There is nothing sweeter in the world for home buyers than to hear the much anticipated words from
their mortgage lender:

Clear to close!

Getting to that point though has taken a bit longer in my area (Macomb County MI) and I have a feeling
it's the same for most of the country.   Times sure have changed and we all need to be on our toes and be pro-active to understand what we can change and what we can't change about the mortgage process.

Below is a list of things that can (and will) slow down your mortgage process and delay the closing on
your new home beyond the expected date:

• Appraisal review:  This is now the new normal.  Once the appraisal comes back to the lender it most often goes in for an additional review by another set of eyes. You'll have another 3-5 business days of waiting out this process before you will hear those magic words.
  
  
• Last pay stubs and bank statements:   It doesn't matter that you gave your lender pay stubs and bank statements 30 days ago.  Save each new one as you receive it and forward it to him/her immediately.  It's much quicker and less stress on you if you just forward them over instead of waiting to be asked for them.
  
  
  
• Verbal verification of employment:   The day before or the day of closing the mortgage processor will make one last phone call to your employer to make sure you are still an employee.  Unemployment is still high and the lender wants to make sure you have employment the day you sign the mortgage papers.  (If your company is going to be closed down for any vacation time or holiday please let your lender know those dates.)
  
  
  
• Homeowners insurance:   A simple rate quote and declarations sheet used to be good enough for the underwriter to clear your loan to close.  Not quite so simple anymore.   Ask your mortgage lender for the specifics of what is needed by you and your insurance carrier 10 days to 2 weeks before your anticipated closing.  (Most lenders will be happy to talk to your insurance representative - they all want to get it right the first time around.)
  
  

The best advice that I can offer a home buyer to help all of this go smoother?  Keep in constant contact with your mortgage lender and buyers agent.    Teamwork is truly the key to a smooth home purchase and hearing those magical words "Clear to close".



~Kris Wales~  A partner for your real estate needs in Macomb County MI

Can we be kinder to each other please?

It doesn't take a degree in economics to understand that people are hurting financially. All we have to do is look around us at the people within our own industry to know that the real estate market down turn has hurt more than just homeowners.  It's hurt all of us.

In my Metro Detroit area I have watched as many agents have left the business, as well as mortgage lenders and home inspectors.   I cringe each time I hear "well, that's more business for us" or "It's getting rid of the bad ones" or the ever popular  "If they just worked harder they wouldn't have left."   

Hogwash.

I don't know about you, but the people that have left the industry that I'm acquainted with have been stand out people that provided a wonderful service and agents that I thoroughly enjoyed working with.   They've left this industry because they need to provide for  their families.  They've left the industry because they didn't have a choice.

Oh I'm sure there are some agents and other real estate professionals that got into this industry when times were great and then bailed, but for the most part this is not what I'm seeing as the norm. 

Truth of the matter is we've lost good people.  Hardworking real estate agents and mortgage lenders and home inspectors who need to feed their families and provide health insurance and pay their mortgages...you get the picture.

Last year I offered to help a struggling agent as he took on another job to feed his family and pay his bills.  I didn't want anything in return - only his continued presence in this industry.   Why?  He was a damned good agent who cared about his clients and always conducted himself in an ethical manner.  Sadly, he couldn't hang on and made a decision that I know broke his heart.

Please.  Let's be kinder to each other.   Instead of saying "He didn't work hard enough" or  "More business for me!" how about offering a helping hand when we can?    A kind phone call to someone struggling, an offer of your time without any expected compensation, or a bit of advice and cheerleading can go a long way to lift a persons spirit in their time of need.



Photo courtesy of Valerie Everetts Photostream via Flickr - Creative Commons License

Every home buyer wants a bargain.  I love bargains myself. 

However, your home purchase won't feel like much of a bargain if you miss out on the deadline for the first time home buyers tax credit because you waited for months for a reply on your offer to purchase a short sale property. 

In the next couple of months we are going to be seeing a buyers frenzy as people start to understand that the deadline is approaching. 



I'm not going to be popular with listing agents for saying this, but here goes:  If  you are going to place an offer on a home that needs short sale approval keep updated about the current market and available homes after you have the sellers approval.  You need  2 sets of approvals for your short sale offer:  One from the home sellers, one from their mortgage holder.  Until you get that approval from the mortgage holder you don't have a deal.

Have a Plan B:   Give yourself a firm cutoff date on when you need to hear back from the mortgage holder and need to move on with your home search.  (I suggest no later than September 1st.)    Ask your buyers agent to send you regular updates on the homes that are coming on the market that meet your criteria.  Stick to your cutoff date.  If you haven't heard back from the mortgage holder in a positive manner about your offer on the short sale property move on without looking back.

****The deadline to close on your home in order to qualify for the First Time Home Buyer tax credit
is November 30th, 2009****


~Kris Wales~   A partner for your real estate needs in Macomb County MI
Want to search for homes in Macomb County MI with MLS provided data?

A recent caller asked if the (up to) $8000 first time home buyer tax credit is able to be used if
they choose to use a VA mortgage.

Yes, yes YES.    One of the confusing bits of misinformation is that the 1st time home buyers tax
credit can only be used with an FHA mortgage.  That is not true.  FHA, VA, conventional, land
contract - if you are a first time home buyer and meet the other guidelines you qualify for the tax
credit.

VA mortgages also allow the buyer to ask the seller to pay up to 6% in sellers concessions towards
the buyers closing cost, pre-paid items and tax prorations.  (In my experience unless the home that
you are purchasing has reverted to non-homestead status this 6% will cover most of these items for
you.)

One other tidbit about VA mortgages that I recently became aware of:   If you are determined by VA
to be at least 10% disabled they will waive the funding fee.   (Make your mortgage lender aware of your
disability status and provide him / her with the documentation.)

I hope this cleared up another bit of the confusion and misinformation about the (up to) $8000 first time
home buyers tax credit.  Remember, this credit has an expiration date:  November 30th, 2009.  Don't
dawdle and lose it!

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~Kris Wales~  A partner for your real estate needs in Macomb County MI

Awesome article in this mornings The Detroit News regarding the FTC and its new stance on bloggers and the articles they write touting products.

I'm not one who wants controls on speech, but I have to tell you I agree with the FTC on this one.   If I'm going to receive a free cruise and then write a blog article about how wonderful the cruise was then I would think I should be disclosing that I received the freebie.

Now I wonder about all the blog posts we've seen here about products and such that are clearly endorsement articles.   Have the bloggers received freebies to endorse these products and write glowing reports?

Last month a buyer client of mine closed on the purchase of her condo and was absolutely thrilled. As she wasn't a first time home buyer she isn't able to receive the First Time Home Buyers tax credit, but is happy about the wonderful condo that she bought at a terrific price.

I've heard from several people over the last couple of months that are interested in purchasing condos but are concerned about what they've been reading as far as obtaining a mortgage for one.

A couple of tips:

• If you are purchasing using an FHA or VA mortgage ask your buyers agent to check and see if the complex you are interested in is on the HUD approved list.
  
  
• Have your buyers agent do their homework:  Insist on financial statements from the association or management company as part of the due diligence during the inspection period.   Review them together, and if they are complicated ask an accountant to review them on your behalf.
  
  
• Ask your mortgage lender if there are any requirements that you or the condo complex must meet in order to obtain your mortgage.  (Guidelines change quickly and you want to make sure that the information you received 6 months ago from your lender is still the case today.)
  
  
• Remember that all real estate is local.  What may be the norm for Florida or Nevada isn't the norm here.  Talk to your buyers agent and your mortgage lender about what is happening in your desired purchase area.

There are some outstanding condos on the market know in Macomb County and people who wish a more
maintenance free lifestyle may want to consider purchasing one of them.   For example, here are the condos
that are on the market this morning in Sterling Heights.  



If you have any questions about purchasing a condo in Macomb County MI please don't hesitate to contact me. No pressure - just conversation.

Kris Wales - A partner for your real estate needs in Macomb County MI

Waaay back in 2008 (sure seems like a long time ago!) many, if not most real estate professionals
agreed that some of the signs that the bottom of the real estate market had hit was when we saw
the following:

• Interest rates rising.
• Multiple offers on homes - privately owned as well as foreclosures.
• The average days on the market steadily lowering.
• Short sale homes actually selling.

Well folks, I'm personally seeing all 4 signs now. 

In the last 2 months my buyer clients and I have been a part of multiple offers on homes (yes, even the
privately owned homes), the interest rates on their mortgages have been higher, homes selling quicker
than we can get in to view them, and last but not least:  Homes on the market as short sales are actually
closing more often than not.

Is the worst over?   I can't predict that.  The economy (especially here in Metro Detroit) is still rough
around the edges, but people are feeling a bit more confident about the future. 

The government stimulus programs are working in our area (the $8000 first time home buyers tax credit
amongst them) and consumers are realizing that purchasing a home is something that will always be a part
of the American way of life.

I'm now looking forward to the next sign that I'm sure we'll all be watching out for:  Home prices
stabilizing and then increasing in value again.   



~Kris Wales~  A partner for your real estate needs in Macomb County MI
Want to search for homes in Macomb County MI with MLS provided data?

Carole Provenzale left a comment on one of my articles that inspired this post.  Thank you Carole!


One of the areas of our profession that my clients routinely express their surprise at is the length of time it takes to complete each part of their transactions. We come from such a hurry up society that sitting down and taking hours to go from Step A to Step B comes as a shock to most of my clients. 




A couple of recent examples popped in to my head when I read Caroles comment:

• When I told Mr. Buyer how long the home inspection would (should) take and to
  please budget that amount of time from his day he was surprised.  "You're kidding?"
  No, I'm not.  2  1/2 to 3 hours is the typical time for a good home inspection.
  
  
• One buyer spent 90 minutes with his mortgage lender in a face to face sit down when
  formally applying for his mortgage.  He had no idea it would take more than a few
  minutes to "sign a few papers" but was elated that the lender explained everything
  to him in a clear manner and gave him options to consider.
  
  
• Another client was a bit dismayed that it took me a couple of hours to weed through
  the active listings & narrow down their home search to those that fit their criteria and
  didn't waste their time in potential viewings.   When I sent her a lengthy email detailing
  what I do, and why I do it, she understood and thanked me for being so careful with
  the list of homes that I was sending her.

These are just examples of some of the things that take time during the process of purchasing your
home.   Much goes on behind the scenes that you personally do not have to take care of because the
professionals you hired are doing it for you.   We do try to make it as stress free as possible for you, but
we can't skimp on the time that we spend, or that you will spend in purchasing your home.  I'm sure you wouldn't want us to rush on what is probably going to be the most important and expensive purchase of your life.



~Kris Wales~  A partner for your real estate needs in Macomb County MI

Want to chat about Macomb County MI real estate?

**Photo courtesy of Aaron Gellers Photostream via Flickr - Creative Commons License

Caution - true story below.   (Specifics changed to protect the privacy of someone but the meat and potatoes are there.)

Last week I received an email from a future Macomb County MI home buyer.  The email was cc'd to approximately 30 other Macomb County real estate professionals.  In the email the future home buyer asked each agent to send a list of all of the bank owned homes on the market that met the criteria that was stated at the end of the email.  After driving around and viewing the homes the future buyer would then call the agent who sent her the list with the homes she was interested in to represent her inher purchase. 

Nothing was said about what would happen if all 30 of us sent her lists and how she would handle choosing an agent to write her order (purchase offer).

In her defense I would like to point out something else in her email:  She is under a time crunch because of her financing and did not have time to call agents and wait for return phone calls.

Some of the things that ran through my head after I read it:

Buyers agency and 'what it is that we do' has not been explained to her.

The time it takes to properly represent a home buyer has also not been explained.  (I did some old fashioned math and averaged the hours I have spent with my last 3 buyer clients and came up with 73 hours representing their interests from start to finish.  This doesn't include the "after care" that I take with each one.) 

Where could I cut corners?   Of course I would have to cut some corners in switching modes to an order taker and not a performing my duties as a buyers agent.  But where?   My instinct told me there wasn't any aspect of my due diligence on my clients behalf that I would be comfortable cutting from my services.

I had a chance to make some quick money and I turned it down.  All I had to do was return her email quickly, perhaps pick up the phone and call her and introduce myself and tell her the list of foreclosures were on its way.  And oh, by the way, pick me!

I don't feel badly about it, in fact I feel pretty darned good about my decision.  I sent her an email wishing her well and congratulating her on being a future Macomb County home owner. I also advised her to ask the agents that responded about buyers agency.  I hope that after wading through all of the agents emails and phone calls that she picked someone who would be able to sit her down and explain buyers agency to her and what it is that we do.  Or, that she received a darn good order taker and everything goes smoothly for her!

~Kris Wales~  A partner for your real estate needs in Macomb County MI

Inevitably a phone call from a prospective home purchaser gets the wheels running
inside of my head and I ask the question:

"Could I have your permission to write a blog article about your question?"

With thanks to Lisa for her wholehearted agreement, here was her question:

"My apartment lease isn't up until October 1st, but I read your article about not
waiting until the fall to start the process to purchase a home.  I don't want to miss
out on the 1st time home buyers tax credit, but I also don't want to pay extra for
my lease and a mortgage payment.  What do you suggest?"

Lisa asked a very good question and one in which I'm sure many prospective home
buyers are asking themselves.

My advice to Lisa was pretty straightforward and simple:   Start gathering your
paperwork for your mortgage pre-approval and sit down with a mortgage lender (or
her bank or credit union loan officer).   

Lisa could then start to look for her new home in July and August, with a target date
to have an offer to purchase accepted by the end of August - early September.
Closing is taking approximately 30-45 days for an FHA mortgage.  With that in mind,
the home Lisa decides to purchase wouldn't close (become hers) until the end of
September - beginning of October. 

What about her October apartment rental payment?   She would pay for that and
not have a double housing payment as her first mortgage payment wouldn't be due until
November 1st.

Lisa thanked me for my time, but I was the one who was grateful that she called.
Her phone call stressed to me the importance of getting the word out to potential home
buyers who do not want to miss out on the First Time Home Buyers tax credit.  She also
was a very good sport and gave me permission to post her question here, so that others
could learn from the question that she asked.



~Kris Wales~  A partner for your real estate needs in Macomb County MI

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