So on 4/30/2010 this Birdie flys away and takes with it the $8k/$6.5k tax or cash benefit. 

  You won’t miss it, will you?  Buyers still have time to find the home they want and nail

  down this huge govt. hand out!

We can find the home you want in less than 30 days, so hang with us and we’ll get you there in time.  The housing inventory is exceptional, you name it and it’s out there for you.  Best part is; the deals are unreal and you’ll probably never see it better in your lifetime!  Add to this, the rates that continue, at least for now, at record lows…and…the FHA203k program to help you with the cash you don’t have…to make repairs and improvments.  That means you can get a short-sale or foreclosure property that needs some fixin and appliances - to look like new before you move in!  Seriously, if you can buy, BUY NOW!   http://money.cnn.com/pf/loan_center/index.html

FHA is still at 3.5% down, and up to 6% for closing cost request from sellers.  Rates are still just over the 5% mark but all indications are, we’ll see a serious rate increase starting soon.  Don’t let it happen to you…Buy Now!

Home ownership declined some in 2009.  With some of the older short-sales and REO’s getting sold, we’re hoping for an uptick in the traditional home sales.  While some markets report slight price increases, this may still be a ’skewed’ result due to the lower priced, distressed stuff going away.

Many pundits see the market prices dropping even further due to the expected glut of homes that were held back from short-sales, as the owners tried to qualify for mtge payment reductions and/or, principal reductions.  So few have been able to qualify and of those that have, over 35% are back in the soup within months, failing to carry out the plan.  These homes will show up next.  How many, is anyone’s guess.

Another move by the FED, that will no doubt have a serious affect on the market, is their decision to stop buying mortgage-backed securities.  This could result in rate increases and diminish the ability of buyers to qualify for loans, or, limit their ability to buy the house they want?

We have been helping buyers get outstanding deals and rates throughout this housing mess.  We can help you too.  Give us a call to discuss the possibilities.

If you’re ‘upside down’ in your equity position and wonder whether you should jump on the ‘HAMP’ band wagon, or sell or short sell, give us a call and we’ll fill you in.  There’s a lot to learn and it won’t cost you a dime to get this info.

If you’re interested in selling but question whether this is the time to try, call us…we’ll give you all the market info you need to make a decision that serves your best interest.  No charge here either!

We work with a lot of investors to help them meet their goals, both on the buy and the sell side.  If you’re an investor who could use some help, give us a call…can’t hurt to talk?

 We love to hear from ourt readers.  If you’d like to comment on this or any other post, just click on the headline and a comment box will open for you. 

This mess will end.  Mean time, let’s work together to get you where you want to be!

Our best to all of you!

Ed (651-770-5000)

Picture this…main watering hole for the agents of  a large Brokerage office…”Happy Hour!”   The agents are having a drink and sharing their weekly  war stories.  Let’s listen in:

“So Freddie, didn’t I hear you nailed a ‘hogger’ this week?”  “Yeah baby, you heard right…I’m at the house, a $475,000 listing, putting up a rider on the sign that says ‘Great N’Hood,’ and a couple drives up and wants to see it.  Ms. Homeowner was just leaving to get groceries and told me to go ahead and show it, so I did.  They liked it and said to write up an offer.  I showed the offer to the sellers and they went with it.  So…I didn’t have to split the commission with another agent…got the whole 6%, $28,500 for myself…hogged that one!”

See, in a normal situation, the listing agent lists the house at 6% and when a different agent brings a buyer, the selling agent gets 2.7% ($12,825) and the listing agent gets 3.3% ($15,675). The listing agent is the one that covers the marketing expense of the house.  Only makes sense the listing agent should get more…to offset expenses , right? 

 The listing agent probably took pictures (no cost?), made brochures ($15. ?), provided copies of the disclosure document ($5.?), had a yard sign installed ($40.?), spent a couple hours working with the home sellers, before the listing was secured, showed the home a few times (4 more hours?), took calls from other agents who showed the home (two more total hours?), wrote the offer (another hour and a half?), and will attend the closing (another 2 hours?).  So, a total of 11.5 hours.  But I usually find an agent will spend about 20 hours per deal.  So lets say the agent worked 20 man hours and had total expenses of $60.  Landing the hogger means he made $28,500 - $60 = $28,440 divided by 20 man hours = $1,422 per hour.  Yeah baby, hog it up!

Most buyers don’t understand this whole process.  They’ll sometimes be working with their agent but attend an open house or call to see one from the info on a sign and the listing agent shows them the house, writes the deal and gets a “hogger” on it.  The agent the buyers has been working with, sometimes for months, gets absolutely nothing and the agent that wrote the deal…spent maybe, a couple hours with the buyers, gets the big reward.  Bad deal, this?

Agents are supposed to not only ask a potential buyer if they have an agent, they’re suipposed to defer to the other agent, if there is one.  Then, if there is no other agent, the listing agent is required to disclose to the potential buyers, on an “Agency” document, how the process works…and…have the buyers sign it.  But do they?  The Hoggers are in waiting…c’mon uninformed buyers…line up!

When you start working with an agent, if you’re happy with them, have them set up all showings and situations for you.  That’s the only way they can get paid.  Don’t hand over the pay to some agent you don’t even know, who hasn’t done a thing for you.  And, if you do look at a home while in the search process, if the showing agent does not ask you if you are represented by another agent, let your agent know about it…the showing agent is either derelict in their procedure or unethical or plain stupid?  Would you want to reward someone like that?

One more thing (I’ll bet many readers are wondering about this), If a listing agent was happy with the normal way home sales pay out…and…an unrepresented buyer comes along…and…the offer is less than the sellers want…why wouldn’t the listing agent offer up all or part of the 2.7% he wouldn’t have to pay out to another agent, to help his sellers?  We do here…we do even more…check us out?

Beware…the “Hogger” may come your way?

Next: How to get the best deal when qualifying for a mortgage!

Ed

Whether you’re downsizing, up-sizing, investing in real estate or buying your first home…buying now, right now…is the best time to buy in 40+ years!

With over 7 million home owners behind on their mortgages, the already huge inventory of homes will get even bigger.  The choices available are phenomenal!

We’ve recently looked at so many foreclosures and short-sale homes and find a good percentage are not beat up at all.  In addition, many are eligible for the super FHA 203k plan, whereby you can get the fix-up cash you need…and…it gets better, since most of these will be devoid of all appliances, this program will kick in cash for that as well.  Nice! 

One of our “pros” recently put his client in a home that sold in the $230k’s just a few years ago.  Now, our client is in a large 4 bedroom, 2 bath home on a large, fenced lot with landscaping, a very big - new asphalt drive, new interior fixtures, new bath fixtures, new electrical box and some wiring, new plumbing, some new carpet and all new - higher end appliances.  He’s on cloud nine, thanks to our pro being informed.

All this was financed through this terrific FHA product and the client has nearly a new home.  He’s in it for the $164,900 he paid, plus the $25k he didn’t have but the FHA plan provided.

If you care to know how this plan could work for you, give us a call and we’ll give you the details.  We have so many first time buyers that know they can get a good deal but just don’t have the money to make repairs.  Find out how this plan can get you in the home you want and put the cash in your hand that you need.

And by the way, for those of you that would like to stay in your home, vs. a short sale or letting it go into foreclosure, give us a call, we’ll help you get the info you need.  No worries, you don’t have to be selling or buying, this one’s on the house!

We come across so many people that don’t understand how the “HAMP” program works…or…they’ve called their mortgage company and get nowhere on the phone with them.  You have to know how to work with these birds and what the rules are because half the time, they don’t know themselves.  Let me share a success story with you:

another of our “pro’s” is talking with one of our clients; a single mom with a serious financial crisis…less hours and very reduced pay, no where near the child support money she needs and…increased mortgage payments from an adjusted rate mortgage plan.  What to do?  She calls her lender and is told they will have to see if she’s qualified to adjust her payment…they’ll get back to her.  Weeks go by, no call back. 

She calls again and gets the same story.  (Enter our guy.)  She tells him what’s going on and he tells her she is qualified and asks her to give him an authorization letter, where he will be allowed to talk with her lender on her behalf.  He called the lender and told them she was absolutely qualified, to read the mandates and get busy helping this lady.  Within days…new ball game.  The lender is cooperating and the mortgage will be adjusted to a comfort level for her.  The family can stay put!

                                                                   Dontchaloveit!

And don’t be embarrassed if you paid too much, have no equity and the bank is on your case. (Cute story,see theWSJ /2/8/2010 by JamesHagerty.)  

My interpretation: the MBA (mortgage bankers association), movers  and shakers…right(?)…paid $79 million for their newer headquarters in 2007.  They thought they might be better off to sell it now.  They have an offer and it looks like they’re going to take it.  They owe the bank $75 million but the offer is for less, only $41.3 million.  Oh shucks…looks like they’ll have to come to the close with the balance…right?  Oh, but some good luck, they may not have drawn the whole amount because the bldg. was under construction.  They’ve refused to be interviewed about their intentions.  Smell fishy to you too?  But wait..there’s more!

Their chief executive, John Courson, in an interview last year, said that people that were “under water” -borrowers owing more on their home than it was worth- should keep paying their loans if they could.  He went on to say defaults hurt by lowering property values and sent the wrong message to their kids.  Well guess what?  He refused to be interviewed about what his Association was going to do about the balance owed.  Can we guess what that means?  Funny stuff, this?  You should feel bad about your situation?

                        Call us, we’d be happy to help you end the financial pain!

Back to the “buy” side; rates we thought were going up are still in the 5% range and jumbo rates are still in the 5.5% range…hey…the time to buy is right now…remember…you make money in real estate “on the buy.”  Also, if you’re buying to occupy, there’s the $6.5k to $8.5k govt. tax credit, or, cash if you don’t owe taxes. But that will blow away if you aren’t under contract by the end of April and scheduled to close by June 29th of this year.  Doesn’t look like they’ll extend it either…so…latch on if you can! 

Next time: “The Hogger.”  (Don’t miss it, it’s pretty funny…pathetic…but funny.)

Ed

You’re probably not old enough to have known a better time to be investing in Real Estate.? For Home Sellers, they’ve probably never seen a worse time to be for sale?   It’s not only a “buyer’s market,” its as hot as it can get for Investors!  You make money in Real Estate on the buy! Buy now, don’t wait, let’s look at why.

The bank bail-out deal did not work according to plan.  The banks got to borrow at 1/4% and lend out at 4.75%+.  Who wouldn’t jump on that arrangement!  Trouble is…few loans are being made, except to highly qualified buyers.  Not only are the Banks messing up the housing market, the PMI insurers are fighting with the Banks, refusing to pay according to their original agreements.   In some cases, the PMI Insurers don’t have the reserves they need to pay up. Case in point, a sad story…

I’m helping a young couple try to short-sell their home.  Both have been laid off, she has cancer and couldn’t return to work even if she wanted to.  They have a young son, have moved in to less than desirable quarters but it’s all they can afford,  they are both under 30 years old, they owe $270k on their mortgage and they’re 5 months behind on their payments.

So I get a ridiculous offer…$167k and the buyer wants $10k back for closing costs.  (I really don’t think the bank will get more than $185k for this house.) The bank does an appraisal and turns down the offer.  Not surprising?  Next, I get an offer for $190k and this buyer only wants $6k for closing costs.  The bank will look at it.  Weeks go by and no answer.  I have to work through a couple different Reps at this bank, to get the proposed deal looked at.  Meanwhile, the buyer wants an answer soon - they don’t want to miss out on the second choice.  We get an answer; the bank will go with the deal but the PMI Insurer wants the young couple to sign a $25k promissory note.  I’ve already sent the bank tax records, closed bank account records, a hardship letter, monthly budget and “comps.”  This young couple couldn’t sign a note for $25 bucks, let alone $25k?  The bank won’t allow me to negotiate with the Insurer.  When I informed the prospective buyer’s agent, she came back to us with a $200k offer and I informed the bank.  They said they would take another look.

Several days later, the agent withdrew the offer and I informed the bank that the deal was dead.  Several days  after that, the bank notified me they would accept the offer - they hadn’t even read my e-mail to them from days earlier.  Who’s in charge at this bank?

We now work with an attorney and a staff totally dedicated to doing short-sales.  This strengthens our marketing efforts and reduces the time necessary to get these done.

This whole mess adds value for the Realty Investor. The stumbling and bumbling of these banks has put a huge number of homes in front of Investors that have good financing sources.  If you can close fast and have savvy lenders, you’re in the drivers seat!  What we’re finding though, is that too many Investors are sitting on the fence, hoping for even more price reductions, before they snap the trigger.  More and more realty tracking firms are projecting a slide in prices for up to another 18 months.  There’s more to consider though…an increase in rates is inevitable and those rate increases may eat up the dollars saved on the buy, within a few years.  The time to buy is right now, especially since the banks, Fannie and Freddie are going to make it harder for buyers to get financing.  Look at these guys…struggling with depleted reserves.  Last week, a WSJ article pointed out that these reserves were supposed to be at 2% but were only at less than .6%

Fan/Fred put the ‘touch’ on the FED to the tune of $111 billion so far.  FHA requires lenders to have cash reserves of $250,000.  But now they’re considering to raise this reserve amount to $2.5 million.  You can guess how many Lenders will no longer be offering their services for FHA deals if this goes through.  They’re in trouble folks - and the loan game is going to tighten up like nothing we’ve seen.  The time to buy…if you can…is now!  Rates will go up, they always have.  When this will start is hard to say but when it does, it will be swift and severe!  Don’t get trapped, buy now while there’s plenty of choices and some money still available!

Now, where to go for the deals? We always look at the areas that offer the best potential for rental and resale.  If you’re not working with a proactive, ambitious Realtor that’s taking their time to do previews for you and pulling ‘comps’ to find the very best deals for you, give us a call…we can find you what you want in less than 30 days.  And…December is one of the best months for an Investor to be busy in the market.

But wait, there’s more!  Sound familiar? There really is more though, here’s how we work with you:

We get together to set up a strategy to find you what you want.  We nail down the best areas to search in.  We set you up with a search program that gets all new listings to you, the same day all Realtors get them…you’ll be at the front of the line so you don’t miss anything.

If you’re too busy to see the homes you have the greatest interest in, we’ll preview these for you and give you a report on them.  That will save you time  - we’ll only set up showings for the homes at the top of your list.  Make sense?

Once we find what you want and close on it, you’ll get 25% of the commission paid by the sellers.  This is to compensate you for your work in the search process.

There are over 1,525 homes for sale at prices less than $150k right now, in just 4 counties! Many of these were purchased and renovated or updated within the last few years.  This means you may have only minor items to repair or just cosmetic work to do in order to rent them out or re-sell them.
Time is money…don’t get caught in a rate increase and lose out on some of the hottest deals ever!  We just put a deal together for an Investor at 5.25%.  If that same deal ($150k) was 7%, it would require an additional $170/month.  Get in while you can ‘cash flow!’

Ed