Posts Tagged ‘home buying’
Monday, December 5th, 2016
I read an interesting fact today: 44% of consumers find the homebuying process scary or intimidating. That is a staggering number of people who are unsure of the process and need guidance. The good news is that today it is easy to make finding your next home a fun and positive experience.
Here is my advice on how to make the process not so scary:
Hire a great agent – Yes, there are many real estate professionals out there, and yes, some will make promises to the moon and back, maybe even tell you they will give you back some of their commission if you choose to work with them. But that does not make one a great agent. Here is what does: experience, local knowledge, intelligence, familiarity with the homebuying process, strong negotiation skills, great referrals.
Find a professional mortgage officer – This is another of those “must haves” when searching for a home that could either make or break a purchase. You need to find a great mortgage officer PRIOR to searching for homes. That person should have all of your data and necessary paperwork so he or she can issue a preapproval – this is important for two reasons: 1. it will tell you how much you can afford, and 2. You will have a higher chance of getting an offer accepted if you are preapproved.
Choosing a mortgage professional is similar to selecting a real estate agent – there are many who will talk the talk and even make promises, but you need to feel comfortable with that person – yes, it’s about getting a great loan but it’s also about making sure the lender can close your loan. If you do not know where to start it is often good to ask those you trust, including that great real estate agent!
Get educated and start your search way early -I tell ALL buyers that it is never too early to start getting ready to purchase a home. If you plan to buy in a year, two years that means you need to get educated and you should start now. Learn about different neighborhoods, their amenities, positives and negatives. If you have children look up local schools and see how they rate – talk to neighbors in potential areas you like and ask about the neighborhood, schools and anything else that may be important.
Most importantly, start looking at homes way before you are ready to buy! Most people hear this and ask me why, so I tell them that you will learn a lot about different areas, floorplans and so much more. When it does come time to buy you will know more about the areas in which you want (and don’t care) to focus, which will make the homebuying process way less scary! So get out there and visit open houses, schedule appointments with your agent and start learning.
It is also important to note that you can learn a lot about homes online – with so many informative real estate sites available at your fingertips you can learn about amenities and so much more.
Stay Organized: Use all the above tools to your advantage and create a folder so you can categorize those areas and even floorplans that have potential. If you are not planning to purchase immediately you will likely forget all the things you learn along the way.
Monday, November 28th, 2016
If you have been looking for a home recently you may realize that doing so has become tougher: there is less inventory out there and when a great home lists there are often multiple offers. So how does a buyer get ahead to secure a home when many others are in the same situation? Here are some tips.
Hire a great real estate agent. This is above all the number one way to find a home in a tough market. Not only can your agent give you advice about what price and terms may get you that house you love, but they are also locally connected, which can make all the difference in the world.
Here is an example – After losing out on a few multiple offer situations I found buyers a home through my connections with other local agents – one that had not gone on the MLS yet. In another situation, I notified buyers of a home that was about to come on the market (they lost out on purchasing my listing in the same neighborhood), and they got into contract prior to the home going on the MLS. Some say this is unfair for the other buyers out there as they never had a chance to see or bid on the home, but many real estate sales work this way. Those of us who work particular areas often stay in touch and know when there is a listing coming up. Having that on your side as you search for a home is priceless.
Be Paperwork Ready: There is no better advice than to be ready to make an offer. This means you need to be preapproved with a lender (the lender should have all your paperwork so s/he is ready to go once you write an offer, and you should have a preapproval letter). Have a copy of your latest bank or investment statement showing proof of funds for your downpayment, in order to submit with your offer. Your offer should be as strong as possible so speak with your agent to determine what needs to be in there and what may be left out in order to avoid a multiple offer situation.
Know what you want: Often this is difficult when one is focusing on multiple areas or neighborhoods, but if you really know those you prefer, including floorplans and other amenities, you will be able to act quickly to see the home and make and offer. Even if multiple offers do come in, being first to present can often be helpful. Start looking at areas and homes before you are ready to purchase – the more information you have the better and more prepared you will be when the time to buy is right.
All in all, buying a home in a low inventory market can be tough. With interest rates rising every day counts – if you can lock in a rate prior to another rate increase that is great – and it just means you need to be ready when that right home becomes available. Of all the above tips, having a great buyer’s agent is the best advice I can provide. Many people think they can find a home without an agent, but a good agent is worth her weight in gold when it comes to finding the right home.
Happy home shopping!
Thursday, September 12th, 2013
Sunday, May 26th, 2013
Wednesday, May 9th, 2012
So many sellers ask me when they can repurchase after a short sale, foreclosure or bankruptcy. Following is a great synopsis of when a seller can repurchase after a distressed sale or bankruptcy, based on the type of loan/bankruptcy:
Chapter 7: 2 yrs.
Chapter 13: 2 yrs.
Foreclosure: 3 yrs.
Short Sale: 3 yrs, * unless borrower was not late prior to short sale (on ANY obligation) and was not trying to take advantage of the market.
Chapter 7: 2 yrs.
Chapter 13: 2 yrs.
Foreclosure: 3 yrs.
Short Sale: 3 yrs.
VA High Balance:
Chapter 7: 7 yrs.
Chapter 13: 7 yrs.
Foreclosure: 7 yrs.
Short Sale: 7 yrs.
Chapter 7: 4 yrs.*
Chapter 13: 2 yrs. from discharge date or 4 yrs. from dismissal date*
Foreclosure: 7 yrs.*
Deed in Lieu:
• 2 yrs. if subject loan is 80% ltv or less
• 4 yrs. if subject loan is 90% ltv or less
• 7 yrs. if subject loan is over 90%ltv
• 2 yrs. if subject loan is 80% ltv or less
• 4 yrs. if subject loan is 90% ltv or less
• 7 yrs. if subject loan is over 90% ltv
BK Chapter 7: 4 year waiting period is required measured from the discharge date or dismissal date of the BK. A 2 yr. waiting period is permitted if extenuating circumstances can be documented.
BK Chapter 13: 4 year waiting period is required for a Chapter 13 dismissal. A 2yr. waiting period will be permitted with extenuating circumstances (* See below)
Multiple BK filings: for a borrower with more than one BK filing in the last 7 years, a 5 yr. waiting period is required.
Foreclosure: 7 year waiting period is required, and is measured from the completion date of the foreclosure sale date.
A 3 yr. waiting period is permitted if extenuating circumstances can be documented and the loan-to-value rules are applied, MUST to be a purchase of a principle residence or a limited cash out refinance on an owner occupied, second home or non-owner.
*What are extenuating circumstances? They are non-recurring events that are beyond the borrower’s control that result in a sudden, significant and prolonged reduction in income or a catastrophic increase in financial obligations.
This analysis was provided courtesy of Daniel Dobbs with American Commerce Mortgage. He can be reached at 949-250-3981 or email@example.com.
Wednesday, September 21st, 2011
Being a home buyer these days sure is easier. For starters, there is so much information at your fingertips that once was available only to real estate agents. I think this is great, as it allows those who wish the ability to do some research on their own and feel more comfortable going into the buying process. It still does not replace the Realtor, as s/he is there to help you not only get into homes, but also with legalities and paperwork, negotiations and disclosures, as well as having someone on your side to exclusively look out for your interests.
Here are some of my favorite real estate websites:
1. Zillow.com. Zillow is a comprehensive site because it provides so much information beyond just the listing. Zillow will show you all the photos and information contained in the MLS, as well as comparable sold properties, neighborhood information, walk scores and a “Zestimate.” ** see below for caution on the Zestimate.**
2. Realtor.com. This is another site that is well-endowed. You can search for properties and also link to great current real estate information, trends and mortgage calculators.
3. Trulia.com. While also a great home searching site, I love Trulia because of the personal touches. If you are searching for an agent, you can get a lot of great information about area agents here. Also, you can ask questions – any real estate related questions you might have – and Realtors will answer them. It is a great way to gain different perspectives when you do not have an agent and do not understand something. You can read agent blogs and get an idea of how they work, before you even contact them. It is a great way for agents to connect with the public as well.
Some great real estate applications for smart phones:
1. Zillow. I like Zillow’s mobile app the most, as it is easy to use.
2. Realtor.com. (Most devices)
3. Trulia. (Most devices)
4. Wikihood (for iPhone and iPad). This free app for the iPhone/iPad (possibly other devices too) provides a wealth of information about any neighborhood you choose. It truly is amazing – you instantly get information on the area, including nearby beaches, shopping, dining, schools, transportation, entertainment, industry…the list is endless. This is especially helpful for those moving to new areas.
5. Essential Real Estate Dictionary (iPhone and iPad). $9.99. This app is great if you either have no knowledge of the real estate process or if you buy property for investment purposes, or for anyone who wants a more in-depth understanding of real estate terms. Of course, if you have a terrific agent you can save the $9.99 and have your agent explain everything, but some people like to do their own research.
6. ZipRealty. (iPhone, iPad and Android). Free. This app is helpful in that it has a great feature called “House Scan” that will show you what is for sale in the area you are located, and guide you to those homes. You are also able to schedule a showing appointment from your mobile device. There are many other helpful features within the app that will provide you with home and neighborhood information.
7. Mortgage Calculator Pro. (iPhone) $.99. While there are many mortgage calculator apps out there, and many free tools on sites (ZipRealty, Trulia, Realtor.com, Zillow and most agent websites offer them for free), this app goes a step further and allows you to add HOA fees and property taxes to your payment analysis. You can also compare different loans and save them to your desktop.
8. Suburb Scout (Android) $1.99. This app allows a buyer to search for those factors that may not be so appealing, like airports, landfills, prisons and other potentially undesirable neighborhood turn-off.
9. Google Maps. (Available on most devices). Free. Google Maps is a great way to help navigate neighborhoods, get routes and driving distances to work, schools, etc. Street View is a fantastic way to explore any area at street level.
One caveat must be pointed out: when using many of these sites and apps to search for property information, you have to keep in mind that some of the information you read may be incorrect. For example, Zillow is one of my favorite sites for many reasons. It showcases properties and provides so much more, like area data, comps and “Zestimates.” But more often than not the Zestimates do not ring true – this is a big cause of problems with some buyers, who believe that what Zillow estimates the value to be is the gospel.
My advice when using sites to find value is to do so and gather as much information as you can, and to then have your real estate agent do a full comparative market analysis. Zillow cannot account for upgrades, condition, or take into consideration distressed properties. An appraiser definitely will not be using Zillow to appraise your new home. So it is still very important to have your agent run the comps and fully discuss them with you, before making an offer.
With all the great tools out there for today’s buyers, getting informed and finding the right property is fun and easy.
Wednesday, July 27th, 2011
As many people are aware, short sales are not going away any time soon, and they often present the opportunity to purchase desirable properties at prices below comparables – not such great news for the neighbors, but a blessing for buyers.
If you are a buyer considering purchasing a short sale, or if you know someone who may soon do so, there are a few things to be aware of before you make an offer.
1. Time frames. You probably already know that short sales can take a while to be approved by the lender(s). How long depends on several factors, like how many liens there are (approval time is usually quicker if there is only one), whether you are the firstnbuyer to submit an offer (if there had been a previous buyer and some progress had been made, you may not have as long a wait), the skills of the listing agent or her negotiators, and the alignment of the stars. All in all, the process has gotten quicker than it used to be, so a ballpark in San Diego County is likely 2-4 months (my last 3 short sales closed in about 2-3 months).
2. Acceptance by the seller does not the contract seal. By this I mean that just because you and the seller agreed to the contract terms, the lender can change those terms. It can ask for a higher sales price (and often does when the BPO (Broker Price Opinion – like an appraisal), and change terms (see #3). Be aware that things could change, and that is why it is so important to work with an agent in writing an offer.
3. Write as clean an offer as possible. The best chance at getting an offer accepted is to write a clean offer. Make the escrow period as quick as possible, do not ask for the seller to pay your closing costs unless this is absolutely necessary (most lenders will not). Also, I advise my clients not to ask for a home warranty, as the lenders won’t usually pay for that. Instead, I buy one for my buyers. Oftentimes lenders won’t pay for termite work but will pay for an inspection, but I do ask for the seller to pay any section 1 (typically the seller’s responsibility) items regardless. The lender can choose to say no, but I have had lenders pay for this so I include it. It depends on the lender, the sales price and other factors. Speak with your agent to make sure your offer is as clean as possible.
Short sales seem to be turning into an art. The best advice is to work with an agent who is experienced with these sales, and: don’t be afraid of short sales! It continues to surprise me how many agents refuse to work with them. Unless you need to close escrow quickly it can be a great way to get a good deal on a home; and the time frames, while frustrating, are usually well worth the wait. Happy hunting!
Saturday, May 28th, 2011
More Homeowners Refinancing into Shorter-Term Mortgages. A new study recently revealed that many homeowners are refinancing into shorter term loans. The advantage is that the mortgage will be paid off in a short time, which is appealing to those who face retirement in the next 10-15 years. Some rates are as low as 2.99 or 3%, with 7-10 year terms. The trick of course is that you must have equity in your home to be able to qualify for a refi, and then must be able to afford the higher payments. This trend shows that home ownership is still very much desired, which is a good sign.
Home Insurance Premiums are on the Rise. While home prices are falling across the U.S. those who plan to buy need to be aware that home insurance is on the rise. Some of the largest insurance companies have indicated they have or will be raising rates. This is partly due to the slew of natural disasters our country has experienced recently, such as the hurricanes and tornadoes in the mid-western states, floods in the south, and earthquakes/tsunami in Japan and elsewhere. Different areas will experience different increases, depending on risk factors.
Great Opportunities Abound for Buyers/Investors. Housing prices have dropped slightly and will likely continue to do so, due in part to the large distressed property inventory that will continue to grow for at least a year or two. Mortgage rates are still low and buyers can get a LOT more for their money right now, so it is a great time to take advantage before mortgage rates do rise.
Mortgage Delinquencies Increasing/Foreclosures Down. Although the number of new foreclosures went down in the last quarter, the number of homeowners who are delinquent in paying their mortgages increased slightly. This is an indicator that there will be a new wave of foreclosures and short sales to come, and that prices will continue to decrease until that inventory is cleared out. Great news for buyers, not such great news for sellers (unless they have equity in their homes). Foreclosures comprised 45% of home sales in California in the first quarter.
California is Expanding Foreclosure Investigations. The state of California has been expanding probes into loan servicers and applying pressure. The Attorney General is looking into robo-signing claims in an attempt to enforce restitution and prevent bad lending practices from happening in the future. A mortgage fraud task force has been comprised of 25 individuals will be targeting 3 specific areas: corporate fraud, fraudulent lending practices, and scams aimed at troubled homeowners facing foreclosures. Other states, such as Illinois and New York, are also expanding investigatory procedures.