What You Need to Know About Living in a MUD or PID Community

If you’re considering buying a home within a MUD or PID, here’s what you need to know about them.

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If you’ve been looking to buy a home in the Dallas-Fort Worth area, you’ve likely heard the terms MUD and PID a lot. They are both acronyms for organizations that raise funds to pay for utilities and infrastructure in a new community. 

MUD stands for municipal utility district and is usually created by a developer. It provides water, sewage, drainage, and other utility-related services to new communities. The basic purpose of a MUD is to provide a developer an alternative way to finance the infrastructure. MUDs are likely to exist in large, master-planned communities outside city limits. As an example, a few local communities classified as MUDs are Light Farms in Celina, Artesia in Prosper, and Trinity Falls in McKinney. 

PID stands for public improvement district and is created by a city or county. PIDs are used to finance the same infrastructure that MUD would finance, but they're more commonly used to fund additional items such as sidewalks, landscaping, parks, lakes, and recreation. Some examples of this kind of community include Mustang Lakes in Celina, Creeks of Legacy in Prosper, and Winn Ridge in Aubrey.

Once a PID is paid off, it’s gone forever.

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The homeowners within a MUD pay an additional annual tax. In a PID, they don’t have this annual tax, but they do have an assessment, which can be paid up front or accrued during the years a PID is active. Once it’s paid off, it’s gone forever. A MUD, on the other hand, is always going to be there and should be treated as an additional property tax.

Is it a bad idea to purchase a home within a PID or MUD or both?  Yes, that’s right. There are a few neighborhoods where you can have both. My answer is that it depends.

My only recommendation is to do your due diligence ahead of time and know exactly what you will be required to pay for on a given home. Know the tax rate if you’re in a MUD, know what the PID assessment is, and the overall property taxes and fees. If you don’t want to do all this legwork, I recommend hiring a real estate agent to guide you toward the most financially sound decision.

If you have any questions for me or want to know what I can do to help you achieve your real estate goals, don’t hesitate to give me a call or send me an email. I look forward to hearing from you soon.

Featured Listings

Available near you:

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3320 Propser Trail

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409 Hidden Trl

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3032 Crossing Drive

What Closing Costs Are Buyers Expected to Pay?

Today I want to discuss closing costs for buyers—what they are and how they work for buyers, specifically.

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The vast majority of buyer closing costs are lender related. The lender you’re working with should provide you with a loan estimate showing the line-by-line breakdown of all your fees within 30 days of your submitting the loan application. I encourage you to study this document and to ask your lender any and all questions you have about it.

The first line you’re likely to see on your closing disclosure is going to be a loan origination fee. This fee covers the cost of obtaining a loan, which includes the lender’s underwriting fee, processing fee, funding fee, etc. I’ve seen that fee vary from as little as $200 up to 1% of the loan amount. Some lenders waive that fee altogether, usually in exchange for charging you a slightly higher interest rate; there are some circumstances where such an approach can be beneficial.

If you’re going with a government-backed loan such as an FHA, VA, or USDA loan product, you’ll be required to pay an additional fee:

• FHA insurance premiums are at about 1.75% of the loan amount
• The USDA loan will charge you a guarantee fee, which is about 2% of the loan amount
• The VA’s guarantee fee varies from 1% to 3%, based on your down payment

Appraisal and credit report fees will most likely be collected from you before closing. An appraisal fee will typically run at about $500 or $600 in our area; your credit report fee will probably run as little as $50 to $100.

Depending on the loan, you’ll be required to pay an additional fee.

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In Texas, we use title companies to facilitate a transaction. Sellers in a transaction will pay an escrow fee, which is typically around $400. Also, just like how sellers get to purchase a title insurance policy to ensure to the buyer that their property is clean and clear, buyers get to purchase a similar insurance policy, only for their lender. Based on your lender and the type of endorsements that they require, this policy will probably cost somewhere around $300.

Beyond those, you can expect to pay around another $200 in miscellaneous administrative fees, such as for deed recording, document preparation, etc. These aren’t technically closing costs, but they’re usually taken from you at closing, so I usually like to address them, as well.

It is very customary in Texas to pay for a full year of home insurance for the property you’re purchasing, which is collected at closing. Additionally, your lender is likely to require creating an escrow account in which they basically take your own money and store it in that separate account for your own protection; those funds will be used to pay your property taxes or PMI (premium mortgage insurance) if you’re going with a conventional loan product with a less-than-20% down payment.

If you have any further questions about the closing costs expected of buyers to pay, don’t hesitate to reach out to me anytime.

Featured Listings

Available near you:

1 / 3

2210 Laurel Street

2 / 3

3041 Clearwater Drive

3 / 3

10078 Sharps Road

What Buyers Must Know About Submitting Offers on a Property That’s Under Contract

Can you submit an offer on a property that is under contract? Let’s discuss this common question today.

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Can a buyer make an offer on a home that is under contract?

This is a question I hear all the time. Technically, the answer is yes. Buyers can make an offer on any listing at any time. The catch is that sellers are not able to accept offers while under contract with another buyer.

They can, however, accept backup offers. Submitting a backup offer allows you to step in if the current buyer terminates their contract for any reason.

Your backup offer may also supercede the first offer if the existing contract is contingent upon the sale of that buyer’s current home. Depending on terms and conditions outlined in the offer, sellers in this situation may have the right to terminate the existing contract and accept your offer instead.

But how do you know whether a property is under contract, and what kind of contract a property is currently under if it is, when submitting a backup offer?

Submitting a backup offer allows you to step in if the current buyer terminates their contract for any reason. ”

The best way to determine this is by asking your agent and by looking at the property’s status. If a listing is in “active” status it means the home is available and the seller is accepting offers. “Active option” status means that the home is under contract, and the buyer is within their option period.

“Active contingent” status means the home is under contract and the buyer has finished their option period, but there are some unsatisfied contingencies waiting to be met. And “pending” status means that the home is under contract and all contingencies have been satisfied.

Finally, when you see a property in “active kick-out status,” this means that the home is under contract but that the sale is contingent upon the buyer selling their current home first. This status presents you with the opportunity we outlined earlier, where you may submit a backup offer in case the current deal falls through.

If you have any other questions or would like more information, feel free to give me a call or send me an email. I look forward to hearing from you soon.

Credit Tips for First-Time Homebuyers

Purchasing a home for the first time can be both daunting and invigorating. Today I have mentor Gail Hillman here to give advice to first-time homebuyers about how to position themselves for a successful purchase.

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Buying your very first home is an important event. Gail Hillman, an incredible mentor and even better human being, is with me today to help give advice to Sarah, a client of mine who was looking to buy a home for the first time.

Sarah’s first question was about credit. The myth that you need a credit score higher than 700 still persists to this day, so I’ve asked Gail to help clear that up for us.

According to Gail, lenders can actually take a credit score as low as 585, which is a far cry from the higher score many people believe is necessary. Now, it is better to have a higher score; it will be easier to get a loan in general, but it will also afford you access to different types of loans.

If your credit score is low, that’s not a permanent situation. If you’ve been late a few months here and there or are suffering from the consequences of past bad decisions, there are several options available to get your affairs in order.

Sometimes it’s a matter of having a high balance on a credit card, which can ruin your credit. It could also be a matter of needing more credit. Other times, credit issues can stem from medical charges and other things. Regarding any of these issues, we can put you in contact with someone who works in credit repair; it might take three to six months to fix, but it is possible, and I highly recommend it. That said, be sure to get a referral for a credit repair worker, since they’re not licensed and could be inexperienced.

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If your credit score is low, that’s not a permanent situation. ”

I make it a point to tell all my first-time homebuyers that even if you’re not going to buy for another six months, it’s a good idea to start the home buying process early. It will give you some time to cushion yourself and repair your credit. Remember, the higher your credit score, the better the rates that you’ll get on any loan you’re approved for.

Beyond improving your credit, Gail’s advice for first-time homebuyers is to contact a lender before shopping for homes. Let your lender know where you’re at in the process; the last thing you want to do is look at a home, only to find out you can’t afford it.

If you need help beginning the home buying process for the first time, please reach out me at Ebby Halliday Realtors. We can advise you and give you a ballpark idea of what you’ll need to do in order to get in the best position to buy a home.

The Top Benefits for New Construction Buyers

Why are more and more homebuyers looking to new construction homes over resale homes? My latest appearance on “The American Dream” will clear that up.

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I recently joined Kara Kay with "The American Dream" to talk about the Northern Texas real estate market. You can watch the full interview above, but here’s a written summary of what we discussed:

There’s a high demand for new construction homes right now in the Dallas/Fort Worth area. With a shortage of pre-owned homes available for sale, many of my homebuyers have opted to build instead. Who wouldn’t want a brand new home that you can design your way? Building a dream home is something that many people are looking forward to and we’re so fortunate to have great builders who offer great products in varied prices.

One of these great builders is Mike Tadlock, the VP of Sales for History Maker Homes. The technology on a new construction home is far superior to that of a 12 to 15-year old home. The value of a new construction home tends to lead to better opportunities for a buyer. You don’t have to worry about anything breaking with a warranty, and you’ll get lower energy costs with efficient appliances.

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A home warranty is one of the best things about buying a new home.

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Other advantages of buying a new home including energy-efficient windows, water conservant plumbing, smart appliances, and automated lights and doors. The builders warranty is also important. You never have to worry about your A/C dying in the summer or your water heater bursting in the winter with a new home. If a problem does arise, the warranty will cover it right away. You’ll be safe, sound, and protected.

91,000 people moved into the Dallas/Fort Worth market this last year. What we’ve seen is that people are finding the affordability factor in this area as superior to the places they’ve been living previously. As a result, they are getting more home for their money.

Thanks to Kara for having us. If you have any questions about the market or about buying a new home, don’t hesitate to give us a call or send us an email. We would love to hear from you soon.

Do You Need a Realtor to Get a New Construction Home?

Why should you hire a Realtor when buying a new construction home? There are many reasons that I’ll share with you today.

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Do you really need a Realtor’s representation when purchasing a new construction home? The answer is a resounding yes, and here’s why.

That smiling, friendly agent at the model home represents the builder’s best interests, not yours. They are there to get the builder the most money and most favorable terms. After all, that is their legal duty and job description. 

I love new construction homes, but things rarely go smoothly. Issues almost always arise during and after the construction. A good, reputable Realtor will have more pull when fighting and negotiating with a builder than you ever could on your own, especially when it comes to issues of flaws and warranties after the purchase. 

Again, that friendly salesperson will fight for their employer, the builder—not for you.

A good Realtor knows the builder, their reputation, and their strengths and weaknesses. Your Realtor should also know about the community, future area developments, changing school zones, tax variances, and resale values. 

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I can often find a builder who is a better fit for you.

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I cannot say how many times I get a call from a client saying, “We came across this builder and fell in love with one of their floor plans. Can we please meet this weekend and write a contract?” 

Almost every single time, I ask them a few questions about their wants and needs and am able to introduce them to a new community and builder that will be a better fit for them. The clients love the new builder more than their original choice; they simply didn’t know something else was available. 

Since I sell a number of new homes each month, I know all of the best communities and the best homes currently available. That is my job!

Last but not least, many buyers think that they can pay less for a home if they don’t have to pay a Realtor’s commission. That is simply not true. Appraisals are a sensitive subject when it comes to new homes; the builder needs the price of their homes to be consistent whether a Realtor is involved or not. 

In other words, the commission is built into the price you pay regardless of whether you have an agent representing you or not. So, working with a Realtor not only costs you no money, a good Realtor can actually save you money, time, and headaches. 

If you have any questions about buying a new construction home or about real estate in general, just give me a call or send me an email. I would be happy to help you!

5 Advantages of Buying an Older Property

There are five advantages to purchasing an older home. I will be reviewing each of these benefits, today.

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Buying an older home can present several key advantages. Previously, we discussed the benefits of buying a new home, but today we’re going to switch gears. 

So, why might you want to purchase an older home? Allow me to list the top reasons: 

1. Location. Older homes tend to be centrally located. They will be closer to dining, shopping, and entertainment options. If you can’t stand the idea of a lengthy commute, an older home may be the way to go.
2. A larger yard. As a general rule, older homes have bigger yards. Land is so expensive right now that new construction homes are being built as close together as possible. 
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Lush landscaping, winding streets, and a strong sense of community can be found in older neighborhoods.

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3. A mature neighborhood. Lush landscaping, winding streets, and a strong sense of community can be found in these older neighborhoods.
4. More character. Many people just don’t care for the look of a brand-new neighborhood. 
5. Lower taxes and HOA fees. Depending on the city, you’ll likely pay lower property taxes on an older home. Many new communities are subject to additional taxes and fees.

If you have any other questions or would like more information, feel free to give me a call or send me an email. I look forward to hearing from you soon.

A Warranty Service That Totally Protects Your Roof

Total Roof Protection provides one-of-a-kind roof warranties. Cole Newton is here to talk about what his company offers.

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Today I have a special guest joining me: Cole Newton with Total Roof Protection. Cole is here today to talk about roof warranties and why they’re so important for homebuyers.

Total Roof Protection is the only roof warranty company that provides coverage against rain, wind, sleet, and hail. Currently there is a gap in the market where, if somebody has roof damage, they pay out of pocket until they meet their deductible. If the deductible is $4,000 and the cost of the damage is $3,500, then that cost comes from the pocket of the owner.

We at Total Roof Protection want to fill that gap. We’ll come and fix the damage and make sure that you’re good to go.

There are multiple ways to pay. You can pay up front or you can pay on a low monthly payment. All the warranties are transferable, so if you decided to sell your property, it would transfer over to the next lucky homeowner.

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Total Roof Protection is the only roof warranty company that provides coverage against rain, wind, sleet, and hail.

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If you have a house that is 3,000 square feet or less, you can pay $299 for a one-year service, $399 for a two-year plan, or $499 for a three-year warranty. You can also turn that into a monthly plan. For example, if it was the one-year plan, it would be $25 a month; for a two-year, it is $19; and for a three-year, it’s $14 per month.

In North Texas, the largest roof damage we see is from hail. Hail storms wreak havoc on entire neighborhoods. If the damage incurred is enough to warrant an insurance claim, we can also work with you to make sure that the claim is filed properly.

If you live in a place where roof damage is a frequent concern (and even if you don’t), you might want to consider investing in a Total Roof Protection warranty. You can reach Cole at (817) 917-5405,  by sending an email to info@totalroofprotection.com, or visiting www.totalroofprotection.com. 

For further real estate questions, feel free to reach out to me at any time. I’d be glad to answer your questions and help you meet your real estate goals.

A Quick Word on Down Payments

There are many loan products available to you that don’t require you to put down 20%. 

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As a homebuyer, what kind of mortgage options are available to you? What kind of down payment should you expect to make?

Contrary to popular belief, you don’t need to put 20% down to purchase a home. According to Gail Hillman of Waterstone Mortgage, there are many other options out there. 

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You have many loan options out there.

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A conventional loan, for instance, only requires you to put 3% down. There are also programs that only require 5%, and another program that requires 15% down without any mortgage insurance. Jumbo loans, too, are available for purchases over $458,000.

Waterstone also offers a special loan product that doesn’t require any money down and allows you to buy up to $650,000. It’s a portfolio product that they keep in-house, but they’d love to share it with anyone looking to buy a home. 

If you’re looking to purchase a home and want to know more about your mortgage options, feel free to call Gail at (972) 200-3253.

If you have any other real estate questions, don’t hesitate to reach out to me. I’d be happy to help you.

You May Qualify for a Mortgage Much Sooner Than You Think

Today I’m joined by a special guest, Adam Colberg from Fairway Independent Mortgage Corporation, to help me cover an important subject: down payments.

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Today I’m joined by a special guest, Adam Colberg from Fairway Independent Mortgage Corporation, to help me cover an important subject: down payments.

I’ve got a lot of buyers who still believe they need at least 20% down in order to qualify for a mortgage, but this isn’t the case.

Adam says he and many other lenders see this mindset in consumers fairly often as well. But Adam wants everyone to know that there are programs and loan products out there that are designed to help. USDA and VA loans are just two examples. 

Some of these programs require as little as 0% down. Not everyone will qualify for these, but there are other products that can allow you to put down as little as 3% or 3.5%. Conventional loans and FHA loans are two examples of this. 

If you have really good credit and a steady job but still want to save, putting down just 3% with a conventional loan may be right for you. This is actually a very common route that people have been taking recently. Rates right now are very low, which is definitely motivating people to buy.

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Rates right now are very low, which is definitely motivating people to buy.

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Another option for saving money during a home purchase is to consider a fixer-upper. Putting less money down will allow you to keep some cash to be used for improvements. 

But even if you need to make improvements but don’t have cash set aside, there are other products you can take advantage of. At Fairway Independent Mortgage, there is a conventional homestyle type of rehab loan that can help you put the polish on your perfect fixer-upper.

If you have any other questions or would like more information, feel free to give me a call or send me an email. I look forward to hearing from you soon.

What Can you Expect to Pay in Closing Costs?

What can you expect to pay in closing costs? That number depends on your lender and which loan program you qualify for.

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How much can you expect to pay in closing costs when purchasing a home?

Whenever my clients ask me to estimate the closing costs of their home purchase, I typically tell them that it depends on their lender. When you purchase a home, most of your closing costs come from the expenses associated with obtaining your mortgage. 

Adam Colberg of Fairway Independent Mortgage gets this question a lot too, and his answer is more or less the same—it depends. There are many different loan programs and lenders out there, and costs can vary from lender to lender. Without knowing which loan program you qualify for, your exact closing costs will differentiate.

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There are many different loan programs and lenders out there, and costs can vary from lender to lender.

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When buying a home, it’s important to remember that there are three different things you need to set money aside for:

1. The down payment
2. Your third-party fees (i.e. lender and title fees)
3. The prepay fee, or the money that will be set into an escrow account to pay your taxes and insurance when they’re due

With most lenders, you have the option to waive your escrows, or pay your taxes and insurance on your own. The escrow account is basically a forced-savings account because it’s money you set aside to pay your taxes and insurance. Some people prefer not having to write that check at the end of the year because property taxes are high in the DFW area. 

If you have any questions for Adam, you can give him a call at (972) 984-8662. If you have any questions for me, don’t hesitate to give me a call or shoot me an email. I’d be happy to help you.

Do You Need a Realtor to Get a New Construction Home?

Why should you hire a Realtor when buying a new construction home? There are many reasons that I’ll share with you today.

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Want to buy a home? Search all homes for sale

Do you really need a Realtor’s representation when purchasing a new construction home? The answer is a resounding yes, and here’s why.

That smiling, friendly agent at the model home represents the builder’s best interests, not yours. They are there to get the builder the most money and most favorable terms. After all, that is their legal duty and job description. 

I love new construction homes, but things rarely go smoothly. Issues almost always arise during and after the construction. A good, reputable Realtor will have more pull when fighting and negotiating with a builder than you ever could on your own, especially when it comes to issues of flaws and warranties after the purchase. 

Again, that friendly salesperson will fight for their employer, the builder—not for you.

A good Realtor knows the builder, their reputation, and their strengths and weaknesses. Your Realtor should also know about the community, future area developments, changing school zones, tax variances, and resale values. 

I cannot say how many times I get a call from a client saying, “We came across this builder and fell in love with one of their floorplans. Can we please meet this weekend and write a contract?” 

Almost every single time, I ask them a few questions about their wants and needs and am able to introduce them to a new community and builder that will be a better fit for them. The clients love the new builder more than their original choice; they simply didn’t know something else was available. 

“

I can often find a builder who is a better fit for you.

”

Since I sell a number of new homes each month, I know all of the best communities and the best homes currently available. That is my job!

Last but not least, many buyers think that they can pay less for a home if they don’t have to pay a Realtor’s commission. That is simply not true. Appraisals are a sensitive subject when it comes to new homes; the builder needs the price of their homes to be consistent whether a Realtor is involved or not. 

In other words, the commission is built into the price you pay regardless of whether you have an agent representing you or not. So, working with a Realtor not only costs you no money, a good Realtor can actually save you money, time, and headaches. 

If you have any questions about buying a new construction home or about real estate in general, just give me a call or send me an email. I would be happy to help you!

How to Beat Multiple Offers for Your Dream Home

Today I’m giving you some tips on how to beat out other offers when trying to purchase your dream home.

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How can you win the home you want in a multiple offer situation?

Let’s imagine you found the perfect home, so you instruct your agent to submit an offer. That night you dream about the house and toss and turn thinking about paint colors and furniture. The next day your agent calls to tell you the sellers selected another offer. How devastating! 

To make sure that doesn’t happen to you, you need to follow a few tips on how to make your offer stand out in this competitive market. 

First, shorten or waive some contingencies. You should always do an inspection, but you can shorten the amount of time that’s given to speed things along. Also, if you are offering above list price, it would be worth speaking to your agent about waiving the appraisal contingency. 

Second, accommodate the seller’s preferred schedule. Have your agent check out the seller’s situation to see if they are trying to close quickly or if they need some more time in the home. If you can accommodate the seller’s schedule, your offer could be more valuable than a higher priced offer that can’t. 

Third, act quickly! If you find a home you love, be ready to write a strong, clean offer without making too many demands on the seller. For example, don’t give the sellers a cutoff time for their answer unless you have a legitimate reason for the rush. If that’s the case, have your agent politely discuss it with the listing agent, but don’t make your offer contingent on a set time. 

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Go in with your best and final offer right away!

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Finally, go in with your best and final offer right away. Don’t wait until you know there are multiple offers. Contrary to popular belief, sellers don’t have to let buyers know that there are multiple offers. They can pick one right away, so don’t wait for a second chance. 

If you have any other questions about winning in a competitive home buying scenario or you’re thinking of selling your house, don’t hesitate to give me a call or send me an email soon. I’d be glad to help!

Should I Buy or Sell First?

If you have decided to move, you need to know about these three strategies to sell your home and buy a new one.

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If you’ve decided to move, a question you’re probably asking yourself is if you should buy the new home or sell your old home first.

So, should you sell your current home before signing the contract on a new one? Or, do you buy a new home first and then put your house on the market? What about selling your home and buying a new home at the same time? I’ll walk you through each strategy to see what might work best for you.

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There are three ways to approach selling your home and buying a new one.

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Selling your home before you buy a new one is the safest and most common strategy. The only disadvantage is that you could find yourself temporarily homeless. You’ll have to endure the cost of temporary housing and you’ll have to move your things twice. The advantage to selling your home first is the peace of mind that comes with having that taken care of, and you will have time to shop around for your new home.

Buying first and then selling might be a good strategy if you are looking for a very specific home. When you find that perfect house, buy it. The only disadvantage is that you’ll have to qualify for two mortgages at the same time.

Finally, selling your home and buying a new one simultaneously is the most delicate option. There are a lot of moving parts involved, but it is doable. I know because I specialize in this process. Many sellers are not going to want to sell to you if there’s a contingency on your home selling, but there are some creative ways around it. One way is to obtain a bridge loan which allows you to take out a temporary loan against your current home to finance a new one. There are also some ways to sweeten the contingency terms for the sellers.

I would love to go through these strategies in more detail with you, so if you have any questions, feel free to give me a call or send me an email. I look forward to hearing from you!