#16. IS THE LOAN MARKET CRASHING?!

Actually, yes and no. The loan market is going through an adjustment phase that is necessary because of the over loaning of the past. I the past 10 years or so, the lending market was basically a free for all. I use to claim that if you were breathing and hadn’t been in prison for the last 7 years, I could get you a loan. And that was basically the truth. 100% loans were out there for almost everyone including those with lower credit. All was fine until houses started losing value. Then all those 100% loans started going into foreclosure. Now the market has swung too far to the conservative side, and conventional loans are reducing their loan to values way below 100%. If you have decent credit, you can still get a 97% loan, and with even poor credit you can get a 90% loan. So even though the market is adjusting, with the rates as low as they are, now is still a great time to invest in Real Estate!

Week #6 How is Utah County’s Real Estate market different from the rest of the country?

We hear all the doom and gloom about the Real Estate market, and we worry about our own investment. Here is the truth. Our market is currently the best in the United States! This is because of our stable economy, consistent population growth, lack of available ground (the state and federal government own over 70% of the land in Utah) and the fact that we don’t go through the sudden upswings other parts of the country do. The Mortgage market is certainly adjusting to the nationwide problems. However the doom and gloom you hear on the news is overstated even nationally. The truth is 30% of all homes are owned outright, 20% are owned by investors with at least 20% equity and 50% have a mortgage. Of those only 1 in 400 are currently in default. So fear not, Real Estate is still the safest investment!

"Check out our new home show, "Welcome Home" each Tuesday, Thursday and Sunday, beginning at 11:30 a.m. on SFCN 17"

Week #7 Spring Time — a Good Time for Adding Curb Appeal

The saying in Real Estate is; 80% of the decision to buy a home is made at the curb! What people see, when they pull up to your home is one of the most important selling points of your home. A home that looks well cared for is worth much more than one that has just been lived in. Shrubs that need pruning send a message that you don’t care about the esthetics of your home. Other things that can help are lawns neatly edged, cement in good condition, flowers planted and in bloom, exterior of the home well maintained, decorative shutters on the sides of the windows, porch clean and neat and front door recently painted or stained. All these items make your home exude the feel of a home loved and cared for, which gives the potential buyer the feeling that they want to live there as well. Not to mention that it increases the value of your home!

"Check out our new home show, "Welcome Home" each Tuesday, Thursday and Sunday, beginning at 11:30 a.m. on SFCN 17"

Week #8 What advertising really works to sell my home?

Over 75% of homes that sell were found through the Multiple Listing Service either by an agent or by the home buyer themselves. You can search listings on our web site at www.hotpropertiesofutah.com . 10% find a home through free publications like homes illustrated. 8% of buyers come to the home by way of a yard sign, while another 4 % find a home by way of word of mouth. Someone they know knows of a home. The other 3% find a home through newspaper advertising or through free listing sites like Craig’s list or KSL.com. Realtors use a number of advertising tools like those already listed above as well as Realtor home tours, open houses and flyers. Getting your house exposed is your professional Realtor’s main job. Your job is pricing it right the first time!

"Check out our new home show, "Welcome Home" each Tuesday, Thursday and Sunday, beginning at 11:30 a.m. on SFCN 17"

Week #9 How to price your home?

This is actually the most important thing you will do to get your home sold. Your home is your asset, you need to be the one pricing it, NOT YOUR REALTOR! Your Realtor can provide you with information about comparable properties that have sold recently, as well as current listings (which are your competition). Your job is to go see those homes, look at the curb appeal, look at the square footage as well as the other features of the homes, compare them to yours and ask yourself this question. If I had the choice of this home or my home, which would I pick. You MUST be honest in this assessment, and really work to price your home just below your competition to get the most showings. The first price you set is the most important since the first 2 weeks of a listing is when most showings occur. If you’ve priced it too high, you won’t get showings and you wasted the best exposure time.

"Check out our new home show, "Welcome Home" each Tuesday, Thursday and Sunday, beginning at 11:30 a.m. on SFCN 17"

Week #10 What are “Seller Disclosures” and why are they required by law?

Seller Disclosures are a 5 page document where the seller tells the prospective buyer everything they know about the home, including any problems. The state of Utah requires this on every Real Estate transaction. If you don’t fill them out completely, you open yourself up for problems down the road. If you had a leak in your roof, but fixed it, you can disclose it in this document, and then even if the buyer finds out later that the fix wasn’t up to code, you disclosed it, so it is their problem. From a buyer’s perspective, you want to study the disclosures closely to find out if there are any problems you want to explore more fully. By having both parties totally knowledgeable about the process, everyone comes out a winner, and litigation down the road is eliminated.

"Check out our new home show, "Welcome Home" each Tuesday, Thursday and Sunday, beginning at 11:30 a.m. on SFCN 17"

Week #11 What is the difference between a CMA and an Appraisal?

It’s basically this; Realtors use CMA’s to arrive at the highest sales price for their sellers. Appraiser’s try to find the most likely sales price for the lender. Lenders dictate through their underwriters what they want to see in appraisal reports. Appraisers comply with this as well as a national “uniform practices and procedures” standard which is adopted by the state and in effect becomes state regulation. Current examples are; use comparables under 90 days old, within one mile of the subject, one older than the subject, one newer than the subject, one bigger, one smaller more bedrooms and baths, less bedrooms and baths etc. this called bracketing and all reports must have this. The comparables must also be as close to the subject in size age and appeal and seller paid concessions deducted. Any relative expired listing as well as low sales in the subject neighborhood must be analyzed. CMA’s do not require this technique and as a result a higher value opinion may be reached in a CMA vs an appraisal. In simple terms a CMA looks for an optimum sales price and a lenders appraisal, through disciplined techniques looks for the most likely sales price. Thanks to Brian Darling of Darling Appraising for the above information.

"Check out our new home show, "Welcome Home" each Tuesday, Thursday and Sunday, beginning at 11:30 a.m. on SFCN 17"

Week # 12 How to avoid foreclosure

With the current downtrend in Real Estate and the looming recession, many people find themselves unable to continue making their Mortgage payments. Many avenues exist to help you avoid foreclosure. Contact your lender and let them know about your situation. They may be able to restructure your loan so you can make the payments, or even let you skip a payment or two. If there is just no way for you to make your mortgage payment down the line, then you should consider selling your home if you have enough equity to do so. If you don’t have enough equity, you can sometimes arrange with your lender to do a “deed-in-lieu of foreclosure”. You simply sign over your home to the lender which saves them a lot of costs and you get out from under your mortgage. Or, you can sometimes arrange a “short sale” which is basically that your lender agrees to take a payoff from you on the mortgage that is short of what it would take to pay it off. Talk to your Realtor to get more information about any of these options, and be informed!

"Check out our new home show, "Welcome Home" each Tuesday, Thursday and Sunday, beginning at 11:30 a.m. on SFCN 17"

Week # 13 When remodeling, where is your money best invested

Many people want to remodel to increase the value in your home. Some remodels are cost advantages and some are not. Basically, the most cost effective redo’s for your home are painting the interior, particularly if you can do a two tone painting. And floor coverings, such as carpet or tile, or to refinish those hardwood floors. But some other more major remodels can also give you a good return for your investment. Kitchen redo’s will usually bring back about 95% of what you invest in the remodel. Bathrooms are at about 90%. Now while those may not “make” you money, they do increase the desirability of your home, either for your continued enjoyment, or for a prospective new buyer for your home. Let’s face it, women usually make most of the decision to buy a new home, and their number 1 want is a nice kitchen, so even if it doesn’t pay back all of your investment, it could in the long run, make you a lot of money.

"Check out our new home show, "Welcome Home" each Tuesday, Thursday and Sunday, beginning at 11:30 a.m. on SFCN 17"

Week # 14 Finding a contractor you can trust

None of us like having to trust people when we don’t understand their business. Contractors are no exception. When we need a contractor, we want someone that does a nice job, is priced reasonably, will do the job to our satisfaction and won’t have any unforeseen problems! So how do you find such a contractor. The best way is through word of mouth. Good contractors get a good reputation, while bad contractors get a bad reputation. Ask around with your friends and neighbors. Also, when you do find a contractor, ask to see some of their work. A good contractor will give you address’ of satisfied clients and you can ask them their opinion of their contractor. Make sure your contractor is licensed by the state, which you can find on the state web site. And make sure that you both have a total knowledge of what each of you expects. When everyone is on the same page, the job will go much smoother. Finally when the job is done, and you are satisfied, tell others! That’s how all of us in the service industry make our living.

"Check out our new home show, "Welcome Home" each Tuesday, Thursday and Sunday, beginning at 11:30 a.m. on SFCN 17"

Week # 15What does a title company do?

A title company acts as a disinterested third party to any Real Estate transaction. They are the ‘go between’ for all the parties involved. These usually are the seller, the buyer and the new lender. They provide a title insurance policy for all the parties needing a policy on a real estate transaction. But they also work with the seller’s current lender to pay off the existing note on the property and reconvey the trust deed currently on the home, so the new lender can put their trust deed against the home as collateral for the buyer’s new loan. They take the money from the buyer, and new lender, and hold these funds in trust. They take the new transferring deed from the seller and hold it until all the funds are received on behalf of the buyer. They then balance the funds on the transaction, paying off the old lender and reconveying the old deed of trust, paying the seller for their equity, paying all closing costs on the deal and placing the new deed of trust on the home. Without the title company deals would take much longer, and be less secure.

"Check out our new home show, "Welcome Home" each Tuesday, Thursday and Sunday, beginning at 11:30 a.m. on SFCN 17.

Week # 1 Should I Hire a Realtor® or Sell it Myself?

Most homeowners want to sell their home by themselves to save money. With

Week #2 How to Select a Real Estate Agent?

There are a lot of great agents out there, so how do you find one who will be perfect for you? First, look for someone you enjoy working with. Ask a lot of questions and make sure he or she is comfortable answering your questions. Good agents make a lot of money, but they work much harder than you might think to make that money. Good agents will always take time to answer your questions. Second, find out how much experience the agent has, and how many clients he or she is currently working with? Buying or selling a home is a major financial transaction, so use an agent you can trust to look out for your interests! Finally, ask for references, or ask friends or family if they know of an agent who they enjoyed working with. Another good way to find a good agent … ask a title or mortgage officer. They work with agents all the time. They will tell you who are the best agents to work with.

Week #3 How to Stage Your Home to Sell!

Have you ever walked through a model home and thought, “Wow, this looks great!” Well, that’s because the home has been “staged”. To impress prospective buyers, you want to make your home give that same impression. To get started, look objectively through your home. Put yourself in the shoes of a potential buyer, paying attention to the things you normally don’t notice. Do you need to paint? Are the doors free of dirt and scuff marks? Is the carpet dirty? Do all the doorknobs match? Fix all the little things you have learned to work around. And, don’t forget to clean out those closets! Put out-of-season clothing, along with items you rarely use, in boxes. Store things you don’t need and take up space in a storage unit. Open up your home by removing clutter and furnishing you don’t need. Lastly, remove those family photos, patch the walls, and give your walls a fresh coat of paint. (Since people who are looking at your home are picturing their things in your home, family photos reinforce the idea that the home isn’t theirs.)

Week #4 Should I Use a Realtor® to Buy a Home?

Yes! A Realtor® can make the home-buying process smooth for you and will also help protect you from all the potential pitfalls that can accompany buying a home. Since the seller typically pays the commission to the Realtor® , his or her service to you is free so all you’ll need to worry about is buying the home. Make sure you select a good agent who will look out for your interests. A Realtor® has access to a number of services to help you find the perfect home. By using the MLS (Multiple Listing Service), your agent will help you identify the right house, in the right neighborhood for the right price. Be loyal to your agent! Once you select an agent you like working with, use only that agent to make appointments to look at homes. Even for a home that is “For Sale by Owner”, have your agent call to arrange the appointment. Just because a home is “For Sale by Owner” doesn’t mean the homeowner won’t work with you if you have an agent. Let your agent do the work.

Week #5 How to Select a Mortgage Company.

Picking an honest and good mortgage lender can make or break a deal. Most people aren’t experts in mortgage lending, so here is what to look for. The lender should explain all the closing cost you will need to pay, as well as how your interest rate is determined. A mortgage broker who is honest can get you a better loan at less cost than a bank can; however, a bank’s loan will always be a good rate with pre-set closing costs. Typically, a bank will be a safer bet than a mortgage broker who is not honest! Get a good-faith estimate from each entity you are thinking of employing, on the same day, and then compare closing costs and rates. Be informed, and don’t hesitate to ask questions. Remember, the loan officer doesn’t get paid unless the loan closes, so they are in your corner. Tell them everything about your finances, so they can find you the best loan.

Resale Potential for Your New Home

You might think it's strange to consider selling a house you don't even own yet, but what if you decide to move? Do you want a house that has grown in value and sells quickly? Sure you do. Many of us won't live in the same house forever, so when considering a purchase it makes sense to look at resale value. Although it takes a little more time to think about the resale value when considering a home, if there comes a time when you have to sell, you'll be glad you made that earlier effort. Begin finding out about resale values from the very start of your home buying search.

Location, Location, Location

When deciding on location, don't necessarily pick somewhere that has a desirable status today, but rather, look at the reasons why it has become so, and then look for a location that includes those same things or will within the time you're living there. Some things to consider could be availability of services, areas in town increasing in desirability, community changes (for good or bad), etc. Allow these factors to influence your decision on where to buy. Remember to always find a home that suits your needs and wants best, but if possible, someplace that others might end up wanting as well. Think also of what type of people are moving in. If a lot of recent buyers are families with small children, search for a house with a large yard, lots of room, and away from a busy street. If there are elderly people buying where you're looking, consider homes with few or no steps, as seniors sometimes have difficulties. Also try reviewing real estate ads in your area. If there is a particular feature mentioned in several areas, it could be one that is in demand. Also avoid buying outdated homes, unless you plan to fix it up. A home with two bathrooms is worth a lot more than a home with only one. Central air and heating are more popular than swamp coolers or baseboard heat. Although you might think outdated means character, keep in mind that in order to resell, you'll probably have to change those older features.

Cosmetic Fixes Can Be Painless

If you see the home needs just a few cosmetic touches, don't be afraid to do them yourself. Often homes in need of cosmetics are priced below market value. Fresh pain is fairly inexpensive and can make any home look almost new. A few new appliances can make an old kitchen come to life. Consider adding glass to your front door or cabinet doors to lighten things up. New light fixtures or switch plates can change the entire feel of a room. Take a trip to a nearby hardware store and check out what they have to offer. However, be sure to buy good quality product so that your fixes stay fixed.

Buyers Wants

Important features change, depending on your area. If you want to find out what is in demand, talk to a realtor, look in a realtor magazine or even ask the hardware store for some input. Some features that nearly every buyer looks for include storage space, closets (the larger the better), homes with natural lighting or bright, open areas, and floor plans with bedrooms on each end of the home are becoming every more increasing in popularity. If you know that you will be moving in three to five years, carefully consider the resale value of any home you consider purchasing. Even if you think you'll stay for awhile, find a house that's right for you, but don't hesitate to think of how it might be right for someone else, somewhere down the road.

Determining a Home’s Value

No matter how seasoned a buyer may be, no matter how many homes you’ve purchased or what you know about the market value of homes in your area, it can still be unsettling to make a formal offer. Below are some ideas about what you should or shouldn’t do when making an offer on a home. Some buyers are so worried about overpaying for a home, or missing the seller’s low point, that they come in with an extremely low offer, and it alienates the seller. If the house is obviously overpriced or low is all you can offer, go ahead and do it, but keep in mind that the seller might take it as a personal insult and may not want to deal with you. Consider making a more realistic first offer, if it all possible.’,'If you offer too high, you may never find out if the seller had a lower point, and might pay more than you needed to for a home. Try to obtain a good idea of the market and of that particular home’s market value before you make any type of offer. Be sure when requesting an agents help for making an offer that you are talking to the buyers agent, not the sellers. A seller’s agent has a specific duty to get the best deal he can for the seller. Some agents will offer you a list of comparable properties and the prices they’ve sold for but will not help you decide the offer. Unethical agents might even try to talk you into a higher offer because they know what the seller is hoping to get. A buyer’s agent, however, will help you determine what to offer. Not only will the agent run comparables for you, but will also help you plan and write the offer and probable even present it for you. Remember that having a buyer’s agent doesn’t cost you anything - their commission comes from the sale of the home.

Visit your county courthouse (or equivalent place where property records are kept). Ask the staff to explain how to decipher deeds or other records that indicate sales prices. An example: Possibly each tax dollar represents $500 in sales price, so it’s easy to calculate how much the buyer paid for the property. Home buyers around the US will find huge differences in the ease of this type of search. Some record-keeping systems are much simpler to access than others. Some localities have records available on disk or online, but most do not. This type of search is easiest to accomplish when you know the address of specific properties or the names of the buyers or sellers. If you attend open houses, keep the listing sheets. When the house has sold, go get the details. Attending open houses helps you track the condition of homes. It’s hard to make comparisons by looking only at recorded stats. Check your local courthouse as well because some records could include home facts, sketches or even blueprints. You might consider ordering an appraisal before you make an offer, however, you want to be sure that the results of your appraisal are not publicized because opinions can vary by appraiser. Also check out advertised prices for similar homes because it can give you an idea of average asking prices… keep in mind, however that the sales price is probably different than the asking price. Consider taking a look at your home’s tax value, but it probably won’t match exactly the market value of the property.

Other factors

Be sure to consider other factors when deciding an offer amount. If the house has only been on the market for a short time, the sellers may not take the first offer, especially if it’s lower than they’d desired. If it’s been up for awhile or they need to move, they may be more motivated. Compare with other houses for sale in the same neighborhood or area. Look for repairs or updates needed, especially those that could be costly like roofs, plumbing, electrical, windows, baths or kitchens. If the repairs could be costly and immediate, the offer price could be lower if the seller understands why it is. Remember that your final decision on what to offer will come as a combination of your instinct and research.

It's Not Yours Until the Paperwork is Complete

You're counting down the days until closing, the sellers have accepted your offer, the lender has you pre-approved and the house is officially under contract. Does this make the home yours? Nope - nothing is certain until all the paperwork has been signed, and the keys are in your hand. There are still some things that can happen before you close, and if you're not careful about your actions between now and closing, you might accidentally slow things down, cause yourself stress, or worse, break the deal. Here is some advice on what NOT to do until the ink is dry:

1. Don't Change Jobs

Banks are always nervous about lending money, and usually a mortgage is the most a person may ever borrow. Banks like to see consistency in your job history. They are less nervous if you change jobs within the same field, but they prefer if you stay put, especially when waiting for mortgage approval. Until the keys are in your hands, don't change jobs unless it's absolutely necessary.

2. Don't Make a Large Purchase

It is wonderful news if you've just found out your credit is great. However, making a major purchase can quickly change your credit rating, because it changes your debt-to-income ratio. Although a new car would look great in the driveway of your new home, the car payment will not look great to those lending you money. They may decide not to lend you money after all. It's better to wait until after closing to make any major purchases, including furniture, cars, etc. If you absolutely must make a large purchase, it's a good idea to talk to your loan officer before you do it.

3. Don't Give Earnest Money Directly to a For Sale By Owner

Sad as it is, sometimes a seller spends a buyer's deposit money prior to closing. If the transaction doesn't take place, even for valid reasons, like financing problems, repairs, etc., the buyer ends up fighting to retrieve their funds. Your deposit is probably safer if placed in a trust account. Some sellers don't realize or understand that deposit funds are to be applied to your closing expenses. Find a neutral party, preferably an attorney, someone who can hold your deposit until you close. It's also a good idea that your contract defines what happens to these funds if closing never takes place.

4. Don't Forget to Switch Utilities

It may seem simple to arrange for utilities to be started or stopped, however many people forget to cancel or apply for utility service. As soon as you have a contract, it's a good idea to call the utility company. Find out how many days lead time they need in order to switch the service, and be sure they'll be discontinuing services at your old home. Depending on how far the move between your old home and your new one, you may have to contact a different utility company for the same service.

5. Don't Forget Hazard Insurance

Hazard Insurance is another often forgotten task that some buyers scramble to take care of right before closing. Before you can close, a lender will want ensure that you have some type of coverage for the new home. Obtain this coverage as early as possible in order to avoid delaying the closing. In some areas, other types of insurance coverage may be required. Your lender can indicate what insurance requirements there are in your area.

6. Don't Allow Emotions to Take Over

>While searching for a home to buy, it's important to be realistic. There is no perfect home, although there is a home perfect for you. If there are repairs needed, don't allow the seller's refusal to do a small repair ruin the deal or your dreams. Often, it isn't a big deal for the buyer to make small repairs. However also keep in mind that some repairs are too big, so don't allow yourself to fall in love with a house that you may not be able to handle, financially or emotionally. Decide beforehand what kind of repairs you can realistically handle and then stick with that decision when looking for homes. Remember to maintain a good attitude and keep a cool head throughout the entire process, including during and after an inspection, as well as at closing.

7. Don't Make Friends with the Seller

Although it's important to be cordial, it isn't a great idea to get into a lot of discussion with the seller. No matter how nice you are, the home you are buying used to be theirs and you may just hurt their feelings by making a comment you think is fine. Everyone makes changes to their new home, but some sellers don't like change and a casual statement could end up costing you when issues about repairs or other things come about. Be friendly, but don't make friends with the sellers. Remember, it's not always a good idea to mix business with pleasure.

8. Don't Panic if the Appraisal Comes in Low

If the appraisal comes in low, there are several options you have in order to resolve things before you panic. Talk to your lender, your realtor, the seller and others in order to decide what is best for your situation. Some resolution could include buyer paying more, seller asking less, finding middle ground, etc.

9. Don't Ignore Lender Requirements

Every lender will have certain requirements or documentation. Listen carefully and provide everything they need in a a timely manner if you want things to go as quickly as possible. Your closing may depend on it.

10. Don't Do Things Alone

If you decided to work with an agent, part of your agent's job is making sure things go smoothly and that closing is completed. A good agent should be tracking most of the day to day details that involve the buyer, the seller, the lender or the seller's agent. Don't let your agents off the hook by neglecting to ask for their help. Remember, they're getting paid to help you.