June 2011 Archives - HomeVocal Real Estate Network

Home Selling Tips For 2011

June 20, 2011 By admin Leave a Comment

The hottest time for sellers of the year is upon us. Spring and early summer is typically the time that most people want to start selling their home or buying a new home. The kids are out of school, and people tend to make more free time to look at homes and investigate the real estate market.

In 2011, there’s important shifts in your mindset you need to consider when selling your home.

Redefine Real Estate Market Value

I have seen homes that have been on the market for 150 days, 250 days, or even longer. And when I look at the history of that property listing I can see a very unmotivated seller.

The market value of your property is what a buyer in today’s market is willing to pay for that property in conjunction with what you are willing to sell the property at. It is important not to look at properties that are currently active on the market when determining your home’s market value, but look at homes that have been “accepted” by buyers recently which means they have been sold. You can also tentatively look at homes that are listed as pending and extrapolate what they’re typical selling price is probably going to be.

So, before you even list your home keep these things in mind and don’t just take the agent that gives you the highest number in the listing appointment.

Buyers having their own personal agent

In my experience, a buyer should have their own personal agent in the transaction upfront. At least have a written client agreement between you and agents that you’re working with whether that is the listing agent are not. In most states, there is no such thing as implied agency which means that if you are officially being represented by a real estate agent, you must have that agreement in writing. Most buyer’s agents don’t charge any fees upfront or any commissions due to them from you as a buyer at closing.

Sellers take the selling season correctly

Choosing when to sell your home is an important decision and will reflect what type of offers you get and how quickly you receive them. I huge part of the real estate market is driven by children’s school schedules in most markets. Parents typically don’t want to interrupt a school year in the middle of classes and would much rather move in the summertime.

In the buyers shoes

If you have your home on the market , is a good idea to subscribe to listing data for homes that are similar to yours. This will allow you to see the competition and take a peek at what a potential buyer of your home is also looking at. Just by signing up to receive automatic MLS listings to your e-mail will give you a good feel for the market and will help you understand why your home isn’t selling if that’s the case.

When you are receiving these listings, you might see a home that is bigger than yours, and him and their location is priced below yours and is still not selling. If you see this, it’s time to go back to the pricing table and get your home price correctly before you lose the hot time of the market.

Consider short sales and foreclosures

Even if your home is not a short sale, you need to keep your eye on the market of short sales foreclosure properties. These are what buyers are looking for these days because they wanted the still possible. Don’t assume that your home is in better condition or better home overall just because it is not a short sale or foreclosure property and price your home accordingly. You may have an advantage if you can stage your home and make it stand out from the competition because many short sales and bank owned properties may not show that well.

Overall, it is important to know the market and this will help you keep your fingers on the pulse of pricing so that you can be one of the sellers actually gets their home sold and can move on with their life.

Filed Under: For Sellers

Short Sales and Mortgage Insurance

June 20, 2011 By admin Leave a Comment

Important thing to know when buying your home is whether you will be having mortgage insurance on your loan or not. Many buyers don’t even think about this until they are getting approved for a loan, and sometimes they don’t even know about it or recognize it until there at the signing table.

With a lot of listings these days being short sales, mortgage insurance plays a bigger role than ever when it comes to completing a transaction. Mortgage insurance company in a short sale is part of the reason a short sale take so long to get approved. Not only does the bank has to get approval for the short sale through the investor or investors, but they must work through the home mortgage insurance scenario as well. A lot of the times, the mortgage insurance company has to pay out on the property whether there is a short sale or a foreclosure so they are not necessarily super motivated to get a short sale completed.

Why do you pay mortgage insurance?

many buyers don’t necessarily want to mortgage insurance on their loan, but it is required with many loans out there these days. Private mortgage insurance or PMI is typically required when the borrower is putting a down payment of less than 20% of the sales price. The less that the borrower puts down on the home, the greater the risk for the investor. This private mortgage insurance is insurance for the lender in case of buyer default.

Do I get to choose my mortgage insurance company?

Being that we are living in America, you would think that you would have the right to choose who the mortgage insurance company is, but that is not case. When you think you would get to choose and negotiate what the premium is? Well, you don’t.

If you have an FHA loan, chances are that you do have private mortgage insurance attached that loan. Because you typically only put down around 3.5%, there is a greater risk that you will default in the eyes of the bank. Also, with FHA loans, unit your home appreciates in value which gives you 20% equity, you still need to pay down or reduce the original loan amount by 20% to be able to get rid of that private mortgage insurance. Typically there is a minimum of five years on FHA loans to remove mortgage insurance.

Avoid paying mortgage insurance

There are several ways that you can avoid paying mortgage insurance. If there is a way that you can get out of paying mortgage insurance, it can save you thousands and thousands of dollars over the life of your loan.

If you are a veteran, you can obtain a VA loan which has no private mortgage insurance attached.
With some loan programs, you can pay a higher interest rate and they will allow you to go without private mortgage insurance.
You can take out what is called a combination loan which might be a 80% – 10% – 10% loan which consists of 10% down, one loan of 80%, and a second loan of 10%.
The home that you’re purchasing might qualify for HomePath mortgage financing. This is a special loan program offered by properties that are owned by Fannie Mae which allows you to have a small down payment and still not have mortgage insurance.
Sometimes you can find special loans based on your profession. If you are a teacher or a doctor, sometimes you can find loans that don’t require mortgage insurance even with a small down payment and some even offer 100% financing.

If you can help it, try to stay away from having to have mortgage insurance on your new home loan because it really does not get you any closer to paying off your home.

Filed Under: For Buyers

5 Home Selling Steps Before Listing

June 20, 2011 By admin Leave a Comment

Don’t get ahead of yourself. Before you list your home with a real estate agent, it is important that you set a foundation for success. The ultimate goal for you in selling your home should be to sell your home for the highest not possible, net the most amount you possibly can a closing, and do it in the least amount of time with the least amount of hassle.

The Reason For Selling Your Home

The first thing that you need to think about is what is the reason you are wanting to sell. Everyone has their own reason to sell. Does your reason make you motivated to go through the selling process? If you are truly ready for the transition, he can be setting yourself up for a lot of disappointment.

Buying a new home

A lot of people that sell their home are doing it because they want to relocate and purchase another home. Before you commit, you want to know what price range you’re going to be in and start driving some of the neighborhoods that meet your specific criteria to see if there’s going to be a potential for matches. You just might find out that you prefer to stay where you’re currently at.

Talk to a listing agent

You might want to get an idea of what your home value currently is by talking to an experienced agent in your city or community. They should be able to give you a pretty good idea of what your home will sell for and how long it will take to get an offer. This can give you a good idea of whether you want to take the next steps or not.

Getting your home ready to sell

Start by thinking about a staged home that you see in a brand-new subdivision. Think about the layout, but the core, and the overall look and feel of the home. Now, look at your home and see if you can match that same look and feel to maximize your selling price.

Repairs before you sell

Just because there is something that you think you need to fix, does not mean that that particular repair will pay off. Make sure to consult your listing agent before making repairs to ensure that you need your money back out that you’re putting in or make it easier to sell.

Home staging

You could hire a professional stager come in and go through your property and either give you advice on what to do, or do it for you. This obviously depends on what needs to be done and how good of an eye you have for staging a home.

Pricing your home right

Every seller wants to get top dollar for their home. Make sure you look at your home as a commodity rather than looking at from a personal angle when determining price. Put yourself in the buyer shoes and look at the other properties that are available that they potentially will be looking at. Make sure to make price adjustments if needed early in the process rather than waiting months and months to rectify a mispriced home.

Selling your home will always, always come down to where it is priced. There is no repair or miscalculated paint color that can’t be corrected by price. So, if your home is in the best condition and looks as good as is going to look, and it is not selling, you need to look at the marketing of the property and you need to look at the price of property. If the home is marketed properly, and selling your definitely going to need to reduce the price to make it appeal to buyers who are out there looking and comparing homes.

Filed Under: For Sellers

Short Sales and Todays Buyer

June 20, 2011 By admin Leave a Comment

Today’s real estate buyer tends to think that short sales are a great deal. While they can be a great deal, there are some very important things you need to watch out for when thinking of purchasing a short sale property.

Another term for a short sale property is typically calling a pre-foreclosure property. This is a home that is typically in, or close to being in, the foreclosure process but has not yet been foreclosed on. In these scenarios, the owner typically does more than they can sell the property for and have to sell the home “short”. Keep in mind that a short sale does not mean that the transaction is going to be a short one, but rather be prepared for a much longer than typical wait to see if you actually are able to purchase the property.

Many buyers are waiting anywhere from 2 to 6 months on a short sale offer. They’re waiting for the bank to respond to their offer and either accept it, counter it, or reject it.

Multiple Liens Short Sale

there are many properties for sale listed as short sales that have more than just one lien holder on the property. Homeowners have taken out first and second loans on properties and therefore both of those banks, or investors, would have to approve to release the lien on the property. The more lien holders involved, typically the longer and more frustrating the wait.

What Price To Offer On A Short Sale?

Many times, the seller of a short sale is in a financial hardship and may have stopped making payments on the property. With that information, you would think that the banks would be very motivated to approve a short sale offer, but this does not always happen to be the case. An estimation would be that short sales will be priced at around 10% below the typical market value of a similar home that is not a short sale. One thing to keep in mind is that the bank will order an appraisal or a BPO which is also known as a broker price opinion on the home before they accept or reject any offers. Because the lender is typically not even in the same state, the appraisal number for the BPO number is their only number they have to go on when it comes to determining the value of that property in the current market.

So, without being said, don’t expect to get a short sale property for 20%, 30%, or 40% below the market value.

Short Sale Wait Time

The most frustrating part of a short sale transaction is the long period of waiting from the time he you have an accepted offer between a buyer and seller, and the response from the bank. Again, you think they would want to get rid of these properties to a willing buyer quickly, but with so much on their plate in so many properties in the same situation the response times can lag on and on. Make sure to check with your experienced buyers agent or listing agent on a time frame to expect in your particular market and with that particular bank.

Overall, short sales can be a great option if you’re very patient and have an open ended timeframe to close on your new house. If you are in a rush, or have a set schedule for your move, you might want to consider a bank owned property, which is a property that has already been foreclosed on, or a typical seller listing that is not in distress.

Filed Under: For Buyers

Sarah Palins New House In Arizona

June 20, 2011 By admin Leave a Comment

A new home has been purchased in Scottsdale Arizona, and the new homeowner is reported to be the former first lady of Alaska, Sarah Palin. This home pictured here was reportedly sold for $1.695 million. The strange thing is that the home was sold one year ago for $803,000 according to the public tax records.

This whole time I thought that the real estate market in Arizona was going down and not up, but who might say. And I really shouldn’t call this a home it looks more like a compound. I guess you would call it an estate in Arizona. Good luck to the Palins in their new home.

Filed Under: US Real Estate News

Getting in An ARM Loan Trap

June 20, 2011 By admin Leave a Comment

Homeowners looking at the possibility of doing an ARM loan has jumped up 75% from last year alone. Interest rates have crept up from the mid-4% range into the low 5% range and a lot of homeowners are starting to look at the possibility of an adjustable-rate mortgage because it can give you a lower interest rate from anywhere from one to 10 years.

Adjustable-rate mortgages that mature after five years are the most common. They’re called a 5-1 arm loan. This means that they are fixed at a lower interest rate for the first five years of the loan, but then can increase at a rate of up to 1% per year thereafter. They are adjusted based on the interest rates at the time of the adjustment period.

An example of the savings an ARM loan can give you would be savings of $230 per month on your monthly payments which equals over $19,000 during those first five years of the adjustable-rate loan. This can be a good thing if rates stay low or you plan on refinancing or selling in that five-year range.

You can also be at risk of getting into a loan that you can’t afford after it does it just. Who knows what rates will be in five years? Nobody. You are protected a bit because most loans can only go up 1% per year thereafter. Because they are adjustable, they can also go down.

According to the national Association of realtors, the average homeowner stays in their home for eight years. So, keep that in mind as you choose which loan program you’re going to go with. There are three your ARMs and seven year ARMs as well.

If you plan on staying in your home for 10 years, 15 years, or longer, they might be safer for you to go with a fixed rate loan which typically come in the 15 year and 30 year variety.

Watch the video below for a little bit more information about recent mortgage news from CNN.

Filed Under: Idaho, Mortgages

Foreclosures Drop Again

June 20, 2011 By admin Leave a Comment

Eight straight months of foreclosure filings drops have been reported by Realty Trac.

In May of 2011, foreclosure filings dropped 33% from the previous year and just about 2% from the previous month of April of 2011. The amount of homes that have actually been repossessed which is also known as REO, also dropped to 66,879. This is a reduction of 3.8% from April 2011 and a 29% drop from the same time last year.

Keep in mind, that the drop in the number of foreclosures in the United States does not necessarily mean that the real estate market is in full recovery.

It is estimated that a lot of the reduction can be attributed to the Robo signing controversy that went down last year in September of 2010. This Robo signing scandal showed that banks were skipping over a lot of the foreclosure process and requirements that they are supposed to be doing therefore rendering some of the foreclosures illegal. Sloppy paperwork was involved and gave homeowners access to their initial rights comes to foreclosure in the house.

Many banks are in the process of revamping and reorganizing their foreclosure processes in order to comply with the law and standards that they must uphold two. This will ensure that homeowners have their rights and voices heard throughout foreclosure process and keeps the banks accountable for their actions and how they proceed.

Many banks are not in a hurry to repossess homes at this time because they’re so much inventory in the market. It is not good business sense for banks to take back homes and then have to pay for property taxes, heating, home repairs, and home insurance. If they can’t sell them quickly, they may not want to proceed quickly with the foreclosure process.

There are many instances of foreclosures taking anywhere from one year to two years or more before the bank actually forecloses.

All these numbers and information depend deeply upon the local market and the local economy when it comes to how banks will interact with delinquent homeowners.

Filed Under: Idaho, Market Trends