Mother & Daughter Blog: August 2007

$220,000 with $7,500 cc & carpet credit. Great for 1st buyers. This is a nice charming 3/2 with vaulted ceilings, with open floor plan, large kitchen, breakfast area, formal dining area & living room with fireplace.(1340 sq ft./lot is 5663 sq ft). Located in Tempo Park area with schools & bus stop within 3 blocks. This is a short sale upon lender's approval. Only serious & pre-approved buyers. Seller is motivated. All offers considered. Buy NOW!

Call listing agents: Rosemary or D'Adrea - 866-750-8282
Want a showing, please give agents a call first - Owner is in home.

Short sale: Price, expense, commissions, conditions and terms are subject to lender's approval. Commission will be split 50/50 upon lender approval. Pre-Approval letter must accompany all offers to be considered.

MLS: 70090397.

Open House Schedule:

9/1 & 9/2; 9/8 & 9/9; 9/15 & 9/16

(from 1-3pm each weekend)

The biggest challenge in today's mortgage environment is probably how to qualify borrowers on today's higher rates.  According to my Indymac rep:

"One answer is Indymac's aggressive TEMPORARY BUYDOWN PROGRAM!! We still allow up to 6% seller credit which can be used to do a Temporary Buydown as low as 3% lower than the note rate! The really good news is that the borrower only needs to qualify at the initial interest rate and given that some of our programs allow up to a 55% DTI, even for Interest Only, Temporary Buydowns will allow you to qualify more homebuyers."

Said it was ok to share.  If you don't know about this, please check with Indymac.

They offer:

• 3-2-1 buydowns
• 2-1 buydowns
• 1-0 buydowns

Let's say you're doing a 30 Yr Fixed with a rate of 6.875%.  A 3-2-1 buydown would drop the rate the first year to 3.875%, 4.875% the second year, 5.875% the third year, and 6.875% the rest of the 30 years.  A 2-1 buydown would drop the rate the first year to 4.875%, 5.875% the second year, and 6.875% the rest of the term. This enables your borrower to QUALIFY AT THE INITIAL INTEREST RATE and then ease into their loan payments. You don't have to try and overstate their income because with a Temporary Buydown, they'll be more likely to qualify Full Doc. There is NO neg am because the difference is paid for with the seller credit.

What's so great about Temporary Buydowns?

•1)       You can qualify your borrower on the Initial Interest Rate!

•2)       The DTI limit would still be the same. In the example above, you can go up to a 55% DTI and still use a 3.875% Qual Rate!

•3)       A lower Qual Rate allows you to go Full Doc and thus get better pricing!

•4)       You can even qualify your borrower on an Interest Only Program!

•5)       There is NO negative amortization!

I am not heavy in this and what it all means, but I will pass it on -- hopefully it will help you in your efforts to get qualified buyers.  Or ask your loan officer if they offer this.

Any suggestions, tips or anyone want my lender's name???

blog tipbit... 

Every second, 17 blog postings appear on the Web.  The most popular blogging languages are:

• Japanese - 37%
• English - 36%
• Chinese - 8%

These figures are according to Technorati, a blog that tracks blogs.  Starting a blog is a snap.  Since you are reading this, Welcome to blogging! Welcome to AR.

Blog: A blog is often a mixture of what is happening in a person's life and what is happening on the Web, a kind of hybrid diary/guide site, although there are as many unique types of blogs as there are people.

The Fed's are looking for 32,000 pensioners!  Go to pbgc  and see if your name is on the list.

The federal organization guaranteeing pension benefits owes these missing people a grand total of $133 million.  If found, the beneficiaries would receive anywhere from $1 to $611,028 from the Pension Benefit Guaranty Corporation; the average benefit is just under $5,000.  The lost pensioner typically started working at companies when they were young, stayed on long enough to be vested, but didn't keep their address current.  Othere pension holders became part of the corporation's database when they could not be located after their former employer went bankrupt, merged, or moth-balled its pension program.  To see if Uncle Sam owes you a bundle, go to: (PBGC) pbgc.gov/search.

If found please contact the Pension Benefit Guaranty Corp.

You know the saying.... Home is where the Heart is?

Hopefully, this will answer the questions:

• Why buy a home - with so many losing their home right now 
• Why not continue to rent as I am doing isn't it easier to do
• why, why even try to get a loan in this mortgage stall that is going on?

Well, I can't tell you how or what efforts to take to spend your money... but I'd like to jot this reminder down for your reading: Hopefully they inspire you to keep on trying to buy and finding your dream home.  It is a buyer's market, all you will need to do is make sure you have done your homework and have your credit scores up, can document your income, credit history is up to par, and you are gainfully and stable in your employment.

You can go out and purchase the the lovely home that have been dreaming about. 

Home is....

• Where the heart is 
• Where you cultivate
• Where you nurture 
• Where you give comfort
• Where you receive comfort 
• Where you set down roots
• Where you grow wings

Have a home that you love helps you refect what is most important to you and in turn becomes an important part of who you are.

At the end of the day it is the place you want to be most of all.

Don't give up you on finding your dream home.  Its still out there for you and with the proper help from an agent, good financing and your ready, williness and ability.... you will have that place to call home.

There are steps for you to take to ensure you are Ready, Set and can Go get pre-approved, find an agent that you like and start shopping. Call your loan officer and get the process started. When you know what you're worth and can afford, then let's go shopping for that dream home you've been dreaming about.

First and foremost:  The seller should seek advice from his/her tax preparer.  Each homeowner's tax circumstances are unique and need to be evaluated to determine the net tax effect.

According to a local CPA:

Generally speaking, if the loan was PURCHASE MONEY for a primary residence or a vacation home, the shortage on the payoff will not be taxed as income.  Likewise, if a refinance loan was for HOME IMPROVEMENT on a primary residence or a vacation home, the shortage on the payoff will not be taxed as income.

If, however, the refinance was for furniture, debt consolidation, school, or any purpose other than purchase or home improvement, the shortage on the payoff is likely to be taxed as income.  Additionally, shortages on INCOME PROPERTY are likely to be taxed as income.

In all cases, the IRS considers whether or not the sellers are otherwise insolvent.  If the sellers are in bankruptcy, the shortage will probably not be taxed as income.

LAST BUT NOT LEASE (and worth repeating), the seller should seek advice from his/her tax preparer.  Each borrower's tax circumstances are unique and need to be evaluated to determine the net tax effect.

Sellers should never rely on the real estate agent to tell you exactly how you will be affected with the tax after a short sale, because they won't really know.  We are obligated to advise you to seek professional advice from a tax expert.

Due to the market short sales are on the rise.  Nobody likes a short sale but in some cases it is a solution to a bad situation.  Lenders are not just going to approve a short sale - just because you are behind in your payments.  There are some requirements that the seller must meet in order to complete the short sale requirement package and above all others: Seller must be in a valid hardship with proof, and must present a reasonable offer for the property. 

If you want the whole scoop on what to do to see if you qualify for a short sale, and what the pre-foreclosure process is --- there are several blogs on this subject, there are several agents with experience in short sales that are willing mentor you -- Just ask.

See read: The rankings are in from the top 20 - and also check out Mike Mueller's site on foreclosures.

Well AR its my vacation time....

I am so blessed to be able to go on vacation this year.  The sales are not what I had hoped or set goals for but I have an opportunity to take a vacation and I have surrender to the temptation --- well in a way I have.  I have decided that as long as it can be a working vacation... I can do it.  I know! I know! You gotta be creative to pull it off.

Well, first let me say that I am not going to the Bahamas, Jamacia, Mexico, Hawaii, Florida and no cruise is on the schedule of places to go. I'll just say its because of weather so that you won't think that I am whinning... 

But let me just say that if I had reached my "mid-year" goals I could possibly have gone elsewhere.  This market meltdown has caused some change of plans at least in my household it has.  And should it start to pick up I don't plan on being somewhere laying in the sun and not having my laptop on and doing something to make sure that our team is right in the mix.

So you guessed it, I have a friend that knows a friend that I can go visit and relax a little, but take my pc to continue working just as if I am at my home office.  Now if I sound bitter, I am not.  I am sure I will find something to do to have fun and when I come back I will tell everyone I just came back from vacation but the truth is... I will be working.

.

 I CAN"T STOP THE RAIN!  

And on top working on my business, I will not miss out on posting and reading, and reading and posting on AR. I figure this will be good because if the meltdown cools off and the market pick up -- I'll find out about it on RAIN! smile

I will be going to Winnsboro, Louisiana - where the....?? is that ?? Well you might not know where it is but you know the weather will be H O T! And those rain pockets will cool things off.....Hopefully, no tornados of threats of such... but positively...(I will get good cooking and friendly faces).. gumbo, fried fish, bbq, shrimp, rice and oh I could go on and on. 

 I love visiting Louisiana and this trip promises to be fun -- even if I end up working more than one would do on a "VACATION".

Here is just some of the items I will taking on my working vacation besides just my usual vacation clothing and items..... 

• Sunshades
• a big smile
• Laptop
• My Hot files, with all the phone numbers associated with them! 
• Default lists, preprinted default letters, envelopes and stamps (going to do a mailing while there)!
• Credit card to order more post cards to have delivered and ready for me when I return
• Correction write out, pens and oh yeah my RSA SecurID - so I can log on to MLS! Can't forget that
• my camera - might take a few flicks for my "vacation book"
• my cell phone and will have jott capabilities, will have callwave working so that I can get all my messages via text -- gotta keep up with my calls.  And yes, you bet I will be making call backs all during the day!
• my laughter!
• And a few other business type equipment to keep me busy

So by now you're convinced that I am going on a "working vacation" if there ever was one. Right?  I don't want to let an opportunity pass me by just because I am on vacation!!!  Now I would not have that to worry about it the market had been nice to me and the rest of the nation during the last few months that have passed me by this year!  Thanks to the meldown. But I have faith that anyday now, it will lift and it is going to get busy!  And I am ready.

But nonetheless, I thank God that I am able to take this working vacation and that I still have my smile and laughter to carry along with me, plus my laptop!

I heard a song the other day: There is hope: You don't have to pay to smile and you don't have to pay to laugh, you'd better thank God for that!  And I do.

Happy working vacation to me.

By now we all know what going on with the lenders and housing -- if you don't know it all you know some of what is going on. I continue to educate myself on what is going on and I am increasing my awareness of downside, the mass impact and the options.  It occured to me that we have not heard from the credit union and they do a large amount of lending to their members and there are a large number of members all over at several credit unions.

QUESTION:  Who haven't we heard from during all this chaos? 

ANSWER:    The member-based credit unions!

Just a recap... the leading stories that we hear on the television, internet, radio, and all over unless you are under a rock and even then....

lead stories

1. Softness in the housing industry
2. Declining home prices in some areas
3. The problems facing the subprime mortgage industry today.
4. Foreclosures
5. The stress of the poor loan options

The credit unions' mission is "to encourage habits of thrift." and if you base it on what we are NOT hearing in the news about credit unions lending, they are doing very well with that approach - here are some of the "we pride ourselves with having" list from credit unions:

1. Careful lending policie
2. Conservative investments
3. Strong capital base
4. A safe and sound member-owned financial institution (in most cases)
5. Secure while others are faltering
6. Loans secured are made to qualified borrowers and their borrowers have a good record of being extremely conscientious in making the payments on their loans. They don't seem to be making or offering the unsound and high risk loan products which are the underlying causes of the failures in the mortgage industry. 
7. Uses internal sources of funding for our loans and we are not facing the credit crunch 
8. Have strong portfolio that is performing well and we expect to continue.
9. The remain strongly capitalized.  
10. Safety and soundness remains a priority

Now, many in the national media are recognizing the values and benefits of credit unions. Here are a few recent articles you may enjoy.

• MarketWatch
• USA Today
• MSN Money Central

I take this time to say THANK YOU credit unions for hanging their with your habits of thrift  -- you have been a good answer to your members.  Maybe mortgage companies that are not practicing this should take hold.

I was talking to a house inspector and he was telling me something that I wanted to share.  Not that you don't already know it but it is worth reminding agents.

Be careful of inspection report and know what they mean. Don't just take the word and not review and research before you let your seller get cheaped.  Get a second opinion as often as you can. If not in person, do some calling around and take notes.  Once you've lived through a bad experience, I think you become smarter to the tricks of the trade.  Just like any other trade, there are tricks.

Increase your base knowledge to make yourself more valuable to your client.

Remember buyers are looking for a deal -- but even more in this market and time.  They want the lowest price, but on top of that.. they want the highest credit back for closing costs and repairs. Even and especially in this "short sale era".  They tend to overlook the disclosure that the property is sold "as is", they still want the lower price and the credit backs and are not ashame to ask.

Where else can the buyer get you?

One place is inpection reports that are legal, but over inflated to say the least.  In other words they are lies but done in a way that is not illegal. Just not the "real picture". 

             DO NOT BE FOOLED BY THESE INSPECTIONS Recommendations _ Check them out.

Here a couple examples:

1. Inspection report finding:  Roof has minor damage to a small area.  Inspection wording: Major roof damage. RECOMMENDATION:  Replace roof.  To add to that the estimate includes using highest  prices for materials. Truth: There is some damage that need repair but the whole roof is not damaged and does not need a whole new roof - which is dollars above what the actual damage would cost.
2. Inspection report finding: Water has penetrated through the kitchen counter top and has caused fungus damage. RECOMMENDATION:  Remove the existing counter top.  Remove and replace any fungus damaged wood members. Install a new ceramic tile counter top in this area. Unless prior arrangements have been made, white tile will be installed.  It should also be noted that all tile work, regardless of color selection, will be done with a tight white grout joint, unless specified differently.Truth: The termite company is recommending the replacement of the ENTIRE counter top even though these are "standard grade" tile that are available at any tile store.  If damage is localized, why not simply repair the damaged area? The damage is really just around the sink, the entire counter top does not need to be replaced.

These are just two examples of what to look out for.  ... the solution.

• Educate your yourself and your clients.

Do you have any experiences to share? 

I just had a tenant talk too much about the property I am selling and she is renting!  Since the saying "you never know who you are talking to" is true, it has been proven yet another time in this situation.  One of my listings - which is a short sale - is a pretty nice property and it is certainly worth the price that it is priced at to sale.  The inside is great but it is hard to see yourself in it because of the way the tenant "WILL NOT CLEAN UP" for either a showing or an open house.  I have complained to both the tenant and the owner but nothing has improved on that end.  But that's another subject....

So anyway I have to do what I have to do to sale this property, so I over look the mess and hope that the potential buyers can do the same.  However, her mouth is running a mile a minute and I didn't know it... until I received an offer than it is with someone I have never seen.  They just happen to know the neighbors next door and this tenant went over to the neighbors telling them that the house will never sell because of this and that. The neighbor told these "interested buyers" and they figured they could buy it dirt cheap and get the deal of the year in the meantime.

So I received an offer!  Don't get me wrong I am happy about the offer and I have reviewed it with my seller and countered it back to reality and yet it still maybe something the buyer can live with.  But it took creative thinking to do so and lets just hope the bank will approve it. The thing was the agent called me and was telling me the bank got to take this offer because nobody is going to buy the house in the shape it is in!! I have never spoken to this agent before and I was wondering where she was going with this -- was it just her negotiation try with me or what?  Then... the offer came over the fax! It was clear at that point.

But getting back to the tenant talking.  I had to go back to her and ask if she had spoken to anyone about the property and what did she say?  She said she had not spoken directly to an interested buyer that she knew of but she had told the neighbor the "whole story".  So to find out what the whole story was I listened. I explained to her that it is my job to disclose what is going on with the property and that is true even to an "as is" sale and that I'd the opportunity to do that instead of her doing it for me --- her way!

Her story prompted me to ask if she had an estimates or proof for what she was now telling me - since I had spoken with her at the beginning of the listing to ask what she knew was wrong with the home.  I asked if the roof was leaking and if yes was there any leaking damage that I missed?  She said no.  She had said something about air/heating too, which was news to me.  She had told the neighbors and whomever else that it needed replacement.  I asked her if it was broken or just needed a service inspection and maybe parts replacement (which is a big difference).  She didn't know.  She claimed that she had an estimate but could and have not produced those estimates to me. So I had the roof and air/heating professionals come out and give me an estimate and this will be incorporated into the offer (if the buyer actually accepts the counter).

I immediately ask the tenant to just refer anyone that wanted to discuss the house to me.  She has my cards and all information she need to send them to me.  I also called my seller and advised him to talk to his tenant and ask her to please don't trying "help the sale".  He stated that she is angry that he is selling and want to show people that it is not worth buying.

So beware --- every one may know more about the property than you and just maybe spreading word -- in the wrong way about the property.

Have you ever had this kind of situation happen to you?