The Realtor Diaries

I was reading on another blog how this one agent wanted to inject his own comission bonus into a purchase agreement and the overwhelming consensus was that it was illegal to do so.  It seemed to get hung up on that one fact alone,not just the offer being submitted was "lowball".  Yet a less than market price can be but not necessarily is an injustice to a seller and may even be an insult if it was priced in accordance to its condition and the area.  The buyer is not being serious just throwing a figure at the seller.  I mean really lowball too! not just 10% off list price.

Homebuyers are sometimes their own worst enemy in my own experience.  I mean how many of you would just go to the first doctor, lawyer, or mechanic that you run into? No one I think.  Yet I see homebuyers on openhouses that want to talk to the listing agent, thinking obviously that they will get a better deal.  Sometimes I wish the California DRE would outlaw dual agency for real estate salespersons, drastic but it solves the problem.

It happened to me recently that a couple that was referred to me wanted A PARTICULAR property.  After I found out some information about it, I emailed them (I only had an email address) and they were appreciative and told me they were going to drive around and see what was available that weekend as the property the inquired about was not available to show.  As time wore on the property became available and I emailed them about 3 times to set a time  to see the property. She replied that they put an offer on a house and she would let me know Monday if she still wanted to see LeFloss Ave.  I asked her if they went through the listing agent , if they called a number on a sign, etc. and proceeded to tell her about dual agency , how buyer's agents do more than  turn keys,and how they are short changing themselves on truth in representation.  She thanked me for the advice and I guess it did not matter to her as she said they would let me know on Monday if seeing Lefloss was necessary.

Another more onerous ploy is someone that I have been working with for 8 months trying to find a home in another city.  I set her up with my trusted loan oficer as well. I spent  a long time dealing with her constantly changing specifications and eveny time I would change my showing criteria to what she wanted, she would find something wrong with the homes I showed her or say they wanted too much (she wanted quality so I showed her homes on the upper side of her approval range.)  We even were going into contract on a home 15 miles further east but she backed out after the listing agent could not or would not get the bank to honor a previously quoted price.

She eventually was first shopping loan officers as she was very conscious about loan costs.  Funny thing is they were all within dollars of each other!  Then it turned to me...she said she was being honest but she was having a "local" agent shop for her as well!  I told her all agents see the same properties on the listing system, and pointed out if she was not shown a property that she drove by, it was because that property did not fit her criteria.  I handpick the properties to show my client. I also told her that I spent alot of time learning about what she is looking for and that she would have to retrain another agent.  I hope she did not go off a sign like above!  I literally put her on the top of my priorites.

Therefore that does it.  Out comes the Buyer/Broker agreement!  I am tired of disloyalty  because I work hard for my buyer clients.  I thought being free and by choice would make them feel comfortable but then how much does a homebuyer know about what really happens during an escrow?  Would they not prefer to see only homes that fit their needs and desires?  Or do they want to buy a home like they buy bread at Walmart? Homebuyers need to learn about agency and how a dedicated buyer's agent can protect their interests.

Whether you are the buyer OR the seller, participating in shortsale proceedings can try your patience, but can be less stressful if you are working with the right agent. Shortale tranacting is defineitely not for the non-dedicated.  I am therefore going to lay down expectations of operating on both sides of the transaction.  IN ALL CASES MAKE SURE YOUR AGENT IS ACCESSIBLE.  My clients will call me late at night to check in and they know I will answer them.  Do they have a specialization , either Partner First Preforeclosure Certified or the more common Certified Distressed Property Expert certification?

IF YOU ARE THE BUYER...

All I must say is to hurry up and wait!  Well ok there is a little more to it than that. Shortsale proceedings are dependent upon the bank really.  The short sale right now that I have can get me an approval in about 2 weeks and they are the most efficient I have seen.  I have  a shortsale on the buying side with Bof A and Chase and they might have an approval in 2 weeks more as we have been in the process for about a month now.  One agent told me that US bank was taking several months(which I fail to believe really in this HAFA era).  The listing agent should know what sort of time line they are on because you do not want to be held up for something that may not fufill.  Shortsales have a high failure rate, especially if there are two lenders.  The listing agent should update your agent regularly as to progress of the transaction.  No communication is a bad sign...I have a client buyer that wanted frequent updates . I called and emailed the listing agent to no avail.  She called him on her own as she went to the owner's house, and the listing agent then apolgetically updated me on the progress. Try not to ask for too much.  Banks like cash offers especially in these situations because they can reduce their costs of payouts.  They sometimes will pay closing costs but not always and they will not pay for a negotiator....that will come from the buyer's agent or the buyer's pocket!  Don't think about "repairs" because you will not get any. In short , the less you ask for , the better.  Lowball offers do not work.  If the listing indicates" approved " shortsale than that is a good sign that that is the minimum price they will accept.  Offer that if not more!

If you are the seller...

Please cooperate fully with your agent.  They will need lots of financial information that the lenders will need to see to justify the shorting:  Paystubs, Bank Statements, Letter of Authorization, and the Hardship letter.   Don't be surprised if the lender issues their own paperwork as this will happen about 75% of the time.  Make sure your agent expalins the merits of each offer.  Reject lowball offers as this will waste everyone's time.  If your bank has filed a default notice, or threatened a sale at auction, they only thing that will stop the clock is a bona fide offer near the approved price.  The bank will send out an evaluator to verify the validity of the offer.  They might initially approve a slightly low offer if it is close to BPO price.Please know too that although you may detest your bank that they may require a note to be signed by you that you will pay them x amount of dollars (Greentree wants 5% of the sales price).  This is generally much better than a foreclosure since you can buy again in 3 years vs 7 years if you get a government backed loan  (FHA,VA,FNMA,Freddie Mac)

Check with your agent if they use a negotiator in the process  ( a lawyer negotiator is the best) as they may be able to help stem the impact.  They should never charge you for the services as the fees come from the agents or sometimes the buyers. The agent can go at it himself but it is very time consuming.  Be aware of the negotiators with an "investor"  They will flip the property and this is generally not ethical.   Be aware also that they need a RE license just like your agent.

Make sure that your home is accessible to prospective buyers.  It may be an inconvience but you need as much exposure as possible to several eligible buyers and you really do not have time to stall.  REMEMBER FORECLOSURE STINGS!

I had a very alarming conversation with a listing agent today about an offer that I had submitted on his shortsale property.  Mind you, my offer was all cash and about 95% of listprice.  I almost called him daily about my offer status.  First he told me he was going to "mail in the offers"  (since when do we mail things like offers?)... a bit strange but I thought ok... on the 5th of July, I again asked about the offer and he said US BANK said he had to fax them in  ( I could have told you that!) .  Well today I called him and he said that the "shortsale agent" (to most of us its the negotiator...)said it would be 3 months before they worked the file...and he also expressed that he was not going to wait around that long...hard to believe when we use modern means like Equator and Res Net,,and we have HAFA!  ( do I smell cancelled listing here?)

I thought about his answer called my client to appraise them of the situation, called back the listing agent(who is actaully the shortsale agent) and told him that my client would hang on anyway. I also offered to help by using my resources, since I work for TITANIUM  (they negotiate shortsales) and he replied "I think negotiators are rediculous." WELL! I guess he does not want to sell the property!  I felt like yanking my offer just because of his response.

Homeowners need to be sure their agent knows how to work a short sale.  Make sure you get tons of paperwork to fill out.  Your agent should be certified for this some how ..like CDPE or PFC like I am. Your agent should not hesitate to use a specialist if the situation arises...most of the time, it is NO COST to you.  You will need to fill out an income balance sheet, a handwritten hardship letter, provide pay stubs (2) and bank statements ( 2months) and/or tax returns, as wellas fill out a release of information affadavit, andof course the listing contract and addendum.  If your agent is skillful he or she will ensure that you will not owe a promissory note of any kind and the lenders will consider the debt paid in full.

You as homeowners need to realize that you are on a time frame with your bank.  Be careful too because even if they offer a loan mod...they will sometimes proceed to sell it anyway...It happened to a family member as well as a friend of my dad's with two different banks.  Make sure you get it in writing.  It is probably better to list your home with a statement about a possible loan mod so that if it does not work out, you still have the offer to go with (and even so if they accept a shortsale.). You will then be able to buy again in 2 years instead of 5.  NEVER EVER walk away from your home....it will hurt you later no matter how much you detest your bank.

I hope I have shed some light on this and pray for a smooth transaction for you.

Did you miss the first time hombuyer's tax credit?   Well worry no more!  My association has initiated a program that is unique to any Realtor association in the country.  It provides grant money upto $7500 for your downpayment and /or $3000 HOA assistance for qualified buyers.   Basically if you make less than $100000 and can get a bank loan through a direct lender, you qualify.  You must also attend a homebuyer class but a little education always is good insurance.  The process is similar to the information needed for a loan and although you need 3 years of tax returns, that is easy if you request them from the IRS using a special form.

Here is the 411 on the program:

• Maximum income levels (1-2 buyers) $111,480 for Orange County & $99,360 for Los Angeles County.
• Maximum purchase prices is $637,645 for Orange and Los Angeles Counties
• Buyer must contribute 1% of the sales price from their own funds towards the down payment
• Buyer may not have owned any residence within the past 3 years
• Minimum credit score of 620
• Pre-approval from a direct lender, not a broker
• Minimum five-year fixed-rate loan, full documentation (no stated income)
• Applicants must be represented by a PWR REALTOR® member
• Property must be located within PWR's jurisdiction
• Short-sales must have written bank approval.

The Opening Doors program is available to any qualified buyer who purchases a property located in PWR's jurisdiction, which represents 26 cities in Central/Northern Orange County and the Southeast Los Angeles County.

Including:
Anaheim/Anaheim Hills, Brea, Buena Park, Cypress, Fullerton, Garden Grove, La Habra/La Habra Heights, La Mirada, La Palma, Lakewood, Long Beach, Los Alamitos, Norwalk, Orange, Pico Rivera, Placentia, Rossmoor, Santa Ana, Seal Beach, Signal Hill, Stanton, Tustin, Villa Park, Westminster, Whittier, and Yorba Linda.

Sorry I would love to help those in the Inland Empire with this but my association limits this to its service area.

I can help you obtain the reqired documentation as well as the form which I can email you.  You just need to ask me for it!

Funds for this program are limited so lets's get this process going now!

http://www.latimes.com/business/la-fi-ucla-forecast-20100615,0,6824904.story

Trading down: Can it still bankroll your retirement? Trading down to a smaller home is a retirement-planning staple. According to an April study by the Society of Actuaries, 20 percent of not-yet retirees say they plan to downsize after the last child leaves the nest.

Home shortages could develop as recovery unfolds Sooner or later, the economy will rebound, jobs will return and new households will form. When that time comes, however, there might not be enough housing to accommodate all the new family formations.

To read the full story, please click here: http://preview.bloomberg.com/news/2010-06-14/u-s-housing-market-recovery-dependent-on-jobs-growth-harvard-report-says.html

High default rate seen for modified mortgages Fitch Ratings Ltd. forecasts that most borrowers who get lower mortgage payments under a federal government program will default within 12 months.

The Honorable Governor Arnold Schwareneggar has come to the homebuyer's rescue.  He signed a bill that will give a 5% measured credit up to $10,000 payable in three annual payments.  Of course you have to repay it if you sell your home prematurely. On a $250,000 home that means a warrant from the state of California at $3,333 /year for three years. Not quite as sexy as the $8000 version but it helps pay for that furniture you will need.

THE DETAILS:

The eligible taxpayer who closes escrow on a qualified principal residence between May 1, 2010 and December, 31, 2010, or who closes escrow on a qualified principal residence on and after December 31, 2010 and before August 1, 2011, pursuant to an enforceable contract executed on or before December 31, 2010, will be able to take the allowed tax credit.

There has been talk too of re -renewing the federal version. Although nothing is carved in stone,I have heard that it is caught up in the Senate right now...and its reicarnation will probably be a lesser credit.  Maybe Obama can sneak that into his health care bill like he did the abortion thing!  Kinda like burying in your short sale agreement that the lender will consider the seller's debt paid in full.

I always said real estate was stimulating and I am sure it will be even more so after April 1 when HAMP kicks in and lenders really have to start working with realtors and not be so mysterious.  I already am seeing a surge in BPO orders from clearinghouses that would indicate a storm is coming.  They even send stuff at 3 am or 9 pm at night...they are still hard to get however.  Realtors need to remember too that although we like dollar signs, the needs of our CLIENT COME FIRST!  If they can manage to keep their home, then it is a good thing!

IS THAT PROPERTY TRUELY "AS IS"? (edit/delete)

There was another network that I participate in that basically revolved around a property being sold "as is" and defining what that really meant.  The general drift I got is that it is "what you see is what you get" with no room for negotiations as far as requested repairs, which I understand.  What I don't understand is why listing agents feel that they can wash their hands of the whole visual inspection  (keep in mind here I am in California and we have  an extensive contract to sign). We have something here called DUE DILIGENCE and we agents representing the buyer are supposed to owe our allegiance to the buyer not the seller.

Yet  I quote from a "buyer's agent":As Is is As Is! As an REO Buyers Agent, I drive home to every buyer or investor what that really means. Every Addendum I have ever presented says about 50 different ways in English that you are buying asset AS IS. No renegotiating contract, price and terms upon Seller's verbal acceptance. Buyer can use the Inspection for informational purposes and have their Attorney terminate the contract. I just make it simple and advise clients and prospective clients that if they want the Foreclosure Deal, then there is a price and that is AS IS!'

This does not seem like working in the best interests of the buyer...if you have to leave it to an attorney to cancel a contract.

As we know already...the reason we got a DRE is because of the need to protect the buyer perhaps  thoroughly.
"AS IS" is intened to be a catch all but I remember back 4 years ago my office manager said during training that it was not accpetable to write "as is" on an inspection. In the event you were sued, the judge would look at your report or lack thereof and cite your lack of due diligence. Some how banks became exempted from this requirement in its entirity,maybe because they never lived in the property and honestly do not know about its defective history.
The listing agent however is still "selling " a product that he or she derives payment from and therefor needs to be observant about the property as well.
Would you buy a drill from Home Depot if the sales associate could not tell you why a $299 HILTI drill was so much better than a 29.95 Black and Decker variety?. Yet that is what happens often enough in our trade and us agents that do alot of work with buyers need to carefully guide our buyers because no one else will.
Asset mangers should also look at how well does the agent represent them, ADVISING them of proper procedure( agent to asset manager) after all we are the professionals here. Too often I feel it is just a production assembly line and the asset manager just wants it done! (" Here is the BPO ..I need it tomorrow"
Some day the DRE will wisen up and require everyone to follow the same rules,make the paperwork consistent with no mystery forms, prohibit cross preapproval mandates ( maybe use a universal procedure and documents form?!)and lastly accept all types of fianancing...VA, FHA, or conventional.
I even have a chart that really spells out little difference between the two as far as inspection requirements. If it cannot pass, then the bank needs to take a hard look at it. I want my FHA buyer to have as much chance as your conventional buyer...or as somone said...a cash buying investor wants it at 50% off and I actually know a few of them in my circle ( then there is the strange things they want to do...like assign contracts...put only $500 as a deposit,or have a 60 day escrow.

All I know is that I will continue to look out for the protection and real estate well being of my clients who trust me to get them through this.  I am tired of substandard service in this industry but I cannot change it alone.

Real Estate is wrapped in fraud possibilities and I would like to illuminate them.

You are losing your home and desparately want to keep it and it is natural to want to.   Does the avaeragege consumer know they can do much of the work themselves at no cost?

Loan Modifications are, in my opinion a breeding ground for fraud.  Just noted in the LA TIMES that a LAW FIRM got into trouble for not delivering on their services.  I got a little concerned when loan mod services first apperaed not long ago...suddenly EVERYONE was an expert.  Had a prospect tell me some time ago that they were going into loan modification and I thought  "I am maybe going to be their realtor ,their source of expertise.  What do they know about loans? I don't think too much since they had tons of prequalification issues themselves.  Then my  broker told us we were not allowed to do loan mods...that only lawyers could do them.  Since when do lawyers know more about reeal estate then we do?  We deal with banks all the time trying to get clients approved.

Then comes INVESTORS.  They claim that they will deal with the bank...of course then they will undercut the bank (why would someone take LESS for a property than it is worth anyway?)  Then they will bring in a buyer to sell at full price....oh they claim to pay us realtors a double commission.  I read on the CAR.ORG website that this was unethical and could get the attention of the judicial system. Of course the investors don't realize that THEY NEED A LICENSE TO BUY AND SELL PROPERTY for another.  Unethical,illegal behavior!

The only assured way is to attempt a short sale.  I say attempt because the bank is a smarty pants.  I submitted one offer on a short sale.  The listing agent told me that the Bank wanted the owner to sign a $50,000 promissory note.  The owner declined.  This is not the first time I have heard of this.  There is a reson for all that apaerwork the homeowner fills out...full disclosure which we as professionals all must do.

Short sales are beneicial to the homowner too...they have less negativity on their credit overall and they help the rest of their neighborhood by keeping vacant homes to a minimum which drive down property values.  In the long run a REO property will cost a bank MORE to maintain.

I hope everyone has learned a little today. I am here to help.  Let's keep our profession a respected one.

Wow! It seems as if the competition is similar to that of five years ago of trying to get an offer accepted on a bank owned property. If you don't offer the right amount or even have the "right" lender, one can easily be discouraged.  Most REO listing agents will not submit your offer to the bank unless you go through their lender.

I have put together some key points about dealing with bank property:

Bank Owned Facts to Know:

• Purchasing a home from a bank is much different than buying from a homeowner. If a problem is found during the home-buying process, it may take the bank longer to resolve the issue than it would a homeowner. As with short sales, home buyers need to be aware that foreclosures can take longer because most banks are overwhelmed with properties and do not have enough qualified staff to handle all requests.

• In previous years, when home prices were increasing, banks didn’t have to keep foreclosed homes on their books long. Often, investors would purchase the foreclosures through court auctions. However, as home prices declined, especially in the past two years, many investors decided to delay purchasing new properties. Banks then had to concentrate their efforts on selling to thegeneral public, which often takes longer.

• When a bank repossesses a home, it typically engages a lawyer to determine whether there are other claims on the property. Generally, the lawyer only is paid to look at the time from when the owners took out the mortgage to the time the bank repossessed the house. Any pre-existing problems, or new ones, usually surface at closing time, when a more thorough search is performed.

• Buyers should be aware that banks usually sell homes in an “as-is”  condition, and on their own terms. Although buyers are informed prior to beginning the home-buying process, some are unwilling to agree to the bank’s terms when it’s time to finalize the deal and sign addendums to the contract.

IS the end of the recession near?

It seems forever since I last posted but this is truely a terrific market for the buyer.  Some key points to remember however:

• Not all sellers will accept an FHA loan, especially bank owned property.
• REO prices are artifically low and are misleading because they incite fierce competition which drives up the price, as much as 10% more over list price.
• Private sellers tend to still ask more than their home's worth.
• Short sales are actually the best place to get a deal if you are patient.
• Rehab loans do exist to help improve a maintenance deferred property.
• Buying direct from the listing agent takes away many of your protections and using your own buyer's agent dose not cost you a dime.

Please comply with a agent if they want to consult with you prior to seeing property.  They are not tour guides.  If that person understands your goals, they will actually save you time in finding that ideal home.  If they show you property, consider buying from them exclusively. Sign the buyer broker agreement if they present it to you.  They will likely work more diligently for you.

I wish you all fufillment in buying your piece of the American Dream.  Buying a home need not be intimidating but be a exciting time in your life...

I have notice that there is alot of hype and misinformation on the stimulus package as it affects real estate.  I am going to set the record straight.

First...all first time home buyers that CLOSE an escrow before December 1 st will get UP TO an $8000 refundable tax credit.  This will not have to be repaid.  If you bought your home prior to this version of the credit, you still only get the $7500 credit which is not really a credit at all because you repay it over 15 years.

Second... No check in the mail this time.  You will see a very modest increase in your take home pay...about $13/week on average from federal tax relief.

Third...IMPROVE THAT HOME!!! Energy efficient doors and windows qualify for a 30% credit, up to $1500.

There are other more generalized provisions, like health insurance and help for local government programs.

As always it is important to moderate the hype.  Be careful  with emails or advertisements claiming to know the "secret" that the government wants to give away money through little known programs or programs that net more stimulus payment.

Finally beware of realtors claiming that they can use the stimulus payment to finance your purchase...they cannot as that is strictly a tax credit.

FHA loans still REQUIRE 3.5% down and there is no way around that.  Beware of 100% financing...sellers 95% of the time do not accept it, even if it exists.

Like the Obama Stimulus Package, I want to stimulate your home buying experience.  You can count on me to get accurate information that is straightforward and plain. If you want to purchase or sell, I will get you there.  That is the bottom line.

This probably one of the shorter entries I have done but I have been thinking of the economy.

There is a lot of confusion in the economy right now.  The media hypes the subject and magnifies the negativity.  The presidential election looks like Obama but the debates are a dead heat.  Everyone "has " an answer.

The truth?  There is opportunity everywhere and not just where you would expect it to be.  Bank owned properties continue to be a good deal.  As it is I have a realtionship with a bank that I will have firsthand knowlege of unlisted property that I can get an accepted offer at 10% off of list price.  To boot,I can get as many as 8 cosigners on a single home loan to go through! (It helps to have the right people in place.)

The stock market will soon have some incredible deals of its own.  It will soon be possible for as Sarah Palin puts it "Joe Six Pack" to own a decent stock portfolio.  (no, actually I am not sure who I am voting for right now).

Just think about it and look for hidden opportunity.  It is there.  Get a group of people togther and pool your resources.  America is the land of innovation. Yes, you can buy property under certain conditions for $500. down.  Its called section 8.  Go for it.  I will get you there.

The mortgage market is a mess indeed and everyone talks about loan reform , etc.

The REAL reform that needs to be done is have loans that actually make sense.

 Have you ever realized that if you divide a $300000 price tage by the usual 36 years or 360 months, you should get a base payment of only $833.00? Instaed this payment hangs around $2400 /month.  WOW!!! That is a difference of over $1600!!! And that is interest mostly and a little bit for taxes and insurance.  What should happen is this :  $833 base payment + $200 interest /month + taxes and insurance   (about $1500/month max) and then you get a loan that people can afford and real estate will rise and everyone becomes able to buy. Instead you can see where loan corruption was allowed to creep in with exotic approaches.

Other than this, the coming year will bring new things to home buying like a new federal tax credit for new home buyers and other options like better interest rates and down payment assitance loans.

Tell me what you think... I will be here.

Well, it has been sometime since I last blogged.  I guess you could say I have been busy writing offers.  Indeed this market is so active that I showed an REO tonight at 830 pm!!!  It was in the Los Angeles Times that sales volume is up over 30% from last year!

I wanted to talk a little on what goes into today's offers.

This is a very good market for well priced properties.  Properties sometimes do not last more than a few days and there is much competition.  It is not uncommon for there to be several offers at once.

How can you best prepare for this onsalught?

First  always have the folowing ready BEFORE househunting:

• preapproval letter or underwriter's certification  (even better!!!)
• stay away from 100% financing.  Even if it is available, there is low probability that you offer will get accepted.  10% down offers get noticed!
• have a copy of your FICO score...it shows you are reliable and able to fulfill your loan
• have a bank statement handy to back up that you check for the deposit will be good when it goes into escrow.
• be ready to go over list price...these properties are so well priced that they MAY go as much as 5-10% over list  and they do!!!

When looking at bank owned property, bring a flashlight and ladder with you if possible, along with gloves.  Many properties are in need of repair and you may need to inspect things.  If you go home to think about it and get your equipment, it may not be there when you get back.

I also wanted to spend a little time on finance.  I drew this from an article I got from my loan officer.

On top of this, the Housing and Economic Reform Act of 2008 does actually have some provisions that could make a difference in our housing markets.

One really interesting piece that was included in this legislation is that for first-time homebuyers (Definition of a First Time Buyer: Someone who has not owned a property in the last 3 years.), they have a window to qualify for up to a $7,500 tax credit. The tax credit will be 10% of the purchase price of a home, up to a maximum of the full $7500 credit. Basically, if the house is over $75,000 they would get the $7,500 maximum. The tax credit will have to be paid back over a period of 15 years which is interest free. It breaks down to about $500 per year. Washington just provided first time homebuyers a 15-year interest free loan to motivate them to buy a home!

It should also be noted that most of the news stories have gone way overboard on new lending guidelines by portraying a market where there is almost no way to get a mortgage. THIS IS NOT TRUE! We can still do loans with as little as 3% down and close them with no problem in 30 days or less. Debt to Income ratios of 55% are still being approved. Fixed rates, interest only and adjustable rate products are all still

So there you have it... let's go invest in something today!

Buying property is beleieve it or not challenging.  This especially true when the property is perceived as a good deal.  I recently wrote an offer for a property that was listed at one price and supposedly was going for $75,000 over list price.  While we could debate that the listing agent mislead everyone by underlisting it in the first place, we could could also establish that our preapproval needs to be accurate.  What I mean by this is that just because you have a preapproval for $350,000 does not mean that is where you shop at.  Allow yourself some room to negotiate, and sometimes for a extemely well priced property, this means paying over list price.  If you get preapproved for let us say $230,000, $215,000 is where you look. 

If you want seller concessions, expect to pay more upfront.  This means closing costs and seller assitance gifts with the downpayment will increase the final price.

You might also consider that low priced property buyers sometimes have cash on hand and this will nearly beat out a financed offer every time.  This is sad but true. 

REO property while appearing to be easier to buy, can actually cause more anxiety due to bank demands.  Watch out for mandated financing which is illegal if they make you use their lender.  They can ask for cross-preapproval but nothing more.  Keep those financial docs handy.  Cooperate fully with your agent when buying these properties, as much information will need to be exchanged.

And......

if you need to find out how much house you can afford, fill out my online loan application.  It is the same form lenders use but the advantage working wih me is that I can match you to the right loan without having to resubmit paperwork, especially to sellers that want cross-preapproval.

I has been quite some some time since I last posted on my blog.  The reason?   It is a fantastic time to buy a home.  Open house traffic is up 200% from the previous year.

A new means of purchasing a home has arisen and will have a stronger presence than ever before because they won a ruling from that they must have the same access to listings as traditional brokerages do. Redfin.com is one example.  Yes you can buy from a online ad jsut like books and music.  We already know that online stores are generally on par with brick and mortar stores as far as price, and then there is shipping and handling.  Yes, buying online is convienient.  Would you however buy something that costs several thousand dollars  off of an ad?  Hmmmmmmmm.

Basically, they claim to save a buyer thousands of dollars off the price of a home.  Do they really?  Let us examine what they do.

They basically claim that the buyer will be rebated the majority of the comission (66%) after they purchase their home.  Sounds good doesn't it?They claim they have experienced agents negoiate the deal and so called junior agents show the property. Wow! Great service... all that service and you get money back!

Selling a house is very time demanding to an agent. A typical client will want to see in excess of 10 properties.  That same client also has online resources.  It is estimated that 85% of all buyers use some type of online real estate listing service. 

A good agent will sit down with the client and find out what the client is interested in.  A good agent will not pressure a buyer into a particular house. A good agent will provide you with online information tools to help you choose your home.  A good agent has a written performance guarantee.  A good agent cultivates long term relationships.  You are not just a transaction ...you are a person.  A good agent will negotiate the best deal for you and get you the best financing.  A good agent will present your offer in person wherever possible. 

Tell me then ... would you like to have a realtor give you full service and get you the same price that an online broker will do?  Oh yes I forgot; will the online agent deliver documents and bring YOU  information  that you need?  Te convential agent is going to work hard for his or her commission and that is after the broker (the boss) takes his cut. 

I think the answers are clear.  If you want personalized service then go MAMMOTH! I am here to help.  Let me use my negotiating skills to benefit YOU. By the way, if it takes you two years of using my tools to buy a home then you are welcome to it.  I will be here when you are ready.

I was looking at the dry erase board and saw how one whole column was filled for the month of April in sales.  Amazing!  Like I was saying, the market is heating up, bad news from the media not withstanding.  I looked at the other side of the board and saw that it was barely half full in new listings.

What does this translate to?  There many buyers competing for a few properties that are priced right.  At this rate the current inventory will shrink and home values will tick upward again because you and I know that the surplus cannot go on for long.  As it is now, I know people that lost out on a house that they desired because the either waited too long or decided to get approved AFTER finding a home.

Even if you are contemplating selling, but want to hold off on it because the market is not  "right", consider the real deal that you may get a larger home for just a LITTLE more than you pay now because the price that you buy into is lower, unless of course you bought when the market had peaked and in that case I would recommend holding on for about 5 years or there about.

In any case, get your financial means in position by checking your credit score,  having at least 5-10% down in the bank (use your "stimulus " payment as a starting point, and give up going out to dinner/movies one time per month.  Your budget will yield all sorts of money.

If you are truely ready, fill out my online loan application on the button "qualify for a loan".  The application gets faxed to me...no other middlemen or spamming, selling of information ,etc will occur.

Meanwhile I am going out tomorrow to find you your ideal property.  Call me to see what I found for you.

Usually I don't sound an alarm to things of a real estate nature but I aquired knowlege that our government in Washington is up to something that may as well affect buyers and sellers alike.  There is a plan currently afloat that the government is going to step in and shore up mortgages.  Initially this will affect those facing foreclosure as the banks will be asked to refinance thier distressed loan at 80% of their value. 

What does this mean to you, watching the market and determining whether or not to buy/ and or sell?  It means that prices will have bottomed out as I have said in the past that they have and may start inching up again as the inventory leaves the market.  While this may not return things to a seller's market there will be slight increases in price.

As said before, as prices go up interest rates decrease and vice versa.  Any savings in price may be negated by interest rate increases. The reason why money is inexpensive is that the government is trying to spark the economy to little avail.

Seriously consider your  real estate goals and the motivations behind them.  If you need extra space or want to graduate to home ownership, now is the time to act. Don't be tempted to buy property to flip it because the costs to resell it in a legal manner will negate the marginal profits.

Never forget that a real estate transaction is a complex process that can be costly if done the wrong way. Saving money on fees will not save you from headaches.  Stay away from those that claim to know a secret way of getting something for next to nothing. Fully comply with disclosure documents and statements.

...and in the end enjoy your new investment, whether it is for you or your portfolio.