You've Opened Escrow, Now What?

Congratulations, you are on your way to owning your very own home!

Follow these suggestions (and your realtor's advice) so that escrow and settlement with go as smooth as possible.

• You will be asked for a down payment on the home you are purchasing.  You can choose to put down as much or as little as you want (depending on your mortgage), but remember, the more you put down toward the total price of your home, the less time it will take you to pay off and the less your mortgage payments will be every month.
• During this period of purchasing your home, you are going to need an escrow or settlement company to act as an independent third party so that you know when and who to give your money to get the deed to your new home. The escrow or settlement company will hold your deposit and coordinate much of the activity that goes on during the escrow period.  This deposit check may also be held by an attorney or in the broker's trust account. Make sure that there are sufficient funds in your account to cover this check.
• The deposit check will be cashed. Assuming the sale goes through, this money will be applied to the purchase price of the home. If for any reason the sale is not consummated, you may be entitled to receive all of your deposit back, less standard cancellation fees. In certain instances, the seller may be able to retain this money as liquidated damages. Prior to executing a purchase contract, it would be wise to speak with your counsel regarding whether or not it is your best interest to have a liquidated damages clause as part of the contract.

The period that you are "in escrow" is often 30 days, but may be longer or shorter. During this time, each item specified in the contract must be completed satisfactorily. By the time you have opened escrow, you have come to an agreement with the seller on the closing date and the contingencies. Each contract is different, but most include the following:

1. Inspection contingency: this should be completed as soon as possible after the contract to purchase is signed as unsatisfactory results of the inspection may mean that you will want to cancel the contract.
2. Financing contingency: once the contract is signed, you have a period of time to secure funding. If, for any reason, you are unable to secure funding during the period of time granted to you by the contract (and the seller will not provide a written extension of time), you must decide whether you want to remove the contingency and take your chances on getting a loan. You may choose to cancel the purchase contract.
3. A requirement that the seller must provide marketable title.

With an attorney or title officer, review the title report. The title must be "clear" to ensure that you do not have legal issues regarding your ownership.Check into local and state ordinances regarding property transfer and make sure that you and/or the seller have complied with them.

Secure homeowner's insurance. This will probably be required before you can close the sale. Due to such requirements as special fire and earthquake insurance, obtaining this insurance may require a lengthy period of time. It would be in your best interest to apply for insurance as soon as possible after the contract is signed.

Contact local utility companies to schedule to have service turned on when you close escrow.

Schedule the final walk-through inspection. At this time, you should make sure that the property is exactly as the contract says it should be. What you thought to be a "permanently attached" chandelier that would come with the property might have been removed by the seller and replaced with a different fixture entirely.

You've made it! Once the sale has closed, you're the proud owner of a new home. Congratulations!

Real Estate Hidden Gems

Helping Your Appraiser do the Best Job

By Lew Sichelman | LA TIMES

trackback:

http://www.latimes.com/business/realestate/la-fi-lew-20140316,0,186251.story#ixzz2wRDrk5eY

Your home is on the market. You found buyers, a nice young couple just starting out, and they're sold on the home. But wait — there's one more person you have to sell: the appraiser.

You can no longer try to influence the professional who's responsible for placing a value on the house — a value that the lender must feel comfortable with if, for some reason, your buyers don't pay back their loan and the bank has to foreclose.

No, the days of MAI — which stands for Member of the Appraisal Institute but was euphemistically known in the trade as "Made as Instructed" — are long gone. But there is still plenty you can do to improve the chance that you will obtain the value you are looking for.

According to builders and realty agents, many a deal has been scuttled when lenders assigned appraisers who lived hundreds of miles away or were not familiar with the area. So after the appraiser calls to set up an appointment, check his or her bona fides.

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FOR THE RECORD:
Appraisal tips: A Housing Scene column in the March 16 Business section on how to get the best appraisal for your house incorrectly identified John Brenan as director of appraisal issues at the Appraisal Institute. Brenan is director of appraisal issues at the Appraisal Foundation. The column also was incorrect in stating that the Appraisal Institute was created byCongress to set appraisal standards and appraiser qualifications. That description applies to the Appraisal Foundation. The Appraisal Institute is a professional organization based in Chicago. —

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"The best way for owners to combat potential problems is to ensure the appraiser is qualified and competent," says Ken Wilson, president of the Appraisal Institute, a trade association based in Chicago. The organization was created by Congress to set appraisal standards and appraiser qualifications. "Consumers have every right to demand the use of someone with field experience in their market and knowledge to handle the assignment properly."

Ask your lender about the appraiser's professional designations. How long has he practiced? What level of experience does she have with your market and your type of property? Is he familiar with the neighborhood?

Of course, you spruced up the house when you put it on the market. You painted, perhaps, and you certainly fixed that broken window in the master bath. And you put away all that clutter in the kitchen.

Now make sure the house is just as dandy when the appraiser finally arrives. Tidy up. Get the dishes out of the sink and into the dishwasher. Clean off the counters. Pick up the dirty clothes from the bathroom floor. Change the furnace filters.

Also, send the kids off to the neighbors' or out to the movies, and lock up your animals.

None of this will add or subtract from the valuation. But human nature being what it is, it will convey the notion that the house is well-maintained, says John Brenan, director of appraisal issues at the Appraisal Institute.

Although you cannot try to directly influence the appraiser — offering a free dinner at his favorite restaurant, maybe, or a little cash under the table — you can speak with him. It's a myth that you can't.

"Conversation is not only allowed, but it is vital," Brenan says. "The appraiser needs to be able to discuss pertinent items about the house or contract."

When the appraiser arrives, present him with a list of everything in and about the house that you believe adds value — new windows, perhaps, or an addition above the garage. You are not trying to influence the deal, per se. Rather, you are "simply documenting," Brenan says. "You are not saying you need an extra $5,000 because you put on a new roof last year. You're just saying that you put on a new roof."

Your list should include a detailed description of any improvements or replacements, the dates they were made, who did the work (backed up by invoices to show they were done by a professional as opposed to a weekend do-it-yourselfer), a brochure to show the quality of the materials and building permits.

Also list any ways your house differs from others on your block: different finishes used, your better view, your larger lot size. "The list goes on and on," Brenan says. "You can't provide enough information about the house, the neighborhood, the schools. It will help give the appraiser a better understanding about the market."

Also give the appraiser a list of comparables, or "comps," which are similar properties in your neighborhood that sold recently. The appraiser may well already have the exact same houses, so at the worst, your list may be redundant. But then again, he may have only one or two.

Either way, Brenan says, "as long as you don't make any demands, a good, competent appraiser should appreciate" the help.

Some appraisers still balk at accepting such information. One recently told Jill Sackler, an agent with Charles Rutenberg Realty in Merrick, N.Y., that he was no longer allowed to do so. But Barbara-Jo Roberts Berberi, a Rutenberg agent in Crystal Beach, Fla., had the opposite experience recently.....

READ the rest of the article here...

http://www.latimes.com/business/realestate/la-fi-lew-20140316,0,186251.story#ixzz2wRE25z1c

Distributed by Universal Uclick for United Feature Syndicate.

Copyright © 2014, Los Angeles Times

Home prices edge down in big cities, Case-Shiller says

By Andrew Khouri | LA TIMES
http://www.latimes.com/business/money/la-fi-mo-home-prices-case-shiller-december-20140225,0,6368372.story#ixzz2uNNwKYJ6

Home prices fell slightly across large U.S. cities in December from a month earlier, further evidence that the housing market cooled to close the year, according to a closely watched index.

The S&P/Case-Shiller index of 20 large U.S. metropolitan areas, released Tuesday, declined 0.1% from November, the second straight month-over-month drop. Compared to a year earlier, the index rose 13.4%, a slower one-year pace than in November.

“The strongest part of the recovery in home values may be over,” David M. Blitzer, chairman of the index committee at S&P Dow Jones Indices, said in a statement.

Eleven cities saw slower one-year price increases in December compared with a month earlier. Los Angeles posted a strong rise of 20.3% from December 2012 to December 2013, but that was smaller than L.A.'s November-to-November gain.

Only six metro areas, including San Francisco and Las Vegas, saw prices rise in December from November.

The Case-Shiller index, created by economists Karl E. Case and Robert J. Shiller, is widely considered the most reliable read on home values.

The housing index compares the latest sales of detached houses with previous sales, and accounts for factors such as remodeling that might affect a house's sale price over time.

The index, however, trails other indicators. More-recent data have revealed weakness in the market as would-be home buyers have struggled with high costs and too few homes available for sale.

In January, sales of previously owned homes dropped to the lowest level in 18 months, according to the National Assn. of Realtors.

http://www.latimes.com/business/money/la-fi-mo-home-prices-case-shiller-december-20140225,0,6368372.story#ixzz2uNNwKYJ6

New jobs, recovering housing market restoring California economy

By Kevin Smith, San Gabriel Valley Tribune |Daily Breeze

California is on track to reclaim its status as the Golden State, according to a report released today.

The Los Angeles County Economic Development Corp.’s 2014-2015 Economic Forecast & Industry Outlook notes that California’s unemployment rate is falling, more people are finding jobs, the housing market is improving and budget surpluses are finally in sight.

The state has regained 70 percent of the more than 1.3 million jobs it lost as a result of the Great Recession, the report says, although the recovery continues to be “very slow.”

“Regionally, the recovery is advancing in nearly every part of the state,” the report says. “Now, after nearly five years of recovery, California is on a more solid footing.”

The report notes, however, that the state is currently grappling with one of its worst droughts on record. Southern California will likely receive little water from Northern California this year and increased conservation and recycling will help the region keep pace with growth and reduce reliance on imported water.

Orange and San Diego counties led the Southland’s growth last year with year-over-year job gains of 2.1 percent and 1.8 percent respectively. Los Angeles and Ventura counties were close behind with employment growth of 1.7 percent. But the Inland Empire was still struggling with growth of just 1.2 percent, the report said.

“The Inland Empire has a lot of strength in construction, but that sector was very hard hit in the Great Recession,” said Robert Kleinhenz, the LAEDC’s chief economist, who helped research and prepare the report. “We’re still looking at several years before we recover all of the jobs that were lost in the recession.”

Los Angeles County — boasting the largest county economy in the nation — saw its population surpass the 10 million mark last year and the region is expected to see nonfarm job growth of 1.6 percent this year with another gain of 1.2 percent in 2015.

The county’s unemployment rate is expected to average 8.7 percent this year and 7.8 percent in 2015.

The most current reading from the state Employment Development Department put L.A. County’s jobless rate at 9.2 percent in December.

The county’s biggest job gains in 2014 are expected to come in health services with 12,800 new jobs. That will be followed by employment gains in leisure and hospitality (8,900), professional, scientific and technical services (8,800), administration and support (7,700) and construction (5,800) and manufacturing (4,700 jobs), the report said.

David Aley, an admissions clerk at the West Hills Health & Rehab Center in Canoga Park, said his facility hired more employees in 2013, bringing the total workforce to around 140.

“In health care you’re always hiring and firing ... but mostly hiring,” Aley said with a laugh. “People change jobs, moving from one place to another. But we’re always busy.”

Further inland, the report shows that the combined San Bernardino and Riverside counties area has regained more than 40,000 of the 147,000 jobs it lost during the recession, adding more than 14,000 new jobs in 2013 alone.

The Inland Empire’s most recent unemployment rate of 9.2 percent is expected to average 9 percent this year and drop to 8.2 percent in 2015.

“A lot of hope has been placed on the transportation and logistics part of the economy, not just to generate jobs going forward but to also create a sizable number of well-paying jobs,” Kleinhenz said. “Transportation, warehousing and utilities will grow by at least 2 percent this year in the Inland Empire. The job counts have already exceeded the pre-recession peak.”

The Inland Empire’s biggest employment gains this year are expected to come in retail trade (3,200 jobs), leisure and hospitality (3,200 jobs), health services (2,800 jobs) and government (2,500 jobs).

L.A. County and the Inland Empire are both poised for significant growth in residential housing, the study said.

L.A. County saw 15,700 housing unit permits issued last year and that number is expected to rise 34.4 percent to 21,100 permits this year, with another 28 percent gain in 2015. That would bring the total number of permits issued next year to 27,000.

The Inland Empire is primed for even more dramatic gains. The LAEDC said 8,900 housing unit permits were issued last year. That number will rise 53.9 percent this year to 13,700 permits and 45.3 percent next year to 19,900.

Karl Woehrstein, a broker with the Century 21 Amber office in Torrance, said his area is saddled with an all-time low in inventory. The combination of that and multiple bids have driven home prices back up to 2006 levels, he said.

“Usually our multiple listing service would have 3,000 to 4,000 units for sale,” Woehrstein said. “But now we’re down to about 900 to 950.”

The LAEDC report also notes that the Los Angeles and Long Beach ports play a significant role in Southern California’s economy.

The value of two-way trade in the region is expected to rise 4.5 percent this year to $433.3 billion and 6.9 percent in 2015 to $463.2 billion.

http://www.dailybreeze.com/business/20140219/new-jobs-recovering-housing-market-restoring-california-economy

Real Estate can be a Complicated Business

Written by Joe Stampone |http://astudentoftherealestategame.com/

“Real estate is not an overly complicated business” is a common sentiment I hear. Historically, that was true. Real estate was a business made up of small local players who financed properties through local bank relationships and raised equity from the neighborhood doctor or attorney, but as the business became institutionalized, it’s become increasingly complex.

By way of example, my company was just awarded a new deal and I was thinking about all the complexities of the transaction.

Winning the Deal: The property was being sold by a public REIT which valued surety of close over getting the best price possible. In order to get the seller comfortable working with a relatively new group, we did a ton of upfront diligence on the property, market, leasing environment, and financing options, which gave us a leg up on the competition. We retained a best in class mortgage brokerage shop to help with the financing, decided to keep the same leasing and property management team in place, and conservatively underwrote upfront and annual capital reserves to mitigate any surprises we uncover during our due diligence.

Simultaneously, we were working an internal contact we had at the seller’s firm to put in a good word for us. All this upfront effort was critical to winning the deal and beating out two other groups that were willing to pay as much or even a little more than us.

Financing Options: Upon winning the deal we had an internal kick-off call to discuss due diligence, raising equity, and financing options. In our initial conversation we discussed the pros and cons of bank, Life Company, and CMBS debt and the key points of fixed long-term off the bat or going with a flexible bridge with refinance shortly thereafter. Each financing option has its upside and risks, and while there is no right answer, we’ll do a comprehensive review to determine what is right for this deal. This requires a deep understanding if the various financing options.

Value-Add: One of the great things about real estate is the opportunity to add value at the property level. On this deal, the REIT’s in-house management team was located about an hour away and was not in-tuned to the sub-market. Therefore, the property was 70% leased in what has traditionally been a 90% occupied market. We brought in a young, hungry broker who specializes in this market and knows every tenant in the area.

Other: There a countless other things that go into executing a successful deal including pitching investors of the merits of the investment opportunity, negotiating with potential tenants and renewing leases (TI packages and pricing), and improving the physical asset.

The point is that real estate has evolved from a business made up of mom and pop operators to an institutional asset class made up of sophisticated investment professionals. So if you’re looking to compete in today’s real estate business, learn more than the macro story, pick up textbook and learn the intricacies and nuances of the business.

Understanding The Foreclosure Process Timeline

No one likes the thought of facing foreclosure.  However, sometimes there are circumstances that are beyond our control.  Job loss, divorce, illness or any number of other issues which could occur without warning.  The end result being a time when the borrower fails to pay their mortgage on time or perhaps not at all.

The words mortgage foreclosure will send chills down the spine of most people.  There are many different foreclosure laws and the foreclosure process varies from state to state.  Therefore, we are going to take a few minutes to go over the foreclosure process with you in an effort to help you better understand the foreclosure process timeline.

Pre-Foreclosure.  The first stage in the foreclosure process.
Many people think if their home has gotten to the pre-foreclosure stage, there is nothing they can do to save it.  However, nothing could be further from the truth.   If you take some time to educate yourself about the foreclosure process, before your home actually goes into foreclosure, you could prevent it from happening at all.

The first step is the receipt of the missed payment notice.  This notice will state that you need to make your payment, including late fees, in order to avoid any further action.  If you don't make your payment, the mortgage company will take the next step.

The mortgage company will then send you a notice of default.  This notice is sent if your payment is more than 30 days late.  If you still don't pay the balance due on your mortgage, the bank will then proceed to the next step.

Foreclosure.  The second stage in the foreclosure process.

The next step is when you receive the actual foreclosure notice.  This letter is notifying you that the bank has begun the formal foreclosure proceedings.  Your home will then be scheduled for sale at an auction.
 
Auction.  The third stage in the foreclosure process.

If your loan has not been paid and reinstated within the pre-foreclosure timeframe, your home will be put up for auction.   An auction will allow potential buyers to bid on your home.   The auction price for your home will start at what you owe and bidders can submit their offers  from there.  At the end of the auction, your home will go to the highest bidder.  If your home doesn't sell at the auction, the lender will then take ownership of the property.

Bank-Owned.  

Now the bank owns your home.  They will clear the title and make any repairs that are absolutely necessary.   The mortgage company will then attempt to sell the property in an effort to recover any unpaid balances.

Foreclosure process timeline.

There was a time when the foreclosure process timeline was pretty similar in most states.  However, with the housing market being so unstable,  now the foreclosure process varies greatly from state to state.  Therefore, it is nearly impossible to predict how long it will take for your home to go through each stage; from the pre-foreclosure through to the auction date.
Options that will help you avoid a possible foreclosure.

The first thing you need to remember is to stay calm.  You do have options.  It's easy to panic when the thought of foreclosure is looming over you.  However, there are some things you can do to get yourself back on track.

• Try to borrow some money to get your payments up to date.
• Take a look around your house.  Sell anything and everything you can to raise enough money to make your payments.
• Talk to your mortgage company about a forbearance plan.
• Check to see if your lender has any mortgage modification programs that will lower your monthly mortgage payments.
• Consider refinancing your home with a new loan.
• Talk to your local real estate agent about selling your home.  You can then take the equity from your home and purchase another one that is more affordable.
• Some investors will buy your home then lease it back to you under their lease to own option plan.  Just remember to check with your attorney before entering into any investor lease to own programs.
• If you file for bankruptcy, it could allow you to consolidate your debt and pay it off over a set number of years.
• Talk to your mortgage company about a deed in lieu of foreclosure.  

Understanding the mortgage foreclosure process is a crucial part of controlling the outcome.  You need to educate yourself about the foreclosure timeline.  If you want to take command of the situation and avoid a foreclosure altogether, it would behoove you  to learn the different options that are available to you.

Find a real estate agent in your local area that specializes in foreclosures.  Your realtor will be your best defense in getting through this process with the best possible outcome.  So take advantage of their knowledge and years of experience to get you through these trying times.

What Not To Do When Selling Your Home

Now that it's time to sell your home, you're probably trying to make sure you get everything right.  You don't want to make any mistakes that could cost you a top dollar sale.  However, there are many common mistakes that sellers often make.  Not because they don't know any better, but because they truly believe they are right despite what their realtor is telling them.  Here are some of the most common seller mistakes that could easily be avoided.

                             Here is an example of a presentable master bedroom for showings


1.  Don't overprice your house.  We know you have lived in and loved your house and you're probably emotionally attached to it on many different levels.  However, no matter how much you have put into the house or how many upgrades you have completed or how much you owe on it, your home is only worth what the market is willing to pay for it.  Even if yours is the best house on the block.

2.  You must remove all clutter and all personal items.   Your buyers need to be able to picture themselves living in your home and they can't do that if they see your personal decor and your family pictures, etc. all around the house.  You need to keep it as neutral as possible.  Additionally, by keeping everything to a minimum, you will make your house appear bigger and cleaner.  So go ahead and pack up anything you aren't using and store it until you are ready to move.  You have to pack anyway and this is a great way to get a  jump on things.

Presentable Family Room- from our listing 45 Eastfield.

With all clutter removed.

3.  Be prepared for lowball offers.  Lower than asking price offers are inevitable.  You will receive lowball offers but don't get offended and whatever you do don't ignore them.  This is your chance to negotiate a better offer.  You can't blame the buyer.  Some sellers will accept a low ball offer if they are in a desperate situation.  But that doesn't mean you have to.   Just take some time and try to get the buyer up to a price that is agreeable to both of you.

4.  If something is broken - fix it.  And that means everything!  Never neglect to fix something that is broken no matter how small it is.  The minute your buyer sees something that needs to be repaired, they will begin to look for anything else that may be wrong with your house.  Additionally, it will cause them to wonder just how well you have maintained the house over the years.  Once the buyer is in this mindset, it's very difficult to change it back.

5.  Don't skimp on the marketing.  About 80% of homebuyers will start their home search on the internet.  The internet offers them thousands of options from which to choose.  If you only have a few low quality pictures of your home and most every other ad has plenty of high quality pictures, as well as, virtual tours; which ads do you think they are going to click on?  Yep, that's right - the ones with the great pictures and virtual tours.  Talk to your realtor about how to get the most out of your advertising.

Clean & presentable decor ready for marketing.

Taken from one of our listings on the market.

Selling your home doesn't have to be a chore.  Allow your realtor to guide you in the right direction.  Your realtor has the experience to sell your home quickly and to help get you the highest selling price possible.  Therefore, take his advice and know that he is doing everything in your best interest.

Rates to Stay Low Central Bank Says

LA TIMES:
European Central Bank (ECB) President Mario Draghi said the bank was ready to use "all available instruments" to keep market interest rates from rising and hurting a fledgling economic recovery.

He said the bank would "exclude no option," such as a third round of cheap, long-term loans to banks. Draghi spoke after the bank left its benchmark rate unchanged at a record love 0.5%.

The U.S. Fedderal Reserve is considering scaling back its effort to keep bond market rates down. That has left to concerns that market rates might rise in Europe despite the record low ECB benchmark. Europe's economy has just begun a recovery and still needs the support that low borrowing costs provide.

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Tips That Will Make Your Move Easier

It's a well known fact that moving can be one of the most stressful events in your lifetime.  Therefore, if you are getting ready to move, why don't you plan to use the easiest, most efficient way possible?  Here are some moving tips that will help make your move easier.

1.  Know the quantity of your needed moving supplies and gather them ahead of time.  For a five room house, or approximately 2500 square feet, you will need the following:  21-25 small moving boxes, 12-15 medium moving boxes, 18-20 large moving boxes, five extra large moving boxes and about 8-10 wardrobe boxes.  In addition, you will need boxes for your electronics, unprinted newspaper,  2-3 rolls of 150' bubble wrap, some permanent markers and 10-15 rolls of sealing tape.  Don't forget the box cutters, Styrofoam peanuts, mattress covers, stretch wrap and any specialty boxes you may need.

2.  It's helpful to use different colors on your boxes.  Each family member should have their own color.

3.  The most frequently lost items in a move are the wires and remotes for all your electronics.  Therefore, you should put each set of wires and remotes in their own bag and label them accordingly.  Then you should put all of those bags in a separate box and carry them with you in your vehicle where they can't get lost.

4.  After you have disassembled your furniture and other items, you should take all the screws and loose parts and put them each in their own envelopes and seal them.  You should then tape that envelope to the part or piece of furniture to which it belongs.

5.  Make up a separate box of move in supplies.  This should contain things like picture hooks, different sized nails, brackets, a screw driver, a hammer and a level.  Additionally, you should add some toilet paper, paper towels, soap, wipes, rags, trash bags, drinks and some quick snacks.

6.  You should make a home inventory list and design a map of where you want your furniture to go once your movers get there.  

7.  Talk to your new neighbors and give them advance notice about the date and time that your moving truck will be parked in front of their house or blocking their drive.

8.  Purchase all your new locks ahead of time.  Make sure you have covered all your bases.  You will need locks for the front door, back door, any storage doors or exterior utility areas.  You will also need to know the garage door opener codes and alarm codes, etc. for your new home.  It's a good idea to have the garage door opener codes and alarm codes changed once you have moved in.

9. Make arrangements for your pets and your children on moving day.  Pets and children usually become extremely stressed when their environment is disrupted and they could be easily lost or hurt during the move.  So it's best to remove them from the situation for the day.

Talk to your realtor about more moving tips and tricks.  Your realtor will also be more than happy to provide you with the name and number of a reputable mover if you need one.

The Dangers Of Non-Disclosure

If you're trying to sell your house, you probably already know that you must, by law, disclose any problems associated with the property.  However, some sellers have a tendency to think that not pointing out the flaws in their home will bring them more money on the sale of their home.  And that may be true; however, there are many problems that could arise later on down the line due to non-disclosure of your homes past and present issues.

Non-disclosure lawsuits are on the rise.   Once upon a time it was a "buyer beware" market but not anymore.  Ask any realtor and they will tell you that non-disclosure ranks as one of their three biggest problems during the sale and after the sale.
Especially if the seller has made concentrated efforts to cover up the problematic issues.   Another thing to make note of is that after you have completed a repair, it must be documented.  If you complete a repair and it's not documented, and issues arise down the road, you could still be held liable.

A seller must disclose anything that could affect the property's value.  Things such as foundation problems, etc. and in some states you must also disclose any risk of natural disasters such as the home being in a flood plain or if there is a high risk of earthquakes.   Additionally, some states also require that you disclose neighborhood nuisances like a barking dog or any other type of noise nuisance.   The non-disclosure rule applies to everyone.  Even if you sell your house "as is" you still have to abide by the non-disclosure laws of your state.   Below are a list of items that should be included in your property disclosure report.  Some of these may vary from state to state.

• Completed repairs or repairs you were made aware of by the previous owners
• Past or present termite issues
• Any past or present water damage or moisture issues
• Mold
• Lead
• Natural hazards such as the risk of flooding, earthquakes and wildfires
• Past history that includes a notorious haunting or horrific events such as a murder, etc.
• A historical designation that limits remodeling
• Special zoning
• Environmental issues

When in doubt you should disclose.  However, just because you disclosed an issue, doesn't necessarily mean you are obligated to fix the issue.  You can negotiate the repairs with the buyer as terms of the contract.  Or you could just include an "as is" clause in the contract for the repairs in question.

Talk to your realtor about everything in your home that needs to be disclosed.  Don't ever keep information from your realtor.  He is there to help you.  Not disclosing important issues is serious business and could land you in a lawsuit later.  You will then have to pay for the repairs anyway.  So do yourself a favor and save everyone the time and trouble and be diligent about what your buyer needs to know.

How to Yield Better Leads and Results Using LinkedIn

How to Yield Better Leads and Results Using LinkedIn

LinkedIn has been the choice social network for professionals for a number of reasons. It’s not as cluttered as Facebook, it’s not as limiting as the 140 plus character limit for Twitter and more importantly, it’s a source of additional leads to grow your business or network.

People have used this social network in various ways and yielding varying results. Depending on what you intend to do or what you want to accomplish, you might have tried using LinkedIn as well. Ask any company owner or manager, as well as your respective peers, and they will tell you that they have are using LinkedIn to some extent some with dazzling results, others not so much. You can push how LinkedIn can work for you even further. Here are some ideas and motivators you can try out the next time you log-in.

Understand Why You Joined – Many real estate marketers think that the only reason they need to join LinkedIn is because it is another avenue to market or announce new properties. Others think that hanging around LinkedIn for a few minutes a day can automatically generate leads without having to sweat so much. There are even a few who think that LinkedIn is no different from other social networks like Facebook. By knowing your goal, you can be effective in managing your time while plunged inside LinkedIn’s vast network and services.

Groups – It can be very easy to classify your contacts on LinkedIn. It’s twice as easy to expand your chosen network by joining the different LinkedIn groups that are active. The LinkedIn groups do not just open the doors to new people who might potentially be your ally or even a prospective property buyer. They can also be a way to open new ideas and marketing strategies for your business.

The Top Five Things Most Buyers Neglect To Check When Buying A Home

Buying a home will probably be one of the largest purchases you make in your lifetime.  Therefore, it's vitally important that you inspect everything on that home before signing the contract.  Because something that may seem small and insignificant could turn into a loss of thousands of dollars in the long run.   Below are just a few of the most common areas that many buyers neglect to check when buying a home.

1.  Open and close all the windows.  Do they function properly?  Are they fogged?  If they don't function properly there could be underlying problems with the house such as foundation issues, etc.  You never want to skip this step.  Window replacement can be very expensive.

2.  Turn on all the faucets to see if the drains are draining properly.   If the home was a foreclosure, there may be some damage done by the previous owners somewhere deep in the pipes.  Damage that is not visible to the naked eye.  Sometimes branches from large trees or broken pipes could  cause drainage problems as well.  Underground pipe replacement is another very costly expense.

3.  Taste the water.  When you have an old house, some of the pipes may be so old that they can drastically affect the way the water tastes.  Not to mention the quality of the water and the purity of the water coming through those pipes.  This is the same water you will be making your ice with, showering with, washing your clothes with and more.  Installing a whole house water filtering system could get expensive.

4.  Check all of the light fixtures and switches.  Changing a light fixture or switch due to an electrical problem may not seem like an expensive item.  However, if the electrician has to trace the problem and it turns out you have a bigger electrical problem than just a simple fixture or switch, this could become a big expense very quickly.

5.  Most people check either the air conditioner or the heating system depending on the season.  However, most people don't think to check both.  You should check both the air conditioning and the heating system no matter what season it is.  You don't want to buy your home in the summer and then, when the  winter rolls around, find out that your heating system doesn't work and will need to have it repaired or worse to have it replaced.

6.  Test the fireplace.  You need to make sure that your
fireplace is functioning properly and that there are no flaws or blockages that could potentially cause a fire to break out in your new home.

Jumbo Loans getting cheaper

Lenders are now offering rates near & sometimes lower than interest rate for conforming loans.

With mortgage rates rising to levels not seen for two years. Its hard work finding a great deal on a home loan, unless you're rich enough to need a jumbo mortgage. These loans on steroids certainly aren't for everyone: Jumbos are defined as mortgages over $625,500 in much of California and more than $417,000 even in places where homes are cheap.  But if you can qualify Americas banks stand ready to reward you with a rate nearly as good or even better than what you can get for a normal loan. This is an unprecedented situation because jumbos historically have come at a premium price, said Brad Blackwell, executive Vice President of No. 1 mortgage lender Wells Fargo Home Mortgage.

"This is a new phenomenon-- something we've never seen before," Blackwell said in an interview.
Freddie Mac said Thursday that lenders were offering non-jumbo 30 year fixed rate loans to solid borrowers at an average of 4.57%, up from 4.51% last week and a recent low of 3.35% in May. The borrowers would have paid 0.7% of the mortgage amount in upfront lender fees to obtain the rates.

Rates for 15-year fixed mortgages and adjustable loans also rose, a trend attributed to stronger growth in the gross domestic product and positive surveys on manufacturing and home building. Additional encouraging reports Thursday on unemployment and hiring drove the yield on the 10-year Treasury note -- a mortgage-rate benchmark  to nearly 3% its highest level since July 2011. Home lending rates were volatile but continuing to move higher, mortgage professionals said. But that same improving economy also has heated up competition among lenders to make jumbo mortgages, which are too big to be backed by Freddie Mac or Fannie Mae.

They are written mainly for affluent residents of the East and West coasts, where home prices have risen rapidly over the last year.

Jumbos, like all mortgages not backed with a government guarantee, nearly disappeared after the financial system cratered in 2008. Rates jumped nearly two percentage points above those for Fannie and Freddie loans, compared with a usual spread of one-eight to three-eighths of a percentage point higher, said Keith T. Gumbinger, Vice president of financial publisher HSH.com

HSH and fellow data tracker Bankrate.com calculate that lenders are now offering 30-year fixed-rate jumbo loans at the extreme low end of their normal range- an eighth of a percentage point or so above so called conforming rates.

But the Mortgage Bankers Assn. said loans actually made within the last few weeks showed average jumbo rates lower than those for the smaller conforming mortgages that can be sold to or guaranteed by Freddie and Fannie.

The trade group said the average contract rate for a conforming loan with a 20% down payment was 4.73% last week, compared with 4.71% for a similar jumbo loan. The difference was more pronounced in the "hybrid" loans, popular with affluent buyers, that have a fixed rate for five, seven or 10 years before becoming adjustable.

Wells Fargo's Blackwell said his bank was making 30 years fixed jumbos with no upfront costs to borrowers at 4.75% on Thursday, compared with smaller conforming loans at 5%. For a loan with a rate fixed for the first 10 years , Wells was writing mortgages at 4.125% for jumbo borrowers compared with 4.875% for conforming loans, he said.

The reason for the difference is that Wells Fargo has been keeping low-risk jumbo loans on its books rather than selling them as fodder for mortgage-backed securities. That was a good deal for Wells because big banks are flooded to the gills with deposits that are costing them virtually nothing. Wells Fargo, for example, reported that as of the second quarter this year it was paying an average of 0.14% a year interest on its $1 trillion in deposits.

Over the last three years, Wells Fargo has added about $100 billion in home loans to its own portfolio. That's not enough to pose a risk to a bank with $1.4 trillion in total assets, Blackwell said, but plenty to make a big return on the cheap deposits its lending out.

Five Steps To Selling Your House Quickly

Are you thinking about selling your home?  Do you need to sell it quickly.  Selling your home quickly can be done.  You just have to know how to go about doing it correctly.   Today we are going to talk about the best ways to get your home sold in record time.   Once you have finished reading this article, you will have some great tips on how to get this done.

Probably the most important thing you should know about selling your house quickly is to hire a qualified real estate agent.  Some homeowners try to cut corners and sell their house themselves; however, this is not the best route to go.  A realtor has access to state of the art tools and to the MLS system database in which only licensed realtors can utilize.

Finding just the right real estate agent is critical.  You will need to interview your prospective agent and ask them to show  you the homes that are comparable to yours that they have sold recently and how quickly they sold them.  You can also ask to contact the sellers with whom your prospective realtor has worked with to see if they were satisfied with the process.

Additionally, you should shop the area for other homes he is currently trying to sell.  Take some time to visit the realtor's office to see how many people are working and how you are treated.   Check their website to view their other listings and to see how professionally they handle their ads.   Request some copies of the flyers and advertising packets they have on their other listings to determine if they are of good quality and include all of the necessary detailed information needed to influence a sale.

Another factor in selling your house quickly is how easy you make it for potential buyers to view your home.   Be ready at a moment's notice to do a quick clean up and leave the house long enough  for the buyer to view your home, even if it's inconvenient for you.

Talk to your realtor about setting up an open house.  Ask them to send personalized invitations to all of their potential buyers and everyone on their mailing list.  Your realtor should be trying to do everything they can to create a buzz about your open house and to encourage a scenario of competition to encourage higher offers.

Sometimes offering your agent an incentive if they sell your house within a specific time frame will give them that little extra boost needed to get the job done more quickly.   However, you will need to check the laws in your State to determine what types of incentives they are allowed to accept.  Some States restrict the types and the amount of the incentives they are allowed to receive.

Your realtor will be familiar with many different ways to sell your home quickly.  And he will do everything in his power to make the process go as smooth as possible from start to finish

Do You Really Need A Home Inspection?

Buying a home can be a very exciting time, but get one thing wrong and it can turn your life upside down.   Performing a home inspection is one of those things that some buyers think they can forego.  However, the home inspection is a vital part of knowing that you are getting a quality home with as few defects as possible versus getting a money pit.

The only way to know if you are getting a good solid, quality home is through the home inspection report.  The home inspection report will help give you an accurate picture of the maintenance required to preserve the home, as well as, what may need to be repaired before you can move in.  Alternatively, it could give you an "out,"  without forfeiting your earnest money, if the inspector uncovers any major flaws in the home.

Always use a licensed home inspector and not your best friends cousin who is a handyman and thinks he is a home building specialist.  A licensed inspector is required to attend classes and pass a test before he is able to become licensed.

Generally, the home inspection only takes a few hours and will cost between  $200-$400 dollars.  The inspector will start by checking the physical  condition of the exterior by looking for cracks in the walls and any signs of water damage, etc.  He will then inspect the electrical, HVAC, plumbing, appliances, water heater and any other features of the home for damage or potential problems.

The home inspector will then report any visible defects; however, they usually don't notate the condition of things like buried pipes, etc.  Although, they will notate if they see any standing water in the yard  that could indicate an underground leak in one of the underground pipes.

The home inspection report will allow the buyer to request that the seller fix the items found on the inspection report before the sale of the home has been completed.   The seller, however, has the option of refusing the repair request and offering the home on an "as is" basis or lowering the price of the home to compensate for those repairs.   If the repairs discovered through the home inspection process are major, it's generally advisable that you walk away and find another more suitable home for you and your family.  Otherwise, you may be looking at bigger problems later on down the road as the problem grows.

If you don't want to start the entire home search over again from scratch, you could opt for a 203K loan or something similar to have those repairs fixed.   Talk to your realtor about what he recommends.  Your realtor may know of another property that would be perfect for you versus going through the time and hassle of any major repairs that are needed on the current home you are interested in.

Buying A Second Home

Buying a second home - should you or shouldn't you - that is the question.  Well, buying a second home could very well be the absolute best thing you have ever done but you have to do it for the right reasons.  Let's talk about a few of the things you need to consider before making any quick decisions.

First you must ask yourself why you want to purchase a second home.  Is it to invest in your future?  Is it to use for a vacation home?  Are you doing it for an additional income?  The answer to these questions is critical so let's look at all of the facts.

If you are buying a second home as rental property to use as part of your retirement plan then you have made the right decision.  Buying a home forces you to make regular savings in the form of a mortgage payment each month and that is money in the bank when it comes to a retirement fund.

You must make sure,however, that you have enough money to cover the mortgage payments plus any additional expenses such as repairs, yearly taxes and insurance, if they are not a part of your mortgage payment, and anything else that may arise.  The good news is if you buy the right house at the right price, your rental property should always stay rented.

Another reason a second home as part of your retirement plan is a good idea is due to the fact that your investment money is subject to less income tax and the interest and taxes may be deductible.   So planning ahead could pay off in a big way.

Housing, for the most part, appreciates over time.  There are definitely ups and downs in the housing market but buying a home is a long term investment that can ride those tides very well.  A home is an inflation proof investment.

The experts have predicted that both fixed rate and adjustable rate mortgages will probably remain in the single digits for the foreseeable future.  Therefore, financing a home with a nominal down payment should remain achievable for quite some time.

Buying a home is very exciting and can be a very profitable experience but your decision cannot be made lightly.  It is wise to give a lot of thought to why you want a second home, then make a financial plan and stick to it.

If you have some disposable income, then purchasing a vacation home may be just what you need to add a little spice to your life.  Then by all means, go ahead and find the perfect house, buy it and enjoy.

Whatever the reason you want or need a second home, please think about your reasons, make a plan and follow through.  It is also advisable to talk to a real estate agent about all of your options before diving in.  A real estate agent can help you make the best decisions and could potentially save you thousands of dollars in the long run.

5 Tips to Make Summer Home Renovations Pay Off

NEW YORK (MainStreet)—Younger homeowners are likely planning renovations this summer, according to a new study, with some improvements benefiting property values more than others.

The Zillow Digs Summer Home Improvement Trend and Spending survey found that 71% of those aged 18 to 34 plan a home improvement or addition compared to 51% of homeowners 55 and older.

The survey found that 40% plan to work on their outdoor spaces while 17 percent plan to improve their bathrooms.

"As we head into the long days of summer, we are seeing increased interest in outdoor spaces with very natural elements such as stone fireplaces as well as bringing more light into bathrooms with clear glass on the walls and shower enclosures," said Cynthia Nowak, a trend expert with Zillow Digs.

Overall, 60% of American homeowners plan renovations and expect to spend $1,200 with 65% of homes housing children planning three or more home improvements compared to 57% of homes without children.

But not all home improvements pay off and positively impact property values, according to the Appraisal Institute, a professional association of real estate appraisers.

Siding replacement, entry door replacement, attic bedroom addition, minor kitchen remodel and garage door replacement rank among the projects with the highest expected return on investment, according to Remodeling magazine's most recent Cost vs. Value report.

"Projects that take a home significantly beyond community norms are often not worth the cost when the owner sells the home," said Appraisal Institute President Richard L. Borges. "If they don't match what's standard in a community, they're considered excessive."

Other renovations with high expected pay-offs include basement remodel, deck addition and window replacement.

"Consumers should be aware that cost does not necessarily equal value," Borges said.

Below are 5 tips to consider before launching home renovations:

• 1. Arrange a feasibility study for an unbiased evaluation. "During a feasibility study, a professional real estate appraiser will analyze the homeowner's property, weigh the cost of rehabilitation and provide an estimate of the property's value before and after the improvement," said Borges.
• 2. Add green and energy-efficient renovations. "Adding Energy Star appliances and extra insulation are likely to pay the homeowner back in lowered utility bills relatively quickly. Lower utility costs also are a draw for potential homebuyers," said Borges.
• 3. The longer a homeowner stays in a property, the greater the opportunity for a return on investment As a result, Borges advises holding off on big renovations when a homeowner isn't sure how long they will be in their home.
• 4. Check online for home renovation ideas. About 37 percent of homeowners look to the internet for home improvement ideas and inspiration, according to the Zillow Digs survey. HGTV.com, Pinterest and Zillow Digs were among the most common online sources for inspiration.
• 5. Download the Appraisal Institute's free Remodeling & Rehabbing brochure at www.appraisalinstitute.org

--Written by Juliette Fairley for MainStreet

4 Factors for Effective and Successful e-Newsletters

e-Newsletters have always been a great way to keep in touch. It’s one way to remind past clients of you and your business as well as impress prospects who may convert into clients later on. Below are 4 factors to a successful e-Newsletter.

1. Reliable Information.
   • Make sure that the information and references you include are up-to-date and reliable.
   • Your readers are interested on how you can help them. That’s most likely one of the reasons they signed up in the first place.
   • You want to let your readers feel thankful that you shared this significant information.
2. Be Engaging and Creative.
   • Get creative with your subject line! Make your readers want to open your email. Instead of “October Newsletter”, go with “October Newsletter: So You Want to Sell Your House?“
   • Don’t forget about the design. It’s just as important as your content. Use color combinations that are easy on the eyes.
3. A Touch of You.
   • It’s a given that your e-Newsletter should have a professional voice but it would do more to give it a personal touch.
   • Write the way you’d talk face to face with a client or prospect and add a short anecdote from time to time.
   • If you have people writing for you, you can write an introduction or have your own corner where you’ll share a few words.
4. Feature a Client.
   • If a client will allow it, feature them and their story in your e-Newsletter. If it’s also possible, have them write a short testimonial.
   • People love to hear about other people’s smooth or successful transactions.
   • Let your prospects think, “Hey, I want that great experience too!”

With these factors applied to your upcoming e-Newsletters, clients will appreciate your expertise and, from your influence, consider you for their real estate business needs when the time arises.

5 Mistakes You Shouldn’t Be Making on LinkedIn

LinkedIn is the ideal social media platform for professionals and business owners. Unfortunately, you might be doing something wrong that could be costing you your connections. Review these five mistakes to improve your LinkedIn page:

1. Giving in order to receive.
   • One of LinkedIn’s features is that users are able to write recommendations for other users in their network which will be displayed on their profile.
   • It isn’t effective to write recommendations to others and expect them to do the same for you especially when the person you’re expecting it from does not know you professionally.
   • Give genuine recommendations. If people return it, then great. If not, it’s okay.
2. Waiting for a need.
   • This means you’re only active when you need something – clients, an online presence or a solid real estate network.
   • Envision where you want to be (socially online speaking) and start building your network now.
3. Forgetting where you are.
   • LinkedIn may be a social network but it isn’t the same as Facebook. Don’t get carried away with commenting. Keep the atmosphere professional.
   • You never know when a potential client or business opportunity may stumble upon it and decide you’re not the person for them.
4. Going generic and not sharing.
   • One great way to personalise your LinkedIn profile is by sharing posts that you like.
   • It gives other people a peek of who you are. You’ll also get to see who shares the same sentiments as you do.
   • Read up on the comments and know which topics tend to be popular within your connections.
5. Not nurturing your connections.
   • Building relationships in the real estate business is important because it gives you two things: Repeat business and referrals.
   • Chances are the people in your network will have the connections you need.