Ivan and Delores Eichers are among thousands of people who fall each year for offers that promise to help them avoid foreclosure but that leave them with none of the equity they had built up in their property. Their situation matches one of the three common models of foreclosure fraud the National Consumer Law Center described in a report on the problem. The number of foreclosures nationwide soared 42 percent in 2006 to 1.26 million, said RealtyTrac, a company that tracks foreclosures. That creates opportunities for more foreclosure fraud, although the exact number of cases is hard to determine.

The Eichers thought they were taking out a $1,700 loan to help them pay the roughly $4,700 in back payments they owed on their mortgage. They learned too late they had signed their house over to Mid-America Financial Investment Corp. and agreed to lease their home from Mid-America when they accepted that loan. Although the couple no longer owned their home, the mortgage remained in their names, so they made their $554 payments on the loan through Mid-America, along with monthly fees of at least $100. A second scheme described in the report involves consultants charging high fees to help homeowners out of trouble but never delivering the promised services. A third involves an agreement where a homeowner knowingly signs over his or her home and agrees to buy it back over time, but the terms of the agreement make it nearly impossible for the homeowner to succeed. (more…)

search for : foreclosure fraud, National Consumer Law Center

We North Carolinians find ourselves in 2007 standing on the brink of a deep but narrow canyon. Across it lies a greener and happier future, secured by substantial new investments in land and water conservation. We’re tempted to borrow the money we need and leap across the gap — but looking over the edge we see far below the dangerous rocks of a bond rating decline. To the left of us there’s the sturdy bridge of dedicated conservation funding, spanning the canyon. But the bridge is guarded by twin giants Realtus and Developus. Behind us we hear the din of the steadily advancing armies of Overdevelopment, so we know there is no time to lose.

Last year the Governor’s Office opposed putting a conservation bond referendum on the ballot, citing fears of a costly decline in the state’s excellent bond rating. The obvious work-around is a dedicated funding source that could guarantee repayment of the bonds over time, but development interests have often managed to block the most reasonable funding mechanisms for conservation. For example, conservationists would love to simply raise the real estate transfer tax, currently set at a modest $1 for every $500 in property value. Real estate agents, however, oppose raising the transfer tax, which they argue is discriminatory in its focus on just one industry, given the fact that land conservation benefits us all. (more…)

search for : North Carolinian, conservation funding, conservation bond referendum

What key characteristics of a home’s location — not the features inside — push sales values up or down most dramatically? Just about anybody who’s bought real estate or is in the business knows the mantra “location, location, location,” and has opinions on what matters most. But new research by the National Association of Home Builders uses sophisticated statistical analysis techniques on a massive housing database to come up with a definitive list of the top locational characteristics that raise and depress property values the most.

The “standard” home for the purposes of the analysis is defined as being constructed after 2003, with 1,850 square feet of living space, two full baths, three bedrooms, dining room, kitchen and a “miscellaneous” room, a basement, garage, fireplace, and “no special (locational) amenity or disamenity.” The starting valuation of the “standard” or baseline new house ranged from $163,540 in a non-metropolitan area in the Midwest to $589,551 in a large southern California metro area. The study then examines what happens to that valuation when positive and negative locational characteristics are introduced into the equation. For example, in a Midwest suburb the baseline house with no special locational amenity would be valued for sale at $212,137. Put that same house in a location that has parkland or open spaces nearby and the value rises to $215,510. Put the house in a gated community and the value rises to $225,772. Put it in an area that is convenient to public transportation and the value jumps to $238,340. And locate it on waterfront and you get the biggest positive impact of all — its soars in value to $303,760. (more…)

search for : location, location, location

Most people think of a mortgage as a means to an end. After all, you buy a house, not a home loan. But a mortgage is much more than the path to home ownership. It is a financial implement that must be managed, just like any other financial investment. “Think of it as part of your financial tool kit,” suggests Susan Martin, a vice president and spokesperson for Countrywide Home Loans, one of the country’s largest lenders. “And it’s a dynamic financial tool, not a static one.” Years ago, people took out 30-year loans, threw their mortgage papers in the drawer and didn’t take them out again until 360 payments later. Then they held mortgage-burning parties.

If rates have risen, and it looks as if yours is going to reset higher, it also might be time to refinance into a loan that’s more stable, or maybe another ARM with a lower start rate. Another advantage of today’s multiple-choice mortgage market is that you can match your loan to significant life events, not just changes in interest rates. If your spouse decides to give up his or her job to stay home with the baby, maybe you can trade in your current mortgage for one with payments that more closely match your reduced income. If you just took a new job that pays significantly more, perhaps a new, shorter-term loan with larger payments is now in order. Maybe a loved one has had a major illness; it’s time for Junior to go to college; or an investment opportunity presents itself. All of these are personal events that have a significant effect on your bottom line, and a new mortgage might be something to consider. (more…)

search for : mortgage, home ownership, 30-year loan

Do you have any ideas on how to clean my Cadet baseboard heaters? When I first turn them on for the winter, I get a black film on the wall above the heater. What should I do?

What’s probably happening is that during the time the heater is off, dust or other material is accumulating inside the unit. When the heater is turned on in winter, this material burns off and streaks the wall.

First of all, try to minimize the dust buildup. This might be done by rearranging furniture, increasing fresh air in the room, or increasing air flow in front of the heaters. Then, prior to starting the heater in the winter, make sure it’s clean. For their baseboard heaters, Cadet recommends that you remove the front cover, and use a vacuum to clean out the inside of the heater before starting it for the season. Be sure the power is off before removing the front cover, and be careful not to damage the aluminum fins inside the heater. (more…)

It looks like 2007 is going to be a very hot year for foreclosure sales, according to RealtyTrac.com, creator of the largest U.S.-based foreclosure database. The latest numbers released this week show that while foreclosures filed in December 2006 were 9 percent less than November, it was still up 35 percent December year over year. “New foreclosure filings surpassed the 100,000 level for the fifth straight month, something we’ve not seen since we began issuing our foreclosure market report in January 2005,” said James J. Saccacio, chief executive officer of RealtyTrac, in an online press release.

For many an investor-wannabe, I can hear the sound of chops being licked in the background. The real estate business has been a great creator of wealth for many every-day people, but it’s also created the demise of many a millionaire. If you’re looking to move toward investing in the foreclosure world, it goes without saying that you have some homework in front of you before collecting your rental checks or flipping the property. When an investor is buying what I would call a retail investment property, the property is usually in good condition, the seller actually wants to sell the house and all parties will probably use traditional contracts from established sources, such as the local Realtor association. Such a situation creates a stable environment in which to buy a house that is going to continue increasing in value and where you may already have a tenant in the house. (more…)

search for : foreclosure sales, foreclosure filings, flipping the property

According to the Joint Center for Housing Studies at Harvard, Americans spent $168.7 billion on home improvements and repairs in 2006, 1.5 percent more than in 2005. From the comments of Joint Center officials last week, the increase was disappointing but understandable. The slumping for-sale market in many areas of the country has led many homeowners to delay or pass on major home-improvements, ending the double digit, quarter-to-quarter increases that the remodeling industry experienced over much of the last five years.

The bulk of the demand for remodeling jobs continued to come from the baby boom generation, according to the NAHB research, which was conducted in conjunction with the quarterly surveying used to produce the NAHB’s Remodeling Market Index. However, work requests from 30- to 40-year-old members of Generation X are on the rise, and they are turning out to be bigger spenders than the generation preceding them, the NAHB data show. Rising energy prices last year appeared to have little impact on the demand for jobs related to improving residential energy efficiency, and a majority of remodelers were involved in making modifications for aging-in-place, although they said that most consumers aren’t familiar with the concept. My feeling is that the NAHB should hold a contest to come up with a better description than aging in place, which better describes how I feel when a late train makes me miss the start of an important meeting. (more…)

search for : home improvements, remodeling

Looking at the costs of re-tenanting should motivate you to try to keep tenants. In office and commercial buildings you have vacancy costs plus leasing commissions, tenant improvements as well as the challenges of the construction coordination that will affect other tenants. We know that you will not be able to keep every tenant. Some tenants don’t pay their rent or pay their rent late. Some tenants are just not the right fit. Just this last month we asked a tenant to move from a building because their clients were harassing other tenants in a building. But the landlord’s objective needs to be to keep every tenant they can.

This leads us to the concept of tenant mix. Many years ago before I knew better, I leased a large space to an office tenant in an industrial park. My client’s were very happy, the rent was low, and the location was great. Even the parking was good. They were happy until the new neighbor moved in. The new neighbor was a metal stamping operation. Their equipment went bang-bang all day long. My client’s employees were very frustrated. The walls and the floors were shaking with every stamp. Those people located within 20 feet of the wall they shared could not make phone calls anymore. We learned a big lesson then about how to combine tenants with similar uses, to keep them all happy. (more…)

search for : tenant improvements, rent, landlord

Indicators continue to suggest, instead of buying a move-up, it’s not a bad time to turn your existing home into one — before the spring thaw awakens hibernating homeowners with the same idea. Home improvement demand remains soft and thanks to woes in the new home market, material prices are as low as they’ve been in years, and the building industry is flush with contractors able to do the work.

Even if home prices don’t stabilize, as others expect, at least in some regions, home improvements are a way to shore up the value of your home. According to Remodel Magazine, on average, most common remodeling jobs return at least 70 percent of the cost of the work to the value of the home. Cheaper materials. Wood products industry information source Random Lengths said it’s “Framing Lumber Composite Price” (a weighted average of 15 key framing lumber items’ prices listed in dollars per thousand board feet) was $288 in December 2006, the lowest December price since 2002 when the figure was $276. Another measure, Random Lengths’ “Structural Panel Composite Price” (a weighted average of 11 key panel items’ prices in dollars per thousand square feet) came in at $266 in December, also the lowest level for that measure since December 2002. (more…)

search for : Home improvement, home improvements, remodeling

After several years of a booming real estate market – one that was decidedly to the seller’s advantage – the industry has taken a swing in the opposite direction in recent months. Higher interest rates and a greater inventory of houses is pushing the market in the buyer’s favor. This means that enterprising individuals ready to make a purchase may come away with more than just a good bargain.

To entice people to take out mortgages in spite of rising interest rates, some lenders and builders are offering special programs. Many home builders are using “buy-down” programs, in which they buy down a mortgage by two percentage points in year one and one point in year two. This can lead to substantial savings. But watch out for deals that offer flashy savings early on but sucker-punch you later during the loan term. Pre-payment penalties or early termination fees may be in store for those who don’t do their homework before signing on the dotted line. (more…)

search for : booming real estate market, Higher interest rates

Even a great design can be done in by the sort of unavoidable, nuts-and-bolts infrastructure items every building requires — visible pipes, wires, vents, flues, meters and what have you. As unsexy as they are, don’t fail to think through these kinds of details, don’t put them off to the last minute, and never, ever leave them up to installers to figure out as they go along.

Gas meters, electric meters, and electrical entrance panels — none of which are very lovely to look at — should be assigned to a spot that’s completely invisible from the street, ideally in a recessed or screened area. Never place these items on the front of the building. Since meters are increasingly read remotely, access is less of an issue than it used to be, but you should still check with your local utility for any restrictions on placement. (more…)

search for : electric meters, electrical entrance panels

Winter can be brutal on your home. Your homeowner’s insurance covers burst pipes and ice dams in your gutter. Ice dams are caused when ice forms on your home’s eaves, and water from melted snow flows from your roof, gets backed up behind the ice and flows under the shingles and into your home. You’re also covered (to a degree) if a tree hits your home. Remember, you’ll only be able to recoup the cost of removing the tree up to $500. But if a tree just falls in your backyard, you’re on your own.

If you live in colder areas prone to icing and heavy snowfall, you should have a strong de-icer on hand, like Calcium Chloride. It costs about 10 times more than rock salt, but it’s also much more powerful. If you live in more moderate climates that have occasional snowfall, you’re probably better off just stocking up on rock salt according to the Salt Industry. A 50 pound bag can costs just under $10. Whatever you do, make sure you don’t oversalt. Both rock salt and calcium chloride can be corrosive to concrete that has not been mixed or finished properly. If you have a driveway that is full of chinks and scars, be very cautious when using salt. To get the best results from salt de-icers, you’ll want to put it on the ground before the first flakes begin to form. (more…)

search for : melted snow flow, shingles

Parts of the Northwest and Rocky Mountain regions were still digging out of four weeks of snow as temperatures iced California’s citrus crop. San Francisco Bay Area residents kept an eye out for the first snow flurries in years. Frigid air flowed into New England as wind chill factors pushed some temperatures in the upper states’ hinterlands to 35 below zero. Ocean-effect snow showers were forecast for Cape Cod. New Orleans shivered through 30 degree temperatures and Mother Nature put central and southern Texas into the deep freeze. The Deep South and Southern California held onto “heat waves” with temperatures in the 40s and 50s.

The U.S. Department of Energy (DOE) and the Comfort Institute, an indoor comfort research, training and consumer protection organization based in chilly Bellingham, WA, offer these tips to get your house in order for what’s likely to be a long, bleak winter even Punxsutawney Phil can’t stop.The DOE says the typical duct system loses 25 to 40 percent of the energy put out by the central furnace, heat pump or air conditioner. That puts a strain on your wallet as well as comfort levels in your home. Heating ventilation and air conditioning (HVAC) contractors can diagnose and pinpoint duct leak locations and check the static pressure in your ducts and ventilation system. The exam is often part of an energy audit used to also examine insulation, air leaks and other energy inefficiencies in your home. (more…)

search for : U.S. Department of Energy, duct system, duct leak locations, insulation, energy inefficiencies

Mortgage fraud is being called the country’s fastest-growing white-collar crime. It costs lenders more than $1 billion a year and has turned increasing numbers of federal agents into experts on real estate paperwork. These days, they quickly crack cases that once took years to work, experts say.

Mortgage fraud occurs when somebody lies or misrepresents a fact on a statement that a lender uses to make a loan. Banks and mortgage lenders generally are the prime victims when loans are not repaid, but the fallout from a large-scale scam also can devastate individual investors, who sometimes must file for bankruptcy. Communities also suffer when swaths of properties sucked into a scheme go vacant and deteriorate as they fall into foreclosure. Estimates of mortgage fraud losses vary widely, but experts said trend lines pointed up. Although schemes can prosper during good times — such as the recent mid-decade boom when as much as $2.5 trillion in mortgage loans were made each year — they also can flower as the market cools. (more…)

search for : Mortgage fraud, mortgage lenders, mortgage fraud losses, mortgage loans

The Web frontier for vacation-home owners is vast and continuing to grow as they tap into new resources to market their properties. And networking Web sites can offer a support network for owners navigating the apparently bump-filled rental market. “Making a video is so much better than trying to put all that into words.” Mr. Gilbert has two videos, both on YouTube and Google Video: One showcases the house and some of its features, like the brand of mattresses in the home. The other focuses on the community, Bear Trap Dunes, which has three golf courses and two swimming pools.

Any vacation-home owner is likely to confess that marketing the house to renters is only half the battle. And, perhaps the easy half, once you read through the postings on Lay my Hat (www.laymyhat.com). The site allows vacation homeowners to hash out the apparently neverending string of problems that arise when renting out their second home. Owners vent about problem guests, like those who complain about the lack of ketchup and mayonnaise in the refrigerator or refuse to obey the no smoking policies. Some get advice on larger issues, like what to do when an hour before a renter arrives the electricity in the house fails. The solution, wrote one poster, is to light candles and “gets lots of drinks” for the guests. (more…)

search for : vacation-home owners, YouTube, Google Video, Bear Trap Dunes

The growing influence of home inspections on residential real estate sales has been rapid and unmistakable. Inspections were available in the 1970s and ’80s but were relatively unknown to most people during those years. By the early 1990s, home inspectors emerged as a significant presence in most real estate transactions, affecting the majority of purchases. Two reasons stand out as the basis for this surprising rate of growth:

Accompanying the growth of home inspection services has been a parallel increase in liability claims against inspectors. Two circumstances stand out as primary causes for these claims: 1. Some claims are clearly due to inspector negligence. A contributing cause has been the rapid growth of the industry, prompting an influx of inexperienced and unqualified inspectors. The result has been incomplete or incorrect reporting of property conditions; hence, claims. 2. Many claims, on the other hand, are frivolous, owing again to the litigious nature of the business environment. While unqualified inspectors are subject to claims due to incompetence, even the best inspectors may be targeted, regardless of whether they are truly at fault. (more…)

search for : home inspections, unqualified inspectors

If one of your goals in 2007 is to become a landlord by buying a house, condo, or even small apartment complex, the first thing you should do, if you haven’t already, is begin to educate yourself about becoming a landlord. If you’re already a landlord then you likely know that ongoing education in this ever-changing industry is a must.

Here are some areas that landlords should be certain to record: mileage to and from the rental property, advertising for the property, cell phone use, computer equipment and office supplies, desk equipment, telephone line (if you have a separate line the office line can be fully deducted), Internet access, and house cleaning for the rental. “If you have a cleaning company come in to clean your rental unit, after somebody moves out, those costs are deductible. If you need to buy office supplies it might be computer paper, pens and printer cartridges, postage if you’re mailing out reminders [to] somebody [who] might be mailing the rent late or you need to send somebody a lease to sign — [all are] also deductible. Working with a qualified tax person can help you discover any deductions you might be missing and also make sure that you are operating by the appropriate IRS laws. (more…)

search for : landlord, rental property, deductible

An elderly homeowner who wishes to continue living at home can get access to money that doesn’t have to be repaid until he or she sells the house or dies. The upfront costs of the reverse mortgage loans are high, and they are not recommended for those planning to sell their house in the near future. Paiva’s closing costs were $13,325, which included a payment of $5,760 for mortgage insurance from the U.S. Department of Housing and Urban Development’s Federal Housing Administration. FHA insures an estimated 90 percent of reverse-mortgage loans issued in the United States. Most borrowers roll over the loan costs into their balance to keep their initial outlay of cash to a minimum.

To be eligible for a HUD-insured reverse mortgage, borrowers must be at least 62 years old. The amount that can be loaned depends on the borrower’s age, the amount of equity, and the interest rates. Loans insured by the government cannot exceed a certain limit currently $362,000, according to Peter Bell, president of the National Mortgage Lenders Association, even if the value of the house is much higher. Uninsured loans are offered at higher amounts, and at higher costs. In the fiscal year that ended September 30, 2006, 76,351 federally insured reverse mortgages, also known as home-equity conversion mortgages, were issued, up 77% from the previous fiscal year, White said. In Rhode Island, the number of reverse mortgages increased from 198 to 338. As the baby-boom generation begins to retire, the numbers are expected to grow. (more…)

search for : reverse mortgage loan, U.S. Department of Housing and Urban Development’s Federal Housing Administration, FHA, home-equity conversion mortgage, aby-boom generation

At risk of oversimplifying, credit standards in the conventional market range from A+ to D-, and within that range, FHA would be about B- or C+. FHA credit requirements overlap the higher levels of subprime requirements. A good illustration is the underwriting rules applicable to a prior foreclosure. With exceptions, FHA won’t accept a loan applicant who has had a foreclosure within the prior three years. Subprime lenders may have a three-year rule for their best credit grade, but the period scales down by degrees and might be only one year for the lowest grade.

Similarly, the maximum ratio of total debt service to income acceptable to FHA is 41 percent, which is generally high relative to prime standards, but well below what passes in the nonprime sector. A borrower who meets FHA credit standards will usually do better with an FHA loan than with a subprime loan, despite having to pay a mortgage insurance premium. The rate will be lower, the borrower will have access to a large menu of mortgages, and there are no prepayment penalties. Most mortgages in the subprime market are 2-year adjustables with large margins, which means a high probability of a rate increase after two years, and they have prepayment penalties, usually for three years. (more…)

search for : subprime, FHA credit standards, borrower, mortgages, 2-year adjustables

U.S. home prices may have dipped over the past year, but many American workers would still struggle to afford a median-priced home in major cities, a new study said Wednesday. “American workers are really not gaining ground and they’re so far behind in the first place,” said Barbara Lipman, research director for the nonprofit Center for Housing Policy, which conducted the study. While the median home price in the 202 largest metropolitan areas declined 2 percent from a year ago to $248,000 in the third quarter of 2006, mortgage rates rose enough over the year that homes actually became less affordable as pay did not keep pace.

Other ways families cope with high housing expenses is to work longer hours or extra jobs, or by crowding in more income producers, she said. An October 2006 survey by the group found families who seek to buy less-expensive homes in further-out suburbs – adding to urban sprawl – pay so much more for transit that it eliminates the savings. While home prices range widely across the country, wages for low-wage jobs – from teachers to janitors – are about the same no matter where they are located, Lipman said. The report cited housing aid programs offered by some big-city hospitals that have plenty of modestly-paid workers. (more…)

search for : housing expenses, less-expensive homes, urban sprawl

Women are the CPOs (Chief Buying Officers) of American households, and are rapidly gaining in gender status as the nation’s top wealth holders. According to Tom Peters and other experts monitoring the American marketplace, women now make 83 percent of all consumer buys, including 94 percent of home products, 89 percent of vacations, and 75 percent of all decisions regarding the purchase of the largest investment most of us will ever make — a house.

As women have increased their earnings, built their own businesses, weathered divorces, widowhood, and taken charge of family bequests, they’ve grown more independent and wealthy. IRS data indicates women comprise 39 percent of the top wealth holders in the U.S., a category defined as adults with total assets of $625,000 or more. That adds up to some 2.5 million women with combined assets of $4.2 trillion. Significantly, 42 percent of the women in this group will be single or widowed, according to the IRS, by the year 2050. (more…)

search for : American households

Cash-challenged seniors who want to stay in their own homes have kept reverse mortgages high on the public radar. But not everyone thinks they’re such a good idea. In general, a reverse mortgage converts home equity into cash in several different ways, ranging from monthly payments to an equity line to one-time payouts _ or a combination. The amount you can borrow varies according to your age, the value of the home, current interest rates and loan fees. Reports suggest reverse mortgages can be a source of ready cash when it’s needed, similar to other investments. But taking out a reverse mortgage isn’t a no-brainer. Candidates for these mortgages should consider both the benefits and the drawbacks before jumping in.

To qualify for a reverse mortgage, you must be at least 62 years old. Younger borrowers can’t cash out as much equity as older borrowers. Since banks are repaid when the house is sold, it’s quite possible a lender might have to carry the note for 20 to 25 years or more. For that reason, a 79-year-old is a much more attractive loan candidate from the bank’s perspective. Depending on where you live, the proceeds from a reverse loan could prove a barrier to qualifying for Medicaid, which counts loan proceeds as an asset. Although each state differs in the fine print, untapped equity in the home is not considered an asset in determining Medicaid eligibility, as long as it’s owner-occupied. Recent federal legislation placed the home exemption ceiling at $500,000. (more…)

search for : reverse mortgages, Medicaid eligibility

Economic market conditions shifted in vacation home buyers’ favor in some regions of the country last year, just as the traditional winter weather season took still more heat out of the second home and resort markets.But that doesn’t mean vacation home buying is a breeze.

Just ask some late-to-market speculators who lost their shirts as the last boom faded. Other investors saw their cash flow become cash slow as speculators fled. Still others made buying mistakes that put their second shot at the American Dream, physically out of reach.Buying a vacation home as an investment or rental property requires the same careful forethought necessary for any investment as well as professional assistance where warranted. (more…)

search for : vacation home buying

Think you know what you can afford as a first-time home buyer? Grab a calculator and run those numbers again. There’s a lot more to a mortgage payment than the loan amount and interest rate. Extras such as property taxes, mandatory structural insurance and private mortgage insurance, or PMI, can add as much as 30 percent to 50 percent to your monthly payment. If you don’t realize that going in, you could end up shopping for too much house or falling in love with a home that’s really more than you can afford. Many of these costs will vary with the home, the location, the type of loan and the amount of your down payment.

Some components you want to consider: Homeowners insurance: “A good rule of thumb is $3 for every $1,000 of the loan amount annually,” says Jennifer Gavre, Wachovia mortgage banking executive for Georgia. So that $200,000 home would cost you about $600 a year. Typically, you’ll pay a year in advance at closing, and the next year’s premium will be equally divided among your payments. That 0.3 percent rule of thumb was blown away in hurricane-prone areas after the catastrophic 2004 and 2005 seasons. Homeowners on the Gulf Coast can expect to pay two to four times as much. Flood insurance: If you live in a flood-prone area (usually termed “100-year flood plain”), your lender will likely require you to have insurance that covers flood damage. The cost will vary based on how close you are to flood-prone areas. Figure about $150 to $200 per year, says Gavre. Again, you’ll pay a year in advance at closing, then next year’s premiums will be divided into your monthly payments. (more…)

search for : first-time home buyer, interest rate, private mortgage insurance, PMI, Homeowners insurance, Flood insurance

Home sellers looking to put their best foot forward in some tough housing markets would be well advised to bring their homes up to date. When buyers have hundreds of similar properties to choose from, small details can make a big difference. Having a refrigerator integrated into your kitchen cabinets is one of the hot trends of home design. “New buyers, especially, want the house done in today’s look,” says Mark Nash, a Chicago-area realtor and author of Real Estate A-Z for Buying and Selling a Home, who surveys more than 900 real estate agents and brokers every year to find out the home design trends of most interest to their clients.

Many new homeowners mix natural, well-textured materials, according to Nash, to take away some of that mint-fresh look the home would otherwise have. That means floors of slate or terra cotta, recycled wood from old barns and weathered metal and glass. Nash also points out a couple home amenities coming increasingly into vogue that are designed to meet the needs of changing lifestyles. One is the luggage room, a place to keep your travel bags. As a people, we’re going more places than ever and frequent business trips and vacations have made it desirable for harried travelers to have all their bags in one handy place rather than stowed away in the attic or stuffed into an already crowded closet. (more…)

search for : home design trends, homeowners

Just after the holidays, I decided to preview a few homes in the area to see what’s available in my market area as we approach the new year. What I found is a phenomenal selection of houses with various amenities and value adds. What was disheartening was the apparent lack of market knowledge of either the agent or the unwillingness of some real estate sellers to get with the program on how much their homes are worth.

A quick comparative market analysis of the five-acre property revealed that an identical home with the same lot size sold three months ago for $74,000 less than this seller’s asking price. Where is the owner coming from? Why did the agent even take the listing? Agents working in a buyers market need to look at solds in the last 60 days — no further back. Then take a temperature on the pending sales — which houses are drawing contracts? More than likely there will be a correlation between the houses priced low enough to draw offers and the pending sales. In addition, compare tax assessments and the sold prices. In today’s market, more than likely, the sold prices will be substantially under the tax assessments. The above houses provide a good example. The cheapest, but newest house is priced $59,000 under the tax assessment. Meanwhile, the other two properties are $39,950 and $84,000 over their tax assessments. (more…)

search for : real estate sellers, comparative market analysis, tax assessment

The North Carolina Banking Commission recently proposed stricter guidelines for state regulated brokers, bankers and lenders offering nontraditional loans. Minnesota has already tightened its lending guidelines on the loans and recently notified more than 3,000 state-licensed residential mortgage originators of the changes. To date, 19 states and the District of Columbia have at least warned state-regulated lenders about the hazards of nontraditional mortgages, indicating new federal guidelines for federally regulated lenders are already trickling down to state regulatory offices.

The rules are designed to curtail the rise (during the past housing boom) in the risky business of “nontraditional,” “alternative,” “exotic,” even “toxic” mortgages, including interest-only, payment-option, piggy-back, stated-income (no-doc) and other types of adjustable rate mortgages (ARMs), as well as some home equity loans. The high-leverage products can be useful, allowing borrowers to buy a home (or qualify for a larger, more expensive home) they perhaps couldn’t afford with a standard, fixed rate loan (FRM). However, the rapid growth in the use of nontraditional mortgages, especially among the population of less creditworthy borrowers has alarmed regulators who have begun to mandate that lenders tighten requirements for those who want the loans. (more…)

search for : North Carolina Banking Commission, nontraditional mortgages, adjustable rate mortgages

Now that January 1 and the resolution hype are behind us, take time to set SMART GOALS for 2007 and guarantee that you have a terrific real estate year — a year in which dreams turn into reality for yourself and your family. Resolutions are statements of behavioural improvement that usually focus on ending bad habits like smoking and over-eating. Goals are projected, desired results that can guide daily actions and decision making toward significant improvements in any, or all, aspects of life.

Define your eventual success. Create vivid, detailed, clear written descriptions, so you know exactly where you are headed. Do you want to own waterfront property or acreage in a location of your choice? Do you want your real estate to generate income? If so, how much? Continually, keep your goals “top of mind” by displaying and carrying key words written on small cards, but don’t share all the details until your goal is achieved. Breakdown the goal into doable steps. Know how you will benefit from each. How many real estate properties, each with its own reasonable amount of appreciated value, stand between you and the waterfront, rural or income property you desire? Would shared ownership of some or all of this real estate accelerate your progress? (more…)

search for : waterfront, rural or income property, ownership, real estate

Whether you already have a mortgage or you plan to buy a house in the next year, here are seven mortgage tips for 2007. 1. Review your mortgage _ does it still fit your circumstances? Interest rates change, children are born and grow up, sometimes you need to fix up the house and sometimes you need to move on. Life events can trigger changes in the way you pay for your house. “Every year,” says Dan Hanson, who oversees the retail branches for Countrywide Home Loans,” say, ‘What’s going to happen this year?’ Do I have a child who, in a year, is going to college? Are we going to have a child, maybe add a bedroom or have to move?’” The answer might make you go mortgage shopping.

For example, let’s say you own a house and plan to move in a couple of years because your family is going to grow. Consider refinancing into an adjustable-rate mortgage with a low initial rate that lasts three years (a “3/1 hybrid ARM”). That initial rate probably is lower than the rate you’re paying now and the same with the monthly payments.

Hanson believes that you should ask yourself periodically: “Is my interest rate higher than the market today? Would it make sense to refinance, to take cash out? Would it be a good idea to get a reverse mortgage? How much is my house worth?” (more…)

search for : mortgage tips for 2007, refinancing, adjustable-rate mortgage, interest rate, reverse mortgage

The Federal Reserve put out a helpful little consumer guide this week, and you don’t have to know anything about industrial production and capacity utilization to understand it. The new handbook explains adjustable-rate mortgages (or ARMs), along with some of the pitfalls associated with these increasingly popular and increasingly complicated loan arrangements.

In its simplest form, an ARM is a mortgage with an interest rate that adjusts periodically. The initial rate is typically lower than a fixed-rate mortgage. That makes them attractive to many buyers. People who know they will not live in their new home very long, in particular, can get a significant financial advantage from choosing an adjustable-rate mortgage. The Federal Reserve, however, has been concerned that promises of low payments may be luring some consumers into mortgages that don’t make financial sense. Among those potentially questionable loans are interest-only mortgages, which require the borrower to pay only the loan interest during the first few years. That means the homeowner builds no equity, even though the early payments might be smaller. (more…)

search for : adjustable-rate mortgages, ARMs, fixed-rate mortgage