Tuesday, November 24, 2015

Home Loan Interest Rates November 24, 2015

Yep, gotta keep up and inform my peeps. Just had a buyer ask me yesterday what home loan rates were! Smart lady, knows she needs to be informed!!

So, thanks to one of my lender pals, here's the skinny on current rates:

(Spoiler,  for loan amounts up to 400k & you must have a 740 FICO for these rates!)

  • 30 year fixed conventional loan 20% down - 4.000% (4.175 APR) - You can get a 30 year conventional loan with as little as 3% down up to $417,000.00!
  • 15 year fixed conventional loan 20% down - 3.375% (3.515 APR) - You can get a 15 year conventional loan with as little as 5% down up to $417,000.00!
  • 30 Year fixed FHA loan 3.5% down - 3.750% (5.031 APR) - You can get an FHA loan with 3.5% down up to $625,500.00.
  • 30 year fixed VA loan 0 down - 3.750% (3.940 APR) - VA Loans are 0 down up to $625,500 in LA County and a Veteran can get a VA loan up to $1,000,000.00 with about 9% down.

Friday, November 20, 2015

What To Do With White Cabinet Kitchens

Well, I sell mostly re-sale and we're just getting a significant amount of new construction homes now, so I was a bit surprised to read that 49% of homeowners are choosing white cabinets in the kitchen.

I had an interior decorator tell me years, I mean really YEARS, ago that most set things should be fairly bland in color. Decorate around them so you can change style as frequently as you feel like it.

But, for now, with those white kitchens, what do you do to jazz them up? 4 ideas on Houzz this morning, 3 I am sharing and would love your thoughts!

One was to add a bookshelf. Meh, I didn't bother with a picture of that for you.

Another was Statement Tile

I supposed you don't have to go that colorful with the tile!

A different colored center island. Yep, a lot of us have seen that and I do really like it!

And, a mixture of materials. Wood, metal, cloth. All to add color and dimension.

I actually do have white cabinets in my kitchen. Kinda bored with them for sure. So, when we get around to painting the walls, I just may refinish our center island to match!

Tuesday, November 17, 2015

AS-IS in Real Estate Purchases & The Request For Repairs....Another Saga.

Every home sale in Southern California is sold AS-IS. Stated right there in the offer on page 5, section 11.

But, also as stated in that very same section, seller has to disclose material defects and buyer is strongly urged to do an inspection.

So, based upon my buyers' desire to own a particular home we write an offer and add in Request for Repairs No. ONE indicating no repairs or credits will be requested.

But, yikes, we do our inspections and see quite a bit of work that could be very costly for my client. Seller disclosures note some defects as well. What do we do?

Well, buyer still has every right to cancel at this point. Regardless of indicating they wouldn't be asking for repairs or credits.

Does the buyer have the right to ask for repairs if they've already said they wouldn't? A bit of a gray area honestly.

Everything in Real Estate is negotiable. Price, terms, commissions. Everything. Frequently up to the very end. Well, not so much anymore because of the new TRID lending disclosure nightmare.

But, negotiations can continue to happen. If the appraisal doesn't come in, renegotiate the price. If the seller discloses something after the contract is written, renegotiate the offer.

AND, if inspections present some large repair issues.....write a Request for Repairs No. TWO for sure!

Today I'm waiting on appraisal report, termite report,
 and physical property inspection report.

Then, Request for Repairs No. TWO will be written!

Friday, November 13, 2015

Permits, No Permits, What's A Buyer to Do?

We see it so much in Real Estate, well at least in Southern California we do, remodeling, updating, roofing, done without the required permits.

How does that affect the buyer and seller in a transaction? Disclosure, knowledge, and acceptance. That's pretty much it. Well, unless you piss off your neighbor of course. That's further down this post!

The older the home, the more likelihood that some type of change has happened to the original structure. We see it a lot in San Fernando Valley (my 2nd specialty area), because the homes can be much older there. More people have owned a particular home. More people have changed it to suit their wants & needs over the years.

Now, disclosure here, I'm not an expert on when you must pull permits. That's not part of my job. I have to guide buyers on how to determine if they are comfortable accepting a non-permitted something or another, done to the home they are purchasing.

If it's some finagling of existing stuff, most don't seem to pull permits. A new bathroom sink, hardly. A new water heater, supposed to but no one does that I've heard of. A new roof, I would. A room addition, oh yeah!

But, let's say you're madly in love with a home that doesn't have permits on a room addition. Some issues that could arise? Electrical, plumbing, insulation, etc. not done correctly. You can't see that without opening walls. So, you ask seller for details and then take a leap of faith hoping you're not in arbitration with him in the future!

But, and I've seen it happen, you take that leap of faith and you start arguing with your new neighbor about something? Lo & Behold, the Building & Safety inspector knocks on your door and .....well....damn, you can see how this might go!

That's the warning I give clients for obvious additions that could bother a neighbor or that the neighbor decides to report you. Insurance usually isn't an issue, but you should check with your own carrier.

I've never seen a fire start due to inadequate remodeling electrical work. I've heard of that with old electrical though!

It's the buyers responsibility to verify permit status on a property. It's a sellers responsibility to disclose whether things were done without a permit. So, between the two parties, it should be okay. As long as their respective agents are assisting them with the disclosure, knowledge, and acceptance portion. We assist, it's the clients job to disclose & decide.

Just some food for thought for the day!

Tuesday, November 10, 2015

Story of the Week in My Real Estate World !

Multiple offers. Ugh, love them as a listing agent, hate them as a buyers agent.

Love/Hate relationship, you see?!?!?

As a listing agent I cover my clients butt by writing tight counter offers. Particularly if the buyers are writing way over list price, or over a comfortable appraisal amount. 

As a buyers agent, it's like shooting in the dark. With a crooked arrow too. We generally have absolutely no idea where the other offers are at. Higher offer amount, better terms, represented by the listing agent, using their preferred lender? Will other buyers remove their appraisal contingency? Sign off on repairs now vs. later? Say they are putting more money down to get accepted, then change financing part way through escrow?

It all really boils down to how much the buyer wants the property. Are they emotionally invested? Are they tired of getting beat out? Will they pay 10k over appraised value so they don't lose this one? Will they truly take the house AS-IS? What scenarios that I suggest will they feel okay following?

Truly....a Love/Hate thing with these multiple offers!

Friday, November 6, 2015

What Are HOA Docs & Should You Read Them?

Homeowner Association Documents are generally provided to the buyer during escrow for any condo, townhouse, or single family residence, that is governed by an HOA. They include the rules, the board member info, minutes of past meetings, financial standings, insurance, special assessments, etc.

Should you read them? Hell YES!!! Why would someone even consider buying a property that there is an HOA and not know the rules of what you can and cannot do. The reserves the HOA has for future expenses. The minutes of the meetings depict a lot about who is involved and what type of responses happen after a motion is brought up to the board. What exactly does your HOA cover? Water, trash, inside, outside?

When purchasing a condo or townhouse it is imperative that you know who pays for what if a pipe bursts, or the roof leaks.....right? You want to know these things, don't you? Geez, I hope you are all nodding Yes....

I've told buyers that if they aren't going to read them to turn them over and I will! I'm not really supposed to, but damn,....if they aren't, I feel it's my responsibility to look for problems and alert my clients.

The buyers lender looks at financial risks too. Owner vs. Tenant occupancy. Lawsuits against the HOA. How much money is the HOA putting into reserves regularly for future expenses.

Whether that property you are buying is 150k or 1.5m, read your HOA docs. 

It'll save some possible heartache after closing escrow. 

Tuesday, November 3, 2015

Didn't Raise Rates ..... Again!

We're all wondering how much longer these low rates can hold. When will the Federal Reserve raise rates that, of course, then dwindle down to mortgage shoppers & certainly affect purchasing power.

Once rates creep up, home sellers will need to be significantly more cautious about their pricing strategies.

Once rates creep up, home buyers will need to be much more aware of what they can & cannot purchase.

The Federal Open Market Committee (FOMC) reviews all economic factors and makes the determination to raise or hold rates the Fed will charge.

The problem is the unknown for us that are so micro focused on interest rates for our clients. Anyone that has been in the housing industry for any period of time completely understands this.

Should they refi now? Should they sell now? Should they buy now? What type of loan should they get? So many questions that we get asked on a regular basis.

Right now, we are waiting til the FOMC meets again in December. They have "decided to wait for additional information confirming that the economic outlook has not deteriorated" before they give the green light to raise rates.

We've had this threat on and off again for several years now. The on & off again threat shall continue.