You Think Your House is Worth WHAT?? Pricing Your Home to Sell

You Think Your House is Worth WHAT? Pricing Your Home to Sell

O.k., so you've looked on the Internet, you've checked the Real Estate Weekly - and you've talked to your Neighbors.  You're pretty sure you know what you WANT your home to be worth.  Next step?  You call the Realtors in.

Everyone says you should interview 3 Realtors - so that's what you do!  And sceptically you await their Verdicts!  Does the highest Bid (because that's what it often is)  win your Vote?  Well it shouldn't and let me tell you why.

 

 

                                                      

                                                              

                                                  BUT Your neighbor's house just sold for XXXXX!

 

First of all, Realtors have access to the same information Online.  By doing a CMA (Comparative Market Analysis) they should be able to come very close to the Range of Your Home's Value.  They will see which homes are currently Listed, those that will be in direct competition with Your Home; they will see which comparable homes have Sold recently; and they will ALSO see which homes have 'Expired'....(Listed But Not Sold). That's the Starting Point!

If you use a Local Realtor - which is what I Recommend- they'll also be able to take into consideration different factors about your neighborhood - like development, schools, safety, proximity to transport etc.     

                                                            BUT Your House has been upgraded!

                                                                 

Now where no 2 homes are exactly alike - chances are we've seen most of the homes for sale in your area and have an inside view that you may not have seen.  Even online photos won't give you a complete view of how these homes compare. 

In many ways - it's the Buyer that ultimately determines the value of your home. A house is worth what somebody will pay for it.  It's important to try and anticipate what MOST buyers will pay for it. If the price is too high - you may just end remaining THAT Buyer! If your home should be some chance sell for more then the estimated value, remember the home still needs to be Appraised for the Buyer's Loan, and if it's overpriced it just may not!

                                      BUT That's What INEEEEEEEED to Get for My Home!

There is the odd time that a home is unusual and there are not direct comparables, sometimes this requires a trial and error strategy where we have to gage potential buyer responses in order to fine tune the price. 

Another factor is the current 'Real Estate market'.  Is it a  Buyer's market or a Seller's market - or is it balanced? What kind of standing inventory is in the market in your price range. These well all factor in to your pricing.

The value of a home can also be estimated in part using the price per square foot.  But you do have to use a sliding scale of adjustment.  The 'core' of the home is worth more then the peripheral square footage. ie. the price per sq. foot for a 1000 sq. foot rancher will be higher then that of a 3000sq. ft. basement home. 

Should you start higher - after all you can always come down??? No! If you do that you should be charging your competitor a fee for helping them sell THEIR home!

Remember the most critical time for selling your home is in the first 30 days.  Longer then that you can bet your bottom dollar, (and unfortunately that's probably what it will end up being) that the Buyer will be paying attention to your 'days on market' when making both their buying decision and price point! 

How do you know if your house is priced right?  Feedback! Your Realtor will be calling to get feedback on showings from both the Buyer and their Realtor.  If you've had over 6 showings and have been on the market for 3 or so weeks  that should give you some idea of what the market thinks.  Unusual or high end homes could be the exception here though. 

Sometimes the most important factor is YOUR motivation. How motivated are you to sell?   I know a lot of Seller's like to tell us that 'they don't HAVE to sell'.......and in most cases that's true - you don't!  But if you do want to sell your homecall a Realtor that knows your market and will be honest with you - because that's what a professional does - they Help you Price Your Home to Sell!  

 

                         

  

                                             

 

If you or someone you know is thinking of Buying or Selling property in Cultus Lake, Chilliwack, Hope, Abbotsford, Langley or anywhere in the Fraser Valley Area of B.C. - or if you would like more information please give Liz  Moras of Landmark Realty Chilliwack a call at- 604-799-0459 or e-mail at lizmoras@gmail.com.     

Copyright © 2009 By Liz Moras, All Rights Reserved. All photos by Liz Moras ( except the one's I'm in!). All information provided by this author is only an opinion, it is not guaranteed, may be based on information collected from several sources, and may be time sensitive.  It is not necessarily representative of the opinions of Landmark Realty Chwk. Ltd..   

                               

 

 

What is Mortgage APR, Can You Explain It?

WHAT IS MORTGAGE APR, Can You Explain It?

APR Demystified and APR Predators Exposed

First, lets demystify Annual Percentage Rate (APR).

Mortgage APR was designed to allow consumers to use one standardized number to compare each lender's rate for the same type of loan while rate shopping.  It is supposed to represent the borrower's cost and it works like this.

If I lend you, $10,000  and, I charge a $500 Bump-ta-Bump Fee, you will actually receive $9,500, however you must still repay me $10,000.  Mortgage APR is my real yield and your real cost on this loan.

We agreed that you will repay the loan at 8% interest on $10,000, HOWEVER you only received $9,500 therefore I will earn more than the 8.0% interest rate I charge on $10,000.  In this case, my yield (APR) is 9.799% on the $9,500 you received.   

APR is the lender's yield on dollars actually lent ($10,000 minus $500 = $9,500); in this case, the lender's yield (APR) on $9,500 is 9.799%   (APR is computed as if the above example is a 30 year loan)

The $9,500 also represents the Amount Financed in the Truth In Lending (TIL) disclosure. 

For those of you who use spreadsheets the Rate Function will find APR.  Use the Amount Financed for Loan Amount and use the monthly payment on the actual loan amount.

Fees that must be subtracted from a mortgage loan to properly calculate Amount Financed for APR

Origination and Discount Points

Processing and Lender Fees

Pre-Paid Interest (Use 15 days when closing date is unknown)

Monthly Mortgage Insurance must be added to the payment of all FHA loans and Conventional loans greater than 80% loan to value. 

The inclusion of Mi or MIP accounts for the large spread between Rate and APR on loans with mortgage insurance.

NOTES:  Fees Not used in APR calculation; third party fees such as appraisal and credit.  APR can only be compared on loans of the same type and amortization period

How Do APR Predators Work?

Many sophisticated borrowers shop interest rates by searching for lowest APR which, if property stated, is a valid way to compare similar loans.  Unfortunately, APR is not always stated properly.

How is advertised Mortgage APR is misstated? 

• Prepaid Interest is not included - most common deception and true on all online Rate sites   i.e.: Bankrate.com, Interest.com, Mortgage101.com, ShopRate.com, etc.
• Prepaid Interest is understated - must be 15 days when closing date is unknown.
• MI or MIP is not included in the APR on any online rate sites, Bankrate etc.
• Some lenders do not include MI or MIP on their web sites such as Amerisave.com 
• Lender fees are either understated or not included in the APR calculation.  This is a tricky one because No or Low Lender Fees does not necessarily indicate a predatory lender.  Some lenders charge a higher rate and no points or fees for their so called "Zero Cost" loan.  However, the "Zero Cost" rate will always be higher than a rate with points and/or fees. 
• Notes to the above: 
  • there is no such thing as a Zero Cost loan and some states prohibit lenders from advertising Zero Cost Loans.
  • The spread between Rate and APR on loans greater than 90% LTV should be at least 0.700%.  When it is not... you are being scammed

Rate - Points - Fees are all interdependent

The best way I can explain this is show various Rate - Point - Fee combinations where the lender is making the same gross profit on each combination. 

In the examples below, we will use a $200,000 loan amount and Lender gross profit of $1,000, on a day when the Lender's cost for a 5.000% rate is par (0 point).

Best Rate:  $1,000 Lender profit in various combinations of points and fees

Rate	Fees	Points	APR	Profit
5.000%	$1,000	0	5.044%	$1,000
5.000%	$500	0.250	5.044%	$1,000
5.000%	$0	0.500	5.044%	$1,000

Lowest Fees:
You pay $0 points and fees and Lender's investor pays the lender $1,000 for the higher rate.  

Rate	Fees	Points	APR	Profit
5.125%	$0	0	5.125%	$1,000

The point here is that lenders design their loans to provide talking points for their sales staff (loan officers).  They all require a certain profit margin and it is not important the way the loan is structured as long as the closed loan delivers their required profit margin. 

This illustration also points out the value of correctly stated APR as a way of comparing mortgage loans.  For the sake of these illustrations, prepaid interest was not used.  If 15 days PP was calculated it would have increased each APR by 0.019%.

Bill Ladewig

800.664.7283 (SAVE)

Bill@YourFhaGuru.com

Website

 

 

Bill Ladewig is a Mortgage Broker Licensed by the California Department of Real Estate 00968137

San Diego FHA and VA Home Loans Escondido Mortgages Escondido Localism San Diego FHA and VA Home Loans San Diego Localism San Diego UFMIP Escondido Mortgages Escondido Localism San Diego Mortgage What is APR

Life could crumble if you are too good at something. They said Balance is Everything.

I never knew the effects of success until I found myself absorbing in it. I've always been a perfectionist and I've always challenged to do better than myself. I've never competed with others, just with me but somehow, raising the bar to soar higher had very much its own horrific side effects.

I talked about how I never quite believed in a BALANCED life because I felt that was life at mediocrity. I felt that philosophy was never good enough for me because I'd be holding myself back in equilibrium.

Coincidentally, I'm living a whacked out life right now with all things just seems out of balance. So, I must say I learnt first hand what it means needing to find a balance despite my challenges of understanding needing to be the best at what I do.

The Best for God, The Best Wife for my Husband, The Best Mother for my son, The Best Realtor for my clients, The Best Cleaner for my Home, The Best Blogger for my subscribers. I just have lots to live up to and I truly dont know how to be balanced.

If I knew if I was going to be a stay-at-home mom, my house would be squeeky clean. If I was going to be a rose enthusiast, my garden would be filled with 88 rose bushes and I would get up at 5am every Saturday morning to spray. If I was going to be a Realtor, I'm just going to set out to just be the best. Instant communication and making my clients feel extremely valued and my presence would make a difference.

People find motivation in becoming successful, inspired and motivated to stay the course. On the other hand, my struggle is to do less of these things.

I never understood how people could work so much, that in the end, they find themselves in a hollow relationship with their family. I've always thought it was the financial success they were after. I was WRONG. I would never look at a Successful person in the same light again. Until I walked the path of Becoming the Best at Whatever I do, I thought they had all done it for money. WRONG.

There is something about leaders wanting to push the envelope. Wanting to see how far they can go. Wanting to see what they could do with their God-given talents. So, they try to excel in everything they do. I, for one belong to this category and monetary success has nothing to do with the intended motivation, although it is a rewarding by-product of the success.

In the bible, it said that we cannot serve both God and money and I took the context "money" literally. I saw people who strived for success are people who longed for materialism. I excluded myself from that group. Yet, I found myself in this same place, back to this scripture. I know I cannot serve 2 masters and I'm still finding it a struggle to understand this concept.

I do believe I'm serving God through my business. Hence, I put my best foot forward every single day. But my family life may have suffered along the way. God first, my husband second, my son third. Sometimes, I'm torn about this very concept. Knowing that I'm called to serve Him, that makes His works first. I guess that's where I find it confusing to draw the line between people and God.

 

 

I begin my week here on Active Rain with my God First posts, written every Sunday once a week. My promise to you is that the messages I share will be day-to-day related, often times related to real estate. If these topics are important to you also, I'd love for you to subscribe to my blog.

 

 

 

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All contents are original. Consider subscribing to my blog for more real estate commentaries.

Subscribe via Email if you are not an Active Rain member here.

 

Contact:

Loreena Yeo
Realtor®/ Broker of 3:16 team REALTY
(214) 783-2210
loreena@loreenayeo.com

 

Super-serving Frisco, Plano, Dallas, McKinney, Allen, Little Elm, Prosper, Celina, Richardson, Dallas M-Streets, Dallas White Rock Lake area communities and other surrounding areas.

Copyright © 2009 by Loreena Yeo (3:16 team REALTY).
Life could crumble if you are too good at something. They said Balance is Everything.

Chapter 13 Primer

Commencing a Chapter 13 Case

–A Chapter 13 bankruptcy case begins with the filing of the bankruptcy petition.

–Upon the filing of the petition an automatic stay arises that prohibits creditors from taking any further action to collect a debt or enforce a judgment.

–A Notice of Commencement of Case is electronically served on all creditors who have subscribed to the national database or by mail to all others.

–This Notice provides each recipient with the date, time and place of the meeting of creditors and confirmation hearing, as well as the last date to file for a determination of whether debt should not be discharged.

–At the time of filing of the petition or within 15 days Schedules of personal and real property, exemptions, priority debt (taxes, domestic support obligations, etc.), secured debt, unsecured debt, income and expenses must be filed.

 

Chapter 13 Trustee and Creditors

–Unlike Chapter 7 trustees, Chapter 13 trustees are not empowered to liquidate assets, but rather will evaluate asset values alongside income and expenses to determine if the plan payment is the debtor’s best efforts.

–The Statement of Financial Affairs filed by the debtor is reviewed by the Chapter 13 trustee for complete disclosures in response to a series of questions, income over the last 3 years, transfers, repossessions, and seizures made within 2 years (most trustees will ask about over the last 4 years), and interests in any corporate or business entities.

–Creditors have the right to object to the Chapter 13, but have no voting rights, as they would have under a Chapter 11 plan.

–Mortgage holders and auto finance companies require continue payments for the debtor to retain property rights.  Auto financing entered into within 910 days of the filing of the case cannot have the value of their collateral reduced to the current value (cram down).

 

Who May Be a Debtor and Debtor’s Duties

–Chapter 13 is intended to provide a vehicle through which people facing financial difficulty attempt to keep their property while using their Chapter 13 plan to cure payment defaults, typically only to their mortgage lender.

–General unsecured debt that is liquidated, matured and not contingent cannot exceed $336,900, and secured debt cannot exceed $1,010,000.  The determination of what is secured and unsecured can be subject to objection and litigation in a Chapter 13 case.

–Debtors are required to complete a credit counseling course prior to filing and must complete a financial management course within 45 days of confirmation of a Chapter 13 plan.

–Beginning each month after commencement of the Chapter 13, debtors must begin making the regular monthly mortgage payment to the first and the second (until the second may be deemed wholly undersecured), and regularly monthly mortgage payments may now include an escrow for taxes and insurance (thereby increasing monthly payments).

 

The Chapter 13 Plan

–Also at the time or within 15 days of the petition there must be filed a Chapter 13 repayment plan that will set forth how mortgage default payments will be cured over a 36 to 60 month period of time, as well as treatment of other debt repayment, if any.  Depending upon the jurisdiction, plans may be proposed for as little as 0% being paid to general unsecured creditors.

–Under BAPCPA the period during which debtors must commit to a Chapter 13 plan will be dictated by whether their annualized monthly income is more or less than the median income in their Metropolitan Statistical Area as compiled by the Census Bureau.

–Other requirements as a condition to court approval (confirmation) of a Chapter 13 plan include: submitting tax returns, proof of income and proof of monthly expenses to the Chapter 13 trustee, as well as plan payments calculated from disposable income or the curing of default payments. r all plan payments are made during the term of the plan and the total amount required, the Chapter 13 trustee will file a final report upon which the debtors receive a discharge.  In the event the second mortgage is deemed wholly undersecured, it may be avoided from title as prescribed by order of the court.

 

Advantages of Chapter 13

–Chapter 13 affords debtors the opportunity to retain their homes, as long as they make regular monthly payments and plan payments.

–Wholly undersecured junior mortgages may be removed from title upon entry of Chapter 13 discharge.

–Judicial liens may be removed.

–Auto loans that were made more than 910 days may be subject to being reduced to the value of the motor vehicle with payments made through Chapter 13 plan.

–Foreclosures, seizures, garnishments, levies, and collection efforts are stayed during the course of a Chapter 13 and are permanently enjoined upon entry of the discharge.

–Taxes are generally nondischargeable, but may be paid with post petition interested abated upon full payment and entry of the Chapter 13 discharge.

 

Looking to help the next buyer and seller in Southern New Jersey ~ Bridget Cella, Re/Max All Pros, Turnersville, NJ

2 Bedroom 2 Bath Condo in Washington Township, NJ - Bridget Cella, Re/Max All Pros

2 Bedroom Apartment in Glassboro, NJ

2 Bedroom Apartment in Glassboro, NJ

Sometimes Those Additional Closing Costs Can Be Surprising .. Like The Charge For Heating Fuel Left Behind By The Seller

Did you know that there are things that may come with the house you are buying that could add to the bottom line at the closing table?  Depending on what type of heating fuel you use there could be a charge for the remaining fuel being left behind by the seller.  Many people who move into more rural areas from cities where they are used to natural gas being piped in as needed may not be prepared for what can be  a $1000 + charge for heating fuels at the closing table. Understand that you would have to pay for fuel sometime but if you are unprepared it can come as a shock.  Somewhere along the line it was most likely mentioned that the fuel cost would be paid at closing but the full understanding of what that means may not have hit home. The last thing you need is for $1000 to keep you from being able to close on your house.  Make sure you understand the closing costs as explained to you and ask questions if you don't understand.  

As a home buyers it is important to understand what is involved in buying the house you are interested in.  Having a Buyer's Representative who will make sure you understand the home buying process in the location you are planning to live is important.   A Buyer's Representative will be there with you through search, offer, negotiations, inspections, and closing.  If you are working with a Listing Agent you will be missing out on personal representation and you may not fully understand what is what.

If you are looking to buy in Orange, Ulster, or Sullivan Counties of the Greater Hudson Valley and Catskill Regions of New York I would love to be your Buyer's Agent. If you live anywhere else in the world I can find you a great agent to help you where you want to live.  

I'm Paddy Pizappi - Work with Me and You'll be Happy!

 

Paddy Pizappi, Associate Broker for Buyer Representation
 RJ Smith Realty - A Real Estate Solutions Company
Serving the Greater Hudson Valley of New York
from Pine Bush, NY at the corner of Orange, Ulster, and Sullivan Counties
Call or Text to 845-800-7086
Click Here To Search For Properties In The Greater Hudson Valley

Get Started With Your Own Rainmaker Blog Today Click Here To Ask Me How

 

First Time Homebuyer Tax Credit to be renewed???

As forwarded to me by Internet Compass Solutions, it appears good news may be on the horizon --  Word is the credit will be renewed (read: extended?) allowing not just first time, but also repeat homebuyers the credit, to be gradually reduced, but continued through the end of 2010.  Let's keep the market moving!

Following is the text as per Bloomberg News:
Senate Democrats on Board with Credit Extension

Senate Banking Committee Chairman Chris Dodd (D-Conn.) says Senate Democrats have agreed to extend the first-time home buyer tax credit. The latest version extends the program to home sales signed - not closed - by April 30. Purchasers would have another 60 days to close the sale. The credit will also be expanded to include so-called step-up buyers who have lived in their current home for at least five years.

The credit would be cut slightly to a $7,290 cap. Income eligibility for first-time home buyers would stay the same, but it would rise for step-up buyers to $125,000 for individuals and $250,000 for couples.
Source: Bloomberg News, Dawn Kopecki and Ryan Donmoyer (10/27/2009)

I know there are some out there who believe the homebuyer tax credit was a mistake, and that an extension just compounds the mistake, but listen up --  That's easy to say now, but have we all forgotten the stagnant situation of a year ago, with all the potential homebuyers and homesellers petrified, afraid to do anything?  We Americans have such short term memories, housing markets, economic realities, elections...

Best regards,