Monday, May 9, 2011
It's Prime Time to Buy A Home!
I just read a great ebook called "7 Reasons Why now is a Great Time to Buy a Home!" it's filled with exciting information to help buyers seize the incredible market opportunities available to them right now. Over the next few weeks, I'll be sharing key excerpts from this ebook with you in this blog. For a free copy of the ebook, contact me and I'll send it your way.
Monday, October 4, 2010
Losing your house because of unpaid HOA fees?
People Are Losing Their Homes Because of Disputes With Their Homeowners' Associations
What’s the latest reason people are losing their homes? It’s not just bankruptcies and late mortgage payments. It’s disputes with their Homeowners’ Associations. According to ABC News, over 80 million people in North America live in “self-governing” communities, run by boards that decide everything from the color of paint on houses, to trash pickups, to street parking, and collect fees to minimize crime, repair roads, and take care of pools, gardens and other public areas. Homeowners who break the rules – or don’t pay their fees – are fined and forced to bring their property into compliance. Fines can easily snowball to six figures, leading to foreclosures, violence, and homeowners jailed for small infractions.
For example, an ailing Florida grandfather couldn’t pay his mortgage and afford to re-sod his lawn. So, he let it die. He was thrown in jail until neighbors pitched in to replace his grass. A North Carolina man’s fines for unpaid dues and an illegal white picket fence reached nearly $25,000. A few days before he was scheduled to be evicted for the unpaid fines, he burned his house to the ground – while he was inside it.
So, how can you protect yourself? If you’re buying in a regulated community, read the deed restrictions and Homeowners Association requirements and penalties before you close escrow. If you already live there, re-read the paperwork so you know where you stand. Finally, don’t ignore any notices about late payments or violations, which can lead to a lien and even foreclosure. In fact, go out of your way communicate with your board – so you can work out a solution that works for everybody.
Moral of this story: Even if you can't pay the mortgage, if you want to do a short sale to save your credit...keep up to date on your HOA fees. Unpaid HOA fees can wreck or break a sale.
What’s the latest reason people are losing their homes? It’s not just bankruptcies and late mortgage payments. It’s disputes with their Homeowners’ Associations. According to ABC News, over 80 million people in North America live in “self-governing” communities, run by boards that decide everything from the color of paint on houses, to trash pickups, to street parking, and collect fees to minimize crime, repair roads, and take care of pools, gardens and other public areas. Homeowners who break the rules – or don’t pay their fees – are fined and forced to bring their property into compliance. Fines can easily snowball to six figures, leading to foreclosures, violence, and homeowners jailed for small infractions.
For example, an ailing Florida grandfather couldn’t pay his mortgage and afford to re-sod his lawn. So, he let it die. He was thrown in jail until neighbors pitched in to replace his grass. A North Carolina man’s fines for unpaid dues and an illegal white picket fence reached nearly $25,000. A few days before he was scheduled to be evicted for the unpaid fines, he burned his house to the ground – while he was inside it.
So, how can you protect yourself? If you’re buying in a regulated community, read the deed restrictions and Homeowners Association requirements and penalties before you close escrow. If you already live there, re-read the paperwork so you know where you stand. Finally, don’t ignore any notices about late payments or violations, which can lead to a lien and even foreclosure. In fact, go out of your way communicate with your board – so you can work out a solution that works for everybody.
Moral of this story: Even if you can't pay the mortgage, if you want to do a short sale to save your credit...keep up to date on your HOA fees. Unpaid HOA fees can wreck or break a sale.
Friday, September 3, 2010
5 Reasons Homeownership Is Better Than Renting
The seemingly endless run of bad housing news is discouraging some potential home buyers from considering a purchase. But the truth is that the advantages of homeownership have very little to do with investment gains. The best things about owning a home have a lot more to do with personal comfort and satisfaction.Here are five of them:·
1. Be your own landlord. The bank can only kick you out if you don’t pay; a landlord can be much less dependable – deciding to sell the property or choosing to live there themselves.·
2. Paying the principal is forced savings. Yes, it’s possible that home prices will fall further. It is also possible that your 401(k) will lose value. But over the long haul, both are likely to enjoy modest gains in value.·
3. Fixed-rate mortgages never rise – and eventually you pay them off. With mortgage rates at record lows, people who buy now are locking in real bargains.·
4. Good schools. Family-sized rentals are harder to come by in areas with excellent public schools.·
5. Spacious properties in pleasant neighborhoods. Sizable homes in attractive communities are almost always owned – not rented.
Source: The New York Times, Ron Lieber (08/27/2010)
The seemingly endless run of bad housing news is discouraging some potential home buyers from considering a purchase. But the truth is that the advantages of homeownership have very little to do with investment gains. The best things about owning a home have a lot more to do with personal comfort and satisfaction.Here are five of them:·
1. Be your own landlord. The bank can only kick you out if you don’t pay; a landlord can be much less dependable – deciding to sell the property or choosing to live there themselves.·
2. Paying the principal is forced savings. Yes, it’s possible that home prices will fall further. It is also possible that your 401(k) will lose value. But over the long haul, both are likely to enjoy modest gains in value.·
3. Fixed-rate mortgages never rise – and eventually you pay them off. With mortgage rates at record lows, people who buy now are locking in real bargains.·
4. Good schools. Family-sized rentals are harder to come by in areas with excellent public schools.·
5. Spacious properties in pleasant neighborhoods. Sizable homes in attractive communities are almost always owned – not rented.
Source: The New York Times, Ron Lieber (08/27/2010)
Wednesday, May 19, 2010
Stage to Sell Your Home Fast- Some thrifty tips
With today's market turnaround, more inventory is coming on the market, the median sales price is starting to rise and multiple offers are coming in in certain price ranges, so it's important to not only price your home right but to make it appealing on the first visit!
From RISMEDIA:
May 19, 2010--Surveys show that staging pays off and often helps to sell a home fast. But don't spend thousands to make a big impact. Put the home center stage with these thrifty tips:
1. First Impressions Count. Roll out the red carpet for potential home buyers by sprucing up your entryways, especially the one on a lockbox. Welcome mats, planters filled with seasonal flowers, and clutter-free foyers and hallways set the stage.
2. Sell the Space, Not Your Stuff. Remember that the goal of a successful showing is to make a prospect feel at home – like it's theirs, not yours. Put away your extensive personal collections. Less is more: open up your space so prospects can actually see what they're buying.
3. Paint and Elbow Grease Work Wonders. Fresh paint and a thorough cleaning will give you the greatest “bang for your buck”. Remember that neutral walls are your best bet when staging a home for sale. Lowe's has all the right shades to make your home more inviting. Get started with Lowe's online Paint Visualizer.
4. Go with the Flow. Arrange furniture for easy traffic flow. Consider placing a major piece of furniture at an angle, such as a couch or desk. Angles add interest and can create a more open feel.
5. See the Light. Move lamps to dark corners and arrange window treatments so that natural light floods your rooms. Brighter is better, and your rooms will look larger. Visit Lowe's extensive lighting section for the latest in fashionable, functional lighting.
6. Go Green. Live plants can add decorative flair, without spending a bundle. Plants and cut flowers have a way of warming up a room.
7. Don't Forget the Outdoors. If you have a porch, deck or patio, clean the furniture and replace worn cushions. Give your deck a fresh finish with a new stain and seal.
8. Make the Kitchen Sparkle. Declutter the countertops by removing toasters, food processors, and other non-decorative items. If you have a breakfast table or counter, put out a couple of table settings complete with place mats, napkins, and dinnerware.
9. Warm Up an Empty Home. If your home is vacant, consider renting furniture for key rooms, but don't go overboard. Ask your real estate professional for advice, based on your home's unique features and selling points.These home staging tips are a great place to start as you gather ideas for your open house.
(Jennifer and Marion have their own inventory of staging materials- make an appointment for staging ideas and ways to sell your home fast: jennifer@jenniferlistings.com or (831)254-8654, text OK)
From RISMEDIA:
May 19, 2010--Surveys show that staging pays off and often helps to sell a home fast. But don't spend thousands to make a big impact. Put the home center stage with these thrifty tips:
1. First Impressions Count. Roll out the red carpet for potential home buyers by sprucing up your entryways, especially the one on a lockbox. Welcome mats, planters filled with seasonal flowers, and clutter-free foyers and hallways set the stage.
2. Sell the Space, Not Your Stuff. Remember that the goal of a successful showing is to make a prospect feel at home – like it's theirs, not yours. Put away your extensive personal collections. Less is more: open up your space so prospects can actually see what they're buying.
3. Paint and Elbow Grease Work Wonders. Fresh paint and a thorough cleaning will give you the greatest “bang for your buck”. Remember that neutral walls are your best bet when staging a home for sale. Lowe's has all the right shades to make your home more inviting. Get started with Lowe's online Paint Visualizer.
4. Go with the Flow. Arrange furniture for easy traffic flow. Consider placing a major piece of furniture at an angle, such as a couch or desk. Angles add interest and can create a more open feel.
5. See the Light. Move lamps to dark corners and arrange window treatments so that natural light floods your rooms. Brighter is better, and your rooms will look larger. Visit Lowe's extensive lighting section for the latest in fashionable, functional lighting.
6. Go Green. Live plants can add decorative flair, without spending a bundle. Plants and cut flowers have a way of warming up a room.
7. Don't Forget the Outdoors. If you have a porch, deck or patio, clean the furniture and replace worn cushions. Give your deck a fresh finish with a new stain and seal.
8. Make the Kitchen Sparkle. Declutter the countertops by removing toasters, food processors, and other non-decorative items. If you have a breakfast table or counter, put out a couple of table settings complete with place mats, napkins, and dinnerware.
9. Warm Up an Empty Home. If your home is vacant, consider renting furniture for key rooms, but don't go overboard. Ask your real estate professional for advice, based on your home's unique features and selling points.These home staging tips are a great place to start as you gather ideas for your open house.
(Jennifer and Marion have their own inventory of staging materials- make an appointment for staging ideas and ways to sell your home fast: jennifer@jenniferlistings.com or (831)254-8654, text OK)
Thursday, January 7, 2010
How Many Credit Cards is Too Many?
While one in seven Americans has at least 10 credit cards, the average is four, according to a report from Experian. The national average interest rate on credit cards as of November 2009 is 12.64%.
So what is the correct number of credit cards a consumer should have to most effectively manage and optimize their overall credit profile? The answer is not simple; it’s not the number of cards you have, but how you manage them.
TIP: utilize your credit card each month but do not allow the balance to exceed more than about 30% of your credit line.
Always pay at least the minimum payment but pay extra when possible and pay ON TIME.
By doing this your credit card utilization and payment history provides a strong contribution to your credit score and risk profile, which should help you obtain lower interest rates on new credit in the future.
Beware: Although you make your payment on time every month, if you are regularly “maxing out” your credit card limit, you are actually negatively impacting your credit score and profile. Your overall credit profile would be better served spreading the expense over two or three cards and maintaining the card limits at or below 30%.
The reality is that you can have excellent credit with one well-managed credit card with a positive established history. The primary variable is how you manage your credit versus how much credit you have access to use. The general makeup of a credit score is based: 30% on payment history, 35% on the amounts you owe compared to available credit, 15% on the length of your credit history, 10% on newly established credit and, finally, 10% on the types of credit you use.
Having the right balance of credit cards and overall access to credit can be extremely helpful. Additionally, well-managed credit cards will assist you in establishing a stronger credit profile and better credit scores that can potentially lead to lower interest rates and better terms when applying for new home loans, auto loans, credit cards or even insurance.
Think carefully about adding new credit cards. Do you need the extra card to manage your credit profile better or are you exposing yourself to a greater and potentially unmanageable debt situation? Whatever the reason, it’s important to know that when you add a new credit card, your credit score will likely suffer a temporary drop until you have established a payment history with that card.
Finally, don’t make the mistake of canceling your older credit cards, even if they have higher interest rates than ones you may get on newer cards. Remember, 30% of your credit score is based on payment history and 15% on the length of your credit history. Keep that older, well-established card for that reason and use it once in a while on smaller purchases.
So what is the correct number of credit cards a consumer should have to most effectively manage and optimize their overall credit profile? The answer is not simple; it’s not the number of cards you have, but how you manage them.
TIP: utilize your credit card each month but do not allow the balance to exceed more than about 30% of your credit line.
Always pay at least the minimum payment but pay extra when possible and pay ON TIME.
By doing this your credit card utilization and payment history provides a strong contribution to your credit score and risk profile, which should help you obtain lower interest rates on new credit in the future.
Beware: Although you make your payment on time every month, if you are regularly “maxing out” your credit card limit, you are actually negatively impacting your credit score and profile. Your overall credit profile would be better served spreading the expense over two or three cards and maintaining the card limits at or below 30%.
The reality is that you can have excellent credit with one well-managed credit card with a positive established history. The primary variable is how you manage your credit versus how much credit you have access to use. The general makeup of a credit score is based: 30% on payment history, 35% on the amounts you owe compared to available credit, 15% on the length of your credit history, 10% on newly established credit and, finally, 10% on the types of credit you use.
Having the right balance of credit cards and overall access to credit can be extremely helpful. Additionally, well-managed credit cards will assist you in establishing a stronger credit profile and better credit scores that can potentially lead to lower interest rates and better terms when applying for new home loans, auto loans, credit cards or even insurance.
Think carefully about adding new credit cards. Do you need the extra card to manage your credit profile better or are you exposing yourself to a greater and potentially unmanageable debt situation? Whatever the reason, it’s important to know that when you add a new credit card, your credit score will likely suffer a temporary drop until you have established a payment history with that card.
Finally, don’t make the mistake of canceling your older credit cards, even if they have higher interest rates than ones you may get on newer cards. Remember, 30% of your credit score is based on payment history and 15% on the length of your credit history. Keep that older, well-established card for that reason and use it once in a while on smaller purchases.
Tuesday, December 15, 2009
TRADE UP! 5 Reasons why this is the BEST market to upgrade!
Have you thought about getting that bigger, better house in a better neighborhood?
NOW IS THE TIME!
Whether you need more space, want to upgrade your location, or for any other reason, the current real estate market presents a unique opportunity to capitalize by trading up!
5 reasons why this is the best market to trade up!
1. You will make money NOW on the trade!
Here's how this works. You currently own a condo that was worth $1,000,000 three years ago, and now it's worth $700,000 (that's right, it's gone down 30%!). You may be thinking, I've lost $300,000, right? Wrong!
What you do is go out and sell your condo and purchase the home of your dreams for $1,400,000. That house, three years ago, was worth $2,000,000 and you probably couldn't have afforded it. By buying it now, what you've just done is bought your new home at a $600,000 discount! Just like that, on the trade, you've made $300,000! This doesn't even take into account the money you'll save on property taxes because you're paying taxes on a $1.4M house, and not on a $2M house.
2. ... AND you will make money LATER when you sell your new home!
OK you've listened to my advice, bought that new home of your dreams and traded up. YES! Fast forward five years and the real estate market has gone up 20%. Let's take a look at what has happened. Your old condo is now worth $840,000, for a $140K gain over today's value. Your new home is worth $1,680,000, or $280,000 more than when you bought it today. Just like that, you've made an extra $140,000 on the trade!
3. You can likely buy a house you otherwise could not have afforded, and may not be able to afford again!
Going back to my example above, you probably couldn't have afforded that $2M house three years ago when you bought your condo. You also may not be able to afford it again in 3 - 5 years when the market rebounds. If you've been dreaming about a bigger home or one in a nicer area, now is really the time to capitalize.
4. It's much easier to trade up in a down market than in an escalating market!
I've had clients say that they will trade up when the market "goes back up." Let's take a close look at that. Let's say that 5 years from now, the market is back up 20% from today's values. You then sell your condo for $840,000 and your dream home is now worth $1,680,000. You've gained $140K on your condo (from today's values) BUT your dream home is now worth $280,000 more! That means that, by waiting, you've now spent an extra $140K to buy that house!
5. You'll probably get a better house by trading up in a down market!
The current market presents some very unique opportunities. In most areas, inventory is pretty high and buyers have a lot of great choices. By shopping in this market, you can really get the home of your dreams and take your pick of all the inventory available. In most cases, you can get a good deal on a great property in a terrific area.
The bottom line is that if you can afford it, now is a terrific time to upgrade! Interest rates remain at historic lows and there is plenty of financing available.
NOW IS THE TIME!
Whether you need more space, want to upgrade your location, or for any other reason, the current real estate market presents a unique opportunity to capitalize by trading up!
5 reasons why this is the best market to trade up!
1. You will make money NOW on the trade!
Here's how this works. You currently own a condo that was worth $1,000,000 three years ago, and now it's worth $700,000 (that's right, it's gone down 30%!). You may be thinking, I've lost $300,000, right? Wrong!
What you do is go out and sell your condo and purchase the home of your dreams for $1,400,000. That house, three years ago, was worth $2,000,000 and you probably couldn't have afforded it. By buying it now, what you've just done is bought your new home at a $600,000 discount! Just like that, on the trade, you've made $300,000! This doesn't even take into account the money you'll save on property taxes because you're paying taxes on a $1.4M house, and not on a $2M house.
2. ... AND you will make money LATER when you sell your new home!
OK you've listened to my advice, bought that new home of your dreams and traded up. YES! Fast forward five years and the real estate market has gone up 20%. Let's take a look at what has happened. Your old condo is now worth $840,000, for a $140K gain over today's value. Your new home is worth $1,680,000, or $280,000 more than when you bought it today. Just like that, you've made an extra $140,000 on the trade!
3. You can likely buy a house you otherwise could not have afforded, and may not be able to afford again!
Going back to my example above, you probably couldn't have afforded that $2M house three years ago when you bought your condo. You also may not be able to afford it again in 3 - 5 years when the market rebounds. If you've been dreaming about a bigger home or one in a nicer area, now is really the time to capitalize.
4. It's much easier to trade up in a down market than in an escalating market!
I've had clients say that they will trade up when the market "goes back up." Let's take a close look at that. Let's say that 5 years from now, the market is back up 20% from today's values. You then sell your condo for $840,000 and your dream home is now worth $1,680,000. You've gained $140K on your condo (from today's values) BUT your dream home is now worth $280,000 more! That means that, by waiting, you've now spent an extra $140K to buy that house!
5. You'll probably get a better house by trading up in a down market!
The current market presents some very unique opportunities. In most areas, inventory is pretty high and buyers have a lot of great choices. By shopping in this market, you can really get the home of your dreams and take your pick of all the inventory available. In most cases, you can get a good deal on a great property in a terrific area.
The bottom line is that if you can afford it, now is a terrific time to upgrade! Interest rates remain at historic lows and there is plenty of financing available.
Thursday, November 5, 2009
Why Is Now A Great Time To Buy Real Estate?
Let’s discuss two California families and the real estate market. We’ll call them Able and Baker.
Able sold a home at the top of the real estate market for $500,000 and bought a new home for $800,000, paying 10% down and getting a new adjustable rate mortgage for the remainder. Baker stayed in their existing $500,000 home, and we all applauded Able for selling at the top of the market.
There are many different opinions on the amount of the drop in prices but we can all agree prices have dropped, more in some areas than others. For our example, we will use a simplified 35% drop on all homes.
Today, Able is in their home with a loan still around $720,000 and can’t refinance because their value is $520,000. Their property taxes are still hovering around $8,000 per year. This is called being underwater, and they could be facing tax problems because of forgiveness of debt, etc.
Baker decides to sell today and finally move up to a bigger home. Their home has dropped in value and they think they have suffered a loss of $175,000 as the home is worth only $325,000. They sell and buy the former $800,000 home for $520,000. They get a loan for $468,000 at the current rate of under 5% and their taxes will be about $5,200 per year.
They might also qualify for a $8,000 tax credit and other inducements in today’s market. Also, there could be appreciation as the market recovers and would you rather have appreciation start now on a $325,000 home or a $520,000 home? Plus they’re living in their move-up home and the family is happy. So, who is better off now. Able or Baker?
Remember the old real estate advantage. Sell when everyone is greedy and buy when everyone is needy. Yes, I know the really smart thing to do would have been to sell three years ago and rent until now. Did many people do that? I don’t think so. I sure didn’t.
We can go back in time only in the movies and it’s too late for could’ve, should’ve or would’ve. Hey, we all misread the economy then so let’s move now and not misread it again. If you want to move up to a better home and can afford it, consider doing it now. Remember the $8,000 tax credit sunsets December 1st (but may be extended until June 2010). So, call your real estate agents and say hello. It just might be the best call you ever make.
By Duane Gomer
Able sold a home at the top of the real estate market for $500,000 and bought a new home for $800,000, paying 10% down and getting a new adjustable rate mortgage for the remainder. Baker stayed in their existing $500,000 home, and we all applauded Able for selling at the top of the market.
There are many different opinions on the amount of the drop in prices but we can all agree prices have dropped, more in some areas than others. For our example, we will use a simplified 35% drop on all homes.
Today, Able is in their home with a loan still around $720,000 and can’t refinance because their value is $520,000. Their property taxes are still hovering around $8,000 per year. This is called being underwater, and they could be facing tax problems because of forgiveness of debt, etc.
Baker decides to sell today and finally move up to a bigger home. Their home has dropped in value and they think they have suffered a loss of $175,000 as the home is worth only $325,000. They sell and buy the former $800,000 home for $520,000. They get a loan for $468,000 at the current rate of under 5% and their taxes will be about $5,200 per year.
They might also qualify for a $8,000 tax credit and other inducements in today’s market. Also, there could be appreciation as the market recovers and would you rather have appreciation start now on a $325,000 home or a $520,000 home? Plus they’re living in their move-up home and the family is happy. So, who is better off now. Able or Baker?
Remember the old real estate advantage. Sell when everyone is greedy and buy when everyone is needy. Yes, I know the really smart thing to do would have been to sell three years ago and rent until now. Did many people do that? I don’t think so. I sure didn’t.
We can go back in time only in the movies and it’s too late for could’ve, should’ve or would’ve. Hey, we all misread the economy then so let’s move now and not misread it again. If you want to move up to a better home and can afford it, consider doing it now. Remember the $8,000 tax credit sunsets December 1st (but may be extended until June 2010). So, call your real estate agents and say hello. It just might be the best call you ever make.
By Duane Gomer
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