Home Inspection Expectations

Today, I decided to ask my husband for some ideas about what to write about.  He is a home inspector with over 3000 inspections under his belt and is also a licensed real estate agent.   He suggested discussing what you or your prospect should expect when working with a home inspector.

Most of you know the mechanics of an inspection but today, as I wear my Realtor hat, I am adding a quick checklist you might find helpful:

•·         Home inspectors do not move furniture or raise carpets (they will probably look under a rug)

•·         Home inspectors can't look inside walls but can make an educated guess about what is inside

•·         Home inspectors can estimate the condition of a roof which is concealed by shingles but can't tell you how long it will last

•·         Home inspectors don't fix things

•·         Home inspectors don't disassemble equipment that doesn't have an access panel (like your central air conditioner or heat pump

•·         It is critical that water and power be turned on before the inspection starts because anything related to water and electricity can't be inspected without those services

•·         Most home inspectors will not turn on water or electrical systems when they've been turned off at their source (one inspector turned on water at a second floor bathroom without knowing that it was turned off because a pipe was split and wound up replacing carpeting down the stairs and on to the first floor)

•·         Cartons piled in rooms in preparation for moving prevent the inspector from seeing significant portions of that room

•·         Attics and/or basements that are jammed packed with storage will prevent the inspector from performing a detailed examination of the upper and/or lower structure - inspectors are not going to risk live and limb crawling around obstructions - especially when he/she might fall through a ceiling

•·         Make certain your clients choose an inspector who knows how to describe what he/she has found without being an alarmist - inspectors should have a good command of the English language

•·         My husband makes it a point to photograph every room and all appliances and include those photographs in the report so there will always an inventory of what was there when the buyer last saw the house

Understand that a good home inspector will miss some items but will find 95% of the problems of the house.  Understand also, that there will be some homes that will have no defects.  Recently, my husband  inspected four different homes that were in excellent condition and had no discernable defects.

 

The news is spreading fast...  As reported out from FHA on January 15, 2010 -

HUD TAKES ACTION TO SPEED RESALE OF FORECLOSED PROPERTIES TO NEW OWNERS

Measure to help bring stability to home values and accelerate sale of vacant properties WASHINGTON -

In an effort to stabilize home values and improve conditions in communities where foreclosure activity is high, HUD Secretary Shaun Donovan today announced a temporary policy that will expand access to FHA mortgage insurance and allow for the quick resale of foreclosed properties.

The announcement is part of the Obama administration commitment to addressing foreclosure. Just yesterday, Secretary Donovan announced $2 billion in Neighborhood Stabilization Program grants to local communities and nonprofit housing developers to combat the effects of vacant and abandoned homes.

"As a result of the tightened credit market, FHA-insured mortgage financing is often the only means of financing available to potential homebuyers," said Donovan. "FHA has an unprecedented opportunity to fulfill its mission by helping many homebuyers find affordable housing while contributing to neighborhood stabilization."

With certain exceptions, FHA currently prohibits insuring a mortgage on a home owned by the seller for less than 90 days. This temporary waiver will give FHA borrowers access to a broader array of recently foreclosed properties.

"This change in policy is temporary and will have very strict conditions and guidelines to assure that predatory practices are not allowed," Donovan said.

In today's market, FHA research finds that acquiring, rehabilitating and the reselling these properties to prospective homeowners often takes less than 90 days. Prohibiting the use of FHA mortgage insurance for a subsequent resale within 90 days of acquisition adversely impacts the willingness of sellers to allow contracts from potential FHA buyers because they must consider holding costs and the risk of vandalism associated with allowing a property to sit vacant over a 90-day period of time.

The policy change will permit buyers to use FHA-insured financing to purchase HUD-owned properties, bank-owned properties, or properties resold through private sales. This will allow homes to resell as quickly as possible, helping to stabilize real estate prices and to revitalize neighborhoods and communities. "FHA borrowers, because of the restrictions we are now lifting, have often been shut out from buying affordable properties," said FHA Commissioner David H. Stevens.

"This action will enable our borrowers, especially first-time buyers, to take advantage of this opportunity." The waiver will take effect on February 1, 2010 and is effective for one year, unless otherwise extended or withdrawn by the FHA Commissioner.

To protect FHA borrowers against predatory practices of "flipping" where properties are quickly resold at inflated prices to unsuspecting borrowers, this waiver is limited to those sales meeting the following general conditions: * All transactions must be arms-length, with no identity of interest between the buyer and seller or other parties participating in the sales transaction.

* In cases in which the sales price of the property is 20 percent or more above the seller's acquisition cost, the waiver will only apply if the lender meets specific conditions.

* The waiver is limited to forward mortgages, and does not apply to the Home Equity Conversion Mortgage (HECM) for purchase program. Specific conditions and other details of this new temporary policy are in the text of the waiver, available on HUD's website.

 

Dave Rosenmarkle

Broker/Owner

Highland Realty

Arlington, VA

(703) 538-2566

davidrose@mris.com

www.HighlandAgents.com

 

 

The US House of Representatives overwhelming voted to extend the first time home buyers credit for an additional 12 months to anyone in the military who has served overseas for three months in 2009.  In a vote of 416 to zero the bill now has to go the US Senate and the President for final approval.

This extension could give up to 350,000 military families currently deployed overseas unitl November 2010 to take advantage of the current tax credit.  In addition the IRS "recapture" rules will be waived for any service member who is deployed and must sell or rent their home. 

Known as the Service Members Home Owners Tax Act this bill also contains the provision to waive the income tax liability currently in the expanded Department of Defense Homeowners Assistance Program.  

The next step for this bill (HR 3590) is for the Senate Finance Committee to review the bill and hopefully move it to a vote in the full Senate.

This seems to be one time that the US Congress, Senate and President should be able to agree.  Extending the tax credit for our military is the right thing to do no matter what your political beliefs.

If you have a short sale property with an IRS tax lien, the IRS will remove thier lien and allow you to sell the home. It takes WORK but it can be done!

In cases where the homeowner has not paid their income taxes, the IRS may place a federal tax lien on the property. Actually, the lien covers all of the person's property including the home. Typically, you can convince the IRS to remove the tax lien (from the house) by requesting a Certificate of Discharge of Property from Federal Tax Lien (Publication 783) with the IRS.

The reason the IRS has placed the lien on the person's home is so that they will get paid whenever the person sells their property. If you can convince the IRS that the homeowner is upside down and that there will be no resulting proceeds from the sale, the IRS may agree to release their lien. Along with your request, you will need to include some supporting documentation such as the purchase contract, the payoff statement from the bank, and so forth.

I have had to deal with IRS tax liens on several occasions, and they are not fun. However, there is no way to move the short sale transaction forward until the IRS tax lien has been removed.

This entire process should be coordinated in conjunction with your title company or attorney. Make certain that you are working with a title agent who knows the ins-and-outs of the partial release of lien process. For more information and complete instructions, go to www.irs.gov and search for "Publication 783."

Happy Short Selling!

1. Your photos are unimpressive. The vast majority of home buyers start their search for a home on the Internet, your house had better look great in print. Not just nice... downright fabulous.  Today we are considering internet views as a 'virtual showing'... if your house gets past that, then they might (just might) make an appointment to see it in person... We consider that your SECOND showing. Today's buyers are expecting good quality photos (and lots of them... just 1 shot from the street won't cut it!), a virtual tour, maybe even a floor plan, if applicable.

2. It's overpriced. You've got to view your own property as objectively as possible.  Look at the home like a "buyer"... if necessary, go out with your Realtor and view other homes that are priced comparably to yours.  Be objective.  Given the other options on the market (and yes, you DO have to include short sales and foreclosures on your list... your potential buyers are!), would YOU buy your home, over the others on the market?

If no, then you either have to "update" your home to meet or beat the competition... or lower your price to adjust for it.  if you can't afford to sell for the price, that you KNOW it sell for, you may want to consider just removing it from the market.

3. It shows poorly. This could mean almost anything... from the barky, barky dog, to the smell of the diaper pail.  Maybe the carpeting is a bit worn, or the woodwork shows a lot of wear.  All things that don't show well from the internet, but whoa.... once you get inside the house... they show up, like a cat-urine-smell on a humid day in New Orleans!

4. You're invisible. Today's buyer comes from the internet, almost exclusively.  Have you (or your agent) simply plopped the property on the MLS, and started praying?  Are you on all the websites...(Trulia, Zillow, Craig's List, Google Base, etc...) all the places that buyer's are searching?  If not, you want to be.

5. Your listing is tired and stale on the market. Okay... yes, you overpriced your home initially when you first came on the market 2 years ago.  But since then you have reduced your price almost monthly... constantly chasing the market down.... Now, finally you're truly priced where you should be... but your listings is tired and stale.  Everyone looking for your type of property (ie: 3br/1.1 bath) in your area has already seen it, sometimes twice... and they remember that there was "something" about it that they didn't like... but what they don't remember is... what they didn't like.... was the price.   Time to take the listing off market.  Let it cool off (3-6 months), and bring it back on fresh in the Spring.  Yeah, you'll have 6 mos. worth of holding-costs... but you'll more than make up for it in your purchase price.

btw... Avoid the temptation to bring the house back on at a higher price, than when you left the market.  Just "don't do it"!

6. Your house won't appraise. The house looks great... you've finally gotten someone to bring you a bid on your slightly over-priced, but beautiful pied-a-terre.  But the bank appraiser says it's worth $20,000 less than what they've agreed to pay.  Heavy sigh... bite the bullet.... negotiate with them.   If you have to drop the price $20,000 to make it work.... "make it work"... chances are, anybody else trying to buy your house will run into the same problem.

FINANCIAL NEWS TODAY.  If one of the things that happened today was listening to the business news and hearing that the President's new plan to help stabilize the financial markets is to require that when Wall Street designs an investment product to sell to the public that they will have to keep "some skin in the game".  Interesting because the public probably didn't know that when Wall Street designed complicated financial instruments such as MBSs, CDOs, and plain vanilla CDSs were sold and traded by Wall Street investment houses who had "no skin in the game".  The securities sold by the Wall Street Gangs were often insured against default (credit swaps) by AIG who did not require that there be any "skin in the game" from anyone or any entity. 

SHOULD HOME BUYERS HAVE SOME SKIN IN THE GAME WHEN OBTAINING A MORTGAGE LOAN?  We often hear that home buyers should have "some skin in the game" when they finance a home purchase.  Of course the mortgage on the property is secured by the real property.  However, with no equity there is no "skin in the game" if the home owner defaults. 

WHICH IS THE BETTER RISK?  The American Home Owner or the Wall Street Securities Broker?

If the home owner defaults on their mortgage, they lose their home, their equity and their credit.

If the Wall Street investment banker sells securities that become worthless, they lose nothing.  In fact, the government may lend them money at zero interest or pump several $Billion Dollars into their bank to "tide them over". 

Wouldn't it be nice if the government treated the American Home Owner as well as they treat the Wall Street Gangs?

Courtesy, Lenn Harley, Broker, Homefinders.com, 800-711-7988, E-mail.

                                                           

 

Most people laugh when they hear about the scams that are taking place all over the net.  These scammers are hitting...Craigslist...Facebook...and even Flickr and today...I got one from one of my Careerbuilder alerts.  I've personally had several through all of these sources...fortunately I spend a lot of time on line...but what about those that do not?

I truly do not find it funny.....because so many fall victim.....we have to understand not everyone is a genius or have the basic understanding that most real estate industry professionals have when it comes to buying a home, selling a property or even requesting information on a rental.

A few statistics you should think about before making prejudgments on those who fall for these schemes...I live in an area...where many homeowners do not use the Internet at all!

• Did you know only 74.4 % of North America uses the Internet?  That means there is a good chance some who search for properties on line...may do very little searching...as a matter of fact...they may use the Internet rarely and may not be aware of these schemes. 

• 12 million people in the U.S. still use dial up according to www.rlslog.net!  Have you tried to use dial up recently?  Its hard to get information and really truly does not work well nor give a great experience on line. 

• According to Pew..its 9% who use dial up last year! 
  

• In many rural areas...broadband is not available still!
  

Today while going through my comments I found something quite interesting and thanks to Dave Dugdale...there is a software to detect whether you might be falling for a scheme...The Rental Scam Detection Tool!  I went ahead and tested and I think it is a fabulous tool for those who might fall prey. 

Very basic and very easy to use but specifics to look for when the schemers come scheming!

About The Author: Midori Miller is a Real Estate Trainer and writes and trains Real Estate Training and assists sellers in short sale situations. Midori is a Licensed Florida Real Estate Broker , License # BK645709 and a member of the Daytona Area Association of REALTORS. Contact midorimiller@yahoo.com or (386)453-3236.

 

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SenatorIsakson
June 10, 2009

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Senator Johnny Isakson announces that he is reintroducing his $15,000 housing tax credit that has no income limit or first-time homebuyer status requirement. Business Roundtable in New York adopted...

Senator Johnny Isakson announces that he is reintroducing his $15,000 housing tax credit that has no income limit or first-time homebuyer status requirement. Business Roundtable in New York adopted this tax credit as its number one suggestion to the U.S. Government as the one thing we can do to turn around the American economy. June 9, 2009.

      I believe that now is the time to begin urging your representative to revisit this issue.  There has been some movement toward expanding this tax credit to include all buyers and to increase it's amount to $15,000.   There is an article you can read here, submitted by the office of US Senator Johnny Isakson on this proposed new legislation.

     Additionally, this week we at Coldwell Banker received a summary of ideas discussed at the recent Business Roundatable Discussion held in Washington D.C.  The highlights are these

 

• Keep mortgage interest rates at historically low levels (below 5 percent) for at least one year;
• Expand the current First-Time Homebuyer Tax Credit incentive from the lesser of 10 percent of the purchase price of the home or $8,000 to a higher limit of either 10 percent or $15,000 for all homebuyers, remove the income restrictions and include all primary residence purchases for one full year;
• Conduct a thorough review of current foreclosure mitigation and loan-modification programs in light of rising loan-modification re-default rates;
• Make permanent the current temporary conforming loan limits; and
• Continue to review and strengthen government efforts already underway to review and refine mortgage lending practices

     If you believe, as I do, that this will assist all homebuyers and should be considered by the current administration, please contact your representatives and tell them so.  You can locate contact information for your Senators here and your State Representatives here.

     They have a chance to make a difference, and I for one intend to encourage them to do so.

 

ActiveRain Members - HGTV’s "House Hunters" Is Now Casting and Looking for YOU!

                     

HGTV’s hit TV series, House Hunters, is looking for Homebuyers and Real Estate Agents who want to appear on the show!  ActiveRain and HGTV are working together in an effort to find qualified candidates who may be interested in sharing their "House Hunting" journey on National Television. 

This could be a huge opportunity, and a lot of fun for some of our members and their clients.

House Hunters follows buyers and their agents on the hunt as they find just the right house for them—and every story is different.  If you’re an energetic and outgoing Real Estate Agent currently working with a Homebuyer, we'd love to hear from you. 

Are you in Pennsylvania, New Jersey, Missouri, Minnesota, Georgia or Colorado?

House Hunters is currently looking for Homebuyers who are:

Buying within a 90 min. drive of downtown Philadelphia, Denver, Atlanta, Minneapolis/St. Paul and St. Louis

Closing in the next 1-2 months, this includes buyers who are actively bidding on a home or newly under contract

Fun, enthusiastic, and have a great story to tell

If you're interested, let me know and I'll forward your information to their Associate Producer.  If you'd rather, you can also apply directly at HouseHunters@HighNoonEntertainment.com.  Thanks for helping us find some members and clients for their show, we're excited about assisting them with this endeavor.

House Hunters airs weeknights at 9/8c on HGTV and is produced by High Noon Entertainment.  To learn more about the show visit HGTV.com/HouseHunters.  We appreciate your support with this Casting Quest.