A Happy Place

The Mortgage Process-

When you apply for your mortgage, your lender will request documents from you to determine your qualification. Once you find your home, you will be required to submit these documents again and additional documents as well. Your patience comes into play, because they will ask you the same questions several different ways. Your patience comes into play when you call or e-mail the lender and they may not respond in a time acceptable to you.

The Home Search Process-

You know how much you can spend, you’ve assessed what your needs and wants in a home are, you may have even researched neighborhoods, schools, and other criteria for your home search. Now your ready to go shopping for your new home. You’ve given your REALTOR a list of properties you want to see, and you can only see two out of six because, the property is already under contract, seller’s not accommodating with showing of their home, etc. Patience! Your new home awaits you.

Now you’ve found the home you’ve submitted an offer and once again you have to have patience. If the property is a foreclosure it may take a week to get a reply to your offer. “Patience”. If the property is a short sale it may take months to get a reply from the bank regarding the sale. Then there is also the possiblity of multiple offers on the property. Now this requires patience and preparedness because once you have determined what the property is worth to you supported by Comparable Market Analysis (CMA) from your REALTOR do not get caught up in the frenzy and agree to pay more than what you are comfortable with or what the home is really worth. (The bank will have an appraisal done that you will pay for. If the property does not appraise, the seller may go with another offer and you have now waited time and money) Remember, your new home awaits you.

The Closing Process-

Once you have your fully executed contract (signatures & initials of all parties) the fun begins. You have to schedule inspections, meet with your lender to do a “formal” mortgage loan application, provide information to the title company, and may have to apply for condo or homeowners association approval as well. All of this must take place within 30 to 45 days, while you continue to maintain your regularly scheduled life. The bank has more forms for you to sign and more documents for you to submit, now the condo or the homeowners association, wants information and documentation from you as well as the title company.

Now you are ready to close, now you have to wait (patience) to know exact cash to close you will need. You dash to your bank get a cashiers check or wire funds. At the closing table you are signing so many documents at one time. Why? Because your patience paid off and now your a home owner!

Next blog…home ownership education classes, and grant programs to assist with frst time homebuyers.

So I get in my car and start driving around the neigborhoods I want to live in and I find my dream home. It’s everything I dreamed of; granite countertops, hardwood floors, jacuzzi in master bathroom, a pool; all the bells and whistles. I meet with the listing agent, share my enthusiasm and desire to purchase this house. We write up an offer, I give a deposit. Then I sit down with a lender and I find out that I can not purchase this home…or better yet, I loved the house who cares that is smells funny.

Haven’t we all at some point heard this above-mentioned story a time or two? What I find to be interesting people purchase cars and homes the same way. They find the car (maybe even test drive the car), they find the house (mentally start placing their furniture in the house). They find the car or the house and try to purchase them by any means necessary. (the good news, with the tightening of the lending regulations, this might save some home buyers unfortunately not all)

Purchasing a home requires planning, preparation, and persistence.

1.The Plan – In planning to purchase a home you need to first do a needs assessment.
•How much home do I need?
•How long do I plan on living in this home?
•How much can I afford to spend on a monthly basis?
•How much is this purchase going to cost me initially out of pocket?
Your planning process may require you to seek the assistance of some professionals: Financial Planner (budget counselor); Loan Officer; REALTOR; and maybe a Real Estate Attorney. These professionals can not tell you how much home you need, however, they can assist with some of the other questions.

2. The Preparation -

•Research to find the service providers needed to assist with your purchase. Get referrals from people you know and trust, or look to well known and established companies.
•Prepare all your questions. (there is no such thing as a stupid question)
•Get qualified by a Licensed Mortgage Broker, or bank or lender. You have to know how much home you can afford? (If you have any credit issues you may want to consult with a Budget or Credit Counselor that does not charge for their service or does not tell you “For $495, I can fix your credit”) Remember your credit is not broken….you may have credit issues that need to be resolved.
•Consult a REALTOR….Preferrably a full-time agent with a strong knowledge of the communities in which you plan to purchase. (ask for credentials and referrals)
•Find out if there are any issues in the communities you are interested in. (ex: chinese drywall; home owner association fees, restrictions, and/or anything that is impacting or may impact the home or community.
3. Persistence

•The media is portraying that the housing market is doing terrible. However, many people who could not afford homes in times past can now afford to purchase. So you may be competing with other buyers (some being cash investors). So you may place several offers on properties before you find your new home. If you are submitting offers on foreclosed or short sale properties, you will need patience for getting a response to your offer.
The other “P’ word is perserverance. We will address this on tomorrow’s blog.

Happy New Year!!! This time of year the most popular words after “happy new year” are “my new year’s resolution’. Well I decided to add a new phrase, “my new year real estate resolution”.
In these times I know that this has definitely crossed a few people’s minds.
• ‘Should I sell my home and get more home for the money because interest rates are at a record low and housing prices are low?’
• ‘Is now the time to buy my first home because interest rates are at a record low and home prices have decreased?’
• ‘Should I short sale my home regroup and purchase real estate once I get my finances back on track?’
• ‘Should I invest in the real estate market or keep my money in my mattress account?’
And just like New Year resolutions become idle words, so do “new year real estate resolutions”; here are the other thoughts that cross people’s minds.
• ‘I will be losing money; I could have made more money selling my house in 2005.’ (but you didn’t)
• ‘The interests will drop and the home values are going to continue to decline.’ History has proven that rates tend to increase once the new House and Senate members take office. In some areas home values are actually starting to increase.
• ‘Not fully understanding what a short sale is and afraid to ask questions.’ (There are no stupid questions) I was once told know what you don’t know and then find someone who knows what you don’t know.
• While your mattress might be getting more comfortable or lumpy (depends on if you’re saving paper bills or coins) your investment portfolio is not. An investment requires research, something to invest, and some risk. (Nothing ventured nothing gained)
So How About A “Action Plan”
How about planning a plan and working your plan? Now to plan your plan you need to do some self-assessments. You may want to consult professionals: financial planners; spiritual advisor; significant other; mortgage loan officer; accountant; real estate attorney; and/or real estate agent. Only you can truly determine your needs and wants.
To plan your plan here are a few recommendations:
• Check your credit report to see, how the creditors see you
• Prepare a budget (and do include your Starbucks, Dunkin Donuts, & Blockbuster visits in your budget)
• Be honest with yourself about what you ‘can and cannot do’ or ‘will and will not do’
• Most importantly write your plan (notebook, IPad, anywhere you can refer back to it regularly)
• Give yourself realistic time frames (this might require consulting a professional)
• Etc
Working Your Plan
JUST DO IT!!!
Good luck and best wishes for the New Year!!!!!!

-21%
Florida existing condo sales:
(month-to-previous-year comparison)

-5%
Florida existing home median price:
$136,600
Florida existing condo median price:
$82,400
Florida consumer confidence:
72 National existing home sales:
(month-to-previous-month comparison; all housing types)

-2.2%
National existing home median price

$170,500
National (Freddie Mac) mortgage rate
(all housing types)
4.39%

Yesterday, Monday, November 22, 2010 at 6:28PM, I received an e-mail on my iPhone (yes a plug for the iPhone) with the approval letter attached. Now, the seller, the buyer and all of us involved are looking forward to a Happy Thanksgiving, a smooth transaction, and hope for the short sale process!!!!

They are currently working with Wells Fargo and GMAC on their FANNIE MAE short sales. The staff has been helpful, informative and responsive. When you call or e-mail they actually respond the same day or early the next business day, they are on the west coast.

I listed this short sale on October 29th, received a reasonable offer November 3rd, sumbitted the offer November 4th, BPO was done November 7th…..

Stay tuned…………

The August estimate shows the cost of homeownership (mortgage interest plus principal payments after a 20 percent downpayment) falling to 16.9 percent from 17.1 percent in July. Overall, the Beacon Economics Home Affordability Index has remained below 20 percent for the past twenty-one months.

“Home affordability has reached an historic high,” says Beacon Economics Founding Principal Christopher Thornberg. “Nationwide, prices are down approximately 25 percent from their peak, and mortgage financing rates are at all-time lows.” Moreover, the high level of affordability is likely to drive demand and reduce the stock of excess inventory, ultimately resulting in the need for new housing, a rise in prices, and a pickup in new construction, according to Thornberg.

“While prices may fluctuate modestly over the next several months, we believe the worst of the housing crisis is behind us,” adds Beacon Economics Research Manager Jordan G. Levine. “We expect prices to stabilize around current levels and likely be higher in the next twelve months.”

Thornberg agrees. “Although there could be some modest volatility over the next several months, our research indicates the housing market is at or near the bottom,” he says.

The Beacon Economics Home Affordability Index is intended to help homebuyers and policymakers alike understand the current state of the market.

© 2010 Florida Realtors®