Glaring Flaws

In the past, consumers rode the wings of their soaring home equity line of credit. Small ticket repair items seemed unimportant, doable. While big ticket items, such as a roof or siding repairs, stung temporarily, most gambled on their golden ticket of inflated home values to buffer or augment these glaring flaws or more plainly to justify their vanity.

Today, it would seem suicidal to take such a risk. Consumers are looking to have better energy efficient homes, i.e. newer double pane windows, gas stoves and not Barbie fireplaces. They are looking to have minimal repairs. Big ticket repair items will become glaring flaws and the small ticket items the final tipping point. Only to leave the seller minimal protection to shield their profit from the onslaught lists of imperfections. Sellers who once thrived as kings of the hill have become subservient to tight wad buyers or become victims to opportunistic peronas.

What are today's buyers looking for in a house?

• A Clean house, a home well cared for
• Newer Roof, less than 10 years
• No problematic sidings, i.e. Land Pacific (LP) siding (composed of wood scraps and resins & glue)
• Well serviced heaters and furnace
• Newer furnace
• Newer windows, less than 7 years
• New paint
• Newer appliances
• Wood floors, good hypoallergenic environment selling point
• Great lighting, better when it is natural lighting, especially in the Pacific Northwest
• Better insulation, not always thought of but highly recommended
• No moisture damage = no mold problems
• Remodeled, open & spacious kitchen
• Contemporary, classical floor plans with good flow and/or a great room style
• Consistency in the remodels
• Fresh scent, no harsh odors

What should sellers do before marketing their house? Increase the preceived values.

• Manage the Clutter
• Clean the house from top to bottom
• Get a thorough home inspection
• Prioritize the list of repairs
• Work on one room or one area at a time
• Follow the list of repairs that will give the house a face lift, repairs that communicates to buyers the house was well cared for and loved, i.e. new paint, fix leaky faucet, freshen up old dingy grout
• Keep within your budget
• Be consistent in the remodel theme, i.e. avoid mix eras
• Avoid over remodeling, i.e. a Waterford chandelier versus a good quality chandelier
• Keep paperwork & receipts on large ticket repair items, especially when they carry a warranty or guarantee
• Tidy the yard and garden space
• Get rid of house odors, invite an independent and outside nose to take a whiff
• Don't know what else to do? Try visiting open houses for inspirations, see your house from a buyer's perspective and get off the "My house is better than" attitude.

JD Powers Award 2009 Highest Customer Service

Link: JD Power Ranking of Real Estate Firms

Can you use a short sale addendum to get out of a deal?

A question was posed to the Washington Association of Realtors to whether or not a seller and seller's lender can use Northwest Multiple Listing Service (NWMLS) form 22SS (Short Sale) Addendum to terminate a previously mutually accepted offer, an offer that was signed off and agreed to by all parties involved.

22 SS Addendum Objective: Notifies buyer that seller will continue to accept (review or look into) other incoming offers subject to lender approval.

Question: Can the Seller use the 22SS to get out of an offer they had previous mutually accepted for a better or higher offer?

WA of Realtors said No. Form 22SS does not give the seller the "unilateral right" to terminate. It is a contingency which benefits the seller "in the event seller's lender does not approve buyer's offer." "In this case, seller's lender did approve buyer's offer and seller acknowledged agreement to lender's terms by advising buyer of lender's approval. In other words, the seller contingency set forth in form 22SS was satisfied [or was met]". "The seller misused form 22SS and buyer should be advised to seek legal counsel."

Something to Tink about, $8,000 Tax Credit Extension

Finding yourself scrambling to hit last minute deadlines? It is that time for the $8,000 buyer tax credit to be gone. The elusive tax credit extension have lead some buyers to oscillate and waylay their housing purchases in hopes that Uncle Sam will bring them what they need, time and money. Should Uncle Sam extend the tax credit?

Are there any downsides to this tax extension? The upside is touted by the National Association of Realtors (NAR). They have pushed a call to action to ask our government leaders to save the tax credit extended. Why are we extending it? Is it our intention to make the real estate world go round? Is it to help the home buyers achieve the American dream of homeownership? How about stimulating our economy? Seriously. Why do we have deadlines? Is there a downside to a tax extension? The money is coming from someone somewhere and it isn't from Uncle Sam. Tax payers?

Links:

· Buyer Tax Credit FAQs
· How to get the First-Time Home Buyer tax credit

Changes in consumer protection act to impact closing dates

How will the ammended Truth and Lending Act affect loan timeline?

1. If the buyer needs financing to purchase a property, the new Regulation Z (or REG Z, 226.31 & 226.32) can impact and can dictate the closing date, i.e. delayed delivery of a good faith estimate, rates have not been locked.

Mortgage Disclosure Improvement Act (MDIA’s) requirements:

• "Creditors wait seven [7] business days after they provide the early disclosures before closing the loan; and
• "Creditors provide new disclosures with a revised annual percentage rate (APR), and wait an additional three business days before closing the loan, if a change occurs that makes the APR in the early disclosures inaccurate beyond a specified tolerance [ i.e. 0.125%]." (Federal Reserve press release)

2. An increase of .125% of the APR from the initial good faith estimate or Truth and Lending (TIL) disclosure requires the lending part to revise and re-issue a new TIL to the consumer. Consumer must receive the newly revised TIL within three days before closing. However, if the lender chooses to mail the TIL disclosure, closing may occur on or after seven (7) business days after mailing.

• "Consistent with the MDIA, the final rule amending Regulation Z requires creditors to make good faith estimates of the required mortgage disclosures, and deliver or place them in the mail, no later than three business days after receiving a consumer's application for a dwelling-secured closed-end loan. Consummation [or closing] may occur on or after the seventh [7] business day after the delivery or mailing of these disclosures.
• "If the annual percentage rate provided in the good faith estimates changes beyond a specified tolerance for accuracy, creditors must provide corrected disclosures, which the consumer must receive on or before the third [3^rd] business day before consummation [or closing] of the transaction." (REG Z Docket)

As there are changes which may occur during the purchasing process, it is important to ensure that the estimated fees are accurate as possible. If the APR deviates more than .125% from the buyer’s initial TIL received, lenders must provide updated TIL and if they cannot provide it within three days prior to closing, then the closing date must be extended.

However, under personal hardship, the buyer may be permitted "to expedite the closing to address a "bona fide personal financial emergency", such as a foreclosure. (REG Z Docket).

*** Important to Note***

Lending Double Jeopardy

Some lenders may choose to add “padded” fees due to this new REG Z. The speculation is that these lenders maybe trying to:

· avoid possible delays in closing

· consider this requirement an inconvenience, which can be cumbersome when processing multiplicities of loans

· and/or avoid possible bad rating if their ability to perform is inconsistent, i.e. not able to provide good faith estimates in a timely manner.

It is assumed that they will remove the “padded” fees at closing but who is to say that they will remain honest and follow through with their good intent.

It is important that you review your HUD statement with your real estate professional or discuss it with your closing agent, i.e. escrow officer, to determine what standard fees are normally like (i.e. a general idea), what they should include, fees out of the norm, what are in the junk fees or fees disguised as something else, hidden fees.

3. A copy of the property appraisal must be provided to the consumer three days prior to closing. However, the buyer may waive this review period requirement for whatever reason.

Other changes that can influence closing timeline:

A. Changes in purchasing process can affect the APR and therefore affect the closing date.

• mortgage product (i.e. changing loan programs or types)
• closing/signing date
• loan amount
• unlocked rate
• fees by third parties, i.e. escrow or settlement agent.

B. Interest rates impact the APR. In order to get an exact APR, the buyer has to lock in their rate.

Choices to make before locking in a rate:

· determine loan program

· interest rate

· points &

· lock in length

Marinating Relationships with Time

How many of you know how to can?

I didn't until recently. While visiting some friends, I was invited and guided through the HOW TO. It wasn't as daunting as I had imagined.

I was enthused and wanted to put this new skill into action...with help from family recruits, willingly I might add. Well, we were canning peaches, who wouldn't want to participate. After the cleaning, boiling, hot-flash-peeling, more water boiling and finally the finished products, my brother asked me, "When can we eat it?" I hadn't a clue but asked the expert, who said they needed time to marinate, to give them time to get better flavoring.

It isn't much different in a business relationship; it takes time to build trust. How do we, as consumers, decide whom we choose to be committed to; how much time to give our attention to; whom we should give our loyalty to, our trust to, our business to and whom to refrain from, in a matter of minutes of hearing, seeing or meeting these sales persons, companies or their products?

We live in society where everything is saturated with the "fast food" motto or the "I want it now" quota. We can sometimes compromise the short term gratification for the now rather than for the higher quality outcome waiting for us later. This obsession for all things now have caused some of us to forfeit what we crave and need most, time tested values and quality relationships, outcomes of which can satisfy our long term needs and wants.

Majority of all real estate sales comes through referrals, existing relationships, via family members, friends and already trusted associates and sometimes through individuals who have had at one time or another positive experiences. These relationships bridge the chasm of uncertainty from doubt to trust, from strangers to trusted professionals, relying wholly on the person who referred them.

What do you do if you are starting from scratch? Who do you trust?

Get to know your neighbors: your local bankers, grocers, car dealers, retailers, civic leaders, real estate professionals, restaurant owners, etc. Give yourself time to get to know them, establish a report so when you need them or their services and expertise there isn't the feeling of awkwardness, fear, or doubt. With them, sticky situations can be unstuck and closed doors can be made to open and sometimes they can help buffer the tide of unexpected shortfalls. They will often go the extra mile where others may fall short.

Marinate these networking relationships now that in time these relationships will become your fortress for the enjoyment of life and your buttresses to stem the tide of unexpected shortfalls with kindness and mercy.


Quote:

“When the conduct of men is designed to be influenced, persuasion, kind unassuming persuasion, should ever be adopted. It is an old and true maxim that 'a drop of honey catches more flies than a gallon of gall.' So with men. If you would win a man to your cause, first convince him that you are his sincere friend. Therein is a drop of honey that catches his heart, which, say what he will, is the great highroad to his reason, and which, once gained, you will find but little trouble in convincing him of the justice of your cause, if indeed that cause is really a good one. ” Abraham Lincoln.

Getting Back What You Paid For

Now, I know that this article might rub some the wrong way. It isn't meant to be, just consider it an FYI. It's a common understanding that you get what you paid for, right?

I purchased a strand of pearls from online, nothing fancy but the pictures were very seductive. Alright, yes, I should have been more careful but I didn't know any better. But the deal seemed so good that I thought to myself, it should be an easy and quick buy for a simple project. I was so ecstatic and looking forward to their arrival. So, did I get what I paid for? Well, YES! Disappointment and an inconvenience. The pearl weren't what I paid for, I felt ripped off and the seller wasn't responsive.

I am a big peach fan, especially yellow peaches. Big juicy and fresh! Mmmm.... Well, I went to a well trusted store, big name, who advertised for quality and charged big bucks. You know the kind. It wasn't the big name that I went for, just the peaches. I bought a few with hopes to cash in every juicy bit. I patiently waited for a few days to give them time to ripen. When the time came I smelt it, cleaned it, and cut into it with anticipation only to be disenchanted by pithy and mealy interiors.

You know what I mean and some of you can freshly recall what it felt like to be dissappointed, to be miss lead, to not get what you bought into. When it comes to hiring a real agent to represent our interests why be a scouge, be lead by fair promises, rely too much on the packaging, or cut a few sales person off because we wanted a great deal? The façade can harbor a rotten core and the wrong choices can lead to shady results. In the end we get what we paid for and the outcome of our choices, whatever they may be, are ours.