Taking the Spooky Feeling Out of Foreclosures

 

 

Last week, when Amanda Kostina laid out her 10 Hidden Hazards When Buying Foreclosure, it hit close to home. My husband and I relocated to Florida in the midst of the credit crunch, and what awaited me in my new home state was a depressed real estate market. Even though foreclosures had always been part of my repertoire, nothing could prepare me for the crash course I was about to get in the owned-asset market.

At my five years at Michael Saunders and Company, we have managed and sold an extremely high volume of properties for financial institutions and government sponsored entities (GSEs). And I have found that despite the inherent stigma that comes with purchasing a foreclosure, REO properties are a great opportunity for buyers, especially first time buyers.

That’s because there are built-in incentives to revitalize the area. All GSEs, and most banks, offer programs called First Look Initiatives. These programs allow for owner occupants to have first crack at their listings over buyers who are looking to purchase a listing as an investment. The hope is to pass the property to stable, caring owners. In fact, Freddie Mac has a policy to repair at least 65% of their inventory, seeking to rejuvenate the neighborhoods where their properties are listed.

With those improvements comes some assurances of a relatively-smooth transaction. My foreclosure sellers provide disclosures of anything they are aware of, or have been made aware of, with the property, as well as ensure all liens are satisfied and code issues are rectified, and pass clear title.

Now, while the hazards Amanda listed are present, I don’t know if they’re necessarilyhidden. After all, if there are holes in the walls or the electric is off, you’ll know. But there are some precautions you can take to navigate some of the unseen, volatile waters of owned-assets.

Find an Agent Familiar with Foreclosures: An agent who doesn’t know the process and/or the seller’s contracts and policies could slow or derail an otherwise sound transaction. A trusted, experienced Realtor® can steer foreclosure buyers clear of unspoken pitfalls, and ensure an expedited process.

Get a Home Inspection: Many buyers feel that, because they are buying “as is” property, a home inspection is a waste of time and money. Not so. Having the home inspected will uncover problems within the inspection period. That’s important, because should you want to cancel the contract and it’s outside the timeline, some REO sellers will keep the earnest money deposit.

Consult with an Attorney on Your Contract: Many buyers don’t have an attorney review their contract because they’ve been told that REO sellers won’t allow any changes to it. That is definitely true: changes aren’t allowed, but, if you sign without fully understanding the contract, you (and your selling agent) might be surprised by what you’ve bound yourself to. For example, 99% of the sellers of properties we list have a policy to turn on the water and electric if possible. It is not guaranteed that it will be.  Not even for inspections. So, if the plumbing is cut out, don’t expect the house to be re-plumbed because you have to have utilities on for inspections. No, you don’t, and the contract addendum you signed probably says so.

In any real estate transaction the buyer should beware, and that rings particularly true when purchasing an REO. But working with a Realtor® who is well versed in the REO market can allow buyers to see the benefits of purchasing a property that has been foreclosed on, and many times, those benefits can outweigh any potential “hazards”. 

By: The crew at KCM 


Tech Tip Tuesday: October, 29 2013

5 e-mail tricks every person needs to know  

Compare that with an average of 175 million tweets per day, and it’s clear most folks and companies still prefer e-mail when it comes to exchanging messages.

As someone who receives more e-mail than I can count, I’ve had to cook up special strategies for dealing with it. Experts say up to a quarter of a person’s work week is spent dealing with e-mail.

To lighten your load, here are 5 e-mail tricks I use every day. Use these and you’ll shave serious time off of your inbox management.

1. Send less (and better) e-mail

E-mail follows one law you’ve probably heard before: You get what you give. If you’re sending out dozens of messages, you’re going to receive that many back and more. If the e-mail you send isn’t clear, you’ll end up sending more messages to clarify. It all adds up.

Instead, look for other ways to communicate. If a quick text, call or IM can get your message across faster, use that instead. If you’re dealing with a co-worker, taking a trip to their office might be easier and more productive.

With the e-mail you can’t avoid sending out, make it clear and concise. Anticipate questions and answer them before they’re asked. Try to keep it as short as possible, as well. If a list or short sentence will do, don’t stretch things out into paragraphs.

If you’re frequently sending the same message to multiple people, save time with a template you can copy and paste. These can be customized as you go so they don’t look as much like form letters.

2. Filter and Automate

Nearly every e-mail program or service lets you set up some form of automated message filtering. This can be as simple as setting up folders to separate important mail from the clutter. Advanced systems can color code and label e-mail for you based on sender and other rules.

Start by routing messages from important contacts to a folder labeled “Urgent” or something similar. Create a “Read later” folder for routine or subscription messages. You can create as many subfolders and folders as you need, so set up a system that works best for you.

Act on the e-mail you receive, and then either archive or delete the messages. The quicker it is out of your inbox, the better. Remember, your inbox is a delivery system, not a storage system!

If you want even more advanced filtering options, use programs like Outlook or the free Thunderbird. These are a must for anyone with multiple e-mail accounts. They add all sorts of management features that most webmail can’t touch.

3. Use temporary e-mail

I’m sure at some point you’ve made the mistake of giving out your real e-mail address online. Shortly afterward, a flood of e-mail you don’t care about appears in your inbox.

In most cases, you just needed to give it to a site so you can receive a confirmation e-mail proving you are who you say you are. For those situations, it’s better to use a temporary e-mail account. Mailinator is a good site for this. Its e-mail addresses last only for an hour or so and then all the e-mail is erased.

Some people create a second e-mail address. That’s the one they give out to new or questionable sites. Their main e-mail is reserved for friends, family and reputable sites. You should also keep business and personal e-mail accounts separate.

4. When to use BCC

There are many ways to send e-mail to multiple people. Usually, people simply use “To:” or “CC:” and fill in all the e-mail addresses. For most mass mailings, however, “BCC:” is a better option.

Using it means recipients see only their own e-mail address. That’s a plus when they might not know other people on the list, or your e-mail might be forwarded to strangers. You don’t want a spammer getting their hands on a large list of your friends’ names and addresses.

BCC can backfire, though. In an office setting, using BCC on an e-mail makes you the only target for replies. If the e-mail is about a project with a team, include other team members’ addresses in a “To:” field to help you carry the weight.

Whenever you include multiple people in an e-mail — office or personal — make sure each knows why they’re included. Don’t be afraid to explain that in the body of the e-mail.

5. Turn off notifications

One of the biggest e-mail annoyances is notifications. These come from Facebook, Twitter and other social sites.

You might get an e-mail every time someone interacts with your profile. If you’re an avid social networker, these notifications can take over your inbox.

Go into your settings on each site to turn off notifications. 

 

By:USA Today


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Online Auctions: Future of the Housing Market? 

Online-Housing-Auction

The housing market has been through a lot of changes in recent years. Economic and social factors continue to shape the way the housing market functions. Recently, an interesting development in the housing market has emerged: online real estate auctions. The growing popularity of these online marketplaces could potentially transform the way real estate is bought and sold.

Online Real Estate Auctions

Although some things vary depending on the particular auction site, there are some basic commonalities of most online real estate auctions.

Much like their offline counterparts, these auctions often involve selling foreclosed homes. However, the number of auction sites offering to buy and sell non-distressed properties is growing as well. Unlike traditional foreclosure auctions, the entire bidding process is done online rather than at a courthouse or hotel ballroom.

As with traditional auctions, all sales in online auctions are typically final. However, if the sale involves a foreclosure, depending on the state, there may be a redemption period where the original owner could possibly purchase the rights to the property back (rendering the auction purchase void).

Types of Properties Available Through Online Auctions

Many home auction sites predominantly involve selling homes that have been foreclosed on by the bank. However, many sites have also developed into online marketplaces where both buyers and sellers can exchange a great variety of property types, including:

  • Commercial – Office buildings, multi-family, hotels, industrial
  • Residential – Non-distressed owner-occupiers, non-distressed mid-market homes
  • Non-distressed luxury homes

These are just a few examples of the types of properties that can be bought or sold online through an auction site.

Online Auction Process

Again, the online auction process may vary depending on the specific site, but the general process will be the same. The first step in the auction process is to register for the auction site on which you will be bidding, which is usually free.

Most auction sites will provide for a pre-auction bidding period. During this period it is possible to place a (usually limited) number of bids before the auction begins. If a pre-auction bid is sufficient and meets the seller’s expectations, you can purchase the property before it ever reaches auction.

After the pre-auction period ends, the online auction begins. Online auctions are similar to traditional auctions except the bidding is done from the convenience of your own home or office. Most auctions include minimum bid increments and have set ending dates which can be slightly extended in the case of aggressive last-minute bidding.

If you are the winning bidder, most sites will send you a confirmation email that is shortly followed up by a phone call from a site representative. Unlike traditional auctions where the winner may have to produce the required funds within hours of winning, online auction sites typically only require a deposit upfront.

The potential for online real estate auctions as the future of the housing market lies in their transparency, their level playing field and their convenience. The ability to bid from the comfort of home coupled with the flexibility of payment options upfront makes buying or selling real estate online an attractive option for prospective buyers and sellers. Also, the way auctions level the playing field by providing the average person the same opportunity to bid for a property as a large institution has added to their popularity. If these online real estate marketplaces continue to grow and develop, there is a strong possibility that they could truly be the future of how real estate is bought and sold in the housing market. 

 

By: The crew at KCM blog


The Curious Case of the Jumbo Mortgage

dollar power and elephant 

Though it may feel like yesterday, it’s been about half a decade since the housing bubble burst and the subprime mortgage crisis hit. In September 2008, the United States government took over Fannie Mae and Freddie Mac. Since then, the mortgage industry has undergone fundamental changes, experiencing both increased regulation and a large shift toward nationalization. To give you an idea of the size of these changes, in 2006 around 30% of mortgage loans in the US were backed by a government guarantee. This number rose to around 90% in 2012.

Private vs. Government Funding

As we move further from the financial crisis, it makes sense to start asking if and when the mortgage industry will return to a world where private money plays a greater role and government institutions such as Fannie, Freddie, and the Federal Housing Administration (FHA) play a smaller one. Recently, our representatives in Washingtonhave begun to discuss plans to dissolve Fannie and Freddie and bring private money back into the game, and that’s a good start. In the past few months, we’ve also seen a few encouraging trends in the jumbo mortgage market that could point toward a mortgage industry less reliant on government guarantees.

Jumbo Mortgages

If you’re not familiar with a jumbo mortgage, the entire concept revolves around the type of loans that Fannie and Freddie are willing to guarantee. Fannie and Freddie will guarantee loans only up to $417,000 in value (sometimes more, but not important for this discussion), and these are referred to as conventional mortgages. A jumbo mortgage refers to one with a higher loan amount, typically $417,000 to $750,000, and these are not backed by a government guarantee. Prior to the financial crisis, jumbo loans were priced around .25% higher than conforming. After the financial crisis, the gap has widened to as much as 1.8%, just one more indicator of the flight of private capital.

Latest Trend

In September, something changed – by some measures, the rates on jumbo mortgages actually fell below the rates on equivalent conventional loans. This phenomena was covered in many media outlets, and you can read more detail here and here. As of this writing, the rates on a few popular websites are almost too close to tell the difference, with 30 year fixed rate conventional mortgages at 4.28% and jumbo 30 year fixed rate mortgages at 4.32%. Though it’s only been one month, the fact that jumbo mortgage rates did not immediately diverge from conventional rates is a sign that we may be witnessing a trend.

There are countless ways to interpret the closing spread between jumbo and conventional mortgage rates. For example, banks with excess capital to lend may feel pressure to put this money to work, which one could argue is leading to higher demand for jumbo loans and thus lower rates. Another interesting interpretation, however, ties back to Fannie and Freddie. In recent years, both institutions have raised guarantee fees, the fees that are meant to compensate them for providing a guarantee on a mortgage. This makes conventional loans more expensive, which would help close the gap with jumbo loans in the other direction.

If you’re in favor of more private market involvement within the mortgage industry, you may be wondering if falling jumbo mortgage rates are the first step in a path toward private options for conventional loan amounts. After all, at some point working with Fannie and Freddie may become prohibitively expensive, and the WSJ article linked earlier mentioned a mortgage lender encouraging borrowers to borrow more money to jump over conventional limits. It’s far too early to tell, but this trend certainly deserves attention over the coming months. 

 

By: The crew at KCM blog


Tech Tip Tuesday: October, 15 2013

How to Open Desktop Version of Websites on Mobile Phone 

 

Okay, so you are wondering why anyone would want to open Desktop version of a website on Mobile Phones. I second that, but there are scenarios where it could be helpful.

For Example, Facebook for Mobile doesn’t show all the settings there. If you need to set a photo’s privacy, you need to visit Desktop version of Facebook, which is, sometimes, not possible.

You can use this trick to make changes right from your mobile device.

Install Third Party Web Browsers on your Mobile

The default browser on Android lets you view the desktop version of any website but iPhone does not. So, it’s better to install a third party browser available in Play Store for Android and App Store for iPhone respectively. Here is a list of browsers that are available for Android. Most of them are also available for iPhone as well,

Google Chrome for iPhone | Google Chrome for Android

Dolphin Browser for iPhone | Dolphin Browser for Android

clip image0015 How to Open Desktop Version of Websites on Mobile Phone

If you have installed Google Chrome on your Android, you can find the ‘Request desktop Site’ option.

Or, if you have install Dolphin browser, Find User Agent in Settings and change it to Desktop.

You can now open Desktop versions of any website. It is quite helpful when Mobile version has few restrictions or hide an element from the main website.


Tech Tip Tuesday: October 8, 2013

CALENDAR SYNC – GOOGLE CALENDARS WILL MAKE YOUR LIFE EASIER

If you are anything like me you have a work calendar, a personal calendar, a family calendar, a significant others calendar and probably several other calendars you must keep an eye on for work.  This was starting to get overwhelming especially because all of my calendars were spread across multiple platforms.  It also doesn’t help that I have use my iPhone, iPad, and MacBook Pro interchangeably, and needed everything to sync with out having to think about it.

So… Google Calendars Set, I went on a journey of discovery to figure out how I could get my Google Calendars (all of them) to sync with my iPhone, iPad, and MacBook Pro, all with out the help of anything like MobileMe. (I am not a huge MobileMe fan but thats a blog post for a different day)

Step One: Relieving all of your devices of their native calendars.  In order to have everything play nicely together you must pick one platform…Google Calendars it is.  I am a huge fan of Google’s calendar capabilities anyway so this wasn’t too big of a jump for me.  Once you make sure all of your data is migrated onto a Google Calendar (herein referred to as gCal) you are ready to start.  (Note: it is much easier to create several calendars for types of events rather than trying to squeeze everything onto one)

 

Step Two: Go into the Mail, Contacts, and Calendars settings on your mobile devices.  Make sure to turn off other calendars if you plan to use a gCal for everything. Once that is complete, delete your gmail account from your phone and iPad.  (I know this sounds scary, but dont worry, everything is backed up online)


Step Three: Go to m.google.com/sync on your computer and follow the directions on setting up Gmail using Google Sync. This may take some time, however the directions are super easy to follow. Essentially, you are creating an exchange account for Gmail.   (Hint: When setting up the Google Sync your phone and iPad will more than likely name this account Exchange. If you are super picky how things appear on your phone like I am, make sure to change this to Gmail.)

 

Step Four: Go to m.google.com/sync on your mobile device. You will be prompted to login using your Google sign in.  From here select the device you are working on.  You will be presented with a list of all of the calendars you own and have access to in your gCal account. Simply select the ones you would like to work with on your device, and just like magic they will appear.

Step Five: Open iCal.  Go to preference and delete your previous gmail account and set up a new gCal using CalDav. Once you have the account set up, click the third tab in the preferences named “Delegation”.  If you have this account properly set up you will see all of the available calendars. Select all of the gCal’s you would like to manage and have synced with your other mobile devices.

COMPLETE!

Make sure to run a few tests and check when adding new calendar entries that they update across all of your devices.  The easiest way to do this is to create a new event in iCal, check and amend it on your iPhone, and finally delete it on your iPad.  Then log in to your gCal online and make sure its gone.  Make sure to check the update/sync times on your devices.  I originally thought I had messed up, however I had the auto-refresh times set to long and as such didn’t get the updates immediately.  This is easily changed in the preferences.

Finally: Enjoy knowing when and where you need to be.  No matter what device you happen to be in front of, you can schedule your time away and know you will have total access when ever and where ever.

 

 

Guest Post by Greg Grospitch @greggrospitch.