Tips Selling/Buying

Crossroads Realty Buyer's Seminar and Tax Credit information Review

smercer@DelphicSage.com () — Sat, 12 Dec 2009 12:00:00 GMT

Please join us at the Crossroads Realty Buyer's Seminar (and Tax Credit information Review).

This event will be held weekly, every Saturday, from 12-2pm until further notice.

The seminar is designed to inform the public on "What All Buyers Must Know In Today's Market".

Take advantage of this timely information.

Location: 168 Route 37 West, Toms River, NJ.

Please call: 732-244-2200 to sign up.

Foreclosure Offer Deals But Beware!

smercer@DelphicSage.com (Tara Siegel Bernard) — Mon, 07 Dec 2009 12:00:00 GMT

Click Here to View a List of Short Sale Properties

So you’re looking to buy a new home, and you think a foreclosed house may be the best deal. You’ve probably noticed, then, that many of the big banks’ Web sites are beginning to look a bit like real estate brokerages, showcasing the many properties that they’ve repossessed.

The Gordons are happily living in the three-bedroom ranch in San Juan Capistrano, Calif., that they bought for $500,000 through a short sale in February. These houses often sell for about 15 to 20 percent less than comparable homes in the same neighborhood, according to the National Association of Realtors. And while the banks have been careful not to flood the market with all their properties at once, there are hundreds of thousands of listings now, and half a million more expected in the coming year.

Despite the seemingly high inventory, though, anyone considering buying a distressed property should heed the classic warning: Caveat emptor, or let the buyer beware.

Closing a deal in a desirable neighborhood can be hard to do. Many aspiring homeowners have lost out to all-cash bidders. Buyers also need to search more aggressively than usual, which means figuring out which brokers have the best foreclosure listings, religiously checking for new ones and visiting the properties shortly thereafter. Buyers also need to ensure that the home is truly a good deal and not a money pit — most of these homes are sold as is.

Still, as Rick Sharga, senior vice president of RealtyTrac, a foreclosure listing service, put it, “The best discounts have been on bank-owned property.”

If you are still interested in buying a distressed property, you have several options. You can buy it through a preforeclosure sale, at a public auction or through a bank or other entity that has taken ownership of the home — these properties are known as real estate owned, or R.E.O.’s.

Below is a more detailed description of the potential risks and benefits of buying R.E.O.’s and preforeclosure transactions known as short sales, where the bank agrees to sell a home for less than is owed on the mortgage. Through October, foreclosures and short sales accounted for nearly 37 percent of all home sales, on average, according to the Realtors’ association.

R.E.O.’s

Traditional homebuyers are generally discouraged from buying homes at auction because there are too many risks — you can’t tour the inside of the home, which increases your chances of buying a house that will drain your bank account. Equally important, the home won’t necessarily have a clear title, which means there may be tax liens or other debts against the property. And when you buy the home, you buy those issues, too.

One of the benefits of R.E.O.’s is that the bank typically clears any title issues before it puts the house on the market. “It’s easiest because there is a price already, there is access, you can do your estimate for repairs, and you can write your offer and go,” said Alexis McGee, president of Foreclosures.com, which lists foreclosures and offers classes for foreclosure investors.

But you need to do your share of preparatory work. Start by getting acquainted with the listings in your target area. All R.E.O.’s are sold through an agent. You can find their listings directly on the big banks’ Web sites, like Bank of America and Wells Fargo, as well as regional banks like SunTrust. Fannie Mae offers its listings through the HomePath Web site and Freddie Mac through HomeSteps.

You can also find free listings through independent brokerages like Redfin.com, which has a forum where you can compare notes with other buyers. If you pay a monthly fee, you can access sites that track distressed homes from the moment of default through foreclosure. These sites include RealtyTrac ($49.95 a month), Foreclosures.com ($49.95), and Foreclosure.com ($39.80), all of which provide a free weeklong trial.

One of your first steps would be getting preapproved by a mortgage lender so that once you find a property you are interested in, you can move quickly. Call the listing agent, or hire a buyer’s agent to do it for you. (You should hire a buyer’s agent with experience in these types of sales anyway. In some states, the listing agents may refer you to someone else in their office to represent your interests, said Frank Verna, an R.E.O. broker in Jupiter, Fla.). Arrange to see the home as soon as possible. The bank selling the property may want you to be preapproved with their own lending arm, though you can always use another lender in the end, experts said.

Most R.E.O.’s are sold as is, so buyers should make their offers contingent on a home inspection. It’s best to find inspectors who are also licensed contractors (with references), so they can estimate repair costs. Putting too many contingencies in your offer, however, is likely to derail your bid.

Buyers also need to be prepared to lose to buyers with all cash. That’s what happened to Jason and Elise Hope, who have been searching for a small starter home in San Diego County for six months. The couple has made more than two dozen offers on bank-owned properties, and a couple of short sales, priced from $300,000 to $400,000.

“For the most part, we never heard back from the listing agent,” said Mr. Hope, 28, who works as an equity research associate for a forensic accounting firm. “When we did hear back, we often heard the same story — that the listing had 10 to 20 offers on it, along with ours, within the first weekend of it being available for showing.”

As Mr. Verna, the broker, explained: “In the R.E.O. world, cash is still king because there is no appraisal, last-minute quality checks or potential problems to kill the deal.”

You may be able to increase your chances by making your best offer from the start. But to ensure you don’t overpay, research comparable sales on sites like Zillow.com or have your agent prepare a “comparative market analysis” for you. “You are negotiating with a calculator, and if the numbers don’t work for the seller, they just say no and move on,” Mr. Verna said.

Fannie Mae does give prospective homebuyers a leg up. Last month, it introduced a program that shuts out investor buyers for the first 15 days a home is on the market. Moreover, Fannie also has a financing program, which allows buyers to put down as little as 3 percent and doesn’t require them to carry mortgage insurance. It also provides loans that allow borrowers to wrap in costs for home renovations.

Freddie is testing a program that also initially shuts out investor buyers, and it is currently offering consumers who buy one of its properties up to 3.5 percent of a home’s purchase price, which can be used for closing costs, moving or even furnishings. The program was recently extended to buyers who submit a purchase offer by Jan. 31 and close by March 26. Primary homebuyers are also eligible for a two-year warranty on certain home repairs.

Short Sales

Short sales tend to be more problematic than R.E.O.’s. If you make an offer on an R.E.O., you can expect to get a response within a few days. With a short sale, experts say, it can take months. You also can’t necessarily trust the listing price.

“It may easily be a teaser price just to get offers in,” said Carolyn Warren, author of a new book “Homebuyers Beware: Who’s Ripping You Off Now?” (FT Press). “It’s kind of like posting something on eBay. They are going to list it at a dollar, but they might only sell it for $1,000.”

There are other potential problems as well. While the seller may be motivated, the bank has to be convinced of two things: “One is that the homeowner in question deserves a hardship exception,” Mr. Sharga of RealtyTrac said. “The second thing is that you have to convince it that it is market value, even though it is below the mortgage amount.”

Complicating matters further, the homeowner may have more than one loan on the property, adding to the number of parties involved in the negotiations.

All this lengthens the time to close a deal.

You can get lucky, too. Michelle and Mark Gordon are happily living in a three-bedroom ranch that they bought through a short sale in San Juan Capistrano, Calif., in February. It took only three months to close — record time in the world of short sales. But Mrs. Gordon, a librarian who now stays home with her young daughter, did her homework and was aggressive in her search. She checked the listings religiously on Redfin.com, and saw the property the day after she found it.

The Gordons paid $500,000 for the home, and the bank paid the $12,000 in closing costs. The property was recently valued at $537,500 on Zillow.com. “We painted two rooms,” Mrs. Gordon said. “That was it.”

Signs of Housing Market Recovery

smercer@DelphicSage.com () — Fri, 10 Oct 2008 12:00:00 GMT

Former Federal Reserve chairman Alan Greenspan said the U.S. housing market will begin to recover in the first half of 2009, according to an article he wrote for Emerging Markets magazine published Friday.

Greenspan wrote that the recent slowing in the rate of decline in U.S. home prices is the first positive note in the year-long trauma and that eventually, frozen credit markets will thaw "as frightened investors take tentative steps towards reengagement with risk ... More conclusive signs of pending home price stability are likely to become visible in the first half of 2009," he wrote.

Update on the Housing Market from CNBC

smercer@DelphicSage.com (Tom Brennan) — Fri, 01 Aug 2008 12:00:00 GMT

James Cramer, host of CNBC's ‘Mad Money' and ‘Market Watch'

The Federal Housing Authority will put $300 billion to work to help homeowners with exotic loans and that will put a bottom in housing. James Cramer admits he was the first person to tell everyone not to buy, that thier house wouldn't be worth the insurance money. He is "now telling you that between now and the next six months you have to buy a house."

Cramer also says: "We saw quarters from Wells Fargo, from United Bank of Scotland. We saw a quarter from JPMorgan. We saw a quarter from Bank of America. And those guys had already put charges in that made it so that when housing does bottom, they will be overreserved. That's the ticket. That's what Wachovia did. They anticipated a housing bottom and they're going to be right."

Tips for Buyers

smercer@DelphicSage.com (Loraine Gough) — Fri, 18 Apr 2008 12:00:00 GMT

Take photos and notes of houses you are considering. This will help you keep the details clear in your mind when discussing the features of a particular property later.

Be open with your agent and family members about your priorities. Some of your needs may be fixed, such as number of bedrooms or proximity to a particular school but many of your preferences, like the desire for a fireplace or formal living room can be overlooked for the perfect location.

As the process of previewing houses moves forward, you may come to better understand your needs and what is available in your price range. Be sure to communicate any changes to your agent and let them know if you're willing to compromise on a specific detail or are willing to expand your search to find the perfect home for you.

The Importance of Pre-Qualification

Understand what you can afford. Obtain a mortgage pre-qualification. Buyers with mortgage pre-qualification have more credibility with the seller. It can also give you more of a comfort level if you'd like to make a more competitive offer on a particular house. Don't rely solely on the opinion of your mortgage broker, only you can really determine what payments and price you will be comfortable with.

It’s Spring! Get Ready to Show Your House.

smercer@DelphicSage.com (Loraine Gough) — Fri, 18 Apr 2008 12:00:00 GMT

These simple tips can help to make the most of that all important first impression.

Outside -

* Mow the lawn and tidy up the yard. Check for broken shutters, shingles, loose gutters etc.
* Rake leaves and dress bare areas with mulch. Flowers and potted plants always dress up the home.
* Turn on the lights to create a welcoming atmosphere.

Inside -

* Have rugs professionally cleaned. Repaint tired looking areas with a neutral color such as antique white.
* Clean closets and remove excess decorative items, less clutter will make rooms appear larger.
* Remove rust stains in the bathrooms, coordinate new towels and replace bulbs with softer wattage. Counter tops should have all excess items removed and the tub and sink should look exceptionally clean!
* In the living room, clear away all excess magazines, books and clutter, open the curtains, add fresh flowers and candles.
* The kitchen must be spotless! Clean all appliances inside and out and replace any broken items. Remove all magnets etc from refrigerator and have floors professionally cleaned and polished.
* In the bedrooms, simplicity is key. Remove all excess clothing from closets and try to have the room furnished as simply as possible. Add extra lighting to dark areas.
* The perfect garage contains only cars, if this is not possible organize tools and tidy up storage areas. Start throwing out unneeded items-you're moving anyway!

* Your Crossroads agent will have ideas for each individual home to help you maximize the value of your house and create more curb appeal.

Pricing Your Home

smercer@DelphicSage.com (Loraine Gough) — Fri, 18 Apr 2008 12:00:00 GMT

Pricing Your Home

At Crossroads Realty we know that pricing your home is the first and most important part of the process in selling it. We won't over-price your house just to get the listing, causing your home to languish on the market for months necessitating a drastic price reduction just to complete the sale. The longer a house sits on the market, the less likely it is to sell for full price. At Crossroads, we sell more homes than any other Realtor in our market. Our agents have extensive knowledge of the markets they serve and we understand the importance of pricing your home so that it sells quickly for the maximum value. Our comprehensive market analysis programs will compare sales of similar homes in your area and taking into account special features, will come up with an accurate valuation so that sales people will actively show the house, knowing that the price is in line with the market and lenders will approve loans for the sale price of the home.

Tips for Sellers

smercer@DelphicSage.com (Loraine Gough) — Fri, 18 Apr 2008 12:00:00 GMT

Marketing Your Home

There are many approaches to marketing a house and Crossroads agents specialize in developing a unique marketing plan for each home.

Crossroads provides the homeowner with a comprehensive marketing and advertising plan which includes targeted direct mail pieces featuring photos and information about the house, classified advertising in newspapers throughout the metropolitan area, featured advertisements in the real estate magazines, listing with the Multiple Listing Service and extensive exposure on our state of the art website. The marketing plan may also include broker's open houses, virtual tours and exclusive showings.

Crossroads agents have extensive knowledge of the communities they serve and will work with the individual homeowner to tailor a specific marketing plan to suit their individual needs.

Help Sell Your House

smercer@DelphicSage.com (Loraine Gough) — Fri, 18 Apr 2008 12:00:00 GMT

As each house is different, so are the circumstances of each sale. Be sure to relay your needs openly to your agent and let them know of special timetables you need to observe such as the end of the school term or the start date for a job transfer. Discuss with your agent how quickly you'd like to sell your house.

Read the ads. Is the advertising copy for your house accurate and does it accurately emphasize the special features of the house or neighborhood that would appeal to a buyer? Help the agent to see what makes your house desirable.

Remain open to suggestions from your agent on making your house more saleable. Perhaps a fresh coat of paint in a tired entryway, a carpet cleaning or flowers in the window boxes would make all of the difference in your homes curb appeal. Your agent will be able to advise you on low cost ways to make your home look fresh.

Keep an open mind to marketing suggestions or pricing strategies. As you move through the process of marketing your home, ask your agent for feedback on how the process is going and what else can be done to stimulate interest. An additional open house may be needed or a classified ad in a different paper may spark a new wave of interest in your home. Work with your agent to understand if there is a particular aspect of your house that seems to deter buyers from going through with the sale and what steps can be taken to remedy this situation.

Above all keep the lines of communication open and let your agent know needs and ideas.