12 Reliable Real Estate Tips for 2012

To buy or sell in 2012, what with Armageddon coming and all? Absent any ancient Mayan wisdom on real estate strategies, let's just hope the real cataclysmic event in the real estate market already has passed, even if the rubble from the bubble remains.
A stubborn overstock of households with loans higher than their value will continue to restrain prices and create some major obstacles for sellers in 2012, a year that's shaping up to be another homebuyer's market. In fact, recent studies indicate that more than 20 percent of all residential properties with a mortgage are still underwater, hinting that many foreclosures and workouts are still to come.

However, even the most conservative forecasts call for growth in home sales in 2012, with some select pockets around the country already busting out where there are competitive offers on new listings. More than one-third of home resales were made to first-time buyers in 2011 -- another good sign.
Meanwhile, here are 12 tips for 2012, aimed largely at the group that needs the most help -- home sellers.

Price it right from the get-go

The old-school strategy of real estate sellers crossing their arms and holding out for a better offer will be brushed off by most homebuyers. Consider that of the homes that took four months or more to sell in the past year, almost half of their owners accepted less than 90 percent of the asking price, according to the National Association of Realtors. For a gauge, have your agent produce the latest comparable sales including short sales and foreclosures as well as a recent summary of sales prices versus original list prices. But be wary that such information doesn't reflect the homes that failed to sell.

 

Put your best footage forward

Prep, paint, stage, scrub, improve, repeat. Efforts can include caulking, plastering, planting flowers, adding potted plants, making the windows spotless, pressure washing that oily driveway, edging the walks, trimming the bushes and trees, and mending the fences. None of these is excessively capital-intensive, but when applied en masse, they say "buy me."

Be flexible

I'm not saying bend over backward to accommodate real estate buyers. Bend forward and sideways, too. Be ready to negotiate and offer extras such as closing costs, paid property taxes, remodeling work (or a cash credit), appliances, paid condo association/homeowner association dues, a few months of mortgage payments or even seller financing. Home sellers who've been on the sidelines and who advised their agents to ignore offers by lowballers don't have that luxury now. Instruct your agent to listen intently to prospective homebuyers' misgivings about the home and adjust accordingly and immediately.

 

Trump your techno-fears

Hire a listing agent steeped in mobile platforms. Sellers and buyers are routinely using Facebook and other social media to sell and seek, not to mention dozens of online selling sites. There's also an abundance of smartphone apps cropping up to review real estate listings and refine searches.

 

Don't fall prey

Fraudsters are targeting distressed homeowners with "deals" that can sound perfectly legit. Some offer loan modifications for upfront fees while others offer fee-based "help" in navigating government housing assistance programs, sometimes claiming they're attorneys.
There are also con-artist "investors" compelling desperate owners to sign over their homes with quitclaim deeds in return for a typically empty promise to remain there indefinitely. Others are telling former owners they can get their homes back for a lump sum. Be forewarned: Never sign blank documents or documents with blank lines.
If you're unsure of an offer, have an attorney or other trusted adviser look it over. Keep in mind that a law barring firms -- except attorneys -- from charging upfront fees for mortgage relief or mortgage modification took effect in 2011. It's called the Mortgage Assistance Relief Services Rule.

Finance 101

Realize it's harder to qualify for loans these days. Credit records are under greater scrutiny, and lenders are often demanding a 20 percent down payment and some pricing flexibility from the sellers, especially if the lender's appraisal doesn't reach the asking price.
Consider cash offers, even if they're not the highest. Reject too-low offers from homebuyers gently and with encouragement, telling them they're oh-so-close. You don't want to give away the farm, but you don't want to give it back to the bank either. These days, meeting halfway usually means meeting buyers on their half.

Be your own spokesperson

Agents once advised home sellers to retreat from view during showings, lest they disclose something unsavory or otherwise botch the deal. That's changed. If you can control your ego and emotions and come off as an earnest, flexible seller, you can serve as your best spokesperson. Be ready to answer would-be buyers' questions about the neighborhood and area schools. Be careful about making verbal promises!

 

Flight to quality

Worried about durability? Buyers who place a heavier focus on brick or concrete-and-steel housing may find they're more enduring, safer and quieter.

Are you worried about sustaining value? Buy near a prestigious hospital, university, large government employer or newly vibrant central business district. These entities typically aren't going away, and the demand for good housing around them won't either.

 

Expand your buying universe

There's still an overabundance of well-priced inventory out there, which means you needn't immediately narrow your search to the first house you fancy. That's especially the case with short sale homes, which can be a nightmare to close in a timely manner. There are some for-sale gems that need only a little polishing.

Shop around. Don't dismiss foreclosures and other bank properties, pre-foreclosures, auction homes, for-sale-by-owner or lease-to-own homes. Pick at least three favorites and work from there.

 

'Site unseen' equals shortsightedness

Are you perplexed by the home valuation you did on your place on the website of a large, seemingly reputable real estate organization? Puzzled how that valuation can be 25 percent or more above or below a firsthand appraisal you've had done? Well, value estimates on these sites can vary widely, sometimes by hundreds of thousands of dollars, even by the admission of the companies themselves. There are way too many variables in the valuation game to give too much credence to blind, algorithm-based estimates that are impersonally calculated. Nothing beats a nuanced firsthand professional appraisal.

 

Expand your buyer's due diligence

Aside from the financial details, contracts, disclosures and protections you typically tend to as you prep to buy a home, add these to the list:

• Hire a title company to check the house for liens and tax arrearages.
• Hire you own inspector. Don't use the seller's!
• Have the inspector check for unpermitted work such as illegal room additions and garage conversions.
• Consider the overall energy efficiency of the home with an energy audit.
• Be sure property lines are accurate. If there's any question, hire a land surveyor to research the original deed and to stake out the property's lines and your neighbors' property lines to avoid future disputes.

Make a quality-of-life due-diligence checklist

• Spend some time around the neighborhood and briefly interview neighbors. Determine if there are noisy neighbors, signs of gang activity, nocturnal barking dogs, indigent lingerers, frequent loud parties and/or suspicious nighttime visits. Are there lots of rental homes? Is the block a cut-through point during rush hour? Does the school bus go past the block? Is there a restrictive homeowners association?
• Determine what types of buildings can be constructed on vacant lots adjacent to the neighborhood. This helps avoid unpleasant future surprises. Is there constant noise from a nearby highway or busy street? Are there odors from nearby industrial plants?

We can help make the entire process simple. Please call the Spouses Selling Houses team. Until next time! Ebbie :)

Construction Outlook for 2012

The construction industry has been through a tough 2011, ups and down, materials cost increase bankruptcies, double dipping and more. So what 2012 will be like? Another year where the construction forecast is not as good as expected, and while more numbers and studies are available, the general forecast for 2012 calls for steady growth. The McGraw Hill Construction forecast for 2012 predicts that construction starts will be near $412 billion, 4% less than the forecasted level for 2011.

Construction Forecast 2012 Key Findings McGraw-Hill

Based on significant research and in-depth analysis of macro-trends, the 2012 Dodge Construction Outlook details the forecasts for each construction sector, as follows.

• Single family housing in 2012 will improve 10% in dollars, corresponding to a 7% increase in the number of units to 435,000. This is still a low amount, as the excess supply of homes due to foreclosures continues to depress the market.
• Multifamily housing will rise 18% in dollars and 17% in units, continuing its moderate, upward trend.
• Commercial building will grow 8%. Warehouses and hotels will see the largest percentage increases, but improvement for offices and stores will be modest.
• The institutional building market will slip an additional 2% in 2012, after falling 15% in 2011. The tough fiscal environment for states and localities will continue to dampen school construction, and the uncertain economic environment will limit growth in healthcare facilities.
• Manufacturing buildings will increase 4%, following the 35% gain in 2011, as the low value of the U.S. dollar continues to support export growth.
• Public works construction will drop a further 5%, after a 16% decline in 2011, due to spending cuts and the absence of a multiyear federal transportation bill for highway and bridge construction.
• Electric utilities will retreat 24%, following a 48% jump in 2011.

if you are looking to build at the lake and are looking for a lot, please call the Spouses Selling Houses team. Until next time!! Ebbie :)

Bank of America to Slash Mortgage Balances

Bank of America will significantly slash mortgage balances for as many as 200,000 borrowers.

As part of the $26 billion settlement reached between the five major mortgage servicers, the federal government and the attorneys general of 49 states and District of Columbia last month, Bank of America (BAC, Fortune 500) customers who qualify could see their mortgages reduced by an average of $100,000 or more, according to bank spokesman Rick Simon.

Those principal reductions are much deeper than the ones originally announced as part of the robo-signing settlement deal.

When the settlement was first announced, the average principal reduction was expected to reduce mortgage balances by an average of about $20,000. Among the five biggest lenders, the reductions are expected to help roughly 1 million homeowners who owe more on their homes than they are worth.

 

Bank of America's deal only applies to the mortgages it owns and some that it services for private investors. Loans backed by government-controlled agencies like Fannie and Freddie or insured by the Federal Housing Administration are not eligible for the program.

Many of the mortgages Bank of America plans to refinance came to the bank through its 2008 acquisition of Countrywide Financial, which issued many high value loans called jumbo mortgages that exceeded the loan limits of Fannie Mae (FNMA, Fortune 500), Freddie Mac (FMCC, Fortune 500). A large percentage of those loans were issued in some of the country's hardest hit housing markets, including California, leaving many of Bank of America's mortgage borrower's deeply underwater on their mortgages, said Simon.

The bank has already identified the 200,000 or so borrowers that it will offer modifications to and will start to reach out to them as soon as a D.C. federal court approves the settlement.
"We expect to get off to a fast start with this program," said Simon.
There are incentives to do that. If the bank is able to demonstrate that it faithfully carried out the provisions of the attorneys general's foreclosure settlement -- as well as a separate settlement in which it agreed to reimburse HUD $1 billion to cover problems originating FHA loans -- over the next three years, it can be forgiven $850 million in penalty payments, said Simon.

The bank has also agreed not to pursue foreclosures against any delinquent borrowers who might be eligible for a mortgage modification as part of the settlement. It will also reform its foreclosure processing to avoid repeating robo-signing abuses, in which bank employees signed hundreds of documents a day, testifying to statements they had no knowledge of.

The deal is one of a series of government-led initiatives aimed at tackling the foreclosure crisis. The latest effort came on Tuesday when the Obama administration announced a plan to reduce refinancing costs for FHA-insured loans.

The U.S. Department of Housing and Urban Development (HUD) advises borrowers who believe they were subjected to foreclosure abuse and may be eligible for a mortgage modification under the settlement to call their servicers and ask for a review of their cases.
HUD said once the agreement was submitted to a court for approval, which was expected to happen on Friday, it would hold a press conference to go over the details.

Difference Between Short Sale and Foreclosure

Short Sale Benefits

Here are a few benefits for doing a short sale that may not have occurred to you:

• You are in control of the sale, not the bank.
• You may sleep better at night knowing who is buying your home.
• You will spare yourself the social stigma of foreclosure.
• Contrary to popular belief, you can be current on your payments and still effect a short sale.
• Your home sale will be handled like any other home sale.

Buying Again After a Short Sale

If your payments have never fallen behind 30 days late and the lender does not require that you pay back the loan, Fannie Mae guidelines may allow you to buy another home immediately. Finding a lender who will fund that kind of loan is very difficult. If you are current on your mortgage, you can qualify for an FHA loan immediately as well, but lender requirements can be weird such as you have to move more than 600 miles away.
If your payments are in arrears yet a short sale is granted by your lender, you may qualify to buy another home with a Fannie-Mae backed mortgage within two years, regardless of whether the home is your primary residence. The wait for FHA is 3 years.

Buying Again After a Foreclosure

With certain restrictions, you may be eligible to buy another home in 5 years if the home was your primary residence. Without restrictions, the wait is 7 years.
If you are an investor and do not occupy the home, the wait to buy with a Fannie Mae insured loan is 7 years.

Affects on Credit After a Short Sale

A short sale may be considered to be a derogatory mark on your credit even though credit bureaus do not show the word "short sale" on your credit report. It may say "paid in full for less than agreed" or "settled for less," among other categories. Some clients have reported negative FICO score drops from 50 points to 130 points.
Major point drops are typically due to being in default, meaning you have fallen behind on your payments.

Affects on Credit After a Foreclosure

Depending on your credit history and other guidlines, Myfico.com shows 2 examples in which a credit score could fall 105 points to 160 points after a foreclosure. Generally, a foreclosure will remain on your credit report in the tradelines section for 7 years.

Credit Reports After a Short Sale

All lenders report short sales differently, with many reporting "paid in full for less than agreed," and some report the short sale as a charge off. Negative credit, however, stays on your report for 7 years.

Credit Reports After a Foreclosure

If a prospective employer runs a credit check on you, your job application may be denied if you have a foreclosure on your record.

Deficiency Judgments After a Short Sale

Judgments are often negotiated between the seller and the short sale bank. In some cases, such as California, if the home is your personal residence and was financed through purchase money, there is no deficiency judgment.

Deficiency Judgments After a Foreclosure

Banks are generally unwilling to negotiate deficiency judgments with the homeowner after a foreclosure. In California, for example, according to the California Association of REALTORS, a deficiency judgment may be filed regarding a hard-money loan if the lender forecloses under a judicial foreclosure versus a trustee sale or if the second loan is a hard money loan and the sale takes place as a trustee's sale.

Loan Application Questions After a Short Sale

Loan applications do not ask questions about a short sale. You may report that you sold your home.

Loan Application Questions After a Foreclosure

You are required to answer the question: "Have you ever had a property foreclosed upon or given a deed-in-lieu thereof in the past 7 years." If the bank sees you have had a foreclosure, your loan most likely will be denied. If you lie, you may be subject to investigation by the FBI for mortgage fraud.

Length of Time to Move After a Short Sale

If you've had a foreclosure notice filed, you may be able to postpone that action while the bank considers your short sale. The wait for short sale approval can be from 2 to 3 months, or longer.

Length of Time to Move After a Foreclosure

Unless prior arrangements have been made, the bank may want you to immediately vacate the property and can commence eviction proceedings.

Taxation After a Short Sale

A personal residence is exempt from mortgage debt relief until the end of 2012 on a federal level. Some states will still tax you unless you qualify for an exemption. An investor is not exempt from mortgage debt relief, subject to certain conditions.

Taxation After a Foreclosure

Same as with a short sale. Except some lenders immediately send out 1099s, even if the owner is exempt.

For all of your Real Estate needs at the lake please call the Spouses Selling Houses team now. Untol next time! Ebbie :)

Spring Lawn Care Tips

When spring is finally in the air and the temperatures finally lift. When you're able to get outside and work, there are spring lawn care routines that can be done to ensure a healthy lawn all season long.

• Spend some time getting out the summer tools and supplies and put away the snow shovels and ice melt. Dig out the hoses, rakes, spreader, mowers and trimmers. If you put them away properly, everything should be clean and functional. 
• Walk the yard and inspect the lawn for weak or thin turf, insect damage, disease activity, like snow mold, or any other irregularities.
  
• Pick up any debris that may have accumulated over the winter. Winter toys, litter, branches, and especially last season's leaves, which can harbor disease and pests.
  
• Give the lawn a good raking. Get aquatinted all over again with some elbow grease and sweat behind a fan rake. A vigorous raking will have a de-thatching effect and help "wake up" the lawn for the season. For larger lawns, mechanical de-thatchers can be pulled behind a tractor or attached to lawn mowers. Cutting all the stolons and rhizomes, and cleaning out some thatch, invigorates the grass and improves water and nutrient uptake.
  
• How long has it been since you had the soil tested? Soil test results should dictate your inputs for the season and be the cornerstone of a long term lawn care program. It's a good time of year to lime the lawn if necessary.
  
• Bare patches will need to be repaired, and areas with winterkill or snow mold will need to be raked out, overseeded, and topdressed.
  
• Weeds (especially crabgrass) like to start early. Based on IPM, determine a tolerable weed threshold and have either an organic or chemical weed control program.
  
• It's a good time to inspect tree branches and prune if necessary. Try to allow for adequate sunlight and air flow while still maintaining the natural shape and integrity of the tree.

This is the routine for early spring. Depending on specific conditions, the timing could vary from early March to late April. We hope this information helps in providing you with a beautiful lawn for your home. if a home at the lake is in your future, please call the Spouses Selling Houses team. Until next time!! Ebbie :)

Getting Started on Buying a Home

Let's say one morning you wake up and realize that, yes, buying a home is the right thing to do for yourself. You're tired of throwing away money on rent and figure that it's time to get into a home of your own. But you have reservations.
After all, if it's your first time, you've got questions. You might be a little nervous that you'll mess up, and it's normal to feel that way. You are probably spending hundreds of thousands of dollars and making the most important financial purchase of your life.
You will find that being an informed individual about the home buying process is empowering for you. Lucky for you that you came to the right place. So let's get started buying your first home!

Consider if Buying a Home is For You

Many people harbor secret fears about buying a home, and some of those fears are justified. Not everybody is cut out to own a home, and if you're one of those people, it's better to find this out now than when you're under contract. Ask yourself some questions:

• Renting vs. Buying
  You might decide that renting is better for you than buying, because buying a home has its drawbacks.
• Reasons to Buy
  On the other side of the coin, there are many more benefits to buying. Keep these reasons in mind if you start to get cold feet.
• Should You Buy a Home Before Getting Married?
  
  

Before Buying a Home, Get Your Finances In Order
Line up your financing, set aside a down payment and study the loan programs available. By doing your homework, you will know exactly how much you can pay and what it will cost you.

• Order a Free Credit Report
  Give yourself time to clean up a credit report that contains mistakes. Dispute errors. Try to reduce your monthly debt obligations now by paying down those loan balances.
• Find a Lender
  Check out places to get a mortgage and compare rates and fees. Start with your own financial institution, then interview a few mortgage brokers and choose a loan product you completely understand.
• Determine a Down Payment
  The more you put down, the lower your monthly mortgage payment.
• Consider FHA Loans
  FHA loans carry competitive interest rates, come with minimum down payment requirements and allow sellers to pay some or all of your closing costs.
• Get a Preapproval Letter
  Showing the seller you are already preapproved for a loan gives you an edge during offer negotiation.

Pick a Real Estate Agent to Help With Buying a Home

With so much information available online, you might wonder why you need an agent at all. But all local markets vary from one another, and a good agent can guide you by giving you information based on experience and market knowledge.

• Why Hire an Agent? An agent with experience can help you to avoid making mistakes such as choosing the wrong home or offering too much.
• Find a Real Estate Agent! Start by asking your friends and family member for referrals. Make sure you are comfortable with your agent before committing to work with that person.

Learn How to Avoid Home Buying Mistakes
The best way to avoid making a mistake it to learn from the mistakes others have made. Buying a home in a desirable location is your best defense. Remember: location, location, location.

• First-Time Home Buyer Tips
  Start your search online, and don't rely on print because most homes are not advertised in the newspaper.
• Preview Homes for Sale
  Ask your agent to look at homes before showing them to you, and tour only those that fit your parameters.

Make an Offer and Negotiate Like a Pro

Although buying a home is not like buying a car, for example, you can still negotiate to get a good price.

• Top Three Negotiation Tips
  Price isn't the only consideration. Sellers sometimes accept lower-priced offers for other considerations.
• Facing Multiple Offers
  If you really love the home, chances are another buyer will want it as well. Make a realistic offer and get the deal closed
• Dealing with Counter Offers
  It's common for sellers and buyers to negotiate back and forth through counter offers.

Get a Home Inspection and Read Disclosures

Never buy a home without getting a home inspection. Most states have laws about the types of disclosures you are entitled to receive.

• Find out what a Home Inspection Covers
  Go through this list and make sure your home inspector doesn't miss anything crucial.
• Material Facts
  Besides disclosing lead-based paint, which any home built before 1978 can contain, sellers should notify you of major defects.
• Do a Final Walk-Through
  Always do a final inspection a few days before closing to make sure the property is in the same condition as when you agreed to buy it.

Closing on Your Home

Transactions generally close within 30 to 60 days after your offer has been accepted. Remember to reserve movers or a moving truck early because many people move at the end of the month.

• Home Insurance
  Shop for insurance rates carefully. Often, the company that insures your automobiles may offer you the best policy rates.
• Title Insurance Policy
  You might think you don't need a title policy, but it's the cheapest form of insurance you can buy, and you pay the premium only once.
• Home Buying Closing Process
  Talk to your Agent about covering every step of the home closing process, from the beginning to the end.

Of course we would love to help you find your perfect home. Call the Spouses Selling Houses team. Until next time! Ebbie :)

A Couple of Inexpensive Decorating Ideas

When it comes to cheap home decorating ideas, one of the biggest hurdles that you may face is finding the right idea to beautifully decorate the walls of your house. Since your goal is not only to create a warm atmosphere with the design of your choice, your mission is also to find the most cost-effective ways to create the design changes you wish to make..

Cheap home decorating idea #1: On your main wall, try to avoid the common mistake of just 'filling up space'.

For those of us that are not exactly 'trained' for interior design but are doing our best to come up with cheap home decorating ideas, try to avoid the natural tendency to fill up space on the walls of your home with anything you can find. Trust me, it's perfectly natural to do so, especially on a tight budget, however, there is a better way to do this that will look more appealing.

Instead, using tape or even an imaginary line, create a triangle in any spot on your wall. Start with the main wall in the very first room that your guests enter when they come inside. This wall should be considered the main area that you're looking to fancy up a bit.

The next step is very simple: fill the inside of this imaginary triangle with works of art that you find appealing. These pieces can consist of picture portraits to hang on your wall, artwork that you find soothing, or even uniquely designed clocks that have a touch of color to them. Remember, your goal is not to clutter the entire wall up with your displays, but instead only place these items inside your triangle. Once finished, step back, and appreciate this one simple cheap home decorating idea that has helped you accomplish your goal and cost next to nothing.

Cheap home decorating idea #2: Make life easier by displaying one large piece on your main wall.

If our first idea of creating a centerpiece with multiple wall decorations does not appeal to you, then perhaps you may want to try something much simpler. What is the idea? Find just one thing, yes - just one item - and hang it in the very center of your main wall. In fact, you can do this in every room of your house and create a very structured, yet appealing design to your wall. You're probably thinking that it is extremely expensive to purchase a large painting, and it can be! However, you do not have to run out and spend hundreds of dollars to do this.

If you look hard enough and enjoy shopping around, you will be surprised at just how many bargains you can find in your local newspaper, flea markets, and even garage sales on the weekends. On the other hand, one of my favorite items to use for wall displays is a colorful rug or a quilt.

We hope you find these simple tips helpful and of course we want to be your Realtors of choice here at the Lake of the Ozarks. Call the Spouses Selling Houses team. Until next time! Ebbie :)