July 31, 2008

What's the Hold Up?

There are many things that can delay a closing...

You, the buyer, are relying on several professionals:
* Real Estate Agents - yours and the seller's
* Attorneys - yours and the seller's
* Mortgage - Loan Officers
* Mortgage - Underwriters
(Be aware that many big banks have underwriters in a different state and may not have a personal relationship to influence the speed of their work)
* Title Companies
* Appraiser

This is why having a REALTOR (R) to assist in the transaction is very beneficial!


Currently I am working with a young couple (19 years old)who have decided to take advantage of this market and purchase their first home.

While they have diligently saved money over the past year for a down payment, with little work history and low income, they can only afford around $200,000.

With the most homes in the area averaging around $300,000-$400,000, they have limited choices. Most of the homes in their price range are foreclosures.

After previewing several homes, we found a bank-owned property in Manville listed at $184,900. They made an offer, and had to use the FHA 203K renovation financing loan, in order to purchase the home without doing the repairs BEFORE closing/ownership. This loan seemed like a lifesaver, as a regular FHA loan has stricter requirments in terms of repairs.

Attorney review period ended...Contractors inspected the property and signed off on estimated bids for repairs...Appraiser completed the report....Title work was completed and cleared....BUT we still haven't closed.

Apparently, the contractor bids were needed sooner than they were submitted. **ADVICE TO ANYONE USING FHA Renovation Loans: contractor estimates should be submitted within 10 days after attorney review if you expect to close on time!!!

Since the bids were "late", the lender couldn't order an appraisal to be done for the property. Then when the appraisal was "ordered", the appraiser didn't call to schedule an appointment for 4 days. Once the appraisal came out to the property, they didn't submit a report for another 4 days.

NOW it's sitting in underwriting for the past week an a half - our contract closing date was July 11th. We submitted an extension to July 23rd and STILL HAVEN'T CLOSED.
The lender has played the "we're almost ready to give clearance to close" about 5 times so far, yet one thing after another, the slow reaction of communication has delayed the closing.
MEANWHILE, my clients are now being penalized for not closing on time at a rate of $100/day. While, I hope to close within the next day or two, I wanted to share my story to all REALTORS and buyers to inform you the importance of always being "A STEP AHEAD". Don't ever wait to any deadline, for you are relying on several different parties to work "for you" at their convenience.

My biggest disappointment in this whole transaction is that my 1st time homebuyers have had to go through this. I treat every transaction as if I was the one buying the home, and this "unusual" sequence of delays is costing them an additional $700 plus.

So, please feel free to share any similar stories to help buyers learn from our experiences and help avoid similar delays in the future!

July 15, 2008

Information on Buying a Home!

Home Buyer Defense Guide
Real Estate Insider Advice To Help Homebuyers Avoid Common Mistakes When Buying A Home.

Buy And Sell Real Estate From Home

"Getting a House" Video

House Flipping Guide

The Venus Approach to Real-Estate Investing - eBook

Please feel free to checkout some of this resources.

A Great Time to Buy!

With interest rates still low and a significant amount of affordable homes to choose from, it truly is a great time to buy a home!

While some may be hesitant due to misinformation or just lack of know-how, there are far too many people "waiting"...but for what?

There are several programs available, especially for 1st time homebuyers. As a buyer, you also are not limited to only choose one or two homes that meet your criteria, there are several possibilities. There are also financing available for 1st time homebuyers to purchase foreclosure/fixer upper homes and truly customize their homes.

If you are "sitting on the fence" and just aren't sure what your next steps should be, feel free contacting me for more information! If you'd like me to cover specific topics on my blog, please leave me a comment/feedback and I'll respond with ample sources of references and information. I want my blog to be about YOU, the consumer, so please let me know what's on your mind!

July 10, 2008

Finding Foreclosures & Short Sales

Government Auctions.org

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July 1, 2008

Buying Foreclosures - Investment or a Place to Call Home?

Many are not aware of the potential of the foreclosure inventory and its potential for investing. While interest rates are at a historical low, the homes are affordable and the amount of inventory is high. This makes for the perfect time to move up or move out!

There is a significant portion of foreclosure properties in New Jersey for buyers and investors to choose from. Even if you are not the "handy man" yourself, many lenders are providing renovation financing loans to bundle contracted renovations as well as the purchase price into one mortgage. The interest rates are usually slightly higher (by an 1/8th to a 1/2 typically) and there are a few more pieces of paper required to be completed before the lender will write you a check, however, it has opened the possibilities for many "non-handy" buyers to take advantage of great deals.

As banks are not in the real estate business and do not enjoy having a large inventory of real estate, they tend to rely on the expertise of a Real Estate professional. By contacting agencies whom work with banks on a regular basis (typically referred to as Real Estate Owned a.k.a. REO specialists), you are opened up to many more affordable homes.

The fear of "AS IS" typically is a concern for homebuyers, however, while adjustments and credits are not as easy to come by, they do exist. Banks tend to be more willing to assist in the expense of "unforeseen" issues like termites and not so generous for cosmetics. When purchasing foreclosure, it is the sole responsibility of the buyer to make sure a Certificate of Occupancy is granted by the town before the property is "move-in" ready. When using a renovation loan, the lender allows the money for the purchase of the property to be released and the property closed with just a Temporary Certificate of Occupancy. You will have to check with your township and your lender to see what requirements are needed beforehand, however, buyers are given the opportunity to buy the property and fix it after closing. No substantial repairs are left on the buyer BEFORE closing. The lender will allow a certain time-frame from the closing date to complete all necessary repairs, and the town will only give some sort of time frame as well to make all necessary repairs.

As you can see, both "bank owned" properties and special financing offers from lenders, are two other ways buyers can take advantage of this market. For more information, please comment or visit me at: http://associates.era.com/christinemarkow to learn about inventory available in your area.

*Licensed in New Jersey only. Please contact me for referrals in out-of-state purchases. All information is deemed reliable but not guaranteed and is merely the professional opinion of Christine Markow. Please refer to your local lender, municipal building and attorney for further information regarding the purchase and financial lending for foreclosure properties. Thank you!