Spokane Real Estate Sage Advice

6th Annual Garland Street Fair - Spokane Wa

Spokane Real Estate - Aaron Mallo (Soleil Real Estate Partners) — Sat, 16 Aug 2008 23:15:56 -0500

Garland Street Fair

Held today, August 16th, 2008. The Garland Street Fair is an all-day family event featuring arts and crafts, games for kids, live music on 3 stages, classic cars, face paiting and food vendors.

The Garland Street Fair is a tribute to Judy Garland and The Wizard of Oz.

The bright yellow brick road bobs and weaves through the center of Garland street, leading visitors from one end of the Garland street fair to the other. Today was HOT HOT HOT but thankfully a few booths offered shade, and a place to plop down for a few minutes and catch some time under a fan. There weren't too many food vendors today, so Kim's Teryaki (always a Garland District treat) was packed with hungy and thirsty patrons who could catch a break from the sun. Take a look at some pics: Thanks! Aaron

Free car seat safety check today in Spokane

Spokane Real Estate - Aaron Mallo (Soleil Real Estate Partners) — Sat, 16 Aug 2008 16:41:58 -0500

Spokane County Traffic Safety Commission is putting on a free car seat safety check

Today at WalMart on North Division from 10am - 2pm.
After doing a little shopping with Olivia (while Rebecca slept after working an overnight shift at Sacred Heart), I popped over. I wouldn't have known about the free car seat safety check except that I drove right past it! The volunteers were amazing. Several volunteers helped get me checked in, and a Certified Child Passenger Safety Technician performed the car seat check. After filling out a brief survey and taking an optional safety quiz, a Safety Technician came over and got me started. At first she checked the belts and buckles with Olivia in the car seat, then had Olivia pop out. She and her assistant removed the car seat, recorded the model and year made and did a search for any possible past recall notices. Then, she showed me how to (properly) install the car seat back in our car. The best part of the car seat check was the safety education. The questions they address are:

Is the car seat installed correctly?
Is the car sear the right size for your child?
Has your car seat been recalled.

Our technician talked to me about the benefits of newer car seat models. Ours car seat was made in 2002, which is on the cusp of what the safety experts would consider optimal. She also explained how different car seat models install differently in different cars depending on what safety features your car has. We also had a discussion about the increased safety of keeping Olivia rear-facing instead of forward-facing in her carseat.

The Spokane County Traffic Safety Commissions puts these car seat safety check workshops on about once per month.

Their last free check station was on Saturday, June 21, 2008 at AAA located at 1717 W. Fourth Avenue Spokane, WA.
Their next free check station is on Saturday, September 27th, 2008 at Dishman Dodge
If you don't want to wait until the next Spokane County Traffic Safety Commission workshop, you can have your car seat checked at 7 child-seat fitting locations around Spokane county. You can also call (509) 232-2985 for more information.

Thanks, Aaron

Spokane South Hill South Perry video tour - enjoy!

Spokane Real Estate - Aaron Mallo (Soleil Real Estate Partners) — Thu, 03 Jul 2008 13:36:46 -0500

I LOVE the South Perry District of Spokane, Wa, so I am very happy to be able to post this video of South Perry District on South Hill. Here is a Spokane real estate video tour project I've been working on for several months now (OK, several years actually).

I'm creating video tours of Spokane's neighborhoods, as a way quick way to hightlight what each neighborhood has to offer potenial buyer's who are considering investing in one of Spokane's homes for sale. I've been accumulating photos and videos over the past 24 - 36 months and am just starting to put them all together in video format.

What a blast, I hope I'm able to adequately capture the beauty of Spokane's neighborhoods and landmarks.

... continued... there is plenty more... Such as:

Thanks to those who helped with this project
Links to the business and landmarks you see in the video

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South Hill Spokane South Perry District video tour

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What do you mean... I can't rent out my condo?

Spokane Real Estate - Aaron Mallo (Soleil Real Estate Partners) — Fri, 20 Jun 2008 12:13:23 -0500

What do you mean...I can't rent out my condo?

Condos aren't common (yet) in Spokane real estate, condos for sale in Spokane represent less than 5% of all Spokane homes for sale.

However, for those that choose to purchase a condo as their Spokane real estate investment, this is an important topic.

A client of mine, who purchased a condo about a year ago, wrote to me today asking about limiting the percentage of condo units that can be used as rentals to 10%:

A neighbor of came by and had a petition to sign - that would limit the percentage of condos that could be rented - to ten percent of the total number of condos.

At first thought, it sounded good to me because it prevents the neighborhood from deteriorating with ever-increasing numbers of rental units. However, on second thought, I wondered: If that's such a good idea, why permit even ten percent? Why not vote to prohibit rentals altogether?

The rub, as I see it, is that after the first ten percent of owners eventually rent their condos out - then effectively virtually nobody else can do it regardless of unexpected circumstances or need. But, what would I do if I were transferred to another job location and forced to move - and found I could not sell at a reasonable price because of some downturn in the resale value of the condo?

I'm conflicted over the pros and cons of this issue - so I'm really curious about your take on it. I fully appreciate how dreadful it would be to have 1/2 the condos eventually turned into rentals. All the riff-raff would make the condo little different from living in an apartment - and that would obviously torpedo the resale value of the units.

On the other hand, I dislike the idea that the first 10% of condo owners to rent their units out, are free to do so if it suits them - but then the gangplank is pulled up and for all practical purposes nobody else can do it - even if there was an unexpected and important need....

What's your take on this interesting conundrum?

My Response: It's a good policy...

As far as a 10% cap on rentals, I tend to agree with it. My experience is that a 0% cap leads to lower property values and no cap leads to lower property values.

The reason 0% leads to lower property values is because you've decreased demand for the units by effectively cutting out any potential buyer who has either long-term or short-term plans of turning their new home into a rental. I actually had this happen. A client of mine wanted to purchase a condo and turn it into a rental in about 2 years when he purchased another home. We found a wonderful condo, quite a good value (cheap), and he really wanted to purchase it. I found out the association didn't allow ANY units to be rentals, so he ended up not putting an offer on the condo.

The reason no cap leads to lower property values is...

... continued... there is plenty more...

Such as:
Why 0% cap leads to lower property demand
Why no cap can lead to lower property values
How to get to be in the 10% that CAN use their property as a rental

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Purchasing a condo as an investment

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Suport Vlad Zablotskyy in his defense against ePerks.com frivolous suit

Spokane Real Estate - Aaron Mallo (Soleil Real Estate Partners) — Sun, 15 Jun 2008 22:24:18 -0500

WOW! I've sometimes wondered if "business ethics" is an oxymoron, and in this case, it is. If you've received an email from ePerks.com (similar to what I show here, I get these about 6 times per month), it would be in your best interest to Google ePerks and read up on their lawsuit against Vlad Zablotskyy from and decide if you REALLY want to do business with a company that employs the unimaginable business tactics they have. I was never inclined to, but now I know I absolutely will never do business with ePerks, period.

EXCERT FROM ePerks SPAM/OFFER: "I need to establish a relationship with a reliable buyers agent that my broker can work with to close transactions for our clients and who are open to paying us a 19% referral fee after closing a transaction with the buyers. This is not a lead generation program. I will not send you lists or ask you to cold call customers or charge you per-lead fees. Our clients come to you when they are prepared to buy or sell their home because they are using our program to get a significant amount of cash back from us when they close escrow with one of our partnered agents."

My understanding of the case is that ePerks.com CEO Ben Behrouzi originally hired blogger Vlad Zablotzkyy (from Go-Beyond-MLS.com) to write a paid review of ePerks.com. Comments from Vlad's post poured in with disgruntled, angry and flat out p***ed off agents and brokers who felt they had been duped by the company.

Needless to say, ePerks didn't expect the result and wanted the comments and negative press removed. The served Vlad with a Cease and Desist order to remove the comments. Around the same time as all of this, false child molestation charges started popping up on the web against Vlad. Vlad put together anecdotal evidence that these charges were coming directly from ePerks! Because of the anecdotal evidence he posted, Vlad is being sued by eperks. The complaint states that Vlad incorrectly accused ePerks of making the false child molestation claims against him. The truth is that he simply provided anecdotal evidence.

Andy Beard's detailed chronicle of the entire story: http://andybeard.eu/2008/06/ihype-eperks.html
Dennis Pease, an agent in Florence Oregon believes ePerks is the worst company he has ever seen (take a look at the email correspondence, amazing!) http://activerain.com/blogsview/310746/Beware-of-eperks-com
Vlad's account as to why he finally had to remove the comments from dissatisfied ePerks subscribers http://www.go-beyond-mls.com/eperks/

Support Vlad Zablotskyy's Defense Fund
Defend your own right to free speech!

I Love FHA, And So Do My Clients

Spokane Real Estate - Aaron Mallo (Soleil Real Estate Partners) — Wed, 11 Jun 2008 21:50:59 -0500

I Love FHA, and so do my clients

I love FHA. I love everything about it.

If I could I'd send FHA a little love note and flowers and take FHA out on a date. We'd go to the new Churchhill's steakhouse in town, then head for a nice stroll along Riverfront Park. I hope my wife doesn't mind, I've invited FHA to move in with us.

FHA-insured mortgages have been the saving grace in an otherwise bloodied lending landscape. My clients have benefited immensely from FHA-insured mortgages. Just this week a client of mine, about to close on a house using an FHA mortgage, wrote to me and said "Thankyou for all the small but significant things you do for us besides the big things... helping us with our investment planning (two homes)..."

See if this scenario works for you...

The Scenario:

My clients' credit score is marginal, right around 600
They only have about $2,000 in savings
My clients own a beautiful home in Spokane in a neighborhood they aren't particularly fond of
They are do-it-yourselfers, hooked on DIY-network and have done about all they can to their current home, it is absolutely darling
They'd like to move into and rehab a similar-sized home around Corbin Park, a neighborhood they've been eyeing for a few years
Although they don't like their neighborhood, my analysis shows their neighborhood will appreciate at an above average rate due to certain coming, positive changes in the neighborhood

The Solution: Turn their current home into a rental, purchase and move to the Corbin Park home

My team pre-approved them for an FHA mortgage, and we got them a wonderful Corbin Park house under contract
I photographed and built them a website to post their current home for rent (to protect my clients' privacy, I haven't linked to their website)
I taught them how to create Craigslist postings to drive traffice to their site
I set them up with a rental application form and prefilled rental agreements and instructions on how to find a tenant

Why FHA:

With their low credit score, they'd be paying about 1/2 % higher mortgage rate if they

... continued... there is plenty more...

Such as:
How much my client was out-of-pocket in order to move into their new home (it closed today, actually. They have the keys and are already starting renovations)
What happened to their loan when my client lost their job

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Purchasing Spokane real estate with FHA financing

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2 Agent Misunderstanding That Can Ruin Your Real Estate Transaction

Spokane Real Estate - Aaron Mallo (Soleil Real Estate Partners) — Wed, 11 Jun 2008 21:29:37 -0500

2 Agent Misunderstandings That Can Ruin Your Transaction

Two of the more common mistakes I see on real estate contracts is

The use of escrow "allowances" such as carpet, paint, roof or landscaping allowances for the buyer after closing

Incuding personal property in the real estate transaction.

The short answer is, neither of these is allowed by lenders.

Allowances / Holdbacks / Credits

The idea is, you'll buy my house from me, at closing I'll let the escrow keep $xxxx dollars from me for you to use on repairs to the house.

Just this morning I ran a search on the Spokane MLS for the word "allowance" and found 37 listings offering escrow allowances:

Buyer to receive $10k roofing allowance w/acceptable offer at closing.
$4,000 exterior paint allowance to buyer at closing.
Up to $5,000 driveway allowance, paid at funding.
With acceptable offer seller will offer $10,000 credit on HUD as a repair allowance to the buyers.

Seems fine and dandy, until you try and get your loan funded. The loan underwriter will shoot this down faster and harder than Dick Cheney taking aim on a quail hunt.

What we are NOT talking about is having the seller contribute cash toward the buyer's loan closing costs. This is a perfectly legitimate and accepted practice from the lender's eyes. What we are talking about is the seller leaving a credit, at escrow, for the buyer to make repairs to the house post-closing. Let's see what the loan underwriting guidelines say...

From CitiMortgage Conforming underwriting manual, Section 806

Escrows for repairs on existing properties are not permitted

No sugar-coating here. Note, escrows are allowed on new-contruction homes only.

From BB&T Mortgage Conforming Underwriting manual, Chapter 4:25

BB&T does not encourage escrowing for completion or repairs, However, if the improvements or repairs cannot be completed for valid reason, i.e., inclement weather or shortages of materials, funds may be escrowed

Seems fair, BB&T is willing to bend the rules for situations absolutely out of control of either buyer or seller.

Even FHA Underwriting Guidelines Page 1-8 Paragraph B of HUD document 4155.1 REV-5

Certain expenses... paid on behalf of the borrower, as well as other inducements to purchase, result in a dollar-for-dollar reduction to the sales price before applying the appropriate LTV ratio. These inducements include decorating allowances, repair allowances, moving costs, and other costs.

Aiy Aiy Captain! No-can-do!

Why would a lender care about this? If your house appraised for the sales price (or more), what does the lender care what the seller does with their money? If the seller was feeling generous and wanted to leave a $100,000 credit for improvement to the new buyer, why is it the lender's business?

... continued... there is plenty more...

Such as:
A solution to leaving the buyer a credit at closing
Problems related to purchasing personal property in addition to the house you have under contract
A little wit and humor thrown in the mix (hey, why not?)

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Spokane real estate agent mistakes that can ruin your transaction

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Spokane real estate market update June 2008

Spokane Real Estate - Aaron Mallo (Soleil Real Estate Partners) — Wed, 11 Jun 2008 21:19:27 -0500

Our Spokane real estate market according to the Spokane Association of Realtors

What the Spokane Association of Realtors says about Spokane Real Estate:

There were 489 sales reported in May compared to 441 reported in April. The average sales price was up 1.3% from April. May's average sales price was $206,284 while the median sales price was $183,000."

Again, here is what the MLS data tells us....

When we look at the Spokane MLS Real Estate statistics, what are we really looking at?

Everything. Every property type. Every city within the MLS. Which is why I don't like using the MLS stats. Generally, when we discuss the Spokane real estate market, I want to know about single-family homes in and around Spokane, not in Colville, Spangle, etc. Not condos. Not 120 acre parcels. Nothing wrong with these communities or property types, but I want to know about, analyze and discuss Spokane houses.

So, let's look at Spokane houses (a subset of the Spokane Real Estate MLS data), as of June 9th, 2008:

(The footnote states: Includes sales data from Spokane, Spokane Valley, Millwood, Veradale, Liberty Lake, Medical Lake & Airway Heights on Single Family Houses on <= 1 acre.)

... continued... there is plenty more...

Such as:
5 additional bar and chart graphs
Analysis of the trends in the Spokane real estate market

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Spokane Washington Real Estate Market Update June 2008

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New website for Spokane Real Estate

Spokane Real Estate - Aaron Mallo (Soleil Real Estate Partners) — Thu, 29 May 2008 22:16:05 -0500

Hi All,

I just launched my blog for Spokane Real Estate at TheSpokaneDirt.com which I am rather proud of. I find creating useful content for others is quite a time consuming challenge, but once an article is written and out there, I am so proud and happy that I can contribute to other.

Warm regards,

Aaron

Homebuyer Tip - Applying For Home Financing

Spokane Real Estate - Aaron Mallo (Soleil Real Estate Partners) — Sun, 11 Mar 2007 15:27:05 -0500

How quickly must I apply for a loan?

Many sale agreements require buyers to apply for a mortgage within a specific time period, say five business days after the contract is signed. This is a negotiable item, however, and can be any period agreeable to both parties. Of course, a stronger offer would have a shorter time period.

This is an important matter because if an application is not made in the agreed upon time period, then a buyer may be in violation of the sale agreement. A violation of the sale agreement, in turn, could be grounds to forfeit the earnest money deposit to the seller. Thus, buyers should go through the sale agreement with great care before signing to assure that all obligations are known and understood. Work with an appropriate professional such as a buyer's agent (if you are in the Spokane market, give me a call) when reviewing a sale agreement.

When you meet with a lender, be certain to obtain a letter stating that you met and showing when. Immediately provide this letter to the seller's broker in the manner required by the sale agreement.

Thanks,

Aaron

Homebuyer Tip - Rental Income

Spokane Real Estate - Aaron Mallo (Soleil Real Estate Partners) — Sun, 11 Mar 2007 15:22:08 -0500

Can I rent out a room to help me qualify for a loan?

Generally no. Lenders have no assurance that such income will be regular and continuing. If you intend to live in the single family residence that you are purchasing, very few lenders will allow you to use "boarder income" or "roommate income". Occassionally I'll come across a lender that allows such arrangements (OwnIt Mortgage did before they went out of business 2 months ago).

View dozens of videos, hundreds of photos and thousands of Spokane real estate listings here.

Thanks,

Aaron

Homebuyer Tip - Seller Contributions

Spokane Real Estate - Aaron Mallo (Soleil Real Estate Partners) — Sun, 11 Mar 2007 15:17:43 -0500

What is a "seller contribution?"

Lets say you find a Spokane home that you want to puchase. Your agent will help you write up a sales agreement to purchase the home. A sale agreement typically includes both a purchase price for the property as well as terms and conditions. It sometimes happens that a buyer will make an offer subject to certain terms. (I'll buy your house, but I want to keep the washer and dryer, etc.)

One possible condition concerns "seller contributions." (For example, I'll buy your house if you will pay the first $x of my closing costs.) Lenders will generally accept seller contributions as part of a transaction providing they are written into the sale agreement, fully disclosed and only represent a limited fraction of the sale price. Different loan programs have different contribution caps. Lenders and brokers can provide specific advice.

A seller contribution can be a useful bargaining chip in slow markets. (Buy my house and you can have a credit of $x at closing.) It's a thought that goes a long way with cash-strapped buyers.

Thanks,

Aaron

Homebuyer Tip - Pros and Cons of Land Contract

Spokane Real Estate - Aaron Mallo (Soleil Real Estate Partners) — Sat, 10 Mar 2007 13:09:07 -0600

What are the pros and cons of a land contract?

A land contract may allow a buyer to obtain real estate even if he or she is not able to obtain financing through regular loan channels. A land contract may allow a seller to market a property when interest rates are high.

If a buyer with limited financial capacity purchases with a land contract, then a seller may have problems collecting monthly payments. However, since a buyer with a land contract does not have title until all conditions are met, it is often possible for the seller to get the property back with a "forfeiture" rather than a "foreclosure." The attraction of a forfeiture is that it is much quicker to obtain than a foreclosure. It is also a complex undertaking that should only be done with an attorney.

If a land contract involves the use of existing financing that cannot be assumed, that could set-off a due-on-sale clause. Both buyers and sellers could lose the property if the loan cannot be repaid.

Or, suppose Seller Jones sells a property to Buyer Smith using a land contract. Title will remain in Jones' name until Smith makes a certain number of payments. But suppose that Jones goes bankrupt. What rights does Smith have to the property? Or, suppose Jones does not pay the property taxes? If the local government forecloses, what rights does Smith have?

Also, what happens if Seller Jones goes off to Tahiti? How does Buyer Smith get title?

Land contracts should be seen as complex arrangements. Both buyers and sellers should consult an attorney or legal clinic (separately) to assure that all aspects of the transaction are fully understood.

Thanks,

Aaron

http://www.SpokaneVideoTour.com

Homebuyer Tip - Land Contract

Spokane Real Estate - Aaron Mallo (Soleil Real Estate Partners) — Sat, 10 Mar 2007 13:08:10 -0600

What is a "land contract?"

A "land contract" or "contract for deed" or "agreement for sale" is an installment sale you buy today but only get title after some or all of the payments are made. If you miss a payment, you could lose some or all your equity. Because title has not been transferred, there is nothing to foreclose. Some states, however, have special provisions protecting those who buy property with a land contract.

Be careful in a land contract situation to look at the proposed financing. Is lender approval required? If yes, and such approval is not received, the loan could be called.

State rules regarding land contracts vary extensively and such arrangements should be reviewed by an attorney or legal clinic before acceptance.

Thanks,

Aaron

http://www.SpokaneVideoTour.com

Homebuyer Tip - Due-On-Sale Clause

Spokane Real Estate - Aaron Mallo (Soleil Real Estate Partners) — Sat, 10 Mar 2007 13:06:57 -0600

What is a "due-on-sale" clause?

When a home is financed, the borrower agrees to make regular monthly payments. However, if those payments are not made, if they are late, or if the lender's security is reduced (by not making payments, damaging the property, not maintaining insurance, not paying property taxes, selling the property, selling a part of the property by placing someone else on the title, etc.), then the lender has the right to call for the complete and immediate (say within 30 days) repayment of the loan. The mortgage language outlining the lender's rights is generally called a "due-on-sale" or "acceleration" clause. One effect of a due-on-sale clause is that it effectively prevents a loan from being assumed.

Borrowers should note that state and federal law may limit the ability of lenders to enforce a due-on-sale clause. For instance, a title change in the event of an estate situation may be allowed.

Thanks,

Aaron

Homebuyer Tip - Down Payment

Spokane Real Estate - Aaron Mallo (Soleil Real Estate Partners) — Sat, 10 Mar 2007 13:04:41 -0600

Can I discount the sale price to create a down payment?

No. Lenders provide financing based on the sale price or the appraised value, whatever is less. In the case of a "discounted" price, say selling a home worth $250,000 for $240,000, the sale price is $240,000. Lenders do not recognize a discount.

A better approach is to pay full market value but to make the transaction dependent on a "seller contribution" at closing. The effect is the same, but the accounting makes more sense to lenders.

Thanks,

Aaron

Homebuyer Tip - Sweat Equity

Spokane Real Estate - Aaron Mallo (Soleil Real Estate Partners) — Sat, 10 Mar 2007 13:03:20 -0600

We are handy and want to buy a house using sweat equity for a down payment. Will lenders go for this?

From time-to-time, you hear about lenders that allow the use of sweat equity as a credit toward a down payment, but not all of it. Most lenders, however, are not thrilled with this concept. The problem is valuing labor. If a professional paints a house there is work completed to a given standard (that helps maintain the value of the home, and the lender's security if the loan is defaulted) and there is a bill for labor and expenses (paint, caulk, etc.).

With sweat equity, there can be a cost for supplies, but how is labor valued? At the same rate as for a professional? A discount? And what about workmanship?

The best approach is to speak with as many lenders as possible to see if they have a program that allows the use of sweat equity. Ask about the maximum sweat equity contribution allowed, total cash needed to close, rates, points, etc.

View a mix of fixers and already beautiful, "cream-puff" Spokane houses at http://www.SpokaneVideoTour.com

Thanks,

Aaron

Homebuyer Tip - Accessible Housing Options

Spokane Real Estate - Aaron Mallo (Soleil Real Estate Partners) — Sat, 10 Mar 2007 13:00:23 -0600

Where can I get more information regarding accessible housing options?

Try the following sources:

•· State architectural associations.

•· Local builders.

•· State and local builder organizations.

•· Hardware and building supply outlets.

•· University architectural schools.

•· The library of the National Association of Home Builders in Washington, DC.

•· Local public housing agencies.

•· Local chapters of associations that serve those with special needs.

Homebuyer Tip - Offering Less Than Asking Price

Spokane Real Estate - Aaron Mallo (Soleil Real Estate Partners) — Sat, 10 Mar 2007 12:59:26 -0600

We made an offer on a home that was about 5% below the asking price. Our offer was rejected. What can we do to make the owners more reasonable?

Who says the owners aren't reasonable? They have established a market price for their home. If they can get that price within a reasonable time frame, then they have logically priced their home. If the price cannot be obtained, they will lower either the price or the property will be withdrawn from the market. Because your experience in a different market made selling at a loss acceptable, that does not mean the same logic applies in other markets, or that your choice should in any way impact the sellers. Perhaps it would make sense to restructure your offer - maybe raise your price but seek better terms.

Thanks,

Aaron

Homebuyer Tip - Buying Real Estate With No Money Down

Spokane Real Estate - Aaron Mallo (Soleil Real Estate Partners) — Sat, 10 Mar 2007 12:57:38 -0600

Can I buy real estate with no money down?

Yes. Millions of people have bought real estate with no money down through the VA loan program, or using conventional mortgage financing requiring zero down payment.

If you mean, can you buy real estate at a discount of 20% or 25% with no cash or credit, and then instantly sell or rent the place at a profit, then the answer is probably not. Why "probably" instead of "absolutely" not? Because in a marketplace with millions of transactions each year, somebody somewhere has made a deal with no money down and rented or sold at a profit. But it is also true that somebody somewhere was hit by lightening. The problem is that the term "no money down" is sometimes in the worst cases a code expression for a deal where someone without cash or credit wishes to buy property from someone who is needy, unsophisticated, desperate, in mourning, etc. Under the guise of "helping" the owner, buyers offer to purchase property at 20% off, or more, and with subordination and substitution clauses. Of course, if purchasers really meant to be helpful, they would surely pay full market values. Let's be clear. If no-money-down schemes are so wonderful, why do folks who engage in such investments have a need for "partners" with cash?

Rather than get-rich-quick tapes and seminars, prospective investors are best served by taking a basic real estate license class in your state. This will explain much about financing, marketing, title, and other issues. It will also allow an individual to take the entry-level real estate exam and qualify for a license.

See dozens of videos, hundreds of photos and thousands of Spokane real estate listings for sale at http://www.spokanevideotour.com/

Thanks!

Aaron

Homebuyer Tip - Owner Occupied loans

Spokane Real Estate - Aaron Mallo (Soleil Real Estate Partners) — Sat, 10 Mar 2007 12:43:09 -0600

How long must I live in a house once I buy?

When you apply for a loan, a lender will ask if you intend to use the property as a primary residence. If the answer is "yes," then it is expected that you will physically move into the property and live there for some time. There does not seem to be a set definition in the term "some time," but what lenders are getting at is this: They do not want to make residential loans with low rates and little down to investors. From the loans I've seen, the typical expectation is that you'll live in the home for at least 1 year.

Thus, if someone gets a residential mortgage, instantly moves out, and quickly rents the place, lenders will be more than unhappy - they may call the loan. They may also review the loan application to see if fraud was involved. Lenders do not want borrowers to move in and then rapidly move out, but they will look at the "facts and circumstances" if such an event occurs. For instance, a sudden job change not known in advance might be a valid reason for a move after several months of occupancy. What lenders do not want are situations where a "residential" borrower is actually a disguised investor. Given that most homes are occupied for 8-10 years, a move after several months or a year is likely to set off bells.

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Thanks!

Aaron

Homebuyer Tip - "As Is" sale

Spokane Real Estate - Aaron Mallo (Soleil Real Estate Partners) — Sat, 10 Mar 2007 12:38:59 -0600

What is an "as is" sale?

An "as is" property is sold without a warranty as to condition, repairs, or structure. With an "as is" sale, the buyer is on notice that the seller makes no promises regarding the property's physical status. With an "as is" sale, it is extremely difficult to make a claim against a seller if something is found to be wrong with the property after closing. "As is" clauses should be seen as an absolute requirement to make the transaction contingent on a professional inspection "satisfactory" to you. With a properly written sale agreement contingency, if you are not satisfied, then the deal is dead and you can get back your deposit in full.