first time buyer credit

Gov short sale guide

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 are not being met.  A sub par agent, your Aunt Jinny’s  second Cousin’s friend, will figure,  ‘Hey, if I get an exclusive agency contract they can’t use someone else’.

Ok.  What if you hired a Realtor who went above and beyond to provide high quality service?   Your expectations would be exceeded and the need for a buyer agent agreement would be nil.

Sounds great except…few agents actually will.

The one scenario where a buyer contract will benefit you is when you want one.   You could be tricked into signing one when you don’t need it, read carefully.

For example, if you were looking to buy the most affordable home in a very desirable area say for instance, a Los Gatos short sale, you want to be sure your Realtor is not working with another buyer interested in the same Los Gatos property.

To be sure, ask your Realtor if they are representing other buyers looking for the same kind of Los Gatos house .  If the answer is yes then you request an exclusive buyers agreement.

If  you are asked to sign an exclusive buyer agreement be sure you understand why.  Is it because this agent is a slacker?   Do they have another buyer looking for short sales in Los Gatos?

You may be asking if the author has used a buyers agreement.   There was one time when I wished I had.

A call came into my office about one of our listings and the buyer claimed they were not working with a Realtor.  They wanted to see the home right away.   We set an appointment and I gathered all the information they needed to compare the home to other similar homes to help them determine the value.   They were so thankful!

Well, they had a Realtor.   Their Realtor had told them to search for homes, choose those they liked and to call the listing agents to show them.  He told them to call him when they wanted to buy one.  They did exactly that and I had no exclusive buyers agreement.

Live and learn, right?

I can live and learn.   I will represent many buyers and sellers every year.    Will you buy and sell several houses this year?  Can you take the chance to live and learn?

No.  You have one chance to get the best home.   Find the best suited Realtor, build trust and have fun making your dream come true.

Realted article..
 http://hubpages.com/hub/Hiring_a_Buyer_A…

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.

Do you own a HUD-FHA financed home, and need to do a Short Sale? Here is a summary of the requirements to perform an FHA-insured HUD shortsale or “Pre-Foreclosure” Sale:

1. You must be delinquent 31 days or more delinquent at the time of sale.
2. You must list the property with an un-related Licensed Real Estate Broker
3. You must actively market the property for four months (up to six).For the first 30 days of marketing, the short sale lender (mortgagee) may only approve offers that will result in a minimum net sale proceeds of 88% of the “as-is” appraised Fair Market Value (FMV). During the next 30 days of marketing, the lender may only approve offers that will result in minimum net sale proceeds of 86% of the “as-is” appraised FMV. For the rest of the marketing time (60 days), the lender may only approve offers that will result in minimum net sale proceeds of 84% of the “as-is” appraised FMV.
4. The property must be an owner-occupied, except for cases of job transfer, death, divorce, job loss
5. There should be written proof of your decrease in income showing inability to pay the mortgage, job loss, etc.
6. HUD will pay up to 1% of buyer’s mortgage as part of closing costs if the new mortgage is also FHA, plus reasonable “seller” costs
7. HUD allows 6% Realtor commission
8. HUD will not pay for Home Warranties, points or lender’s title insurance
9. You must get approval to participate in the HUD Pre-Foreclosure Sale Program in advance
10. Upon acceptance into the program, you will be given Approval To Participate Form which will outline program restrictions

There are a number of basic short sale faqs not addressed here.   This HUD guideline sets some of the story straight though.    For more FAQs read this.

Away.  From Harry.

Maybe you should buy a home in Los Gatos or West San jose.  is that far enough?   Cambrian sounds pretty good.   You need to sell your house first though.

You have decided you are going to save money and do it yourself.    More money for you will help you  get further from Harry.  So, where do you start?

Figuring out what your house is worth is probably what you are thinking.   Not exactly… and…. yes, it is.   Better be  quick.  Harry is getting really Buddy-Buddy since he learned you are selling your house.   Saving that 6% Realtor fee should help get it done faster.

Think about it.   You have more room to negotiate!

Do you have experience selecting the prospect pool or knowledge of tested marketing techniques?   How about relationships with hundreds of Realtors who have buyers that are best suited, qualified and ready to buy your home?   Probably not.   But…Harry would love to give you his 2 cents.    2 cents you don’t need.

Selling a house is more of an art than a science.

You are smart though.  You can learn, right?   You are smart enough to read marketing flyers,  read other listing comments, you can get tips from a Real Estate forums about how to negotiate sales price and terms etc.  Great.  Except half of what you learn will be wrong.    About as wrong as Harry’s 2 cents.

I would bet only 1% of what you read will be usable.   The fact is, 80% of homes sold are sold by less than 2% of all the real estate agents.    That means  most of what you read will be sourced from 98% of Realtors who are listing homes that will eventually be sold by, you guessed it, the other 2%.

Can you compete with professionals of that caliber?

To be frank, yes, many homes do sell when listed for sale by owner.

The statistics for those sales are very poor though.  If  a ‘Realtor Listed’  home will sell faster for more $$$, even after all Realtor costs are deducted,  why wouldn’t you hire a full time professional?

In the coming days I am going to present a series of articles to help guide you through the morass.

You won’t have to feel sorry for lonely Harry either.   He will be as happy to see your house sold as you are to say goodbye to old Harry.  Maybe that house you saw for sale in Los Gatos is closer than you 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

______________________________________________________

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?

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 loan lately.  In our local Los Gatos and Santa Clara County Real Estate market it is very difficult.  The symptoms have passed.

I am glad to see someone is checking up, but if it does not relieve distressed markets,  DON’T BOTHER!  It’s  glaringly obvious focus on future Real Estate recovery measures, rather than looking back,  is the best medicine.

Below are the companies that received subpoenas from HUD’s Office of Inspector General:

-First Tennessee Bank N.A., Memphis, Tenn.
-Alethes LLC, Lakeway, Texas
-Security Atlantic Mortgage Co., Edison, N.J.
-Pine State Mortgage Corporation, Atlanta.
-Birmingham Bancorp Mortgage Corporation, West Bloomfield, Mich.
-Alacrity Financial Services, LLC, Southlake, Texas
-Assurity Financial Services, LLC, Englewood, Colo.
-D and R Mortgage Corporation, Farmington, Mich.
-Webster Bank, Cheshire, Conn.
-Mac-Clair Mortgage Corporation, Flint, Mich.
-Americare Investment Group, Inc., Arlington, Texas
-1st Advantage Mortgage, Lombard, Ill.
-American Sterling Bank, Independence, Mo.
-Sterling National Mortgage Company Inc., Great Neck, N.Y.
-Dell Franklin Financial LLC, Columbia, Md.

I bet these companies end up walking away from the testimony with more bailout money.  Want to bet?

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…