawfirm.com/pennsylvania attorneys.php At MHK Law Firm, each Pennsylvania lawyer has earned a reputation as an exceptional attorney. Trust us with personal injury, workers’ comp., family law. www.trulia.com Find homes for sale. www.homesdiscovered.com Search for homes throughout the United States and Canada. www.quickenloans.com/Home-Loans Compare Loan Options, Calculate Payments & Get Home Loan Rates. www.pamortgagebrokers.net Pennsylvania’s directory with website links and information to mortgage and real estate brokers-professionals. Find by location, category or keywords. http:/www.cuna.org/data/consumer/advice/retir_home/ hometoc.html Credit Union Consumer Facts. www.EnergyGuide.com Provides an easy way to assess energy use and get quick tips on saving energy.

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The Buyer's Handbook: Purchasing Property in the Pocono Mountains

www.epa.gov Environmental Protection Agency. A one-stop shop for advice on testing for and mitigating pollutants, from lead paint to radon to mold. www.equifax.com Equifax. A source of credit reports http:/www.pueblo.gsa.gov Federal Citizen Information Center. http:/www.ginniemae.gov Provides advice to buyers on affordability and homeownership, including calculators. http://www.hud.gov/buying/index.cfm U.S. Department of Housing and Urban affairs. Offers advice to buyers on finance, fair housing, and more. www.improvenet.com Provides links to contractors and architects for remodeling projects for buyers and repair services for sellers. For a small charge, buyers can use the site’s Estimators to determine how much renovating a property they’re considering would cost. www.Moving.com Helps buyers and sellers with packing tips and timetables, online mover links and places to store belongings so that homes look less cluttered. www.REALTOR.com Offers consumer information for buyers and sellers as well as home listings and links to service providers.

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Monroe County Real Estate

http://www.rebac.net/hhk.html Real Estate Buyer’s Agent Council (REBAC). Offers a homebuyer’s kit with useful information and checklists. www.transunion.com A source of credit reports.

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The Buyer's Handbook: Purchasing Property in the Pocono Mountains

History

In the northeastern corner of Pennsylvania lie the breathtakingly beautiful Pocono Mountains, which include Monroe County. Because of the natural appeal, this area has given rise to some of the finest and most elaborate hotels, resorts and recreational areas/facilities in all of Northeastern Pennsylvania. It is also widely recognized as a place for vacationing and romantic weekend “getaways” because of the fiery beauty of the surrounding wooded peaks and valleys. Monroe County is known as the “Honeymoon Capital of the World”. Monroe County has built an industry of service that boasts the finest in personal accommodation anywhere. Visitors and vacationers can find an abundance of activities and places to visit that are guaranteed to be rewarding in any season of the year. Monroe County was created on April 1, 1836, from parts of Northampton and Pike Counties and named for President James Monroe. The southern boundary of the county was the ridge of the Blue Mountain; to the east, the Delaware River; and to the west, the Lehigh River formed its natural borders. The county did not have a county seat because no site had been selected (that was not done until July 1837). There were also no county facilities, such as a courthouse, offices and jail. These were to await the selection of a site and the election of county commissioners. For eight months following its creation, a Board of Trustees, named in Act 161, managed the county. The five trustees, named in the law, were all well-known and

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Monroe County Real Estate

respected residents of the county. They resided in the most populous townships. At that time, there were 10 townships and 1 borough. The trustees were Moses Coolbaugh - Middle Smithfield; Benjamin Bush -Smithfield; William Van Buskirk - Stroud Township; and Michale Shoemaker and Joseph Trach - Hamilton Township. None was from Stroudsburg Borough; but borough leaders would do much to shape the County’s future. These five trustees performed a vital function in the birth of Monroe County, even though they were, in effect, interim commissioners. On August 31, 1837, Stroudsburg became the county seat. Stroudsburg, incorporated as a borough on February 6, 1815, was named for Jacob Stroud, a settler. (Stroud built a home for his son, which has now been restored and now operates as a museum by the Monroe County Historical Association at the intersection of 9th and Main Streets.) The new commissioners supervised the erection of the courthouse in 1837, along with a separate building as a jail. Today, Monroe County is comprised of 16-second class townships and 4 incorporated boroughs with a combined population of approximately 165,685 residents. Three of the boroughs and all of the townships were settled in the 18th century. However, most were not incorporated until the 19th century. The oldest of all the municipalities, in terms of settlement, are Smithfield Township and the borough of East Stroudsburg.

Transportation. The railroad arrived in Monroe County in 1856, and a new era of transportation began, changing the landscape and opening opportunities. The first train to come was the Delaware, Lackawanna and Western line, which traveled from Scranton to New York. The first depot was built that same year in Dansbury Manor (now called East Stroudsburg). The railroad led to the creation of new villages and hospitality businesses.

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The Buyer's Handbook: Purchasing Property in the Pocono Mountains

Furthermore, it connected Monroe County with large urban centers, increasing market opportunities for big Pocono crops, such as ice. Tourism thrived as the increased comfort of travel brought more vacationers to the Poconos. The flourishing of hotels near the railroad station formed the nucleus for the separate town of East Stroudsburg, established in 1871. In 1857, the mail delivery system changed from the four-horse stagecoach to railway. Sidings to the main railroad lines replaced the old plank roads to the tanneries. In 1900, the Delaware, Lackawanna and Western Railroad ran a new fast train from New York to the Poconos called the “Phoebe Snow”. This train brought more tourists to Delaware Water Gap and Mount Pocono. Stagecoach routes covered the Poconos. Trolleys were first pulled by mules, then by steam engines called dummies, and eventually by electricity. Other “modern” services followed the introduction of the railroad to Monroe County. A telegraph line was connected to Stroudsburg in 1855. It provided connection with the rapidly moving world outside the upper Delaware Valley. Water was necessary for fighting fires and for drinking. A public water system was completed in Stroudsburg in 1868. Today, the only trolleys still existing are for sightseeing, and some of the old train depots have been turned into museums or restaurants. The existing railroad is used for hauling freight. Commuters who now travel from the Poconos to jobs in metropolitan areas are yearning a high-speed train line.

Commerce. The first industries in Monroe County grew from its natural resources - lumber and agriculture in the summer, ice in the winter, and tourists year round to enjoy all of its beauty. Sawmills turned timber into lumber. Bark suitable for tanning

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Monroe County Real Estate

hides prompted tannery construction. Gristmills grounded agricultural crops. Bricks were made throughout the county. Quarrying operations yielded flagstone, building stone, slate and sand. Icehouses on the lakes thrived until electricity made the need to refrigerate with ice obsolete. As the population grew, so did the need for retail shops and shopping districts to supply goods ranging from foods to clothing to gift items for tourists. Shopping districts thrived in Stroudsburg, East Stroudsburg, and other areas with large varieties to offer its consumers and tourists. In 1911, Stroudsburg became the site of the first of J.J. Newberry’s nationwide chain of “five and dime stores”. Tourists continued to travel to Monroe County and the Poconos, turning the resort industry into the sole source of economic development for the area. Tourism moved farther north onto the Pocono Plateau, taking advantage of forest scenery, the cooler temperature of higher elevations, and available real estate. Resort hotels became resort complexes. As the 20th century progressed, tourists were no longer satisfied to sit on a porch of the hotel. Tennis courts, golf courses, bowling alleys, billiard rooms, swimming pools, and hiking trails were added to hotels in an attempt to attract the tourist. In addition to its rich cultural heritage, Monroe County is home to East Stroudsburg University of Pennsylvania and the Monroe County Campus of Northampton Community College in Tannersville, the Pennsylvania portion of the Delaware Water Gap National Recreation Area, Sullivan Trail (The portion of the route of General John Sullivan’s famous march of 1778 from Easton to New York that reaches from Tannersville to Pocono Pines. This trail leads to the road that scales Big Pocono

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The Buyer's Handbook: Purchasing Property in the Pocono Mountains

Mountain, one of the highest points in the Poconos that offers magnificent vistas.), Aventis Pasteur (manufacturer of vaccines), Pocono International Raceway (home two major NASCAR events held annually), Camelbeach Water Park and Ski Area, Shawnee Mountain Ski Area, The Crossings Factory Stores (named the number one outlet center in North America by the Outlet Retail Merchants Association (ORMA) for 2000-2001), three state parks (Big Pocono State Park, Gouldsboro State Park and Tobyhanna State Park, and Tobyhanna Army Depot (a major element of the Communications-Electronics Command is the largest and most progressive Communications-Electronics repair, overhaul and fabrication facility in the Department of Defense). For more information on the cultural heritage and history of Monroe County, you are invited to visit the Monroe County Historical Association located in downtown Stroudsburg.

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About the Author

Arthur Goode Jr., 54, was born and raised in New York Astoria Projects, and later in Hollis Queens. A father of eight, married 35 years. He has been a resident of Mount Pocono, PA for 26 years. Has worked as a Professional Realtor for the last 10 years. His background is in construction renovation and Commercial Residential Painting, all of which have proved to be beneficial to Real Estate investors. Knowledge of the Pocono Mountain area has enabled him to provide personal and professional service when selling or searching for homes for buyers. His motto: “The longevity and success of any business is contingent on great service and repeat/referral customers.”

"At Monroe County Real Estate we’re serious about service"

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Monroe County Real Estate, LLC. 2642 Route 940 Pocono Summit, PA 18342


The Buyers Handbook: Buying Real Estate In the Pocono Mountains  

Order your free copy at www.monroecountyrealestate.com

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