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

Closing costs are overlooked by most buyers until the final phases of the purchase contract are being executed.  Buying a home is not quite as simple as just applying for a loan and writing an offer and moving in.

Home Buyer closing costs are arguably more important than the loan approval.     You  should consider them first.  While consulting with your Realtor ask them to describe all the different ways these costs can affect your offer, the price you pay and how you may be able to use them to help you afford a more expensive home or reduce you payment.

I have used these costs to make the best offer in multiple offers situations.    Call it creative offer structuring.   Remember,  only a few of these are commonly packaged in your mortgage and if they are not negotiated in, you should be prepared to pay them at closing.

Lender fees:

• Loan origination points – depends on your lender and type of loan
• Prepaid interest – depends on which day of the month you close
• Property tax impounds – depends on the type of loan and time of the year you close
• Insurance impounds – plan on 6 months of insurance, if required
• Processing/Underwriting fees – depends on your lender and type of loan
• Document prep fees – approximately $150.00
• Appraisal fees – approximately $450.00
• Funding fees – depends on your lender and type of loan
• Tax service, flood cert, etc. – approximately $150.00

Title fees

• Owner’s title policy – determined by purchase price
• Lender’s title policy – determined by the loan amount
• Document prep, notary, recording, courier, etc. – $200.00
• Escrow fee – also determined by purchase price

Other fees associated with the Buyer Side:

• Prorated property taxes – depends on the type of loan and when in the year you close
• Homeowner’s dues – varies depending on the development
• Transfer tax – $1.10 per $1,000 of purchase price
• Annual homeowner’s insurance policy – depends on the type of home being purchased
• HOA transfer fee – varies depending on the development
• Inspections – Property (est. $450), Termite (est $250) & Roof (est $175)- other inspections may be recommended i.e. Chimney, Septic, Foundation the list can be long in some cases.

What are buyer contingencies?     click here for a review

These two Los Gatos homes for sale prove that a listing price is rarely a selling price in our Real Estate market.  We are at a crossroads.   It just isn’t what you might think;

131 Millrich Dr.  this Los Gatos house sold for nearly 1% less than the asking and 411 Clearview Dr., a townhome, sold for nearly 5% over the listing price !

A reminder that ’sweet spotting’ your asking price will always pay off.

The good news….neither property was a short sale.

2 Los Gatos Houses sold this week,

131 MILLRICH DR, Los Gatos 95030 (Los Gatos)Single Family Home 3 bed(s) Baths: 4|1 bath(s)   SqFt: 2,593  Lot: 9,100 sq ft

List Price: $1,449,000     Sold Price $1,332,000.00

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411 CLEARVIEW DR, Los Gatos 95032 (Los Gatos)Townhouse  3 Beds, 2|1 Baths:  SqFt: 2,122 Lot: 2,220 sq ft

List Price: $749,000 Sale Price: $780,000

Assoc. Fee: $428

We see a crossroads ahead…one where the buyers in the Los Gatos Real Estate Market aren’t in the driver’s seat.    Could this mean the homes for sale are in a Seller’s market?

Remember…

Spring is coming and the end of the $8000 First time buyer’s credit is there waiting.   I wonder if will  lead to more vigorous sales?…bidding?

It looks increasingly obvious the problems for some lenders are going to get a lot worse.

Rismedia reported this weekend…

The Department of Housing and Urban Development (HUD) said it’s taking a closer look at 15 mortgage companies to determine why they had such high rates of problems with FHA insured mortgages.

Can I answer that?  Lending to anyone who could fog a mirror tends to do that.    I told you Fannie Mae was getting a spanking before this new investigation.

“Each loan on this list will be thoroughly examined and we will track down the reasons why it failed. Once we determine the causes, we will look to see whether there is a need for further review or remedial action. We want to send a message to the industry that as the mortgage landscape has shifted, we are watching very carefully and that we are poised to take action against bad performers,” Donohue said.

I wonder if this has anything to do with the fact Fannie Mae is approving foreclosure without notifying banks.

I don’t think Ken Donahue has tried to actually apply for a Home Purchase Read the rest of this entry »

The program was originally designed for First Time Buyers only.  With the extension of the  tax credit came some other great news.  Just released today was the new IRS form for attachment to your tax filing.  Los Gatos home buyers  should be attaching this form when filing.

The new law allows a long-time resident of the same main home to claim the homebuyer credit if they purchase a new principal residence. To qualify, eligible taxpayers must show that they lived in their old homes for a five-consecutive-year period during the eight-year period ending on the purchase date of the new home. The IRS has stepped up compliance checks involving the homebuyer credit, and it encouraged homebuyers claiming this part of the credit to avoid refund delays by attaching documentation covering the five-consecutive-year period.

what you can and cannot deduct as a homeowner

Get your taxes done FREE

Great short Video Explanation of Credit

Prize: $100 Haitian Victim Relief Donation.

Create a Quip Contest!  Choose One of the Perils and Create a Quip Contest.

Pick a Peril from the list below, create a quip and post it as a comment below.  We will take a community vote at the end of the month.

The winner will have a $100.00 donation made, in their name, to their favorite charity helping the Haitian earthquake victims!

David Letterman announced where donations can be made directly.

You can text to 90999 and enter Haiti  to make a $10 donationtoo.

2 silly Contest Examples:

Why do transactions fail?

8. Applicant makes large purchase on credit before closing.

Quip: At least the store was still open.

9. Illness, injury, divorce or other financial setback during escrow.

Quip: You should know better! Mom warned you about escrowing!

Help others! Choose one of the 88 snags -below the video – and create a quip then post it in the comment section below.   It’s Easy and will help someone in need.  Do It Now!  Please.

Pick Your comment to create a quip… Read the rest of this entry »

The Haitian earthquake reminded me of the 1989 Loma Prieta earthquake and how hard it hit Los Gatos.    I was lucky no one I knew was hurt.   I only had to fix a cracked coupling on my grandmothers gas pipe in the Carlton Meadows neighborhood where she lived.

Think ahead!

I added a couple of links below this post to help you obtain the items discussed here.

‘Safe Up’ your home by addressing these 10 things.

1. Make sure shelves are fastened securely to the walls.
2. Place large, heavy objects on lower shelves or on the floor. They might Read the rest of this entry »

Tait Ave Home Sold In Los Gatos

You can do a detailed search for homes available for  sale in the  the Los Gatos Real Estate market here.

The Obama administration’s $75 billion program to protect homeowners from foreclosure has been widely pronounced a disappointment, and some economists and real estate experts, myself included, now contend it has done more harm than good.

If you have been reading my Los Gatos Real Estate musings you already know that since the program was announced in February, it has lowered mortgage payments on a trial basis for hundreds of thousands of people, but has largely failed to provide lasting relief. Critics increasingly argue that the program, Making Home Affordable, has raised false hopes among people who simply cannot afford their homes.

As a result, desperate homeowners have sent payments to banks in often-futile efforts to keep their homes, which some see as wasting dollars they could have saved in preparation for moving to cheaper rental residences. Some borrowers have seen their credit tarnished while falsely assuming that loan modifications involved no negative reports to credit agencies.

This fact that credit scores are affected by modifications boils my brain!  The program was meant to help!   In fact, it is hurting too many people.   How are you going Read the rest of this entry »

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 »