~Never take counsel of your fears~
(Andrew Jackson)
So this week, I was talking to a young couple I know that was about to
close on their first home. They were riding the wild roller coaster of
current mortgage rate swings and were not happy about the process at
all. Yet, when they spoke about finally living in a home that they own,
their disposition changed dramatically.
A smile came across
their faces as they talked about decorating the house and how much they
will enjoy entertaining in the backyard. They talked about inviting
friends over for dinner and their family over for the holidays. The more
they talked, the more excited they became.
I asked them if
many of their friends were also buying. I was shocked to find out that
they weren’t. Why not? Their friends believed that home-ownership was
financially unobtainable right now. Many wanted to own but didn’t think
they could afford the monthly mortgage payment. They decided to rent
instead.
I said that, with historically low interest rates and
prices where they are today, owning a home might not be any more
expensive than renting one. The couple agreed but said their friends
were AFRAID; afraid they might not qualify for a loan, afraid to handle
negotiations with a seller, afraid of the home buying process itself.
Wow! I've heard of many reasons, but afraid? People should not make any
decision based on fear. I’m not saying that every young person should
own a home. I am saying that anyone that is qualified and wants to buy
should not be afraid of the process.
I realize the process may
seem daunting but realize over 10,000 homes sell every day in this
country. Sit down and discuss your goals with professionals from both
the real estate and mortgage industries. Get the facts. Make an informed
decision. Don’t let the fear of the unknown prevent you from living the
life of your dreams.
If I can help alleviate any fears, please feel free to contact me.
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Ways to Prepare for a Home Appraisal.
#Realestate #Appraisal #Home #Sellers
The appraisal stage of a contract is one of the most anxious periods
any home owner has to face. It determines the value of your house and the
amount you would receive on selling it.
Whether or not your home gets appraised to a decent price is a matter
of great concern for owners. Experts suggest home owners take some
necessary steps to secure good appraisals for their house.
1) MAKE YOUR HOME APPEAR PRESENTABLE.
Pay attention to every nook and corner of your home and find out what
needs changes or repairs. Present your house in its best state before
the appraiser arrives. Change the linen, put up clean and decent looking
curtains, and get the walls and floors polished. See if there is any
part of the house that needs to be repaired. Also keep your yard clean
and green to make the right impression. Even the smallest negligence can
cost you a great deal.
2) CLEAN AND DE-CLUTTER.
Clean
homes always make a better impression on anyone so let your appraiser
also be influenced by the cleanliness of your house. Remove any clutter
that might have accumulated in the cupboards, closets, etc. Make your
home look nice and tidy. A fresh smelling house is also a pleasure to be
in, so try using some air fresheners before the appraiser arrives at
your place. These tiny things may not be complete in themselves,but they
can form a strong first impression on the appraiser’s mind which can in
turn mold their judgment to a more positive one.
3) GIVE A LIST OF UPGRADES AND MAINTENANCE PERFORMED.
Keep the receipts or some other proofs of upgrades that you have had in
the house in the recent past. Let the appraiser see that you pay due
attention to the maintenance of your house. They are likely to make a
more favorable decision if they sense this. If you have installed high
quality equipment in your house, do let the appraiser know of that too.
4) BE HOSPITABLE WITH THE APPRAISER.
Welcome the appraisers nicely, treat them hospitably, and you’ll see
the result of your good behavior in your appraisal document. If there
are pets in the house, it is best to lock them up for the time being
till the inspection is complete. Try to create as little disturbance for
the professional as possible. Even children should be minded by someone
for as long as the appraiser is in your house doing the inspection.
Selling your house is a major decision and involves many complications.
The biggest one for most people is to get the right price for the
property. However, you can avoid many of the hassles by following the
above mentioned steps. These will only require a small investment of
time and money from you, which will be more than compensated in the
appraised price you would get as a result.
Hope this helps and as always...If I can be of assistance, I'm here if you need me.
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10 KEY QUESTIONS TO ASK REAL ESTATE AGENTS:
Selecting the best agent to list your home for sale and asking the
right questions are key components to a successful sale for top dollar.
By asking the right questions listed below you will maximize the probability of a successful sale.
1) HOW MUCH CAN YOU GET FOR MY #HOME?
The best agents will prepare a written #CMA
(Comparative Market Analysis) form to anticipate your question. If an
agent doesn't leave their CMA with you to study, that agent doesn't
trust you.
2) WHAT ARE THE NAMES, ADDRESSES, AND PHONE NUMBERS OF YOUR 5 MOST RECENT #SELLERS:
The best agents will include this information in their Listing
Presentation.Before signing a Listing with any agent, contact their
recent #Sellers to ask, "Were you in any way unhappy with your agent and
would you list your #home again with the same agent?
Listen to the answers closely, especially if the recent Seller hesitates or gives a vague answer.
3) HOW LONG HAVE YOU BEEN SELLING HOMES IN THIS AREA? ARE YOU A FULL-TIME #AGENT? WHAT COURSES AND DESIGNATIONS HAVE YOU COMPLETED?
Just because an agent is a beginner, that's not necessarily bad. He or She will probably have more time to devote to #selling your #home than will an "old pro agent" who carries many listings.
However, be sure a new agent has adequate supervision from an experienced brokerage office manager.
4) WHAT IS YOUR MINIMUM LISTING TERM?
The correct answer is 90 days. Be wary if an agent insists on a
six-month Listing, unless that Listing includes an unconditional
cancellation clause after 90 days.
5) HOW MANY LISTINGS DO YOU HAVE KNOW? DO YOU HAVE AN OFFICE ASSISTANT? WHAT % OF YOUR LISTINGS SOLD IN THE LAST 12 MONTHS?
Watch out for a numbers agent! These are #agents
who have dozens of Listings and one or two Office Assistants. They work
on Percentages, knowing a certain percent of their Listings will sell,
so they want as many Listings as possible. If you List your home for
sale with a numbers agent, be sure it won't get neglected.
6) WHAT SALES COMMISSION RATE DO YOU CHARGE?
Most REALTORS® will tell you the "#standardcommission" is 6% (or 7%) but #NAR (The National Association of Realtors), in a recent study reports the average nationwide sales commission is 5.1%
7) WHAT IS YOUR #MARKETINGPLAN AND WHAT SERVICES DO YOU PROVIDE?
This question is closely related to the sales commission rate.The best
"Full service" agents will prepare a written list of all their #marketing #services.
8) OTHER THAN YOURSELF, WHO IS THE BEST REAL ESTATE AGENT IN THIS AREA?
The best agents will honestly answer you question.
9) IS MY HOME READY TO SELL OR DO YOU HAVE SUGGESTIONS TO BETTER PREPARE IT TO EARN TOP DOLLAR?
Some agents will want to avoid answering this key question until after
you sign their Listing. But you need to know the answer before signing a
Listing with an agent.
10) SHOULD MY HOME BE SOLD "AS-IS?"
Most states now require home Sellers to fill out a Disclosure statement
listing any known residence defects that materially affect the #marketvalue. This procedure avoids after-sale lawsuits if the #Buyer was informed of all defects.
These questions should serve as a guide to helping you choose the right
Real estate agent. If I can be of assistance, please feel free to
contact me at:
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★Economic Update for the week of July 5★
#Realestate #Market #Economy #Mortgage #Rates
This holiday week was a short one for many but it ended on a high note.
Mortgage rates stabilized Monday, Tuesday and Wednesday a bit after spikes over
the last few weeks before rising sharply today after the jobs report
was announced. Freddie Mac’s Weekly Primary Mortgage Survey found that
the average for a 30-year-fixed conforming mortgage was 4.29% percent,
down from last week’s average of 4.46%, The 15-year-fixed rate average
3.39% down modestly from last week’s 3.5%. Unfortunately, the FNMA
30-year-fixed rate hit 4.75% today, about a 3/8% rise from Wednesday,
and 1/4% higher than last Friday. High balance conforming hit 5% and
jumbo is around 5.25%. The 15 year rates also rose sharply.
I
do think the rates will settle a little next week as this seems an
extreme reaction given the unemployment rate didn't change. Overall, I
would expect rates will continue to climb more gradually for some time
until we get close to the 6% range.
Tuesday, CoreLogic released
data showing that home prices rose 12.2% in May compared with the same
month a year ago. This was the largest monthly increase since February
2006 and slightly below the predicted rise of 12.5% for May. The
month-over-month rise was 2.6% including distressed home sales.
Excluding distressed sales May prices rose 2.3% compared with April and
were up 11.6% year over year. CoreLogic predicts June’s housing prices
including sales of distressed properties will rise 13.2% year over year
and 2.9% month over month. Excluding distressed sales, CoreLogic’s
year-over-year increase for June is forecast at 12% and the
month-over-month estimate is forecast to rise by 2%.
Among the
100 largest U.S. cities, 97 showed a year-over-year increase in home
prices. The largest gains (including distressed properties) came in the
Los Angeles metro area which was up 19.8%. This is much different from
the Data Quick and CAR which showed year over year price increases in
the 30% range in Southern California. Those were for median price which
means half sell for more half sell for less. This report is for an
increase of individual homes which is not an exact formula as neither is
probably right for every individual area. Either way they both show
what we know, prices are rising sharply and steadily with no end in
sight at the moment.
I hope you had a good 4th and I wish you a great Holiday weekend!
★ MARKETUPDATE ★ for the month ending June 30, 2013★
Realestate
news for the month of June centered around higher interest rates after
the Federal Reserve Chairman, Ben Bernanke, announced that the Fed
would be slowing down the mortgage-and-bond
buying purchases under the program known as QE3 by the end of the year.
He further stated that the Fed planned to end all purchases as early as
mid-2015. The reason for this announcement was because the Fed now felt
that the economy was growing at a strong pace, unemployment levels have
dropped and he expected them to continue to drop, so further stimulus
would no longer be needed. This program helped bring rates to the lowest
level seen in decades. After hitting this year’s low of 1.61% on May
1, the 10-year note spiked soaring to a 22-month peak of 2.667%
Wednesday, its highest level since August 2011, before settling at
2.52% today.
★INTEREST RATES★
#Mortgage #interestrates
were up sharply both for the week and month. A 30-year-fixed conforming
mortgage is now at 4.38% up from 4.24% last week and climbing steadily
from 3.75% a month ago. The rate was 3.57% on May 1, so rates are up
almost a full percent in 60 days. A 15-year-fixed mortgage rate is now
up to 3.46% up from 3.31% last week and up over half a point from 2.90%
last month. Rates on high balance conforming $417,000 - $625,500 ( LA
and Orange county and $598,000 for Ventura county) are about 1/8% higher
than conforming and jumbo loans are about ½% higher.
This week
Federal Reserve officials continued efforts to curb a rise in long-term
interest rates, hoping to calm fears raised by comments made by
Chairman Ben Bernanke that triggered turmoil in global financial
markets. Officials say an increase in the Fed’s benchmark interest rate
is still a way off and bond purchases could also be prolonged if the
economic performance doesn’t measure up to forecasts.
So why did #rates rise? Is #Wallstreet
fed up? Was the Federal Reserve testing the market’s tolerance with
some well thought out comments? Will the Fed begin to unwind its
efforts? Time will tell the answer to all of these questions. But I do
assure you that the ride is not over. As we’ve seen in years past,
there is always a secondary action to the immediate (usually
over-reaction) reaction, but then again, most have been preaching for
months, if not years, that rates can’t stay this low. Can they?
As a real estate professional, I don’t have all the answers when if
comes to the future of interest rates. My guess....#Rates will likely
dip again and level off in a somewhat upward trajectory. We have likely
seen the record low rates come and go. This happens. It is the cycle. It
is not doom and gloom. Rates are still low and people are still
interested in buying houses. In fact, I typically see an uptick in home
sales immediately after an interest rate rise as #Homebuyers
fear further increases. For now, rates will be what they will be, and
while they have an impact, they certainly are not the largest reason
that someone should or should not buy a home.
★HOME PRICES★
Reports on #Home prices continue to beat expectations. The California Association of Realtors reported that the median housing price in #California
increased 31.9% in May, the largest year-over-year increase in 33
years. Inventory levels remain low while the number of sales in May
continue to rise.
In May, there was a 2.6 month supply
listings at the current sales rate, down from 3.6 % a year ago. A
six-to-seven-month inventory represents a balanced market. DataQuick
reported that an estimated 42,293 new and resale houses and condos sold
statewide last month. That was up 8.3 % from 39,051 in April, and up 1.2
% from 41,790 sales in May 2012. The sales count was the second
highest May ever reported behind only May 2006, where 54,099 homes were
sold.
As always, if you need a #REALTOR to help you #Buy,#Sell,#Lease or #Invest, I would love to be of service.
I hope you have a great weekend!
Thinking about buying a house with an FHA Mortgage?
Well, here's another reason to "Get off that fence", "Pull the trigger", "make the leap" and act RIGHT NOW.
The Federal Housing Administration (FHA) has changed it’s policies regarding the insurance fund and are to take effect on June 3rd 2013.
The FHA recognizes most, if not everyone, doesn’t have 5, 10 or 20
percent to put down on a home. They say if a buyer meets their
guidelines, they're willing to insure the loan. The buyer must pay a
monthly mortgage insurance premium (MIP) until the loan reaches 78
percent of the original loan amount. That is until June 3rd.
Beginning June 3, borrowers who apply for FHA insured mortgages will pay
for mortgage insurance for the life of their loans. FOR THE LIFE OF THE
LOAN!!
Currently the rule says a borrower must pay the
insurance for a minimum 5 years and until the loan reaches 78 percent of
the original loan amount.
Typically once the 5 years, 78
percent is reached, the mortgage payment is lower and the cost of paying
MIP is no longer part of the mortgage. At this point your monthly
mortgage payment will be less. Everyone likes a lower payment, right?
Well, come June 3rd, MIP will no longer fall off after 5 years. It will
be permanent for any FHA insured borrower who puts down less than or
equal to 10%
If you’re on the fence about buying or in the
process of choosing a home, I’d say get under contract before June 3rd.
For loans with FHA case numbers assigned on or after June 3, 2013, FHA
will collect the annual MIP for the maximum duration permitted under statute. 12 U.S.C. § 1709(c)(2)(B).
For information regarding your financial outlook and what best works for you, I highly recommend, L.A. Mortgage Company.
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Buying/ Selling/ Leasing/ Investing
Call me today if I can be of assistance.
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Understanding the Offer Process....
★ Drafting the Purchase Contract
★ Price bidding and best offers
★ Engaging in a bidding war
Once you’ve decided on the home you want to buy, your real estate agent
(ME) or attorney will draft a purchase offer or contract in your name,
which he or she submits to the seller’s agent or attorney.The seller can
respond in one of three ways: accept the offer, counter it with a
higher asking price or reject it.
"Below-price" bidding:
Bidding for a property below its asking price is almost par for the
course during what’s called a “buyer’s market.” When there’s a glut of
houses or condos on the market, for which there are not enough buyers, a
prospective buyer can confidently try to skim 10 percent off the asking
price off the property. But if you bid 20 percent below what a seller
wants, you may be out of luck. Many experts advise against subtracting
more than 10 percent from the owner’s asking price. However, you can
sweeten a relatively low offer price by guaranteeing the seller a quick
closing and a large earnest-money deposit. Or, if you accept the present
state of the home without demanding free upgrades, you could sway the
owner in your favor over other bidders.
Highest and best offer:
Sometimes sellers or their agents get restless during negotiations and
ask you to quote them your highest and best offer for the home. Don’t go
out on a limb if you are not 100 percent sure you want this particular
property. You can always reconsider if you feel you made a mistake,
after comparing other properties to the one that forced you to make a
blind bet on its value.
Full price offers:
There’s no
shame in agreeing to pay the seller’s full asking price without
bartering. If the home you’re pining for is worth its price tag and you
really want it, offer to pay the full asking price. Do you want to see
your dream home slip through your hands because you want to pay $1,000
less for it? Another buyer may show up five minutes after you, eager to
pay that difference.
Bidding Wars:
Engaging in a
bidding war for a property with other interested buyers is not for the
faint of heart. Be warned that you may end up paying too much for that
dream home and regretting it. As one of an unknown number of rivals in a
bidding war, you’re competing against each other blindfolded. Neither
you nor your agent will know how many offers the seller has on the
table, because real estate license laws allow listing agents to keep
such information confidential in the seller’s interest.
You may
end up having to cough up a lot of extra cash for the down payment, if
you’re the winner with the highest bid. Instead, you could keep your
cool and stay off the multiple offer- and counteroffer-carousel.
Sometimes, all rivals for your dream home may throw in their towels and
call the bidding war quits. Who knows, the seller may then come knocking
at your (old) door to ask you to submit your purchasing offer. In that
case, you’ll end up the real winner, possibly holding the power to
barter with the seller for a lower purchase price.
At all
stages of the buying process, keep a written record of negotiations
between you and the seller, as well as changes to agreements made with
any involved parties. In the heat of the home buying process, you may
not remember that you wanted the seller to throw in his basement
refrigerator, or check on the size and location of your high-rise
condo’s storage unit.
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Buying/ Selling/ Leasing/ Investing
Call me today if I can be of assistance.
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