Archive for the ‘How to buy a house’ Category
Nov
13
Posted under
Foreclosures / Bank Owned / REOs,
How to buy a house Campaign Expiration Date:
November 30, 2008
Congress may soon consider a new economic stimulus bill. Housing has always lifted our economy out of past economic downturns so it is imperative that Congress focus on housing in the next stimulus package. This
We need ALL members to support NAR’s efforts to have the NAR Four-Point Housing Stimulus Plan included in any future stimulus bill.
Contact Congress today and ask them to include NAR’s Four-Points in the next stimulus package.
Make the $7500 first-time homebuyer tax credit available to all buyers and eliminate repayment requirements. The credit’s limited availability and repayment requirement severely limit the credit’s use and effectiveness.
*Make the 2008 FHA, Fannie Mae and Freddie Mac loan limits permanent. New rules for 2009 will reduce them. Now is not the time to limit mortgage affordability.
*Get the Treasury relief program back on track and target more funds to mortgage relief. Create a federal mortgage interest buy-down program to make below-market rates available and stabilize home prices.
*Permanently bar banks from engaging in real estate brokerage and management. The banks have proven they have enough to do to simply manage the loan process. Banks should not manage home sales and purchases.
Housing has always lifted our economy out of past economic downturns. It’s imperative now to foster a housing recovery, so that the economy can recover. Thank you for your hard work.
Written by Holly Leano - REALTOR and Sr Mortgage Consultant
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Oct
17
Posted under
Celebrity Real Estate,
Credit / Your Fico Score,
Foreclosures / Bank Owned / REOs,
Home Ideas,
How to buy a house,
Mortgage Purchase Loans,
Mortgage Refinance,
What is the value of my home? CHANGE or REFORM. Is this one and the same thing or are we just saving the middle class?
Wondering which way to vote? Not to worry. Just about everyone who is uncertain which way to vote has now become an ‘Independent’. Forgive me for saying this but if all the Independents had views that bordered between the two parties, why not start the 50/50 ballot system and split the votes. Because in all fairness, why must the in-between voter or for that matter, the ‘I like neither party’ voter be swayed to choose between someone who advocates ‘CHANGE’ and another who advocates ‘REFORM’. Truly both words nearly mean the same thing, so are we just dealing with ‘nuances’ or ‘semantics’ in the language used? But in this political climate, ‘CHANGE’ applies only to the middle class.
I was buying breakfast at a local fast food joint last week and had friendly conversation with the Hispanic floor manager. I asked him how business was going and he said… “Slow.. very slow. No one can afford even fast food these days!”
I asked him, what he hopes will happen on November 4th. He said “I don’t know what is good… all I know is that I want ‘CHANGE’ and I will vote for the person who tells me that he can ‘CHANGE’ my current situation.”
I felt compelled to ask him this next question, so I said to him “I understand your frustration, but what does ‘CHANGE’ mean to you?”
He responded, not indicating the party but using the current buzz word, “Well, if I vote for ‘CHANGE’, that means I will get a tax break immediately. My daughter is not working, not married and she has a baby. I told her she can go on welfare to help her baby. I want a President who is thinking about me….. So why do you ask me this question?”
I decided to explain myself. “CHANGE’ has two meanings - one, change for the better - because we know for sure, it will present a better outcome. Two, change can open up an arena for problems because the plan for change has not been well thought through. This means we are just glossing over the current problem and introducing something new, with the hope that it give Americans what they want.”
The manager was obviously still not clear, as he said to me “Well that’s what I want, ‘CHANGE’.”
I asked him again, ” And what is that exactly?”
He said “I don’t want to have to keep working so hard. If there is ‘CHANGE’ I can get a tax break and medical benefits. Maybe I can save the tax break to start my own business.”
“Ahh.. I see.” I replied. “I’m glad you are excited for change. Both parties have valid points that can either make or break the progress of the United States. However, I hope you will think about this too. As a business owner and a parent, who do you want controlling your money. Also do you think you have been living beyond your means? Are you willing to cut back on your expenses and help others who have less than you?”
He responded quickly “No.. I live paycheck to paycheck. I want my children to have a better life. What do you mean I have to help others? I have very little right now. I just lost my house and now I am renting. I need the tax break to pay for food.”
The manager kept quiet for a long time and then said to me “Why are you saying that I live beyond my means?”
I replied “I never said that. The party who advocates change wants everyone to share the problems 50/50 because that is fair. Not only will we share the problems, we will split the costs, split the difference, which ever way you call it, this party says they can fix America. Are you prepared to do this?”
He replied “Why are you making me choose? I just want ‘CHANGE’… any ‘CHANGE!”
Dear voters, do not rest until every stone has been turned. Until every ‘i’ has been dotted and ‘t’ crossed. Until every voice is heard. Every person who considers himself American, black, white, rich, poor or middle class, think for a moment what America means to you and then go out and vote.
We have not fought for freedom and rights just to benefit one group of Americans.
Choose wisely and vote. Vote for the rights of America and all Americans.
Written by Holly Leano - REALTOR and Sr Mortgage Consultant
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Sep
19
Posted under
Foreclosures / Bank Owned / REOs,
How to buy a house,
Mortgage Purchase Loans,
Mortgage Refinance What is the root cause of our current economic financial downturn. Paulson: \’Decisive action is needed\’
Greedy people. Greedy selfish people who do not care what happens to anyone else but themselves. Now the Feds are working on bailing them out of their greed! Unacceptable!! Not only do we tax payers get hit, The United States is hit as a whole with higher interest rates on borrowed foreign currency.
http://www.msnbc.msn.com/id/26787984?GT1=43001
As a Realtor i work full time, ethically and responsibly to help my clients afford a home.
However honesty and integrity is not a trait that all Realtors are born with. Perhaps the Feds should check the DNA of all new Realtors while fingerprinted. That might cut down the number of people jumping onto the Real Estate bandwagon with disillusioned ideas of making big money off their clients without accountability for their unethical real estate practices.
Let me not stop here. A word to all financial institutions (Countrywide for example) please take responsibility for your shady loan programs. You provided everyone with bait to walk down a path of no return and then washed your hands claiming that we all should have known. Known what?? That financial institutions do not have our best interests at heart?
Buyers and Sellers (yes you too), do not blame all Realtors as the cause for your bad choices. Yes I will admit there have been many Realtors and Loan Officers who have been part of the reason why you have lost your assets. But in all honesty, it is your fault too. You made the decision to listen to their advise.
Education is key to making all decisions. I am a firm believer of this concept and will take the time to educate all my clients so they can make sound financial choices. If you are looking for a Realtor who really cares about her clients, look no further. Call me!
Written by Holly Leano - REALTOR and Sr Mortgage Consultant
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Jun
13
Posted under
Credit / Your Fico Score,
How to buy a house,
Mortgage Purchase Loans,
Mortgage Refinance The buzz word is FHA, Federal Housing Administration. 3% down towards a purchase of a home and like magic you are now approved to buy a home. What might surprise you is that it is not a new loan product by any standards. FHA has been around for a long time and one might consider it ‘the’ loan for the Loan Officer who has a conscience.
The sub-prime market of liar loans are falling by the way side. However there are still products out there that ask borrowers to just verify employment with a telephone call. The lenders are not asking to see paystubs or income taxes. I called a reputual bank (whose name I shall not devulge in this article) to ask this questions. The response I received was shocking!
The account executive informed me that they do not ask for paystubs or income taxes, they assume that the employment information provided by the Loan Officer on the form is correct. What the account executive actually meant is that they assume that the information provided is ‘the truth’.
So what about FHA loans and how can they help borrowers afford a home today. First of all federal legislation recently raised the FHA loan limits nationwide. Although this is just a temporary measure, FHA has opened the door for a large number of borrowers who need loans as high at $729,750.
The FHA does not lend money directly. It provides mortgage insurance (aka MI) to borrowers through private lenders. What this means to you is that the FHA is responsible for any defaulted loans.
Applying for an FHA loan is a long tedious process. Unlike sub-prime loans that slip through the cracks with no docs and stated income stated assets loans for example. FHA requires full documentation of income. Borrowers who can make at least a 3% down payment or have at least 3% equity in their homes can qualify for an FHA loan.
Written by Holly Leano - REALTOR and Sr Mortgage Consultant
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May
18
Posted under
Credit / Your Fico Score,
Foreclosures / Bank Owned / REOs,
How to buy a house,
Mortgage Purchase Loans,
Mortgage Refinance Can’t get a loan to buy a house? Whose fault is it?
There seems to be an epidemic of misunderstanding with the foreclosure market and mortgage loans. That being, today’s buyers are unable to qualify for mortgage loans like the ‘good old days’. Now there are so many rules and regulations, apparently buyers feel that they are getting the short end of the stick. With the number of homes in foreclosure flying off the shelf at ridiculously low values, it’s amazing that more buyers are not getting approved for loans in droves.
The rumor going around is that the people to blame for the ‘rules and regulations’ to get a loan are those who have gone into foreclosure, hence why banks and mortgage lenders are giving everyone a ‘hard time’.
Oddly enough I thrive on such idiosyncrasies of society’s current mortgage dilemma. It gives me a forum to spout my brand of wisdom about this situation and divulge an amazing secret to all who choose to listen.
The secret is - There have always been rules and regulations!
So what or who shall I say is to blame for why buyers are finding it harder to qualify for a mortgage loan today.
Owning a home is the American dream. But in actuality it is not for everyone. Buying a home is the largest financial purchase you will make in your life. It is not a purchase that you can turn around the next day and return the keys and walk away. There are consequences.
The solution to the foreclosure epidemic lies in being accountable. Anyone can qualify for a mortgage loan. How you apply for a loan and what you or your loan officer provides to suffice the rules and regulations of the lender is key to the final outcome of whether you’ll still be making mortgage payments in six months or bailing ship into the murky foreclosure market.
Remember the old adage ‘rules are meant to be broken’? Herein lays the answer to the question of who is to blame. Rules and regulations are broken in one way or another on a daily basis; take jay walking for example. Whether one chooses to accept responsibility for these actions is an ethical issue that few will acknowledge.
So we are all left to face this problem together as homes go into foreclosure and existing home owners watch their equity drop lower and lower each week. My best advice to you my avid blog readers, the next time any of you wish for lower interest rates and a carrot worth 1% is offered to you, stop and read the fine print!
Written by Holly Leano - REALTOR and Sr Mortgage Consultant
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May
18
Posted under
How to buy a house Tempted to pull money from your 401(k)? Consider these other strategies first.
By Robert Powell, MarketWatch
BOSTON (MarketWatch) — Times are tough for boomers and their parents, some of whom are taking drastic steps to deal with the economic downturn, according to a new survey from AARP.
One in four middle-aged (45+) and older workers say they postponed plans to retire due to economic conditions. Almost 25% of people aged 45-to-64 surveyed said they are prematurely taking money out of their 401(k) and other investments. And young boomers are reportedly postponing paying bills and even cutting back on medications.
Before taking such drastic measures, consider these strategies to weather the current storm:
Bring lunch
Workers should examine their entire financial situation and look for areas first where they can trim expenses, said Christine Fahlund, vice president and senior financial planner at T. Rowe Price Group Inc. “Many of these will be regular, daily or weekly purchases that look small but add up to a significant amount over time,” she said. For instance, buying a $5 to $10 lunch every day could add up to $100 to $200 per month.
Two wages are better than one
If possible, Fahlund recommends workers consider finding a second job. “It may be that you are married and only one spouse is currently working,” she said. “Perhaps the unemployed spouse can find a way to work at least part-time to help support the family. If there are teenage children at home, ask them to pitch in, too.”
Return to retailer Fahlund recommends that those considering a purchase wait a day or two to see if it still is top of mind. “Many times, purchases seem to be important, but a short period of time later you forget about them,” she said. Also, she recommends consumers throw away catalogs when they arrive in the mail and unsubscribe to email solicitations.
Don’t shop until you drop
For those who can’t stop their impulse to shop, regardless of their actual financial situation, Fahlund offered this advice: “Consider carefully saving the receipt after your spree and returning the majority of the items within a few days,” she said. Better yet, find other things you can do with that time, like volunteer at a food bank or mentor a young girl or boy who needs you.
Keep on contributing
No matter one’s financial hardships, Fahlund says workers should continue contributing to their 401(k) plan. If money is really tight, workers could reduce how much they contribute, but still keep it high enough to get the company match. Also, “if you are very close to retirement, additional contributions to your retirement plan will not have a large impact in your projected income from investments in retirement,” she said. “Therefore, if you are tight on funds, contribute enough to get any employer match but focus on the benefits of delaying your retirement date until you are on your feet again.”
Retirement accounts aren’t rainy-day funds
Workers should avoid tapping their retirement account as if it were a rainy-day fund. “Whatever you do, if you are not yet retired, do not permanently withdraw assets from your retirement plan accounts, paying taxes and possible penalties now,” she said. “This would be a terrible mistake that you would live to regret later in your life.”
Delay retirement
Workers who are currently employed and considering retiring soon should delay their retirement date if at all possible. “Every year your employer pays you is a year you don’t need to cover your own expenses, and another year your retirement nest egg can grow and compound,” she said.
Delay Social Security Workers and retirees should also delay taking Social Security for as long as possible, too. That way, workers can take advantage of the delayed retirement credit. “Payments will increase significantly the longer you wait,” she said.
Worst case
In dire cases where it’s just not possible to spend less or it’s just not possible to work extra or longer, then the only alternative is for workers and retirees to seek assistance from family, community, and government, said Rande Spiegelman, vice president of financial planning, Schwab Center for Financial Research.
Apr
01
Posted under
How to buy a house An increase in region’s median price is not the best indicator
The southern California housing market is hot. So hot, that in January 2004, the median home price in Malibu was up 106.7 percent from a year ago. Did Malibu homeowners actually see the price of their homes double in just one year?
For years, first-time home buyers who typically buy less-expensive homes, dominated the home-sale market. When the sale of less-expensive homes outpaces the sale of more-expensive homes, the median home price stays relatively low. In 2003, trade-up buyers accounted for 70 percent of the home sales in California, according to the California Association of Realtors. Trade-up buyers purchase more-expensive homes. When there is an increase in the sales of more-expensive homes relative to the sales of less-expensive homes, the median price increases. A 10 percent increase in the median price doesn’t necessarily mean that your home appreciated 10 percent. It could have appreciated more or less than that. It’s difficult to measure absolute home-price appreciation. For one thing, you can find different rates of appreciation within one market. For example, from 2000 through 2002, the low end of the market appreciated in most places, while the upper-end market prices actually dropped in some areas during that time. One measure of home-price appreciation uses refinances to gauge price increases and decreases. This measure is inaccurate at best.
Refinance appraisals are notorious for being either high or low relative to current market value. The appraiser is merely attempting to justify the home value for the lender. So, if the borrower is taking out a small loan relative to the value of the home, the appraisal tends to come in low. HOMEOWNER’S TIP: The only accurate gauge of your home’s current value is the market.
Here’s an idea - keep an eye on sales of similar homes in your neighborhood. Visiting Sunday open houses, and then following up to find out the ultimate sale price is one way to gather useful pricing information. Another way is to ask me, Holly Leano, your local real estate agent to prepare a comparative market evaluation. In active markets where the inventory of homes for sale is very low, multiple offers can result in a sale at an astronomically high price. A Piedmont, Calif., home buyer recently paid approximately $400,000 over the asking price in a multiple-offer competition. This buyer was desperate after having looked for a home for two years.
In today’s market it would be nice if all sellers had buyers like in the example above. However, it would be imprudent to base the value of your home on an isolated incidence like this. Fair market value is more accurately defined by the price a willing buyer will pay and the price a willing seller will accept, when neither is under duress
By Holly Leano, REALTOR and Sr Mortgage Loan Consultant with excerpts from original article written by Dian Hymer
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Apr
01
Posted under
How to buy a house Friends and Family, the short answer to that question is, today.
Yes, today; because believe it or not the market is in full swing for buying today. The market has finally reached a plateau for sellers with idealistic perceptions of what their home value is really worth. Compounded with another truth that real estate sales agents and appraisers have added to the inflation of value when in actual fact, the house may not be worth more than the sum of its parts.
Gone are the days of inflated values, the 2000 boom and negative option arm loans. Welcome to 2007 the year of foreclosures and people desperate for answers to why they are in this situation.
So, how do we define what is value for money and why are so many people loosing their homes.
Take a look at the headings on the past flyers that I have sent to you. The underlying message of each of these articles refers to credit issues, high interest rates and real estate value. Needless to say, these articles have been written time and time again with varying points of view. However one main point stands out and that is – you must be prepared to buy or sell a home.
Obvious is the answer but how many of us have fallen into the hype of what the media or some smooth talking sales person, related or otherwise who has encouraged us to react on the next great deal rather than prepare for your first or next big financial decision.
About now, you may be wondering if my answer to your question is still, ‘today’.
Most definitely, ‘today’ is the best time to start preparing to buy your home and I can help you get to that stage. Hiring a good Realtor and/or Loan Officer who you can trust to discuss your financials with is a serious business. However, it is one of the key factors involved when you decide it is time to buy or sell your house.
In this time of depreciating values, sellers are concerned with not wanting to pay any fees to Realtors. Buyers on the other hand are trying to find a good deal i.e. will the seller pay for all my closing costs and will my loan officer or the bank give me a loan with no closing costs.
The bottom line is if you want a good deal you need to take responsibility for your decision to buy or sell your home. Having someone like me on your side to help you prepare mentally and financially for this big decision is worth more than what you pay me in commissions.
My slogan is “My friends are my Estate. Each and every one of you is important to me. You help make my career as a full time Realtor and Loan Officer most rewarding. As a Realtor I work regularly with people who have different needs. With the personal service that I offer, I have become a part of your life, your families, finances, feelings and even your opinions. My ultimate reward is your referrals. Your referrals reflect my integrity and thoroughness in business. I truly value your comments and your compliments on my excellent service to you at all times. I am proud to be your Agent today and I continue to work hard to keep your confidence in me as your Realtor and Loan Officer for a lifetime.
Written by Holly Leano - REALTOR and Sr Mortgage Consultant
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Mar
31
Posted under
How to buy a house Home buyers now have more negotiating power than they have had in years. However, that doesn’t necessarily make it easier to decide how much to offer. The goal is to buy the property at the best price and on the best terms. But, you don’t necessarily get there by offering a very low price. One agent was ushered to the front door when he presented an offer for a buyer who thought there was no harm offering way less than the asking price. The seller was insulted by the buyer’s very low offer.
After much encouragement by his listing agent, the seller finally issued a counteroffer. But the episode didn’t sit well with the seller who was less than cooperative throughout the transaction. Some buyers, particularly in the current market, don’t want to make an initial offer that’s close to the top price they’re willing or able to pay. They feel that if they do so, they’ll have little room to bargain. You don’t necessarily need a lot of bargaining leeway to strike a deal. If you start off with a price that is relatively close to the list price, you can stand firm or counter back at your best price along with a take-it-or-leave-it message. Just as a seller can decide not to sell if the price is too low, buyers can decide not to buy unless the price is right.
HOUSE HUNTING TIP: Ultimately, your decision about what price to offer should be based on a careful analysis of your own financial situation. Other considerations are how well the house is priced for the market, current market conditions and anything you can learn about the seller’s motivation level. In some markets, there’s a wide range of pricing strategies. Sellers who understand the current market and who want their listing to sell within months and not years, price competitively. Other sellers with unrealistic expectations overprice their homes, thinking their property has appreciated more than it has. In most areas, appreciation is flat at best compared to a year ago. Study the market carefully by looking at any listing that might suit your needs. Keep track of what these listings sell for so that you’ll be able to determine if a home is priced right or is overpriced for the market.
THE CLOSING: Your offer should be good enough price wise to catch the seller’s attention. But, it shouldn’t be for more than you can afford, and it should be justifiable given current market conditions.
By Holly Leano, REALTOR and Sr Mortgage Loan Consultant with excerpts from an article written by Dian Hymer
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