Michael Roberts' Blog -San Jose Homes, Real Estate and Houses for Sale

An exclusive Buyer Agreement is one where you, the buyer,  agree to work with that one agent exclusively.  Are there good reasons to sign an Exclusive Buyer Agreement?  Answer:  One and only one and… rarely necessary.

What if your agent is not what you expected?

You say,  “No!  I have the best agent!”  She is the number one agent for this, that and some other thing, she drives an expensive car, demonstrating her success, and she knows your Aunt Jinny’s second cousin Julie.

So, why did she ask you to sign an exclusive buyer agreement?  It’s a matter of trust.

In my series of articles  “Is my Agent Lying to Me?” the core lesson, was trust.  The primary reason an agent requires a buyer to sign one of these agreements is usually their lack of confidence to provide superior service.   They don’t ‘trust’ that you will be satisfied and you will wander off and use a new agent.

Usually,  a buyer will only change agents when their specific needs Read the rest of this entry »

That FHA mortgage looks like a winner for San Jose home buyers and Los Gatos home buyers.   Low Down Payment,  Great Interest Rate!  What more could you ask for?  A short sale?

Well, not much, obviously or , at least,  hoping is not going to change the new rule.   The upfront costs are going to be a bit higher.

To get that Low Down Payment and Great interest Rate you are going to be required to….

• Pay an upfront mortgage insurance premium of 2.25 percent of the total loan amount, up from the current level of 1.75 percent. A borrower taking out a $200,000 mortgage would pay a $4,500 fee, for example, rather than the current fee of $3,500. Borrowers will still be able to wrap these fees into the total amount borrowed. FHA officials also plan to ask Congress to increase the maximum annual premium that FHA can charge.

So, they may get more expensive.   This will  reduce the number of buyers who can qualify.   There’s more…the credit score benchmarks are changin too, further decreasing the number of buyers a home seller will be able to market their home to.

• Need a credit score of at least 580 to qualify. Many FHA lenders already require a higher score, but there had been no standard requirement across the program. Borrowers with a score lower than 580 will need a down payment of at least 10 percent.

Maybe this is what we should expect all things considered.  I want to remind you a HUD approved lender is not like any other and the more experienced they are, the better your chances of a quick approval and subsequent closing.

Yes, you can buy a short sale in Los Gatos or a house in San Jose that is listed for sale as a short sale.  Interesting concept.

Buying a home means you need to understand your credit score better and how it weighs in and out of your favor. This is true In Los Gatos and the Bay Area, more than most, due to the high priced Real Estate here.  Investors know this and so should you.   What will a finance company consider when you make an offer on that Los Gatos foreclosure you want to buy?

With all the misguided information flying around about loan modifications understanding these myths will prevent some misteps.

“Many Americans hold mistaken beliefs about credit scores,” cautioned  Ethan Ewing, who heads the free online consumer portal at Bills.com. “Misinformation on television and in hearsay from friends and neighbors only compounds the problem.”

Here are the top 10 commonly held myths surrounding credit scores:

Myth #1: A credit score is a credit report. The credit report is a detailed listing of all debts and payments, going back throughout an individual’s entire payment history, Ewing explained. For each entry, it shows the creditor’s name, amount owed, the highest balance owed, the available credit, whether the account is open or closed (and who closed it), the number of late payments and whether the account is in default. A credit score is a number between 300 and 850 that is based on complex formulas incorporating all the data in the credit report.   Most homes for sale in Los Gatos yield many offers so, you need to have the best credit score. Read the rest of this entry »

California Price Shows Year-To-Year Gain for First Time in Two Years
By: Robert A. Kleinhenz , Ph.D., Deputy Chief Economist

The median price of a home in California experienced its first year-to-year gain in over two years during the month of November, as the California housing market continued recent trends in terms of prices, supply, and sales. The monthly median price crossed the $300,000 threshold in November with a median of $304,520, up 2.4 percent from the October median price of $297,500 and up 5.8 percent from $287,880 a year earlier. The situation has improved greatly from a year ago during the worst of the financial crisis, when the median price had registered 41.3 percent year-to-year decline.

This supports the conclusion

After a 59 percent peak-to-trough decline, the California median Read the rest of this entry »

Yes he did.  Speaking to associates at a Home Depot, last Friday,  President Obama was touting his new ‘Energy Initiative’ and used the word.  The worst part he was talking about insulation.

I don’t know how sexy insulation is, but with tax season coming it is a very good time to plan ahead for spring.  If you do it right you could get a few ’sexy’ bucks from Uncle Sam.

If you are planning to do a remodel project take time to plan.  I know, how else would you do it?   I am talking about planning what materials and products you and your contractor are going to use.  Don’t forget to get a permit if the cost of improvement  exceeds $1000.

The San Jose Planning Dept. has reduced staff, so start the process early.

Read the rest of this entry »

This must be a symptom of low supply and the fear the bottom has passed.

The median price of a home sold in the county rose 9.9 percent compared to a year ago to $494,400 in November, according to MDA Dataquick, the second straight month of year-to-year increases.

The number of homes sold also rose 47.2 percent to 1,649 in Santa Clara County.

“The latest stats show just how much the Bay Area market has changed in a year,” said John Walsh, MDA DataQuick president.

The question I hear most is…”Has the market bottomed out?”

If this price trend continues for another quarter I will answer Read the rest of this entry »

The spanking Fannie Mae is suffering has become intolerable.

The rumor several banks have agreed to streamline short sales is true and will certainly make the spanking a light one.  How do I know?  When I inquired why my calls were not being returned, for a few days in October, contacts at BofA told me they were being trained for a new program to expedite… Read the rest of this entry »

The following homes in Los Gatos reported as closed (sold) this past week.  Congratulations to the new homeowners and the community they will certainly enjoy!

15400 VIA PALOMINO Single Family  4 bed(s) /3|1 bath(s)23,482 sq ft     Monte Sereno $2,395,000

16242 AZALEA WY Single Family  3 bed(s) /2|0 bath(s) 8,000 sq ft Los Gatos   $1,229,000

102 HOLLYCREST DR Single Family 3 bed(s) /2|0 bath(s) 7,070 sq ft  Los Gatos  $799,000

14225 LORA DR #102 Condominium 2 bed(s) /1|0 bath(s)     2,242 sq ft Los Gatos $345,000

These homes all sold for below their asking price from  High reduction of -9% for Lora Drive and low price reduction of 3% for Azelea Way.  Home sellers and agents in Los Gatos and surrounding areas should take heed of the substantial reductions made this week.    The days on market or CDOM are more relevant factors in pricing homes today than we have seen in the past few years.

This article  (here) is evidence our market is doing better than average.

Image by Getty Images via Daylife

Last month BofA chose to work with REOtrans, a leading transaction vendor to the mortgage industry, to advance and streamline foreclosure solutions by reducing them all together.

They are working to move the short sale idea into the mainstream RE sale arena. This is great news no matter what side of the Real Estate market you find yourself standing in.

The traditional Short Sale process has led to immense frustration and outright anger, not only here in California, but throughout the nation for all parties involved. As a Real Estate professional, having to negotiate short sales on behalf of distressed homeowners, I have learned that many people charged with Short Sale approvals agree…the short sale process, as it is implemented now, is ridiculous even archaic.

B of A has been the penultimate banking institution in the United States for decades and it goes without saying their agreement to work with REOtrans is a window into Real Estate sales for the near term. Read the rest of this entry »

The Home Mortgage Preservation Program is now Turbocharged enough to help high Los Gatos mortgages hopefully.

In May the government stepped up the pace to modify mortgages to stave off the 10–12 million potential foreclosures looming on the horizon.   This was to be done first, by allowing homeowners to qualify for modifications on a temporary basis.  650,000 homeowners are now in that process.

However, only 2000 have been approved for modifications through the program.

Request Loan Modification .PDF

Chase Loan Mod Docs .PDF

GMAC Financial Statement .PDF

“We now must refocus our efforts on the conversion phase to ensure that borrowers and servicers know what their responsibilities are in converting trial modifications to permanent ones,” said Phyllis Caldwell, the newly appointed chief for the Treasury Department’s upstart Homeownership Preservation Office, in a statement released Monday.

The MakingHomeAffordable.gov Web site will include links to all required documents and an income verification checklist, as well as explanations of how the trial and conversion processes work. The Homeowner’s HOPE Hotline, at (888) 995-HOPE, will provide direct access to housing counselors

The temporary modification idea was meant to allow the homeowner time to submit documentation the lender would review to potentially grant an approval.   This has caused much anxiety on the part of the participants as evidenced in the following quote.

“Now it’s up to the banks to do their part to convert borrowers to permanent modifications,” said Michael Barr, an assistant Treasury secretary. “Servicers to date have not done a good enough job.”

We just don’t know what penalty the participating lender is facing if they do not comply with the pressure.   Without proof of substantial numbers of permanent modifications there is a real sense that this will just be another case of hot air.

This will lead to MORE foreclosures that may well have been prevented if the homeowner had time to seek out alternatives like a short sale or deed in lieu of foreclosure.

“If we don’t see a big increase in the permanent modification numbers, then there’s something seriously wrong with this program,” said Alan White, a law professor at Valparaiso University. “I can only assume the number is appallingly low.”

The Treasury Dept. began to publish reports naming those institutions that were lagging which proved to increase the numbers of temporary modifications from 235000 to 650000 by the end of July.

It is likely there will be another attempt to list their names if the number of permanent modifications does not rise soon!  Not quite Turbocharged.

There are new guidelines, now in place, that servicers are not going to like very much.

This is directly from the HMP press release …

Top servicers will be required to submit a schedule demonstrating their plans to reach a decision on each loan for which they have documentation and to communicate either a modification agreement or denial letter to those borrowers. Treasury/Fannie Mae “account liaisons” are being assigned to these servicers and will follow up daily as necessary to monitor progress against the servicer’s plan. Daily progress will be aggregated by the end of each business day and reported to the Administration.

If you or someone you know needs to get on board, forward this link to them. http://makinghomeaffordable.gov/index.html

Here they will find…

• Links to all of the required documents and an income verification checklist to help borrowers request a modification in four easy steps;
• Comprehensive information about how the trial phase works, what borrower responsibilities are to convert to a permanent modification, and a new instructional video which provides step by step instruction for borrowers;
• A toolkit for partner organizations to directly assist their constituents.

I think this is a mess that still needs cleaning up… and I am hear to watch ‘em.