Archive for January, 2012

My friend Carole Rododni sends out a Real Estate Newsletter. In case you haven’t heard of Carole before she was formerly President of Fox and Carskadon Real Estate, Chief Operating Officer of Cornish and Carey Real Estate, and President of Alain Pinel Realtors.  She is a renowned speaker on the economy and real estate and is currently the President of her own consulting company — Bamboo Consulting.  In her most recent publication she gave 10 things to know in 2012 about Buying or Selling Real Estate. With her blessing I pass them along to you,  they are timely to say the least. Thank you Carole! 

Many homeowners who haven’t bought or sold a home in the past few years will findthat many of the old “rules” have changed. Buying or selling a home is now a long andcomplicated process.

1.A bigger down payment might be necessary. Documentation of income and reserve funds are required for all loans. The loan process is more stringent for jumbo loans.

2. It is not a buyer’s market entirely. Home prices and mortgage rates are down, but insought-after neighborhoods, prices are worth almost what they were.

3. Sellers should not put off those remodeling projects. Call this the HGTV effect. Buyers see all the improvements and now expect it. Older homes need to look like new.

4. Home staging could be worth the extra cash.Besides a new coat of paint, staging has proven to be the best return on investment, particularly for vacant homes. Professional staging prices vary and you can choose to do certain rooms or the entire house.

5. Appraisals may not match price expectations. Due to the Home Valuation Code of Conduct, homes are appraised fairly without the influence of lenders and third parties. You can help the appraiser by providing him with a list of repairs and upgrades. Additionally, know the buyers and banks may ask for 2 appraisals.

6. Start saving your financial records to show the bank. Lenders now require more documentation than ever before. They have to validate everything. Come prepared with 2 years of tax returns and 2 years of bank statements. Be prepared to defend your credit. You will need a credit score of 620-650 to be accepted by Fannie Mae and Freddie Mac. Other lenders may require higher scores.

7. Prepare to spend more time securing a loan.It can take 30-60 days to secure a loan due to compliance and the new federal regulations, so start the process before you go out looking for a home. Also, realize what your credit score means in terms of interest rates and what monthly payment you can really afford.

8. The home inspection is back. Buyers today want top to bottom assessments of a home before making an offer. Sellers should do a pre-inspection of their home before putting their home on the market. You avoid surprises that way. Of course, anything you find has to be disclosed to potential buyers.

9. Sell your home before you buy. In this market, deals fall through, buyers walk away, and loans do not get approved, so do not put yourself in a position where you are paying two mortgages.

10.Work with an agent. Inventory is low in some places, but too high in others. Do you really know why? Some markets are multi-offers, all cash. Can you compete and how? In foreclosure locations, do you know the best locations and which houses are not desirable? Be careful in this market. It is too complex to do it alone.

Carole can be contacted @ www.bambooconsultinginc.com

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