TIPS FOR BUYING OR SELLING A HOME

Buying or selling a home is one of life's most important financial decisions. While it's often intensely personal, some essential advice often applies no matter what the circumstances. These tips can help homebuyers and sellers get the most out of the transaction, work with real estate agents, and find tax deductions in their new digs.

Tips for Buyers

1.    A realistic budget can help narrow the search for a home to what's truly affordable. A comprehensive budget includes the monthly cost of mortgage payments, homeowners insurance, taxes and home association dues (as well as premiums on private mortgage insurance, which protects the lender if the homeowner cannot or does not make payments, when applicable). There are online calculators to help buyers pin down a number.

2.    There are some limits, but interest on mortgages and home equity loans are tax deductible, as are premiums for private mortgage insurance and mortgage points paid by homebuyers.

3.    Sometimes it can be hard to see potential in a home that looks run-down but might be more affordable as a result. With some hard work or a small investment, cosmetic upgrades such as painting a few rooms or landscaping the yard could change the feel of the home entirely.

4.    Homebuyers who can afford to put 20 percent down may be better off doing so. The recommended down payment can lead to lower mortgage rates and closing costs. It also lets buyers avoid private mortgage insurance.

5.    Buyers who can't afford to put 20 percent down may still have options. Government-sponsored programs for veterans, low-income families, and residents of rural areas let homebuyers put as little as zero percent down. Bank of America also announced a mortgage product recently that requires 3 percent down and does not require private mortgage insurance.

6.    Buyers who can't afford to put 20 percent down may still have options. Government-sponsored programs for veterans, low-income families, and residents of rural areas let homebuyers put as little as zero percent down. Bank of America also announced a mortgage product recently that requires 3 percent down and does not require private mortgage insurance.

7.    Getting pre-approved for a mortgage can make the buying process easier. Sellers know it's less likely an issue will arise during the closing process, which makes pre-approved buyers more attractive. (Of course, a cash offer provides the greatest assurance, but that is rarely an option.)

8.    After living in a home for two of the previous five years, sellers can deduct up to $250,000 in profits when selling, or $500,000 for married couples filing jointly. The deduction can be taken multiple times but applies only to primary residences owned and occupied for at least two years.

9.    During the period between the acceptance of an offer and the closing, the buyer can pay for a home inspection. Look for an independent inspector who is licensed and insured; look over the report closely; and don't be afraid to ask questions.

10. When a home inspection uncovers problems, buyers and sellers may need to return to the negotiating table. The seller could complete necessary repairs before handing over the keys or lower the price to accommodate the cost of repairs. If the seller doesn't budge, the buyer must decide if the deal is still worthwhile.

Tips for Sellers

1.    When selling a home, create a good first impression. Touch up the paint, mow the lawn, trim the bushes, and clean the entire front yard thoroughly. Small investments such as new mailbox, a few plants, or a bench for a front patio could also attract buyers.

2.    The longer a listing stays unsold, the less attractive it may appear to potential buyers. They may think something is wrong with the home or stick to lowball offers. To prevent this, prepare the home for sale, determine a realistic opening price, and be ready to move quickly once the home is listed.

3.    Remodeling or installing major upgrades may seem like a way to increase the value of a home, but these projects do not necessarily pay for themselves. Minor bathroom remodels and landscaping are smart moves, according to HGTV. Even if the investment is not entirely recouped, putting in time and money to modernize a home can attract more potential buyers.

4.    Before an open house, homeowners should clean out or spend time organizing storage areas. Try to keep things as tidy as possible, and consider buying new shelving or storage units if they will help make a good impression. To emphasize the possibilities to buyers, consider renting a storage unit and emptying closets or the pantry while showing a home.

5.    When showing a home, emphasize the natural light. Move plants away from the windows, clean the glass regularly, and consider upgrading the curtains to draw buyers' attention.

6.    In some markets, homes get snatched up almost immediately. While the closing procedures could delay a sale date, sellers should be ready to pack and move in case they have only a few weeks.