JasonDemers.com

First-hand insight into the area’s housing trends!!

2009-05-01T10:56:00.003-04:00

Get first-hand insight into the area’s housing trends with a brand new video that features highlights of the Trends in Housing Report. Listen to Sandy Paul, Delta Associates’ National Research Director, discuss what is most critical for Buyers / Sellers and MRIS customers to know about the area’s current housing market. The full First Quarter Trends in Housing report is available at http://www.mris.com/reports/trendsreport/Q1%202009%20Trends%20in%20Housing%20Report.pdf

Common Short Sale Q & A..............

2009-04-28T15:42:00.002-04:00

- How much time do I have? Do I have to start now?
- It is best to begin a short sale when you realize you can no longer afford the mortgage, so that your property can be marketed properly and you can receive a high offer. The earlier you start, the higher our likelihood of success. Remember that your lender requires a purchase offer to review your eligibility for a short sale and it may take a few weeks to get a solid offer.

- Do I need to be in default to qualify for a short sale?
- NO, more and more lenders are considering short sale requests from homeowners who are not in default. However, you must be experiencing a financial hardship that points to imminent default if you are unable to sell.

- What will happen If I do nothing?
- If you do nothing and are not making your mortgage payments, your lender will foreclose. You will have a foreclosure on your credit report, be liable for any deficiency, and/or subject to a taxable event.

- Will I get any money when the property sells?
- NO, for the majority of loan types you are not allowed by your lender to receive any proceeds from the sale of your home. If you have an FHA loan, you may qualify for their pre-foreclosure sale program that does have a selling incentive.

- What if I file bankruptcy?
- Filing bankruptcy will not stop the foreclosure process, just delay it. The property will eventually be discharged from bankruptcy protection and be back in the foreclosure process where it was when bankruptcy was filed. For further bankruptcy information, please seek the advice of legal counsel.

- What is better on my credit – Foreclosure or Short Sale?
- Please consult your own financial advisor or the credit bureaus directly for the answer to this question. From experience only, we can say that foreclosure is much more damaging to your credit. A short sale will most commonly be listed as “settled debt” and is much less harmful to your credit.

- Will I be liable for my lender’s financial loss?
- Depending on your situation you may or may not receive a deficiency judgment or taxable event. It is best to consult an attorney for advice regarding any debt liability. Now, there have been recent changes in the law that reduce homeowner tax liability. Find more information on IRS web site regarding The Mortgage Forgiveness Debt Relief Act and Debt Cancellation. Most tax consequences have been done away with for primary loans on primary residences. Regarding deficiencies – you can have your agent request in the negotiations a full release of lien and that your lender consider the debt settled or satisfied. The bank has the right to ask you to sign an unsecured note or to ask you contribute money at the time of closing. Be sure your agent negotiates the best outcome for you.

- What other advice should I seek?
- Be smart. Always seek professional advice from a qualified attorney and an accountant specializing in Short Sales/Pre-Foreclosure Sales.

- What about the federal government bailout programs?
- To determine your eligibility, please visit www.FinancialStability.gov or www.treas.gov/initiatives/eesa/

- Why do lenders or banks accept discounts?
- A Lender or bank takes a discount or agrees a short sale because it saves them money. It gets bad debt off their books so they can reinvest that money by giving out another loan to a customer. On average a Lender loses between $30,000 to $80,000 on each property that they take back as a bank owned property. In many cases a short sale is necessary in order to get you out from under your mortgage debt. By doing a short sale, you will be able to take a large bite out of the money you owe to your mortgage company, so that you are no longer liable for the entire amount.

- Will every lender or bank allow a short sale?
- The answer is no. The majority of the lenders do short sales however; there are a select few that do not do short sales.

- How do I know what type of loan I have?
- Knowing what type of loan you have is crucial to the process. There are often specific short sale requirements unique to each loan type. You can find this information by looking at your mortgage statement, the settlement papers from when you originally purchase the property, or by calling your lender.

- Will Lenders or Banks do short sales if the mortgage is current?
- Some Lenders will entertain taking a discount when a homeowner is current on their mortgage however they typically require the property to be listed for sale by a licensed real estate agent.

- How long do I need to be in default before I can start a short sale?
- This depends on the Lender. Some Lenders require a property to be 90 days in default before they will entertain a short sale offer; other Lenders will entertain a short sale even if it is not in default.

- Can the owner of the property also be the listing agent?
- Good Question! There is absolutely nothing wrong with that set up. The agent owner or agent spouse is not a financial beneficiary of the short sale by virtue of her commissions, therefore there is no conflict. BEWARE however. There is a small chance that some Lenders could take issue with it and reduce the owner’s side of the commissions accordingly.

- What is required to process a short sale?
- Every Lender or Bank has its own set of required information and some may even have a set of paperwork specific to them. But, in general, most banks require at least the following: A handwritten hardship letter, financial statements, 2 years tax returns, 2 months bank statements, 2 months paystubs, and that you have the property listed for sale at fair market value. Throughout the process additional paperwork may be requested. So, be sure to keep everything handy.

- What is the process?
- The steps and process of a short sale can be broken into 9 main steps. The most important parts of the process for you are to help in the beginning to gather the paperwork required and to help list and sell your home. As your short sale is negotiated, you will be provided regular updates throughout the process.

- How long does a typical short sale take?
- Depending on what state you are from, this answer will vary. For example in the State of Connecticut a short sale typically takes between 2 to 4 months. The short sale time-line is subject to your Lender or Bank. Many banks are overwhelmed right now with short sale requests. However, most do have an understandable review process. Unnecessary delays can be avoided by not sending incomplete short sale packages. Incomplete offers are often passed over or rejected. Your file is then closed and you would have to start over from the beginning. It is very important to be sure you provide everything required by your Lender and requested by the person helping you negotiate.

- Can 2nd Mortgages or junior liens be discounted?
- Yes, absolutely. In fact, if the first mortgage is being asked to accept a discount, they will require that all other lien holders discount as well in order to give short sale acceptance.

- Can IRS tax liens be negotiated?
- Yes, absolutely. Tax liens can be released from a property or reduced and paid at closing. Please consult the appropriate tax professionals for more information.

- How will I know what is happening in the short sale process?
- If you provide an email address that you check daily, you will be given continuous e-mail notification from "SAAB - Manage My Short Sale" online system each time something is done to your file, new paperwork is needed, notes are posted, or any progress is made.

- Do I need to call my Lender?
- No. You are not required to call your lender. However, in certain instances it is often helpful to the process for you to call.

- What is an Authorization to Release?
- This gives the people negotiating on your behalf permission to talk with your lien holder(s).

- A foreclosure sale date has been scheduled for my property. Can I still short sale my property?
- Yes, absolutely. However, certain immediate steps may be necessary to get the foreclosure date postponed. You need to quickly complete the package of required forms, get your property listed right away, and cooperate wholly with your agent. A 3-way call to your lender may also be necessary to speed up authorization. There are no guarantees that there is enough time to get a postponement.

- Will the foreclosure process stop when we submit a short sale offer to the lender?
- No. The foreclosure clock will continue to tick. Postponement requests can be made if necessary. Your Lender will only postpone foreclosure proceedings if they are certain a buyer will perform.

- When should a default property that needs a discount be listed?
-Immediately. The Lender typically will not stop or slow down a foreclosure unless a property is listed for sale by a licensed real estate agent.

- Must a property in default be listed?
- Yes and no. Some Lenders require a property to be listed when they take a short sale or short payoff. Ask the Foreclosing Lender, at the beginning of your short sale, whether you need the property listed.

- I am not going to list the property that low…my neighbors’ house just sold 2 years ago for $50,000 more than that.
- I understand. However the market has changed and every property is different. There has been a reduction in the average value of comparable homes in your area and you must sell your home right away to avoid a possible foreclosure. To do this requires that you list your home at a price that will sell. Understand that Buyers will always look for the best deal. If your property is priced higher than competing homes, Buyers will pass it by.

- I do not want to advertise the home as a short sale, pending foreclosure, or any other negative ownership conditions.
- We understand. Depending on your circumstances it may not be necessary to advertise your situation. However, you need to list the home at a price that is below what you owe. That means that all offers you receive must be contingent upon approval of a short sale. Most are an MLS (Multiple Listing Service) guideline requiring that such contingencies be fully disclosed. The remarks must, at the very least, include that the sale of the property is “subject to third party approval.”

- Will all offers be contingent?
- Yes. It is likely necessary to list your home for an amount that is less than you owe on your mortgage and not enough to cover all other associated fees. To sell requires short sale approval from your Lender or Bank. That makes all offers received subject to your Lien Holder(s) approval of a short sale.

- I want my lender to consider the debt paid in full at closing. Can I include this request in the contingency?
- Yes. However, not all lenders will honor such requests. If this is important to you, be sure that a special stipulation clearly defining your request is included in all purchase offers.

- Do we have to have a purchase offer to get short sale acceptance?
- Yes. Most lenders require that a short sale offer be submitted before they will even accept a short sale package, order an appraisal, and make their review. They typically will not spend the time and resources to review your situation unless they know that a buyer will perform.

- How will the short sale of my home affect the property values of my neighbors?
- Should your neighbors have their property appraised in the next few months, their appraiser will use recently sold comparables to determine value. Appraisers generally do not include any ‘distressed’ sales, like the sale of your home, in their evaluation. In the long run the average property values in your neighborhood will not be damaged by the short sale of your home as much as they would if the property became bank-owned. Vacant foreclosure listings that sit for long days on market and then sell at heavily discounted prices are much more damaging to neighborhood home values.

- I cannot afford to make any repairs…
- When you are listing your property make sure your real estate agent adds the remarks “home to be sold AS-IS”. By doing this, Buyers will be aware that you cannot or will not make any improvements on the property. Be sure that your agent clearly expresses this to the Selling Agent and protects you in negotiations.

- Can an immediate family member buy the home and I stay living here?
- Typically not. The foreclosing lender will not allow anyone to purchase the home through which you could become a direct beneficiary of the property and potentially re-sale for a profit. Furthermore, by allowing you the privilege of a short sale you are required to relinquish all use and benefit associated with the property.

- My situation has changed and I can afford the monthly payments. Do I have other options?
- Yes. Be sure to research your options. Your agent may be able to assist you further.

- My situation has changed and I am making enough money to rent but not enough to pay my full mortgage, but I still need to do a short sale to sell my property. Should I save the extra money?
- Yes, absolutely. You will need money for moving expenses. Also, in some rare instances you can offer a good faith payment to your lender to encourage them to approve your short sale.

- Can I make any money on the sale of my property?
- A homeowner cannot accept money from the sale of their home if a Lender accepts a short payoff or a short sale. However, there are exceptions to this statement; for example an FHA (Federal Housing Authority) insured loan will allow a homeowner to receive $1000.00 when taking a short payoff.

- Will I need to bring money to closing?
- In most instances you will not. A short sale is designed to assist the homeowner. All items due and payable at closing are meant to come from the Buyer’s funds. You will generally not have any out-of pocket costs to pay real estate commissions, closing costs, or any other items due and payable at closing.

- Do I have to pay any processing fees or real estate commissions if the short sale is not successful?
- If a ready, willing and able buyer is not found and the Foreclosing Lender does not accept “an acceptable offer” then there will be no expenses due from the seller/homeowner. Make sure your real estate agent disclosed that the sale is “subject to lien holder(s) approval or 3rd party approval” so that you are protected.

- I may file bankruptcy. Will this affect the short sale?
- Yes. If you file for bankruptcy protection you Lender or Bank will be unable to discuss the terms of your short sale until the bankruptcy is released or discharged. A bankruptcy puts an “automatic stay” on any credit/debt collections which include negotiating a short-pay of your mortgage(s). Any pending foreclosure sale dates will be postponed as foreclosure is also a credit collection. Be sure that you inform your agent immediately upon making this decision. If you choose to file, please provide your agent with any paperwork involving the property that you receive from the Lender of bankruptcy trustee. For further information, please consult with a bankruptcy attorney.

- What happens if the Bank or Lender counters the current offer?
- The Buyer will need to either increase their offer to meet that number or your agent will need to find another buyer that meets your Lender’s requirements.

- Will filing bankruptcy STOP foreclosure?
- No. Filing bankruptcy will not stop the foreclosure process, just delay it. The property will eventually be out of bankruptcy protection and be back in the foreclosure process where it was when bankruptcy was filed. For further bankruptcy information, please seek the advice of legal counsel.

- How does a bankruptcy affect my credit?
- Bankruptcy will stay in your credit reporting agency files for ten years. Now, declaring bankruptcy doesn't necessarily mean that the door to future credit will be forever closed to you. If you take the proper steps after declaring bankruptcy and also manage your credit responsibly, you can rebuild an improved credit reputation in a few years. Please consult a credit counselor or a major credit bureau for more information.
- How many years after filing bankruptcy can I buy a house?
- You will not have to wait 10 years to be considered for a home loan. However, do expect to wait at least five years and only then will a lender consider your loan application if you have stayed current on your bills after the bankruptcy.

- How many years after a successful short sale can I buy a house?
- There are new loan programs designed to help people who have recently had to short sale their home. You can apply for a home loan in as little as two years provided you have maintained your credit with good payment history, kept your debt-to-income ration within lending guidelines, and have verifiable income.

- If I let the bank foreclose on my house, how long until I can purchase another property?

- Unfortunately, there is no specific answer for it except to say that it could be a considerable amount of time (more than the 2 years on a successful short sale). Most lenders view your financial history as an indicator of what you will likely do in the future. If you missed several months of mortgage payments leading up to your foreclosure, then a lender will see you as a likely candidate to default on a future loan -- in other words, you are a big risk.

- Will I receive a 1099 if my mortgage lender takes a discount?
- Yes it is an IRS code. The IRS code states that “a reduction of debt is a taxable event.” However, the Government has passed the Mortgage Debt Forgiveness Act. It states that for a certain period of time, some homeowners with primary loans on primary residences may be exempt from receiving a 1099. Please click here for more information or consult a local tax attorney in your area for any changes or updates in reference to this Bill.

- This is an investment property, not a primary residence. In this situation, will the reduction of debt be a taxable event?
- Yes it is an IRS code. Since the property is not a primary residence, you may not be eligible for an exemption. Please see the answer to the previous question.

- Can I do a short sale on more than one property?
- Yes. You may short sale more than one property.

- Someone told me that I can file as “insolvent” if I receive a 1099 from my lender?
- There are certain tax codes that enable someone in a financial hardship to be exempt from any tax liability outside of the exemptions already allowed in the Mortgage Debt Forgiveness Act. Please consult with a tax accountant for more information.

- Will the Bank or Lender pursue a deficiency judgment for the amount they lost from the short sale?
- Your lender can pursue a deficiency. This does not mean that they will. You can have your agent request in the negotiations a full release of lien and that your lender(s) consider the debt settled or satisfied and paid in full. The bank could ask you to sign an unsecured promissory note or to ask you contribute money at the time of closing. Be sure your agent negotiates the best outcome for you.

- What if my lender requests a promissory note or money at closing?
- Your lender can make such requests. Whether or not you choose to agree must be a personal decision based upon your financial situation. Keep in mind that any amount requested by your Lender or Bank will likely be much less than they could potentially pursue from you as a deficiency judgment if the property were foreclosed upon.

- Will I need an accountant?
- We always recommend that everyone in your situation seek the advice of an accountant or other tax professional.

- Do I need an attorney to represent me?
- It is always important to seek legal counsel when making these types of decisions.

- I am behind on property taxes…
- These can be negotiated into the buyers offer and paid at closing. The payment of taxes owed will simply be another reduction in the amount paid to your Lender. Please note: if the Lender forecloses on your property, this is an expense they will have to pay.

- I have not paid my HOA dues…
- We will negotiate a discount for all current and past HOA dues and have them paid at closing from the funds to your Lender.

- Can I rent the property?
We cannot advise you to or not to rent the property. Keep in mind that if you are not paying the mortgage payment you should not be profiting from rental payments. If you chose to rent the property be sure to keep accurate expense records and put all rents earned in escrow due to the fact that if you are not paying your mortgage then those rental payments are owed to the foreclosing lender (s). Please consult a real estate attorney before making this decision.

- The property is vacant. Do I have to keep the utilities on?
- No. However – it would be very helpful to your agent to leave all utilities on for Buyer inspections. If it is winter time, be sure that you have winterized the home properly before having utilities turned off.

- When should I move out?
- Different loan types have requirements regarding occupancy that could affect your eligibility for a short sale. Before making the decision to move, be sure that you have talked with your agent and your Lender about your plans.

- Can I take anything with me?
- Anything that you are going to take from the property needs to be clearly disclosed to any Buyers viewing the property. Be sure to leave all fixtures that traditionally remain in the sale of most homes, in working order.

- The property is in bad condition…should I do anything?
Extensive repairs or clean-up will be considered by potential buyers and reflected in the list price. Should some clean-up be necessary to assist in the sale of the home, your agent will make that request and work that out with you.

Freddie Mac CFO Reportedly Hangs Self...

2009-04-24T09:17:00.001-04:00

The interm chief financial officer of Freddie Mac is found dead in his home. That's not a good sign.

"Pimp this bum"? Help Hard Luck Case... hmmmm

2009-04-24T08:57:00.003-04:00

Today I decided to post something different... A little story I saw about a homeless man who turned his life around through the help of a few willing warm hearted people... Feel free to leave a comment below. Neat story...

Bidding Wars Are Emerging on Foreclosures...

2009-04-23T01:19:00.003-04:00

I wanted to share this recent article I read today as it hits the nail on the head with what is happening right now. Falling home prices are starting to ignite bidding wars in a few parts of the U.S. as first-time buyers compete with investors for the same foreclosed properties.

In most of the nation, the supply of unsold homes continues to swamp demand. Home prices in many markets continue to fall, and foreclosures, which slowed in late 2008 as mortgage companies delayed taking action against delinquent borrowers, are picking up again.

But real-estate brokers say multiple offers on certain homes have recently become more common in parts of California and Arizona and the Washington, D.C., and Minneapolis-St. Paul metropolitan areas.

Tamby Leonard of Santa Ana, Calif., southeast of Los Angeles, says she has been outbid four times since January when trying to buy a home for her family of five. The more appealing bank-owned homes in her price range, around $300,000, tend to be sold quickly to investors who can pay cash. The market for homes in the Santa Ana area in that price range is "blazing hot," says Ed Mixon of Altera Real Estate, Ms. Leonard's agent.

On Wednesday, the Federal Housing Finance Agency reported that home prices nationwide rose a seasonally adjusted 0.7% in February from January, led by gains on the West Coast. When compared with a year earlier, however, home prices were down 6.5%.

Bidding wars -- common during the housing boom -- had all but disappeared soon after the market peaked about three years ago. Even now, they remain the exception rather than the rule.

The Wall Street Journal's quarterly survey of 28 major metro areas shows that there is still a glut of homes available in most markets. But the glut has shrunk, and some areas are running into shortages of moderately priced homes in middle-class neighborhoods.

Many housing economists expect the market to bottom out gradually over the next couple of years, with some parts of the country stabilizing well before others. California and Washington, D.C., for instance, are likely to recover faster than South Florida, which has an immense glut of vacant condominiums, and the New York City area, which has been hurt by Wall Street's collapse, says Kenneth Rosen, chairman of the Fisher Center for Real Estate at the University of California, Berkeley.

Across the nation, there is still a tug of war between bullish and bearish forces. On the bullish side, falling prices and the lowest mortgage rates since the 1950s have made homes far more affordable, luring shoppers like Ms. Leonard, who has been renting for years. Adding to the attraction, the U.S. government is offering tax credits for certain people who buy homes before Dec. 1. The credit -- equal to 10% of the purchase price, up to a maximum of $8,000 -- is available to buyers who haven't owned any other primary residence in the U.S. during the three years before the date of purchase.

On the bearish side, rising unemployment has knocked many people out of the housing market and made those who still have jobs skittish. Even those with secure jobs who want to buy can't always get loans on attractive terms because of today's tightened credit standards.
[A foreclosure sign sits outside a home for sale in Phoenix.] Associated Press

A foreclosure sign sits outside a home for sale in Phoenix.

In addition, the supply of bank-owned homes is expected to grow over the next few months because many mortgage companies have ended moratoriums during which they refrained from proceeding with foreclosures.

The moratoriums artificially reduced the supply of foreclosed homes listed for sale, says Chad Neel, president of LPS Asset Management Solutions Inc. in Westminster, Colo., which sells such properties for banks. Now "there's a flood about to come on the market," Mr. Neel says. Foreclosures are likely to weigh on the market for years as courts and mortgage companies struggle to catch up with huge backlogs of unresolved cases.

Foreclosures, though far above normal levels in most of the country, are heavily concentrated in a few states, including California, Arizona, Nevada, Florida and Michigan. In areas with large numbers of bank-owned homes, buyers are mainly concentrating on those properties. That leaves ordinary homes languishing as owners generally refuse to slash prices enough to compete with banks.

In the Sacramento, Calif., metro area, about two-thirds of all March sales were foreclosures, says Michael Lyon, chief executive of Lyon Real Estate. The supply of foreclosed homes currently listed for sale is enough to last only about a month at the recent sales pace, he calculates. But there are plenty of homes listed for sale that aren't bank-owned, enough to last more than eight months.

In West Sacramento, a buyer represented by Cherie Hunt of Prudential California Realty recently competed against two other bidders for a three-bedroom home built in 2001. Ms. Hunt's buyer won by agreeing to pay about $220,000, or nearly $10,000 above the asking price. But that's still way down from $405,000, the price at which the same home sold in 2005.

"I have 20 buyers looking desperately," says Ms. Hunt.

Frank Borges LLosa, owner of FranklyRealty.com, a real-estate brokerage in Arlington, Va., is advising clients that banks favor all-cash bids or offers from people who seem certain to qualify for financing. Sellers may well choose the offer least likely to fall through rather than the highest bid, he says. He and other brokers say banks appear to be deliberately setting asking prices low in some cases to provoke bidding battles.

"There are a lot of buyers who think they can lowball," says Connie Vaughn, an agent at ZipRealty in the Los Angeles area. But in some cases mortgage companies already have cut asking prices enough to generate multiple bids. One of her clients recently prevailed over more than 30 other bidders by offering about $86,000 -- or $20,000 above the asking price -- for a four-bedroom house in Adelanto, Calif., that had sold for $200,000 in 2004.

A mortgage company recently slashed the asking price on a two-family home in Norwich, Conn., to $73,900 from $144,900. That price cut prompted five offers that the company is now considering, says Linda Davis of Re/Max Realty Group, the listing agent. She says the price cut was unusually steep but adds, "At some point, [banks] just decide to let it go."

That's encouraging, says Ronald Peltier, chief executive of HomeServices of America Inc. in Minneapolis, which owns real-estate brokerages in 19 states. "We do need to flush out the distressed inventory," he says, before the rest of the market can stabilize.

One positive trend is affordability. A family earning the national median pretax income of $52,800 a year needs to spend 25% of that income to buy a median-priced home, down from 44% in mid-2006, according to John Burns, a real-estate consultant in Irvine, Calif. For the Los Angeles metro area, that ratio has dropped to 45% from 102%. In Phoenix, it is down to 19% from 46%.

Among the markets Mr. Burns expects to recover earliest are the metro areas of Washington, D.C.; San Antonio; Raleigh, N.C.; Denver; Sacramento; and San Diego.

Northern Virginia Real Estate Conditions Are a GO!!!

2009-04-17T03:44:00.003-04:00

Loudoun County and Fairfax County Real estate conditions are booming for local buyers in Northern VA. The buyers market is up and running once again and this time it's flying off the hook. The many factors responsible for this boom is reduced market home values, large supply of homes currently for sale, and a massive drop down in interest rates.

People who wish to buy a home in the current Loudoun County and Fairfax County real estate markets are faced with some excellent conditions. Buyers now have the chance to benefit from the current market fluctuations and make long term investments which will give them a great advantage.

The main factor that makes it the ideal time for buyers to buy a home is the low price of homes that are for sale. The recent lowering of Reston Virginia homes for sale values makes it possible for buyers now to buy a home which might have been too costly to buy just a few years ago.

Currently consumers are able to not just afford property in Northern Virginia, yet actually purchase it at less than market value. Today a big surplus of Annandale VA real estate is available on the market. There are a number of variables that account for this surplus. Primary among these are the less than average number of home sales along with the increased foreclosed upon and bank-held homes on the market.
The big supply means buyers have a great array of homes to pick from. As well, it means sellers have to be more flexible in conditions and prices to meet the buyers' demands. It's a buyer's market in this area, so buyers ought to take advantage of that.

Another factor in the Loudoun County and Fairfax County buyers favor is that interest rates are extremely low right now. The amount of interest a buyer pays over the life of the loan far exceeds the purchase price. Thus, a lower interest rate results in a substantial reduction in the total cost of the home for the buyer. Lower interest rates will also mean lower monthly payments for the buyer.
Buyers should recognize that this is a unique opportunity to invest in northern Virginia real estate. All of the market conditions are in their favor right now. They are now able to purchase a more valuable home than in the past. Not only will they be making a wise purchase for their family, but they will also be making a practical and profitable investment.

Northern Virginia real estate conditions are favorable right now. It is now a buyers market. This is due to a number of factors, including reduced market values, a large supply of homes for sale, and low interest rates. The main factor that makes it the ideal time for buyers to buy a home is the low price of homes that are for sale.

2009-04-16T10:06:00.004-04:00

ASTERISK ** * hits an Amazing Hole- in-ONE shot at the ORIGINAL STEAKHOUSE ASHBURN, VA hours before the Rally for the Cure event!

Though I wasn't able to attend the Rally for the Cure event hosted by Chris and his mom (aka Chris Cooley's mom) (http://chriscooley47.blogspot.com), I was able to get there just before the event to hit this Golden Tee shot which is promoted through out YouTube and will hopefully gain some attention for future Rally for the Cure events.

You can read more about Chris's moms event and the rally on Chris's Blog http://chriscooley47.blogspot.com/.

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-Not everyone searching my site is WITHOUT a real estate agent. I ran into this funny video on YouTube and believe it or not, there are agents out there just like this!.... If you know of an agent like this and your looking for a change you know how to reach me. Otherwise, enjoy this one! It's too Funny!

Northern VA Short Sale or Foreclosure Real Estate Effects on a Neighborhood...

2009-04-15T08:17:00.003-04:00

Many of my clients have been asking me lately why about 70% of Northern VA foreclosed homes or short sale homes on the market are in such terrible shape even when they look excellent from the outside.

The reason is because distressed home owners are taking everything with them... including the kitchen sink! You'd swear that you have just found a diammond in the ruff from the outside, but when you walk in the home there is no dishwasher, ceiling fans, oven, washer and dryer, lighting fixtures and in a few homes I have see the toilets were removed! Many times there are huge holes in the walls and trash scattered about.

This video explains exactly what is going on in all parts of the country right now including Northern Virginia real estate. The good news is that the prices have fallen to just about ROCK BOTTOM and even homes in this condition can be purchased for a MAJOR STEAL!

Distressed Homeowners Being Accused of Fraud !

2009-04-14T19:00:00.000-04:00

Ashburn, Virginia - April 14, 2009 -- Some mortgage lenders are springing a “loan modification trap” of criminal- prosecution against homeowners who try to avoid foreclosure, says a mortgage expert firm, Mortgage Fraud Examiners. Rather than cooperating with homeowners needing loan modifications some lenders report struggling homeowners to the FBI or State authorities for bank fraud.

Storm Bradford of Mortgage Fraud Examiners states:

"The Obama Administration warned this past week that most loan modification companies take advantage of borrowers in danger of default by charging upfront fees of $1,000 to $3,000 for help with loan modifications that rarely, if ever, pay off. Such private firms are competing with the Obama Administration’s own loan modification service. Thus far, that government service also "rarely, if ever, pays off".

Government officials evaded the question of why loan modification efforts "rarely, if ever, pay off." Mortgage lenders are refusing to cooperate with struggling homeowners – unless forced to re-negotiate terms by legal challenges. The root of the problem is that lenders are not agreeing to lower monthly payments, even to avoid foreclosures.

Instead, when homeowners submit financial information to renegotiate the terms of a mortgage or a short-sale, lenders are comparing their new request with the original loan application. If salary and employment information are inconsistent, many lenders are turning this information over to the FBI to prosecute homeowners for bank fraud.

Mortgage Fraud Examiners CEO Storm Bradford explains, “Homeowners must be careful to retrieve a copy of their original loan application before requesting a loan modification. Information on the new request must match the original application, or else be clearly explained and documented.”

Congress and the White House have pinned the nation’s hopes for the housing market on homeowners renegotiating their loan payments. Yet this strategy is failing. The government criticizes private firms, but “free” government programs are also failing.

Lenders are not cooperating with loan modifications; Homeowners have no leverage when talking to mortgage companies and banks. Bank officials will not take responsibility for cutting loan payments. As a result, using a loan modification firm often means paying several thousand dollars for a simple phone call, to which the answer will predictably be “no.” The primary fault, however, is with uncooperative lenders who would rather foreclose than take responsibility for lowering interest rates or forgiving principal.

A new study exposes the failure of loan modifications in general. Alan M. White (Valparaiso University - Law School), Deleveraging The American Homeowner: The Failure Of 2008 Voluntary Mortgage Contract Modifications, publication pending in the Connecticut Law Review. Professor White found that “more than nine out of ten voluntary mortgage modifications in 2008 involved no cancellation of principal, past due interest or even late fees or expenses. The typical modification requires the homeowner to capitalize unpaid amounts or to convert them to a balloon payment.” (Payments are merely shifted to the end of the loan term.) Because mortgage lenders are not genuinely providing any real relief, half of restructured loans default within 6 months.

Professor White’s study found that servicing contracts encourage loan servicing companies to foreclose. “Mortgage servicer compensation (for securitized mortgages) is governed by pooling and servicing agreements (“PSAs”). Servicers receive income from a fixed portion of monthly interest payments actually received, from late fees and other default charges, and from the interest on funds held for investors or escrow.”

“On the other hand they typically must advance interest to investors when the borrower doesn’t make a payment. They also advance funds to third parties, like lawyers, during the foreclosure process. The servicer recovers its advances only when the borrower eventually brings payments current, or when a foreclosure sale is completed. However, if a delinquent mortgage is modified, the servicer will not recover the advances made to investors on that account until the borrower repays the servicer. This is particularly problematic for the servicer when the advances are deferred in a balloon payment due in thirty years.”

So, these contracts misdirect actions toward destructive foreclosures. Dumping more houses on the market then drives down neighborhood market values even further, creating a “death spiral.”

Instead, Bradford and his team of lawyers perform forensic appraisals and loan audits, documenting legal violations. These audits can then be used by locally-licensed attorneys in each State to take legal action, or used as leverage for meaningful loan modification negotiations.

Bradford estimates that “up to 85% of all mortgages may be legally unenforceable due to defects like lost notes, improper notices, appraisal and/or mortgage fraud. When facing a possible lawsuit after an audit, lenders suddenly get religion and become much more cooperative in renegotiating the terms of a loan.”

"You need to take advantage of every conceivable resource that you can find to use against your lender," Bradford says. "We do a forensic audit, along with a forensic appraisal, to examine whether or not there are any legal violations. We give you another piece to use against your lender that nobody else does."

Several homeowners who have used what Bradford preaches, have won million dollar lawsuits against lenders, or have received other such favorable outcomes." http://www.fraudblogger.com/PRLOANMODTRAP041409.asp

The Market Has Officially Bottomed Out!

2009-04-07T19:04:00.006-04:00

(Video Below) If you been out looking at properties or have been on my site to view listings, you have probably noticed that things have really changed in the Northern VA real estate market. About 80-90% of all homes that show as Active (for sale) actually have at least one offer on them or as many as 6+ in some cases. This is because most short sales show as Active in the MLS until the offer is ratified (accepted in writing) by the banks. With huge discounts in sales prices, rates at historic lows and first time home buyer tax credits, there has never been a better time to buy a home in Northern VA. Foreclosure too are flying off the selves like hot cakes. Take a look at an MLS search on my site.

Here's a brand new video that just came out within the last hour on NBC4 TV news that shows the market strength improving even in areas like the Woodbridge market. If you're serious about buying, it's a good idea to start sooner than later. Incredible...

Fannie and Freddie to Open Up Listing Markets...

2009-04-06T20:20:00.001-04:00

Freddie and Fannie to open doors to new agents for REO listing assignments
Last week, National Association of Realtors President Mr. Charles McMillan sat down and spoke with the CEO of Freddie Mac, John Koskinen and Fannie Mae's CEO, Herb Allison to discuss Realtors concern that Fannie and Freddie are not fairly disseminating REO listings.
Both CEO's agreed that they would comply in broadening Realtor participation in assigning future REO Listings. Although the total REO inventory of Freddie and Fannie is not known, it is estimated to be 50% of all foreclosure inventories nationwide.
The National Association will be posting how to take advantage of this historic opportunity in their Washington Report next week. More details on the meeting can be found on NARs web site.

This is a monumental development for Realtors that have been trying to break into the REO business. Mr. McMillan deserves a ton of credit for listening and acting on the concerns and welfare of the vast majority of his constituency.
Are you ready to seize this opportunity? It is highly probable that new Northern VA agents will be screened prior to receiving REO assignments. Agents that have not taken the time to educate themselves are likely to miss out on this once in a career opportunity.

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2009-04-06T18:21:00.000-04:00

To celebrate International Pillow Fight Day, people brought pillows to the National Mall in Washington, D.C. (mind you, the same day as the Cherry Blossom parade, the Japanese street festival, and also the first day of peak blooms for the cherry blossoms - so uh, tourists everywhere) and had a pillow fight. Also created a lot of dust.

My Video Pick of the Day. (laughter is good, try it)

2009-04-05T13:21:00.007-04:00

-Not everyone searching my site is WITHOUT a real estate agent. I ran into this funny video on YouTube and believe it or not, there are agents out there just like this!.... If you know of an agent like this and your looking for a change you know how to reach me. Otherwise, enjoy this one! It's too Funny!

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-Watch your Tediquette and always make a good first impression!

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10 ways the stimulus bill will help the real estate market

2009-04-02T01:15:00.000-04:00

Some good news for the future of the Loudoun County real estate market came along with the passage of President Barack Obama's $787 billion stimulus bill titled the American Recovery and Reinvestment Act of 2009.

Although the package will not be the last of the fiscal bills to address the real estate market, there are several programs designed to provide short-term incentives to home buyers as well as infrastructure and housing-program funding to help with a much-needed boost to the local economy.

They are as follows:

1. Home-buyer tax credit. The bill provides an $8,000 tax credit that will be available to first-time home buyers for the purchase of a principal residence on or after Jan. 1, 2009 and before Dec. 1, 2009. A person is considered a first-time buyer if he or she has not had any ownership interest in a home in the three years previous to the day of the 2009 purchase. The credit does not require repayment.

2. FHA, Fannie Mae and Freddie Mac loan limits. The bill reinstates last year's loan limits for FHA, Freddie Mac and Fannie Mae loans. These limits were equal to the greater of 125 percent of the 2008 local median home price, or $271,050 for FHA and $417,000 for Fannie and Freddie, with an overall maximum cap of $729,750 that applies to Loudoun County. These 2009 limits will expire Dec. 31, 2009.

3. Neighborhood stabilization. The bill provides $2 billion in additional funding for the Neighborhood Stabilization Program, which provides grants through the Community Development Block Grant program to states and localities to address problems created when whole neighborhoods are decimated by foreclosures. The funds can be used to purchase, manage, repair and resell foreclosed and abandoned properties.

4. Commercial real estate. The new law also provides significant funds for state energy programs, which could be used to support commercial property owners' investments in energy-efficiency upgrades. Commercial property owners seeking to invest in alternative energy systems for on-site power generation would benefit from the Department of Energy Renewable Energy Loan Guarantees Program.

5. Rural housing service. The package provides an additional $500 million to existing U.S. Department of Agriculture Rural Housing programs. This service provides both a guaranteed loan program and a direct housing-loan program for those meeting the program's eligibility criteria. It has been reported that this level of funding will provide for an additional 192,000 homeowners.

6. Low-income housing grants. These grants allow states to trade in a portion of their 2009 low-income housing tax credits for Treasury grants to finance the construction or acquisition and rehabilitation of low-income housing.

7. Tax-exempt housing bonds. Tax-exempt interest earned on specified state and local bonds issued during 2009 and 2010 will not be subject to the Alternative Minimum Tax.

8. Energy-efficient housing tax credits and grants. To promote green jobs and energy independence, the new law provides state and local governments with $6 billion in energy efficiency and conservation grants for energy audits, retrofits and financial incentives. Through 2010, homeowners will be able to claim a 30 percent tax credit (up from 10 percent) for purchases of new furnaces, windows and insulation.

9. Transportation investments. The bill provides $46.7 billion to states and localities for capital investment for surface transportation projects, including highways, bridges, transit and rail. These investments will moderate traffic congestion and support a variety of transportation alternatives that will improve the quality of life of American communities and bolster the value of real estate. Loudoun County recently approved a $291 million list of infrastructure-related projects to submit to the state of Virginia, which is receiving nearly $4 billion from the new law.

10. Broadband deployment. The bill creates $7.2 billion in grants to promote broadband deployment in under-served areas and to map the availability of broadband service in the United States. Increased broadband access promotes economic growth and expands opportunities for home sales. A 2006 Commerce Department report determined that property values are 6 percent higher in communities where broadband is available.

Daily Real Estate News

2009-03-27T13:18:00.000-04:00

The average interest on a 30-year mortgage fell to a 38-year low of 4.85 percent during the week ending March 27 from 4.98 percent the prior week, Freddie Mac reported. The decrease came on the heels of the Federal Reserve's announcement that it plans to purchase another $750 billion in mortgage-backed securities and up to $300 million in Treasuries. President Obama says refinancing is now possible for 40 percent of mortgages and encourages home owners to reap the benefits of the record-low rates.
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Fairfax & Loudoun is a True Buyers Market!

2009-03-26T23:02:00.001-04:00

It's a Buyer's Market in Fairfax/ Loudoun County. Buyers have more time to browse, choose and bargain. The average Sold Price is $375K, down 20% from last year this time.(!!) and down from last month. Homes are staying on the Market an average of 113 days versus 123 days last year , and the Average Sale Price is a SKINNY 90% of the list price.(ATTENTION: This means Sellers are OVERPRICING MASSIVELY!) Inventory is WAY UP! Currently there are 5928 properties available. Low prices/correct prices will entice purchasers.

Condition is a HUGE issue correlating directly with price. Well-priced homes in top condition ARE receiving solid offers in 90 days or less. There are no bargains in the sense of actual dollar amount. CONDITION is paramount at all prices; school districts increase in importance in driving sold prices (there is a direct correlation between Buyers' perception of 'good' school districts and sold pricestt and rate of increase of appreciation).!

If you're a purchaser---watch for days on market and price reductions and don't be shy about making an OFFER! Sellers, you need to price your home realistically (which is AHEAD OF THE MARKET). 3 weeks on the market with little traffic & no offers translates to "your home is overpriced".At 45-60 days on the market with no offers translates to "your home is overpriced." Be willing to reduce the price aggressively and negotiate if you want a quick sale at the highest price possible!

SELLERS--Every month that you are on the market and unsold, you LOSE, on average, about $10,000!

Approximate Location Boundaries: ALL of Fairfax County: The Good, The Bad, The Ugly---and it all costs less now. Location Characteristics: Schools in the top 10 in the country, loads of parks/recreation areas, shopping galore, and near major employment centers and commuter routes (and the not-so-soon-to-be-Tysons-rail) -- Fairfax County has it all..

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Market Conditions...

2009-03-26T22:52:00.000-04:00

The U.S. Commerce Department is reporting that housing starts gained for the first time in 8 months. The gain was 22.2 percent. This was the first increase since June.

"While welcome news, this gain only reflects a modest rebound from January, which was the worst month in history for new-home production," said National Association of Home Builders (NAHB) Chief Economist David Crowe. "The majority of the gain was due to characteristic volatility on the multifamily side, while single-family housing starts were up just over one percent for the month." "Builders did pull a larger volume of single-family permits in February, suggesting a glimmer of hope for the prime home buying season, which is near at hand," said NAHB Chairman Joe Robson, a home builder from Tulsa, Okla. "That said, we realize there's a need to be extremely cautious in terms of new building activity going forward, because there's still quite a lot of inventory out there that needs to be absorbed as foreclosures continue to flood the market in many areas." CNNMoney reports that new construction (single family) was up as well in January. "New construction of buildings with 5 or more units increased surged 80% to 212,000 from 118,000 in January.

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Thinking Short Sale? (hmmm...)

2009-03-25T21:22:00.004-04:00

A short sale in real estate is not always a pleasant transaction.

There are many ways to lose a home but signing away ownership in a manner that destroys credit, embarrasses the family and strips an owner of dignity is one of the hardest. For Northern Virginia owners who can no longer afford to keep mortgage payments current, there are alternatives to bankruptcy or foreclosure proceedings. One of those options is called a "short sale."

Approximately 80% of all homes on the real estate market in Northern Virginia are short sales. That's how prominent short sales have become.

When lenders agree to do a short sale in real estate, it means the lender is accepting less than the total amount due. Not all lenders will accept short sales or discounted payoffs, especially if it would make more financial sense to foreclose; moreover, not all sellers nor all properties qualify for short sales.

If you are considering buying a short sale, there could be drawbacks. For your protection, I suggest that all borrowers:

Obtain legal advice from a competent real estate lawyer
Call an accountant to discuss short sale tax ramifications

As Virginia, Maryland or DC real estate agents, we are not licensed as a lawyer nor a CPA and cannot advise on those consequences. Except for certain conditions pursuant to the Mortgage Forgiveness Debt Relief Act of 2007, be aware the I.R.S. could consider debt forgiveness as income, and there is no guarantee that a lender who accepts a short sale will not legally pursue a borrower for the difference between the amount owed and the amount paid. In some states, this amount is known as a deficiency. A lawyer can determine whether your loan qualifies for a deficiency judgment or claim.

Although all lenders have varying requirements and may demand that a borrower submit a wide array of documentation, the following steps will give you a pretty good idea of what to expect.

Call the Lender
You may need to make a half dozen phone calls before you find the person responsible for handling short sales. You do not want to talk to the "real estate short sale" or "work out" department, you want the supervisor's name, the name of the individual capable of making a decision

Submit Letter of Authorization
Lenders typically do not want to disclose any of your personal information without written authorization to do so. If you are already working with a real estate agent, closing agent, title company or lawyer, you will receive better cooperation if you write a letter to the lender giving the lender permission to talk with those specific interested parties about your loan. The letter should include the following:
- Property Address
- Loan Reference Number
- Your Name
- The Date
- Your Realtor's Name & Contact Information
Preliminary Net Sheet
This is an estimated closing statement that shows the sales price you expect to receive and all the costs of sale, unpaid loan balances, outstanding payments due and late fees, including real estate commissions, if any. Your closing agent or lawyer should be able to prepare this for you, if you do not know how to calculate any of these fees. If the bottom line shows cash to the seller, you will probably not need a short sale. Contact me for further information.
Hardship Letter
The sadder, the better. This statement of facts describes how you got into this financial bind and makes a plea to the lender to accept less than full payment. Lenders are not inhumane and can understand if you lost your job, were hospitalized or a truck ran over your entire family, but lenders are not particularly empathetic to situations involving dishonesty or criminal behavior. Contact me for letter assistance.
Proof of Income and Assets
It is best to be truthful and honest about your financial situation and disclose assets. Lenders will want to know if you have savings accounts, money market accounts, stocks or bonds, negotiable instruments, cash or other real estate or anything of tangible value. Lenders are not in the charity business and often require assurance that the debtor cannot pay back any of the debt that it is forgiving.
Copies of Bank Statements
If your bank statements reflect unaccountable deposits, large cash withdrawals or an unusual number of checks, it's probably a good idea to explain each of those line items to the lender. In addition, the lender might want you to account for each and every deposit so it can determine whether deposits will continue.
Comparative Market Analysis
Sometimes markets decline and property values fall. If this is part of the reason that you cannot sell your home for enough to pay off the lender, this fact should be substantiated for the lender through a comparative market analysis (CMA). I as a hired Realtor can prepare a CMA for you, which will show prices of similar homes:
- Active on the market
- Pending sales
- Solds from the past six months.
Purchase Agreement & Listing Agreement
When you reach an agreement to sell with a prospective purchaser, the lender will want a copy of the offer, along with a copy of your listing agreement. Be prepared for the lender to renegotiate commissions and to refuse to pay for certain items such as home protection plans or termite inspections.

Now, if everything goes well, the lender will approve your short sale. As part of the negotiation, you might ask that the lender not report adverse credit to the credit reporting agencies, but realize that the lender is under no obligation to accommodate this request.

Northern Virginia Short Sales and Foreclosures can be found be searching my MLS website or by going to http://www.JasonDemers.com

Northern Virginia Contracts Up 15% Over Strong February

2009-03-25T08:15:00.000-04:00

NOVA Market Report states in March, for every 10 homes on the market, 3.9 were under contract which is an increase of 15% over February contracts. Contracts are an early indicator of market activity and 39% is very strong. In February, northern Virginia posted a 33% increase in homes under contract, over January, so any increase in March is impressive. Manassas and Sterling remain the top two markets for the third month in a row. Both markets have as many homes under contract as they do available. 20 out of 24 markets posted a higher percentage of homes under contract than February 2009.

The strongest sub markets remain in the starter home category where short sales and foreclosures abound. It is not unusual for well priced properties to attract 7-15 contracts in the first week. Winning bids can be tens of thousands of dollars more than list price. Investors are big participants in this market where rental income exceeds mortgage payments. Herndon has twice as many homes under contract (75), as available (35), between the prices of $200,000 and $300,000. That was the #1 market of the 100 submarkets tracked. In December 2008, 1 (out of 100) submarket had more homes under contract than active. By March 09, there were 17.

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New Law Permanently Keeps Banks Out

2009-03-14T08:13:00.003-04:00

This just out....President Barack Obama signed a bill into law Wednesday that permanently prohibits banks from entering the real estate brokerage and management business. Can you imaging what would have happened if they were let into this business in 2001??

The bill--H.R. 1105, the Omnibus Appropriations Bill--ends the National Association of REALTORS' nearly eight-year battle to preserve the separation between banking and commerce.

"If banks had been allowed to engage in real estate brokerage, it would have created anti-competitive and anti-consumer concentrations of power within the financial services sector, which would have ultimately increased costs for homebuyers," according to an NAR resource page it has devoted to the issue.

Thanks to the NAR and all their lobbying, we all dodged a major bullet.!!

Bank Owned Home Inspection....

2009-03-11T23:54:00.001-04:00

The old days of traditional home inspections have not changed...though most of the sellers (banks) these days are not willing to fix, repair or credit you for anything found broke or in need of repair during the inspection.

2 reasons why....

Reason 1. On short sale listings the home owners are in a bind and are trying to receive a reasonable offer and turn it over to the bank for a possible shorting of the amount owed on their principle loan amount. Most northern virginia homeowners are not in a financial position to make repairs to the home they are already losing out on. The home is being sold "as is" which is reflected in the asking price. If the house doesn't sell then it will head right into foreclosure.

Reason 2. Bank owned properties are priced to sell based on comps and property condition right off the bat. The bank just wants to get the home off their books and often set the listing price rather low and hope to receive multiple offers igniting a bidding war. Your welcome to complete a home inspection for "informational purposes only" but don't expect to get a credit for repairs!

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Dulles Metro Rail...Is It Really Coming?

2009-03-11T10:36:00.004-04:00

Yesterday's news is definitely promising and plans are set for GO! Wow, we are actually going to make progress with getting this project off the ground (no pun intended) and get this rail headed west into Loudoun County....

The project is expected to be built in two phases. The first phase will extend Metro from the Orange Line between East / West Falls Church stations to Wiehle Avenue and includes four stations in Tysons Corner. The expected completion date for Phase 1 is July 31, 2013. Phase 2 would extend Metro through Reston and Herndon to Dulles Airport and Route 772 in Loudoun County.

What is this going to mean for the future market prices for Fairfax real estate and Loudoun County real estate? Well, we are six years away from even getting the rail where it needs to be so the economy is going to have to correct itself over the next 3-4 years, housing should already be stablized in the next 2 years and as the dust settles from construction jobs opportuities should be on the rise. I believe we will see a solid and consistent flow of home buyers relocating from urban areas and heading west into Loudoun County that will allow for people to purchase larger homes and gain more space and acrage compared to the concrete jungles of Arlington.

The home buying demand is definitely going to come to areas like Reston, Herndon, Sterling, Dulles and like wildfire into Ashburn, then trickle it's way into Leesburg where the biggest bargain and home sale steals are going on right now....(hint) The question is going to be, what is the supply going to be like? The will depend on what happens with all these Northern VA Short Sales as well as Pres. Obama's loan modification tactics for struggling home owners. One thing is for sure...., the $900 million dollors in federal funds is money WELL SPENT! and those who look towards home ownership today will prosper tomorrow...

"We in Virginia are fortunate to have Dulles . . . to connect us to the world," Kaine said. "But Dulles can only work and the region can only work if there are transportation options that enable it to be all that it can be. Those options have to include a vigorous road network, but also a very vigorous public transportation network."

The expansion of that network toward the airport will begin in earnest in the next week or two. The Silver Line will extend 23 miles from the East Falls Church Metro station to the airport and will terminate in Ashburn. The tracks will branch off the Orange Line, follow the median of the Dulles Connector Road, trundle through Tysons Corner and then settle into the median of the Dulles Access Road for the bulk of the westward journey.

Finding All the Property Listing Details

2008-07-14T13:27:00.000-04:00

Searching for homes online can fun and informative but often downright confusing. Where do you start, what websites are updated daily, what agents are updating their listings and how do you find out additional information that is not listed on a public website? Some of the best places to start your search are big named search engines like Google, Yahoo and MSN.

For this example let's use Google... When you type in "reston homes for sale" Google will search the internet to find the most relevant websites that display homes for sale in Reston, VA within the "organic search results" (as opposed to the paid advertisements up top and to the right of the page on Google). Among the top of the organic search results you will find Homes.com which you would think would have the most accurate listings available considering it's name. When you click on their link on Google it will send you to their page where they display "Featured Listing". Many of the "Featured" homes have been manually added by paying real estate agents to get maximum exposure for their listings, but many of them have either sold or had been taken off the market and are not currently for sale. These are just lead producing avenues that many agents put into place to gain buyer requests from the internet that do nothing but irritate a serious home seeker.

Another way to find listings through Google by using the search phrase "reston homes for sale" is by clicking on the links to the far right hand side of the search results. These are paid advertisement that many agents use and can pay anywhere from .20 to $20 per click. You will find the bigger named companies up top and the smaller agents last in the list of paid advertisers. Many of these ads are not relevant to your search for "reston homes for sale" and often you will end up lost in cyber space or reading their website which describes how many homes they sold in the 20 years they have been in real estate and their favorite foods. What most home seekers are looking for are active listings, addtional info and nothing more!!!

What people deserve these days are real time, accurate and updated information about property listings direct from the local MLS database. Cutting edge technology like I use on www.JasonDemers.com only displays the most accurate and timely information available today and not one old or inactive listing. You won't find any information that is not real estate related and our team of agents are all full time professionals. All inquires we receive are handled immediately, thanks to the large investment we have made into our technology during the past three years.

With all the technology we have at our disposal these days home buyers are expecting quick responses to their housing needs and continued follow up from an agent who can help. If the information your looking for is not publicly displayed (due to local MLS regulations), just send me an inquiry and you'll receive a Full MLS Consumer Listing email which will give you the most updated and detailed information on any home including local homes that have sold or may be new to the market including many foreclosure steals. You can search for accurate listings at any time by visiting my site at www.JasonDemers.com or send me an email and we'll do the search for you.

How to Make Lowball Offers

2008-07-08T11:23:00.001-04:00

Buyers who are lucky enough to shop for a home in a buyer's market are in the enviable position of being more likely to get a lowball offer accepted. In seller's markets, homes quickly sell and, since there is little inventory or competition, it is difficult to negotiate a lowball offer.

If you are shopping for a new home in a seller's market, your best bet for finding sellers who might be receptive to a lowball offer is to check out those sellers of overpriced homes lingering with excessive DOM. But whether the market is hot, cold or neutral, lowball offers can result in big savings to a buyer if they are presented and negotiated properly.

To get started, let's look at what NOT do when making a lowball offer:

Common Mistakes Made by Lowball Buyers

Can't Afford or Unqualified to Pay More. Don't tell the seller your price is fair because that's how much the lender has qualified you to buy. Sellers don't care what you can or cannot afford to buy. If you can't afford to buy the house, that's not the seller's problem; it's yours.

Paying Cash. It's all cash to the seller in the end. Most buyers don't realize that. If a property will appraise at selling price and the buyer's credit is acceptable, a conventional loan transaction will close just the same as a cash deal. The only advantage to a cash deal is it removes the loan contingency, the right for a buyer to walk away if a loan isn't possible. But most loan contingencies follow the same number of days as other contingencies, so who cares? It's not a big selling point.

Walking Away. Some buyers get their knickers in a twist and walk away when the seller counters the offer at more than the buyer was prepared to pay. Maybe the counter was list. Maybe less. Doesn't matter. The point is the doors have been opened for negotiations. Only the inexperienced or truly stupid walk away.

Strategies for Winning the Lowball Offer

Find out the Seller's Motivation. If you don't know why the seller is selling, you can't meet the seller's needs. Maybe the pressing issue is financial. Maybe the seller needs to quickly move. If you know the reason behind the sale, you can structure your offer to fulfill those needs.

Write a Clean Offer. Dot I's and cross T's. Don't ask for items that oppose local custom. Shorten inspection periods, reduce or waive some contingencies and submit a lender preapproval letter. Don't give the listing agent a reason to doubt your ability to perform. Appear strong, qualified and ready to close.

Always Counter the Counter Offer. It goes without saying that the first counter is only an invitation for the buyer to offer a second counter offer. But sometimes buyers get discouraged. It's a dance to see who will win. Until they turn off the lights and close up the bar, keep dancing.

Move Attention Away From Price. There are many other considerations than price. It's smart to change tactics and ask for other concessions such as closing cost credits, repair credits, longer escrow periods or focus on tangible goods such as furniture or appliances.

Give a Logical Reason Why Your Lowball Offer is Fair. Don't insult the agent by handing over a list of comparable sales. Show you have done your homework. Make notations on each sale that compares it to the subject property. Maybe the higher priced homes had remodeled kitchens. If the home you want to buy is not updated, then knock off a believable figure reflecting the remodeling work from the seller's list price.

When Your Lowball Offer is Rejected and Negotiations End
Don't pack up your toys and go home. Just wait. Sellers have reasons for rejecting offers. Maybe you made an offer on a new listing, when the seller thinks that a really great offer is just around the corner. Let them sit out the market. After a month or two has gone by, resubmit your offer. Just cross off the date, but leave enough of it so the seller can see how long it's been since you last made an offer. Then write in the new date and resubmit!

Bank Owned vs Short Sale in Northern VA

2008-05-21T13:39:00.001-04:00

With more and more homeowners falling behind in payments many homes are going straight to the bank! This is where you can find one of the deepest discounts in the market today... Let's start with a common scenario happening all over Northern Virginia as we speak.

Bob and Sue have a home and they just can't make the payments on anymore due to the rate increase in the 5-1 Arm (Adjustable Rate Mortgage) that they were talked into getting 24 months ago and can barely make the second trust payment. They started with a 3% "teaser rate" on the first trust and now they are at 6% on a home they should have been qualified at around 6%...not at a teaser rate of 3%. Their payments just jumped up $900+ each month and they just can't make ends meet anymore as Sue is a school teacher and Bob worked in the marketing dept. for a well know home builder and was recently laid off. They can't refinance or sell their home because it is now worth $80,000 less than they bought it for 24mo. ago.

Bob and Sue decided to looking a Short Sale scenario with their mortgage company by calling them up and asking to speak to someone who may want to take less than owed on their home. The bank tells them that they must put it on the market first, get an offer and then present it to them for consideration. Bob and Sue after three months finally get a (low ball) offer on the home 100K less than what they paid for it. They present the offer to the bank and wait 2-6 weeks to later find out that the second trust company will not agree with the first trust mortgage company at that price. The second trust company is only willing to except a loss of 20K on their end and thus there is no acceptance of the Short Sale after having the home on the market for 3 months and waiting another 6 weeks for a response to the offer they submitted! That's not to mention that the buyers wasted 6 weeks waiting on a response from the bank that had not even approved a short sale selling price on the home!

Now what???? Bankruptcy or Foreclosure??? Bob and Sue are at wits end and decide to rent an apartment quickly and leave their current home vacant for the bank to foreclose on... so the court house process begins and the home does not immediately sell. The bank now has the home as one of their 1000's of inventory across the county and must dispose of it (sell) as quickly as possible as they are loosing more money in expenses and loss of interest on their investment.

Can you say desperate? The winner by far are all the buyers purchasing Bank Owned Homes! Not just in negotiating and saving on the sales price, but also the fact they only had to wait a few days and up to a week to hear back from the bank as to whether or not they are going to get the contract accepted and ratified to the agreed terms of the offer. Though the buyers are purchasing the home "As-is" and it may need 15-20K in upgrades and repairs, they saved 10's of thousands of dollars on the home and didn't waste 1-2 months on an offer they made on a Short Sale that wasn't going to get accepted.... Why does it take so long for a short sales offer to get accepted you ask? Because the banks usually want to see anywhere from 3-6+ offers on the home before they accept or counter an offer! How about you just ask the listing agent how many offers there are on the home before considering to make an offer you ask? Because many of the banks as of recently have been forcing the listing agent NOT to make that information public. Listing agents and representatives for the banks are now keeping this on the HUSH!

Though Short Sales can often be excellent deals and save you potentially 10's of thousands off the sales price... if you don't have the patience to wait up to 2 months for a bank answer then go for the Bank Owned homes or Foreclosures in the Northern Virginia real estate market.

Bank Owned Homes Win By a TKO!

New Model for Brokerages?

2008-05-20T13:05:00.001-04:00

Each week I receive a new emailed newsletter from Realtor.org with topics such as Top 10 Things Buyers Should Know Before They Purchase, or 6 Hidden Secrets To Increase the Value of Your Home. This week I received one that kind of caught my eye, it is titled Does Your Brokerage Have A New Model? They are conducting a survey on topics such as the following.

"Is your brokerage giving customers the opportunity to obtain services on a fee basis?"

Hmmmmm, now what kind of services would those be? Stick a yard sign in the ground of a sellers home and just slap it in the MLS for $300? Or maybe they want a lock box for an additional $50? We can print out 100 copies of a listing packet for .25 a piece? I tell you what I think would be a great idea... $150 hr for an Open House and $100 for each property shown! What happened to the days of Buyer Representation? Where are we going with these "new era concepts"?

Is your brokerage going virtual, with sales associates working mainly from their home office?

Ummmm, let's go with ya? How often do you need to go into the office to check your email, pull up listings, check your messages or to make a long distance phone call? Do you have to meet your client in the office or would a local Starbucks be sufficient?

Times have changed and corporate brokerage offices should be down sizing immediately. The overhead alone for rent, phones, copiers, 100+ phone extensions, desks, chairs, full time secretaries, etc.. can run anywhere from 20-40K+ per month! All this expense gets passed onto to the agent with commission splits ranging from 50/50 to 80/20 because of all the overhead and expenses. Many brokerages are shoving down your throat the fact that you must use their title and settlement companies in order to receive their company perks and benefits. Don't believe me? Call one of the large corporate chains and listen to how they answer their phone.

You'd swear they also have a tanning salon in there somewhere too...!

A New Lease Purchase on Life?

2008-05-19T16:50:00.000-04:00

I recently read an article in the Washington Post about renters seeking out lease options as an option to an immediate purchase... You can read the article online http://www.washingtonpost.com/wp-dyn/content/article/2008/05/16/AR2008051600310.html?sub=AR .

Well my thoughts are good luck! Most buyers are opting to Rent-to-Own in the Northern VA real estate market because they just don't qualify for a loan today. With historically low interest rates and sales prices (including many "all closing costs paid by seller" homes) why would potential buyers want to wait to purchase? The answer is very simple in Fairfax and Loudoun Counties.. because they don't think they can afford too! It's the mindset of the first and second time home buyers.. "Let's wait until the prices go down even more.. then we'll see if we qualify for a loan." Not such a good idea... Many buyers in this market should take the time to educate themselves on the many FHA and First Time Home Buyer programs available today. Rent-to-Own many times means increased rental prices as the home owners have built in a "set monthly rental increase" because they know they are going to have to contribute a set monthly portion back to the tenant should they buy in 12-24 months... What does this mean? More potential monthly income to the landlord... that's about it.

That's not to mention the fact the seller could go into default on their home and YOU the tenant are out with NO Option To Purchase. My suggestion is this, talk to a lender now, work out the financing terms or work on the issues with your down payment any credit score issues that could prevent you from owning a home down the road.

You can Search for Northern VA homes for sale on http://www.JasonDemers.com based on your monthly rent payment. You can figure around $2,400/mo should get you near 400K with little or no down payment. Contact your lender for specifics. Sellers are willing pay just about anything to break your lease and will more often than not pay all your closing costs TODAY, not in 12-24 months.