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Home sales contracts leap higher

April 6, 2010 By Leave a Comment

NEW YORK (CNNMoney.com) — Contracts for the sale of existing homes rose sharply in February, the National Association of Realtors’ (NAR) said Monday.

In the single-biggest monthly rise since October 2001, pending home sales rose 8.2% in February. Economists were expecting a 1% decrease.

It was also a 17% improvement over February last year. The unexpected increase could indicate demand driven by the federal government’s homebuyer tax credit, NAR said.

Buyers have to ink contracts by the end of April to take advantage of the tax credit, which offers first-time homebuyers up to $8,000, and those who are trading up as much as $6,500.

NAR’s report measures signed real estate contracts, but not completed sales, for existing single-family homes, condos and co-ops. Pending home sales are considered a forward-looking indicator since many of the contracts don’t result in completed transactions for many weeks or months.

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Texas Real Estate Commission Warns Public Of Real Estate Brokerage Scams in Dallas/Fort Worth Area

April 5, 2010 By Leave a Comment

The Texas Real Estate Commission Standards and Enforcement Services Division (TREC) has received complaints against a group of individuals and companies that have been doing business in the Dallas/Fort Worth area. The individuals and companies named in the complaints represent themselves as real estate agents and real estate brokerage companies but do not hold Texas real estate licenses. Owners of real property, tenants, buyers, and investors claim to have lost large sums of money related to the group’s real estate schemes. Among other things, the complainants allege that the group takes and keeps deposits for properties over which they have no authority or no control. They allegedly do not pay rent to property owners on property they claim to manage for those owners, or take large security deposits from tenants and then keep the money. They take deposits or earnest money on properties that they claim are available for a short sale but in reality are days away from foreclosure. Apparently, much of the solicitation of potential victims has been conducted through www.craigslist.com.

Before a consumer gives personal information, money, or financial information to a person claiming to be a real estate agent, they should verify the identity of the person and check whether that person actually holds a Texas real estate license. License information can be obtained by doing a “licensee lookup” on TREC’s website, www.trec.state.tx.us, or by calling TREC Monday through Friday between 7 a.m. and 6 p.m. at 1 (800) 250-TREC or (512) 465-3942. The public should be aware that Texas laws provide that consumers who use licensed Texas agents have the financial protection of the Real Estate Recovery Trust Account if they suffer actual damages caused by misconduct of a real estate licensee in a real estate brokerage transaction and later obtain a civil court judgment against the licensee that cannot be collected from the licensee. Consumers who use unlicensed individuals or companies to perform real estate brokerage activities are not eligible to be reimbursed by that account.

Based on information filed with the complaints, the group allegedly hires unsuspecting people to perform real estate brokerage services, such as showing real properties for sale or lease and writing contracts or leases, and misrepresents to the “employees” that a real estate license is not required in order to perform those services. These employees are also apparently solicited via craigslist. Unlicensed real estate activity can be subject to conviction for a Class A misdemeanor, punishable by up to one year in jail and criminal and civil penalties.

If anyone has questions or information regarding this activity or about other activities that require a real estate license, they should contact TREC at the number above. Also, additional information and a TREC complaint form can be obtained from the website above.

The mission of TREC is to assist and protect consumers of real estate services and foster economic growth in Texas. Through its programs of education, licensing and industry regulation, the Commission ensures the availability of capable and honest real estate service providers. More information at: www.trec.state.tx.us

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P.O. Box 12188 Austin, Texas 78711-2188 ● 1101 Camino La Costa Austin, Texas 78752 512-459-6544 ● 800-250-TREC ● www.trec.state.tx.us

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TALCB Enforcement Division Assists Law Enforcement in Combating Mortgage Fraud

March 24, 2010 By 1 Comment

The TALCB Enforcement Division regularly assists outside law enforcement and most recently provided assistance and information to the Collin County District Attorney’s Office and the FBI in connection with real estate appraisers connected to a major East Texas mortgage fraud scheme

The TALCB Enforcement Division regularly assists outside law enforcement and most recently provided assistance and information to the Collin County District Attorney’s Office and the FBI in connection with real estate appraisers connected to a major East Texas mortgage fraud scheme

The Texas Appraiser Licensing and Certification Board (TALCB)’s Standards and Enforcement Services Division (SES) regularly receives requests for assistance in ongoing state and federal mortgage fraud investigations. HB 716 (80th legislative session) created the Texas Residential Mortgage Fraud Task Force, of which TALCB is a member. TALCB’s SES Division regularly provides assistance to the Texas State Attorney General, county district attorneys’ offices, the Federal Bureau of Investigation, Texas Department of Public Safety, and the Department of Housing and Urban Development’s Office of Inspector General, among others. In late 2007, the Collin County District Attorney’s Office contacted TALCB SES and requested assistance with several mortgage fraud cases in which appraisers were alleged to be involved. TALCB SES Investigator Jack McComb was already investigating regulatory complaint cases involving some of these same real estate appraisers. TALCB’s assistance to Collin County led to the conviction of several of the appraisers.

Now the Federal Bureau of Investigation’s Dallas Division and the U.S. Attorney for the Eastern District of Texas have announced that a federal grand jury has returned a massive indictment against    forty individuals in connection with a major East Texas mortgage fraud scheme. The federal indictment includes many of the same individuals for which TALCB SES had assisted Collin County. Included in the indictment are four former TALCB licensed or certified real estate appraisers: Elizabeth Altizer, Pamela Ford, Joshua Melton, and William Doug Mitchell. TALCB revoked all four of these individuals’ licenses or certifications in 2008 and 2009. Elizabeth Altizer, Joshua Melton and William Doug Mitchell received final orders of revocation and Pamela Ford voluntarily surrendered her license. None are eligible to seek reapplication as real estate appraisers in Texas.

“I am very pleased that action is being taken by law enforcement authorities when it appears criminal conduct is occurring in real estate and mortgage transactions,” TALCB Chairman James Ratliff commented. Deloris Kraft-Longoria, TALCB SES Division Director adds, “we have been working cases on these individuals for many years in cooperation with our law enforcement partners. Unfortunately, appraisal fraud is an integral part of the mortgage fraud schemes that we see all too often at TALCB. In addition to revocation of their credentials as real estate appraisers, these individuals will now face criminal charges for their conduct.”

These former real estate appraisers and others charged in the indictment now face various federal criminal charges in connection with the mortgage fraud scheme, including charges of mail fraud, money laundering and conspiracy. (http://dallas.fbi.gov/dojpressrel/pressrel10/dl031610.htm) According to the indictment, “the purpose of the scheme was to defraud lending institutions by convincing them to approve mortgage loans for residential properties for which the property values had been fraudulently inflated.” An indictment is a formal accusation of criminal conduct returned by a grand jury and the individuals charged are presumed innocent until proven guilty at a future date in federal court.

The mission of TALCB is to protect the public interest by assuring that consumers of real estate appraisal services are served by real estate appraisers qualified in accordance with federal and state law and in sufficient numbers to facilitate the free flow of commerce and industry. More information at: www.talcb.state.tx.us

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The Rules Have Changed: Hiring the Right Lender

November 16, 2009 By Leave a Comment

Couple search web largeSo it’s time to buy a new (to you anyway) home.  It’s like a broken record, “rates are at all-time historical lows“.  You’ve selected the area and narrowed your search down to a few homes.  Before you submit an offer, you need to talk to a lender if you haven’t already.  How do you choose a lender?  Where will find you the best deal?

Keep in mind that you need to look at the big picture to find the best deal.  It doesn’t always come down to APR.

What to consider:

  • The rate (APR) - dependent on your credit, the loan amount, and other factors
  • Closing Costs – what it will cost you to close this loan and who pays it (you, the seller, or is it negotiable)
  • Fees – different banks and lenders will have a different set of fees
  • How Long & Likely They Are to Get You To The Closing Table

I’d like to go into this last one a bit because it’s special for our current market.  Gone are the days of assuming that getting pre-qualified or pre-approved means that you will get the loan. There are a lot of lenders who can still talk the big talk, but are not walking the big walk.  Don’t forget that the lowest rate is not the best deal if you loose the purchase after weeks or months of excitement. There are many lenders out there filled with empty promises, don’t set yourself up for such a heartbreaking situation!

What are your options:

  • Mortgage Brokers - They will shop your loan out to find you the best deal for your unique situation, but these middlemen can also slow down your loan since they don’t have the inside track at the actual bank.  They may not always know if a bank is lending money this month because it changes frequently in the current market.  Do your own research even if you hire a Broker.  Even Mortgage Brokers get stuck meeting condition after condition.
  • Your Bank - If you have a great relationship with your banker, this is a great option.  If their rates are competitive, you may sail through some of the verifications since you already have a relationship with them.  However, if your bank is not one in a position to readily make residential loans, you’ll end up with the run-around followed by heartbreak.  They won’t want to deny your loan but may keep it in underwriting until your frustration boils over and give up on them.
  • Another Bank – If you can get a recommendation from someone who as just closed a loan (good Realtors can help a ton), they can give you the best advice on who is following through with their loans (and promises).  Often times, dealing with the bank directly speeds things up greatly than when you go through a company that brokers deals out to different banks.  The trick is finding the right bank.

What to look for
The best deal isn’t always just the best rate.  Find a bank offering competetive rates and closing costs that is actually closing loans like yours in a reasonable time frame. Get recommendations from your Realtor, Title Companies, and ask your Realtor to ask their colleagues as well.

If you thought finding the perfect home was going to be hard, welcome to shopping for the perfect loan!

I am happy to give you my insight and recommendations based on what kind of loan product you are looking for.  In this market, your lending resources are more important than ever.

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In the News: How to nab a low-rate home loan

April 22, 2009 By Leave a Comment

From CNN Money, click to read the entire article

(Money Magazine) — On paper it seems like the perfect time to refinance. The average rate on a 30-year fixed mortgage recently hit a 20-year low when it fell below 5% in mid-March. And the Fed has said that it will spend $300 billion to buy back government-backed Treasury bonds; that will probably keep loan rates low for months to come.

But wade into the mortgage market, and you may quickly feel as if you’re trying to grab a dollar in a game-show booth where the money is blowing around: Those ultralow rates are right in front of you, yet maddeningly elusive.

Lenders, grappling with deadbeat homeowners and shifting regulations, have pared back on mortgage products and upped credit requirements. Still, you have a good incentive to try: If you took out a mortgage two years ago, when rates were in the mid-sixes, you stand to drop your rate nearly two percentage points, saving almost $300 a month on a $300,000 loan. Here’s how to navigate the roadblocks.

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Upside-Down Homeowners & How to Avoid This Fate

March 6, 2009 By Leave a Comment

upside down homeownerThe latest media focus has been on upside-down homeowners.  This means that they owe more on their home than the home is worth (aka negative equity). It takes something special for this to happen in Austin since we continue to see rising prices, but some homeowners have found themselves in this situation.  This is why 0-down mortgages are dangerous and why we are no longer seeing them everywhere.

Reuters is reporting that 1 in 5 American homeowners is upside-down.  In the Austin-Roound Rock area, reports have these numbers as high as 12.7%.  These are likely sub-prime mortgagors in suburban communities that took advantage of the much less regulated mortgages in the middle of this decade.

How to become upside-down:

  • 0% down mortgages
  • Home Equity Loans
  • Buying in the edge of suburbs that are not yet land-locked (resales in this situation compete with new homes)

To sell a home for less than what you owe, you must bring money to the closing when you sell.

Obama’s plan includes forgiving some of these debts, but could result in higher interest rates as banks lose money on loans.

How to become right-side-up:

  • Wait this out if you can and are in a negative equity situation.  We are already seeing a rebound in California.
  • Pay additional principal on your mortgage.  Even $100 extra each month can go a long way to get you ahead on both the principle and interest of your mortgage.
  • Use your tax refund to make an extra mortgage payment.  Like the option above, this will make a bigger difference than you think if you do this year after year.  You can take as much 10 years off of your 30-year mortgage with this tactic.  You may not be in the home that long, but this will help you build equity.
  • Always avoid $0 down mortgages!  Save before you buy and be prepared to put 20% down on a home under $400,000 and as much as 30% down on a home over $400,000.  Always be over prepared!
  • Buy in areas of town that always appreciate if you plan on moving soon, like central Austin or closer to central Austin.  I always recommend buying close to your office because this will save on your commute, gas, etc.

If you are looking for advice on refinancing, selling, remodeling, or on new laws and regulations, get in touch and I will make sure that you get the information you need.

And always avoid foreclosure by seeking expert advice before your missed payment!  On average, a foreclosure costs the bank over $200,000.  They would rather work with you to find a solution to keep you in the home because it actually saves them money as well! “Sticking it to the man” or just giving up hurts the entire community!

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In the News: Highest Home Appreciation in Texas

February 24, 2009 By Leave a Comment

And the award goes to… Austin — again!  This time from the financing front in First American CoreLogic’s newsroom.  Austin continues to prove its resilience.

Austin–Round Rock leads the country’s largest core-based statistical areas (CBSA) in home price appreciation with a 3.7 percent increase in 2008, according to First American CoreLogic.

Ready to invest in Austin?  Call me at 512.771.1776 or get in touch online to let me know what your goals are.

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What low interest rates mean to you

January 15, 2009 By Leave a Comment

“Interest rates are now at historical lows”

“Buy now to lock in a low rate”

You’ve heard that interest rates are low, but how does that translate to actually buying or selling a home?

When you’re buying, it’s simple.  You can a) save a lot of money, or b) buy a lot more house.

Let’s say you are looking at a $350,000 house with 20% down (or $70,000) for a loan of $280,000:

  • At 6.5%, you’ll pay $1,769.79 principle & interest each month for a total of $357,124.57 in interest paid over a 30 year note.
  • Lock in at 4.5% and you’ll pay $1,418.72 principle & interest each month for a total of $230,738.79 in interest paid over a 30 year note.

WOW, that’s a savings of  over $350/month
& $126,385.78 over the life of a 30-year loan!

But that house down the street is so beautiful… and just out of our price range.  Or is it?  If you need to stay just under $1800/month for principle & interest, your budget just rose from $350,000 with 20% down to a $420,000 house with $70,000 down or a $525,000 house with 20% ($105,000) down!

  • At 4.5% with on a $420,000 house with $70,000 down, your principle & interest payment on a $350,000 loan is just $1,773.40/month.
  • If you can afford 20% down (which most lenders prefer), you can afford a $525,000 for the same loan!

If you’re selling, it means that your pool of buyers is potentially larger, and you need to market to this idea!

So, are you ready to house-shop this spring!?

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Top Question: Is now a good time to refinance?

January 12, 2009 By Leave a Comment

moneyThis is one of the top 3 questions we are getting right now.  The answer is simple… probably.  I work with some of the best lenders in town, and if you have a mortgage at a rate greater than 6% APR, chances are that you can save money with a refinance.

There are other things to consider as well, such as how long you plan to stay in the house, what kind of equity you have, etc..  And if you have a great deal of equity, this may be a great time to refinance at a lower rate and take some equity out for that home improvement project.  Just understand that I’m making this suggestion based on a refinance, not a home equity loan.  It is also a great idea to have your Realtor® come out to make some recommendations for you on getting the most out of your home improvement project (a good Realtor® won’t mind because a- they love their job, and b- they’ll still be around when you do decide to sell).  When it does come time to sell, some projects will bring you much more value that others and this depends heavily on your location and your home.

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