renting vs. buying in hawaii - oahu real estate...

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Renting vs. Buyingin Hawaii

Home Buying Guide

eXp Realty

100 Kahelu Ave. #233 Mililani, HI 96789 * Office: (808) 625-5057

Randy L. Prothero, REALTOR® Principal Broker

ABR, AHWD, CRS, e-PRO, GRI, MRP, SFR

eXp Realty Cell: (808) 384-5645

E-mail: [email protected] www.HawaiiRandy.com www.ProtheroGroup.com

Aloha Potential Home Buyer,

Thank you for visiting our website and registering for the home buying information booklet.

The attached information should give you a starting point to learn about the home buying process.

Included in this packet are the following:

• This cover letter.• Should I Rent or Should I Own?• A chart that compares buying a home compared to paying rent.• Things to consider for buying a home.• Purchasing a home. (A description of our services)• A brochure for The Prothero Group• Am I ready to move?• A utility company contact information form

This packet is only designed to give you a starting point. If you are interested in learning more about the home buying process, please contact us for a free, no pressure consultation.

Please remember advice is always free. Advice not followed can be expensive.

Thank you,

Randy L. Prothero, REALTOR®

Randy L. Prothero Principal Broker

ABR, AHWD, CRS, e-PRO, GRI, MRP, SFR

Cell: (808) 384-5645 Office: (808) 200-3677

[email protected] www.HawaiiRandy.com

Rent payments Versus Mortgage P&I Payments If the

Monthly Rent is

…. You’re paying the following in RENT 1 Year 2 Year 3 Year 5 Year 10 year 15 year 20 year 25 Year 30 year

$1,000 $12,000 $24,000 $36,000 $60,000 $120,000 $180,000 $240,000 $300,000 $360,000

$1,200 $14,400 $28,800 $43,300 $72,000 $144,000 $216,000 $288,000 $360,000 $432,000

$1,400 $16,800 $33,600 $50,400 $84,000 $168,000 $252,000 $336,000 $420,000 $504,000

$1,600 $19,200 $38,400 $57,600 $96,000 $192,000 $288,000 $384,000 $480,000 $576,000

$1,800 $21,600 $43,200 $64,800 $108,000 $216,000 $324,000 $432,000 $540,000 $648,000

$2,000 $24,000 $48,000 $72,000 $120,000 $240,000 $360,000 $480,000 $600,000 $720,000

$2,500 $30,000 $60,000 $90,000 $150,000 $300,000 $450,000 $600,000 $750,000 $900,000

$3,000 $36,000 $72,000 $108,000 $180,000 $360,000 $540,000 $720,000 $900,000 $1,080,000

$3,500 $42,000 $84,000 $126,000 $210,000 $420,000 $630,000 $840,000 $1,050,000 $1,260,000

$4,000 $48,000 $96,000 $144,000 $240,000 $480,000 $720,000 $960,000 $1,200,000 $1,440,000

Monthly Payments of Principal and Interest Only- 30 year Term

Interest Rate

Mortgage Loan Amount $150,000 $200,000 $250,000 $300,000 $350,000 $400,000 $500,000 $600,000 $700,000 $800,000

3.00 $632.41 $843.21 $1054.01 $1264.81 $1475.61 $1686.42 $2108.02 $2529.62 $2951.23 $2951.23

3.25 $652.81 $870.41 $1088.02 $1305.62 $1523.22 $1740.83 $2176.03 $2611.24 $3046.44 $3046.44

3.50 $673.57 $898.09 $1122.61 $1347.13 $1571.66 $1796.18 $2245.22 $2694.27 $3143.31 $3143.31

3.75 $694.67 $926.23 $1157.79 $1389.35 $1620.90 $1852.46 $2315.58 $2778.69 $3241.81 $3241.81

4.00 $716.12 $954.83 $1193.54 $1432.25 $1670.95 $1909.66 $2387.08 $2864.49 $3341.91 $3819.32

4.25 $737.91 $983.88 $1229.85 $1475.82 $1721.79 $1967.76 $2459.70 $2951.64 $3443.58 $3935.52

4.50 $760.03 $1013.37 $1266.71 $1520.06 $1773.40 $2026.74 $2533.43 $3040.11 $3546.80 $4053.48

4.75 $782.47 $1043.29 $1304.12 $1564.94 $1825.77 $2086.59 $2608.24 $3129.88 $3651.53 $4173.87

5.00 $805.23 $1073.64 $1342.05 $1610.46 $1878.88 $2147.29 $2684.11 $3220.92 $3757.76 $4294.58

5.25 $828.31 $1104.41 $1380.51 $1656.61 $1932.71 $2208.81 $2761.02 $3313.22 $3865.42 $4417.62

5.50 $851.68 $1135.58 $1419.47 $1703.37 $1987.26 $2271.16 $2838.95 $3406.74 $3974.52 $4542.32

5.75 $875.36 $1167.15 $1458.93 $1750.72 $2042.50 $2334.29 $2917.86 $3501.44 $4085.00 $4668.58

6.00 $899.33 $1199.10 $1498.88 $1798.65 $2098.43 $2398.20 $2997.75 $3597.30 $4196.86 $4796.40

6.25 $923.58 $1231.43 $1539.29 $1847.15 $2155.01 $2462.87 $3078.59 $3694.30 $4310.02 $4925.74

6.50 $948.10 $1264.14 $1580.17 $1896.20 $2212.24 $2528.27 $3160.34 $3792.40 $4424.48 $5056.54

Tips for New Home Buyers 1) Be sure to use a licensed agent who is also a member of the Board of Realtors. The services of a professional Real

Estate agent are free to you. The seller pays all sales commissions.2) When figuring the financial impact of purchasing a home, always consider the tax benefits.3) You are not just buying property, you are buying life style.

YOUR NAMEREALTOR®, CRS Company name Phone#

Randy L. Prothero, REALTOR®Principal Broker PB, ABR, AHWD, CRS, ePRO, GRI, MRP, SFR

eXp Realty100 Kahelu Ave. #233 Mililani, HI 96789Direct: (808) 384-5645

Start your journey today by contacting me at:

Direct: (808) 384-5645 e-mail: [email protected] or visit www.HawaiiRandy.com

The Prothero Group at eXp Realty. Takes Real Estate to Next Level.

Randy formed his elite team “The Prothero Group” to provide their customers with service and an experience not possible from an individual agent.

We offer free services to buyers. Helping you find the home of your dreams is the most rewarding thing we do.

Protecting your interest Finding the perfect home Negotiating on your behalf Managing the transaction Putting you together with other experts

o Home inspectorso Loan officerso Termite inspectorso CPA, etc.

Pricing recommendations Drafting of contracts and explaining all documents Archiving files and records Presenting you the keys at closing.

As a Certified Residential Specialist (CRS) and an Accredited Buyer’s Representative (ABR), Randy has the expertise and training to ensure your success in buying your home.

Also Randy was one of the first in Hawaii to earn the Military Relocation Professional designation (MRP). He and his team are experts in working with our active duty military and veterans, helping them own a piece of the soil they defended, as their way of saying, Thank You for Your Service!

Contact us for a free consultation and get started in the process of buying your new home.

Good Luck and Happy House Hunting!

Copyright © 2015 by Randy L. Prothero

Things to Consider For Buying a Home in Hawaii By Randy L. Prothero, Principal Broker of eXp Realty and Team Leader for The Prothero Group sales team

Buying your first home can be an intimidating process. This letter and the attached documents are designed to make it less intimidating. Our goal is to provide you information that will allow you to enter the process knowing where to start and what to expect.

Why own instead of renting? 1) It allows you to build wealth. As you make payments they go

towards paying off your home and not your landlord’s. Thedifference between what you owe and what the home is worthis known as equity and it is yours.

2) Oahu homes have historically increased in value. (Over theshort term they can and do go up and down). Like you hear onthe radio ads, past performance is no guaranty of futureperformance. It is a great indicator though. In 1985 the median priced single family home on Oahu

was: $158,000. In May of 2014 the median priced home was: $682,000. That made a big difference in the net worth of those who bought back then, instead of renting.

3) Under today’s rules, you can write off the interest of your mortgage payments. You cannot take a taxwrite-off for rent. In other words you will not have to pay income tax for that portion of your pay check.(We do not give tax advice. For more information, please consult your tax professional).

4) If you buy a home with a fixed rate mortgage your mortgage payment stays the same for the life of yourloan. If you rent it can go up periodically.

5) You control how long you wish to live there. When you rent, the landlord can decide to have you moveout to sell it, move in to it, have a friend or family member move in, or to remodel it.

How to get started? 1) Contact a top Realtor® in your area. They will walk you through the process. If you are on Oahu, we at

The Prothero Group would be honored to assist you. If you are not on Oahu, we can help you find agreat agent in your area.

• Your Realtor will help you find the perfect home.• They will walk you through the process and protect your rights.• Buyer’s agents are normally free. Get them up front and save yourself a lot of work and stress.• Be sure the Realtor is experienced in your area and the type of loan.

i. Example: if you are using your VA benefit, be sure to get an agent who does VA andknows the system well.


2) Find an experienced loan officer who works for a local funding lender. Your Realtor® can give younames of great loan officers in the area.

• Experienced: You want the loan officer who has been doing this awhile. You simply want thebest, no rookies. They will save you money and stress. In general loan officers who are paidcommission, generally give better service; their pay check depends on it.

• Local: Someone who knows your area, local contracts, laws and customs. You want someonewho will be in the room, explaining that intimidating stack of contracts you will be signing.Someone you can look in the eye when things get stressful. Someone who depends on yourRealtor bringing them more clients.

• Funding Lender: You want a lender, not a broker. Lenders actually give you the money. Brokersgo to a lender and then add their fees for their service. Since they do not actually loan themoney, the seller of the home and their real estate agent will not be as excited to deal withthem. In general adding the middle man complicates the process.

3) You want a pre-approval from your lender. A proper pre-approval requires the lender to review yourdocuments, pull your credit and interview you. Your lender will then issue a pre-approval letter. Whenyou place an offer on a home, a pre-approval letter needs to accompany it. Here are some of thedocuments you will need to get a preapproval.

a. Your last two years of tax returns.b. Your last two pay stubs.c. Your last two bank statements.d. Statements from retirement accounts.e. Loan and credit card statements.

Home Shopping Tips • Just because the lender is willing to loan you a large sum of money, does not mean you need to buy a

home that expensive. Carefully plan your budget and ensure you are not taking on more debt that youcan afford. Be sure to have reserve funds to cover repairs and expenses like moving and mortgagepayments in times of emergency.

• Do not limit yourself to just one neighborhood. Most buyers find the perfect home in an area theyoriginally did not plan on. Many times you may find a nicer or less expensive home in a neighboringarea. Always include neighboring areas in your search. Even if you buy in your original selected area,by looking at other areas; it will give you a comparison.

• In a hot market be prepared to offer more than the asking price for a nice property, if it is pricedcompetitively.

• Never make an offer without your agent reviewing the comparable sales and giving you an opinion onthe market value of the home.

• Bring your check book. If you find a home you like and wish to write anoffer, you will need an earnest money check. A minimum of $1000 iscustom. For higher end homes or homes in competitive situations, youmay wish to plan on a higher amount. Earnest money is used to openescrow and the money is credited to your account. Escrow is a thirdparty company that handles the money and the transferring of the deedand getting everyone paid off.

• Allow ample time to view homes. In Hawaii bring shoes or slippers thatcome on and off easily. It is custom to remove your shoes beforeentering someone’s home.


What to Expect Once We Have an Accepted Contract Home buying is a complicated stressful process. By getting a great Realtor® and loan officer much of the stress will be eliminated. Your real estate agent will prepare you to minimize surprises. They will help you with negotiations and they will handle all communications with the seller and their agent. Your duties as the buyer are:

• Get your loan. Give the loan officer everything they ask for ASAP. They will ask for the same thingsagain closer to closing. Keep a file with all the documents you gave them for the pre-approval. As youget updated ones like new bank statements and pay stubs, put them in the file. That way they areready when you get that last minute request.

• Return all documents to escrow. They will send you an information packet right after we open escrow.They need that to do the title work and to file needed documents with the state.

• Respond quickly to your Realtor and loan officer, so they can represent you in the best way possible.Steps of the sale:

• Accepted offer and open escrow.• Disclosure process

o Seller’s disclosure. The seller will give you a statement of everything they know about theproperty that could affect your decision to buy it, at that price.

o Condo and association docs. If it is a condo or is in an area with declarations, like a plannedcommunity; the seller will provide you a disclosure package from that association.

o Escrow will provide you a preliminary title report. They will do a background check on thebuyer, the seller and the property to ensure this sale can legally happen and that they can issuetitle insurance on your deed.

o If either real estate agent finds out anything about the property, that might affect your decision topurchase at that price and terms; they also have to disclose it to you. There is no buyer bewarefor residential property in Hawaii.

• Inspection Processo Home Inspection: You will be able to do a home inspection. It is usually done in the first 1 to 2

weeks depending on what was agreed to in the purchase contract. I strongly recommend aprofessional home inspection. This is a major investment. A few hundred dollars is cheapinsurance. Be careful, home inspectors in Hawaii are not licensed. You want someone with theproper experience, credentials and insurance. Your Realtor® can help you find a goodinspector. This can be a renegotiation point. If you find something wrong with the home youcan request a credit or repairs from the seller. If you can’t come to an agreement with the sellerthe sale can be cancelled at that point.

o Survey: If it is a single family home with clearly definedboundaries, a surveyor will do a survey to ensure theproperty lines have no issues like fences or walls crossingonto a neighbor’s property or theirs onto yours. Surveysare paid for by the seller in most cases. There areexceptions.

o Termite Inspection: Usually towards the end of thepurchase process a termite inspection (TIR) is done by alicensed inspector. For some types of loans this is required. Custom is for the buyer to selectthe inspector and the seller to pay for it. There are exceptions.

o Final Walk Through: In the last few days of the process, you will get an opportunity to go backand inspect the home. You are checking to be sure that any agreed upon repairs werecompleted and that the home is in the same condition as when you did the home inspection.


Any damages etc. are the responsibility of the seller. If there are deficiencies, funds can be withheld from the seller through escrow.

• Closing in Hawaii is a little different than most states.o You sign the deed and the loan documents a few days before closing.o One to two days after you sign the papers, your lender funds the mortgage to escrow.o Two days after the moneys is funded, the State Bureau of Conveyances publically records your

deed at approximately 8:00am. You are then officially the owner and can enter the home.o From the time you open escrow until you close normally takes about 45 days. I can sometimes

take a little longer.

Purchase Contract Tips • The Purchase contract spells out the sale from start to finish. It includes timelines, contingencies, price

and what is included in the sale and all terms.• The buyer has many ways of getting out of the sale, if things are not right. Most are during the

inspection and disclosure period (usually the first two weeks).• The seller agrees to sell it to the buyer, if they do everything they promise, when they promise. The

seller’s only out, is if the buyer does not perform.• Always remember to follow your contract. To date, I have never seen a contract that has, “I changed

my mind” as a reason to cancel the purchase.

Summary Purchasing a home will be one of the biggest decisions you will make in your life. Before moving forward, get educated and surround yourself with great professionals.

If you have questions or concerns or are looking for a real estate agent, you can contact us anytime. [email protected] or (808) 625-5057.

Check out our website. It contains tools for buyers including a search engine that can look up all homes listed on the island with Realtors. It also has our bios and blog site: www.ProtheroGroup.com

mailto:[email protected]

http://www.protherogroup.com/

eXp Realty * 100 Kahelu Ave. #233. – Mililani, HI 96789 * (808) 625-5057

Purchasing a Home We will make purchasing your home a pleasant experience.

Here are a few facts about using us as your Realtors® 1) Our services for normally free to buyers.2) Our most important job is to protect your interests.3) We are full time Realtors®. Real estate is all we do.4) We will guide you through the process, remove most of the stress and keep

you informed at all times. We have a team of professionals assisting us.5) We will help you find the home of your dreams.6) We are some of the most highly trained agents in our area.7) We also help our buyers sell their current home for more money with an

aggressive marketing program, that few agents can match.8) Randy teaches classes for real estate agents. He was regional chairman for the

Honolulu Board of Realtors® and currently volunteers as a mediator and ombudsman.

If we are free to you, how do we get paid? • We normally get paid by the seller and not the buyer. In most cases, the seller’s

contract with their real estate agent, gives half of the commission to the buyer’sreal estate agent. If we come across a rare exception, we will alert you up front.

What are some of Tasks We perform? 1) Locate candidate homes that meet your criteria and set up appointments to view them.2) Identify any potential red flags on that property.3) Help you find other professionals (loan officers, home inspectors, escrow officers, etc.)4) Provide you a market analysis and public records on any home you choose to make an offer on.5) Give you guidance on pricing and negotiate on your behalf.6) Draw up the purchase contract and any needed documents during the purchase process.7) Explain all documents to you.8) Open escrow and ensure you are protected through the purchase and in the future.9) Alert you when you may need opinions from other professionals. (CPA, attorney, contractor, engineer, etc.)

Check out our website it contains tools for buyers including a search engine that can look up all homes listed on the island with Realtors. It also has our bios and blog site: www.ProtheroGroup.com

Please feel free to interview us before making any decisions.

Randy L. Prothero Principal Broker

Team Leader– The Prothero Group ABR, AHWD, CRS, e-PRO, GRI, MRP, SFR

Cell: (808) 384-5645 [email protected]

www.HawaiiRandy.com

http://www.protherogroup.com/

www.ProtheroGroup.com

Oahu’s Premier Real Estate Team(808) 625-5057

We sell homes for MORE money AND faster

Whether your Oahu real estate need is urgent, or you just have a quick question about the market, we’re here to help. The team effort you will receive from us

cannot be matched by an individual agent.

Please give us a call, drop by or send us an e-mail today.

Buyers and sellers representationFree consultations

Expert market analysis and home valuations

(808) 625-5057 || [email protected] 100 Kahelu Ave. #233, Mililani, HI 96789

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Randy Beau

/+ProtheroGroup

/HIRealEstate

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What our Clients say:

We will make your real estate experience a pleasant one.

“Randy was the best agent I’ve ever worked with. This is the fourth house I’ve bought. Randy took a lot more time on the house search. He was just so available to me, and he was so articulate. What I really liked about Randy is that he will educate you along the way. It’s not a big mystery. I recommend him whenever I have somebody who wants to buy a house. You can’t find a better resource or teacher when it comes to buying or selling real estate.”

— Bonnie, Mililani

“Randy Prothero is the best Realtor that I ever met. He is courteous, respon-sive, and ethical. He’s well connected and he knows how to get things done in a professional and timely manner. My home sold much higher than anticipated with Randy’s help! I cannot recommend him enough. He truly is a life saver!”

— Larry, Mililani

“It was Randy’s little insights. Besides the stats I could obviously read off the same sheet, he pointed out positive and negative things you couldn’t see on the sheet as well as logistical things. He was giving us the battle strategy for the house. I’d say this is the right guy. We nominated him for the “People’s Choice Awards” for the newspaper. I think because of not just his excellent service, but his vast knowledge. I mean the guy teaches classes to the other Realtors! You want that guy!”

— Sandy & Peter, Waialua

The Prothero Groupat eXp Realty

We are an elite Oahu real estate team formed to raise

the bar.

Whether buying or selling real estate, you will find the service

and team effort you receive from us cannot be matched

by an individual agent.

Why use a single agent when you can have a TEAM of

professionals working for you?

About Randy Prothero and The Prothero Group

See many more client success stories at http://protherogroup.com/category/testimonials

www.ProtheroGroup.com

YOUR NAME

#

Randy L. Prothero, REALTOR®Principal Broker PB, ABR, AHWD, CRS, ePRO, GRI, MRP, SFR

eXp Realty100 Kahelu Ave. #233 Mililani, HI 96789

(808) 384-5645 [email protected] www.HawaiiRandy.com

Start your journey today by calling me at (808) 384-5645 or visit www.HawaiiRandy.com. .

The Prothero Group at eXp Realty. Takes Real Estate to Next Level.

Randy formed his elite team “The Prothero Group” to provide their customers with service and an experience not possible from an individual agent.

If you need assistance in buying or selling a home or just have a real estate question. Contact Randy and “The Prothero Group”.

Advice is always free.

Utility Information Form

Address: __Buyer __Seller

HAWAIIAN TELCOM HAWAII 1177 Bishop St; Honolulu, HI 96813

Billing Service: 8:00am to 4:00pm (Monday–Friday) 643-3456 Customer Service: 8:00am to 4:00pm (Monday–Friday) 643-3456

SERVICE: Terminated Effective:____________________ Date/Time:_________________Start up Effective:_______________________ Spoke To:__________________

HAWAII GAS COMPANY 515 Kamake'e Street; Honolulu, HI 96814

Hours of Operation: 7:30am to 4:00pm (Monday-Friday) Emergency Services: 24 Hour Service Repairs or Emergency 535-5933 Turn ON or Shut OFF services/ Billing Account Information 535-5933


HAWAIIAN ELECTRIC COMPANY 900 Richards St; Honolulu, HI 96813

820 Ward Ave; Honolulu, HI 96814 7:30am to 4:00pm 900 Richards St; Honolulu, HI 96813 7:30am to 5:00pm Telephone Service Hours (Monday-Friday) 7:30am to 6:00pm 548-7311


BOARD OF WATER SUPPLY 630 S. Beretania St.; Honolulu, HI 96813

Hours of Operation: 7:45am to 4:30pm (Monday-Friday) Start or Terminate Water Service Bus. 748-5030


OCEANIC CABLEVISION 200 Akamainui St.; Mililani, HI 96789

Hours: 7:30am to 6:00pm (Monday-Friday), 8:00am to 4:15pm (Saturday)(Counter Customer Service at Mililani) Sales & Billing Information 643-2337 Repair & Service 643-2100


renting vs. buying in hawaii - oahu real estate...

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