This is a website you can go to if you want to check whether or not insurance companies have shut down binding due to a storm being “in the box.” On the top left side, it will indicate whether or not the insurance companies have us on a storm watch. If we are in a storm watch on the date of your closing and your buyer has not bound their insurance yet (usually it will need to be paid for prior to closing), you will have difficulty closing.
This will be important to all of us.
http://www.citizensfla.com/index.cfm
Thursday, August 28, 2008
Wednesday, August 20, 2008
Rental Properties - Residential
This week I had a conversation with our residential property rental person. She is a licensed real estate agent who only handles annual residential rentals. I was surprised to hear that her property portfolio has dropped from 80 homes to about 50 homes. Rentals here have been abundant. Many residential properties were purchased for the sole purpose of investment with the grand plan of being flipped, and then, when that failed, turned into rentals. Also, homeowners who couldn’t sell their homes resorted to renting them out to subsidize mortgage payments on the home. Multiple property ownership isn’t uncommon here.
So, why the drop in inventory?
I seems home owners are giving their properties to the banks and walking away from the properties.
Does this affect you? You bet it does…
First off, If you are a renter, you may be served with a bank notice of foreclosure advising you that you must vacate your rental property. Think about this carefully. The scenario is as follows: You rent a home for a year, you pay one month rent up front, and a security deposit for damages. Mean while, the property owner, who is accepting your monies hasn’t made a mortgage payment for a few months, but he takes your rent. Seven months into your rental you get the notice of foreclosure and advisement to vacate the property. When the bank takes the property they also take title to the property. Will you ever see that security deposit or that one month in advance payment? I don’t have the answer to that. I don’t know how your rental was managed. However, I will advise this… You as a renter, or property owner, should use a reputable real estate company who specializes in property rentals. They will use a properly written lease, provide a tenant background check (always paid for by all adult renters on the lease prior to moving in), properly escrow monies, collect rents, serve notices, etc.
Does it affect the rest of us? Again, yes.
Where are those foreclosed properties going to?
They’re going to the auction block, or into the MLS as REO (bank owned) properties. They are sold cheap. Banks aren’t in the business of holding properties. And these properties all drive down all real estate price statistics through out the region.
On the up side, It’s a good time to be a buyer – A Ready, Willing, and Able buyer.
So, why the drop in inventory?
I seems home owners are giving their properties to the banks and walking away from the properties.
Does this affect you? You bet it does…
First off, If you are a renter, you may be served with a bank notice of foreclosure advising you that you must vacate your rental property. Think about this carefully. The scenario is as follows: You rent a home for a year, you pay one month rent up front, and a security deposit for damages. Mean while, the property owner, who is accepting your monies hasn’t made a mortgage payment for a few months, but he takes your rent. Seven months into your rental you get the notice of foreclosure and advisement to vacate the property. When the bank takes the property they also take title to the property. Will you ever see that security deposit or that one month in advance payment? I don’t have the answer to that. I don’t know how your rental was managed. However, I will advise this… You as a renter, or property owner, should use a reputable real estate company who specializes in property rentals. They will use a properly written lease, provide a tenant background check (always paid for by all adult renters on the lease prior to moving in), properly escrow monies, collect rents, serve notices, etc.
Does it affect the rest of us? Again, yes.
Where are those foreclosed properties going to?
They’re going to the auction block, or into the MLS as REO (bank owned) properties. They are sold cheap. Banks aren’t in the business of holding properties. And these properties all drive down all real estate price statistics through out the region.
On the up side, It’s a good time to be a buyer – A Ready, Willing, and Able buyer.
Monday, August 18, 2008
Tropical Storm Fay
Not really real estate, but what the heck.
Ok, so what do Floridians do when a big storm is on the horizon?
My wife and I have been here five years, which in my book qualifies us as Floridians. You’d definitely get an argument about that form the true natives.
I think the easiest preparation is to grab a jet to Chicago.
That not being practical, we start by letting the refrigerator contents run down. We didn’t buy one of those natural gas generators that look large enough to power up the space station. But it’s on our list… Everyone gasses up the cars before the storm. I thought this was silly at first. Then one year I saw the Palm Beach area without power for a couple of weeks. No electric, no gas pumps running. Here’s a good one. We fill up our bathtubs with water. That way, if those of us who are on a well loose electric, we can get water from the tub to put into the toilet to get it to flush. Northerners serviced by the county for water do it just because everyone else does. Now out to the garden. My wife has lots of really cute “things” in the garden. Tin frogs, metal butterflies, on metal poles, lots of plastic flamingos, you get the picture. Well, all that stuff has to go into the garage. Air born objects, you know. I spent the afternoon lightly pruning the palm trees. Not a pleasant task, but my last landscaper killed a palm from over pruning, so I do the trees myself. Of course, the pool area has to be evacuated of chairs, tables, more tin frogs on metal poles, and those relay neat large potted plants that suddenly aren’t so neat as you drag them into shelter. Other neighbors are putting their window protection devices of their choice. I have never sweat so much in my life.
One last thing to mention… This was all for tropical storm Fay, which is one day away. It may be a Cat 1 hurricane by tomorrow; it may not. If my wife wants all those tin things back in the garden after this storm do you think they'll go back there? Darn right… mama didn’t raise a fool!
Ok, so what do Floridians do when a big storm is on the horizon?
My wife and I have been here five years, which in my book qualifies us as Floridians. You’d definitely get an argument about that form the true natives.
I think the easiest preparation is to grab a jet to Chicago.
That not being practical, we start by letting the refrigerator contents run down. We didn’t buy one of those natural gas generators that look large enough to power up the space station. But it’s on our list… Everyone gasses up the cars before the storm. I thought this was silly at first. Then one year I saw the Palm Beach area without power for a couple of weeks. No electric, no gas pumps running. Here’s a good one. We fill up our bathtubs with water. That way, if those of us who are on a well loose electric, we can get water from the tub to put into the toilet to get it to flush. Northerners serviced by the county for water do it just because everyone else does. Now out to the garden. My wife has lots of really cute “things” in the garden. Tin frogs, metal butterflies, on metal poles, lots of plastic flamingos, you get the picture. Well, all that stuff has to go into the garage. Air born objects, you know. I spent the afternoon lightly pruning the palm trees. Not a pleasant task, but my last landscaper killed a palm from over pruning, so I do the trees myself. Of course, the pool area has to be evacuated of chairs, tables, more tin frogs on metal poles, and those relay neat large potted plants that suddenly aren’t so neat as you drag them into shelter. Other neighbors are putting their window protection devices of their choice. I have never sweat so much in my life.
One last thing to mention… This was all for tropical storm Fay, which is one day away. It may be a Cat 1 hurricane by tomorrow; it may not. If my wife wants all those tin things back in the garden after this storm do you think they'll go back there? Darn right… mama didn’t raise a fool!
Sunday, August 17, 2008
Homeowner Hazard Insurance and Tropical Storms
Coastal Storms and Real Estate
A word about tropical storms:
NOAA recently announced Tropical storm Fay in the Caribbean. Once this announcement was made, all homeowner property hazard insurance applications are subject to being frozen. No new policies are written until the storm passes. The weather system does not need to be classified as a hurricane for this to occur.
Insurance companies operating as they do, I would assume this business practice, in some ways, applies to all ocean coastal areas in the USA. I only have direct knowledge with Florida, USA.
As a buyer or seller, if your real estate deal has a mortgage contingency, you cannot close without the soon to be purchased property having hazard insurance. If the buyer was waiting for the insurance policy to be underwritten on closing day, and NOAA announces a tropical storm, and this tropical storm lasts through your scheduled closing date, and that insurance policy wasn’t underwritten, you will not close until NOAA lifts it’s warning.
How is this avoided?
As a buyer, during storm season, do not delay having your pending "new property" underwritten by an insurance company in advance of closing date.
As a seller, Make sure your real estate representative is on top of things and in communication with buyer or buyer’s representative.
Remember… Tropical storm / No hazard insurance / No closing.
Link http://www.noaawatch.gov/
A word about tropical storms:
NOAA recently announced Tropical storm Fay in the Caribbean. Once this announcement was made, all homeowner property hazard insurance applications are subject to being frozen. No new policies are written until the storm passes. The weather system does not need to be classified as a hurricane for this to occur.
Insurance companies operating as they do, I would assume this business practice, in some ways, applies to all ocean coastal areas in the USA. I only have direct knowledge with Florida, USA.
As a buyer or seller, if your real estate deal has a mortgage contingency, you cannot close without the soon to be purchased property having hazard insurance. If the buyer was waiting for the insurance policy to be underwritten on closing day, and NOAA announces a tropical storm, and this tropical storm lasts through your scheduled closing date, and that insurance policy wasn’t underwritten, you will not close until NOAA lifts it’s warning.
How is this avoided?
As a buyer, during storm season, do not delay having your pending "new property" underwritten by an insurance company in advance of closing date.
As a seller, Make sure your real estate representative is on top of things and in communication with buyer or buyer’s representative.
Remember… Tropical storm / No hazard insurance / No closing.
Link http://www.noaawatch.gov/
Saturday, August 16, 2008
Chicago Suburban Area Real Estate News
Palatine, IL, USA
We received a phone call yesterday asking if we were aware that Prudential bought Starck Real Estate.
Incorrect.
Starck Real Estate, corporate office in Palatine, IL, has expanded its owned offices by three.
Starck has purchased three preexisting Prudential office locations and also procured franchise rights to the Prudential name. By my count, this adds to the 11 Illinois counties that
Starck (Now Prudential Stark) holds real estate brokerage offices in.
We received a phone call yesterday asking if we were aware that Prudential bought Starck Real Estate.
Incorrect.
Starck Real Estate, corporate office in Palatine, IL, has expanded its owned offices by three.
Starck has purchased three preexisting Prudential office locations and also procured franchise rights to the Prudential name. By my count, this adds to the 11 Illinois counties that
Starck (Now Prudential Stark) holds real estate brokerage offices in.
Wednesday, August 13, 2008
FHA Loans Are "Rediscovered"
The “Rediscovered” FHA Loan
I spoke to our lender the other day. She said the majority of the loans she is writing are FHA.
What is FHA? What does this translate into?
To begin, FHA is an acronym for Federal Housing Administration. FHA is part of HUD, which is an acronym for Department of Housing And Urban Development. An FHA loan simply means the loan carries a guarantee. FHA provides mortgage insurance on loans made by FHA-approved lenders throughout the United States and its territories. FHA has been insuring properties since 1934.
FHA mortgage insurance protects lenders against loss if the homeowner defaults on their mortgage loan. The lenders bear less risk because FHA will pay the lender if a homeowner defaults on their loan. Loans must meet certain requirements established by FHA to qualify for insurance. You do not need a perfect credit score to qualify. FHA does not have a minimum score requirement. However, many FHA lenders have set their own minimum standards at 580.
The FHA Advantage
Conventional lenders are requiring higher down payments and higher credit scores, as was the norm (a proper norm in my opinion) a few years ago. FHA loans have the lowest down payment options available in today’s mortgage market. FHA allows down payments as low as 2.55% for borrowers using their own funds, or a 3% down payment if the down payment is a “gift” from family, employer, or charity organization.
FHA Has Increased Loan Limits
Loan limits have been increased. The limit varies nationally. Go to https://entp.hud.gov/idapp/html/hicostlook.cfm to obtain your local loan limit numbers.
This is a realistic increase. For example, the limit in my geographic area of Sarasota, FL, USA, is now $442,000. This value is right in the middle of the majority of home sales.
There is additional information at http://www.hud.gov/fha/.
I spoke to our lender the other day. She said the majority of the loans she is writing are FHA.
What is FHA? What does this translate into?
To begin, FHA is an acronym for Federal Housing Administration. FHA is part of HUD, which is an acronym for Department of Housing And Urban Development. An FHA loan simply means the loan carries a guarantee. FHA provides mortgage insurance on loans made by FHA-approved lenders throughout the United States and its territories. FHA has been insuring properties since 1934.
FHA mortgage insurance protects lenders against loss if the homeowner defaults on their mortgage loan. The lenders bear less risk because FHA will pay the lender if a homeowner defaults on their loan. Loans must meet certain requirements established by FHA to qualify for insurance. You do not need a perfect credit score to qualify. FHA does not have a minimum score requirement. However, many FHA lenders have set their own minimum standards at 580.
The FHA Advantage
Conventional lenders are requiring higher down payments and higher credit scores, as was the norm (a proper norm in my opinion) a few years ago. FHA loans have the lowest down payment options available in today’s mortgage market. FHA allows down payments as low as 2.55% for borrowers using their own funds, or a 3% down payment if the down payment is a “gift” from family, employer, or charity organization.
FHA Has Increased Loan Limits
Loan limits have been increased. The limit varies nationally. Go to https://entp.hud.gov/idapp/html/hicostlook.cfm to obtain your local loan limit numbers.
This is a realistic increase. For example, the limit in my geographic area of Sarasota, FL, USA, is now $442,000. This value is right in the middle of the majority of home sales.
There is additional information at http://www.hud.gov/fha/.
Monday, August 11, 2008
Working With Short Sales
I’ll wrap up this short sale topic with this posting, as all I’m trying to accomplish is let people know what’s happening in today’s market.
After many days of phone calls to two lenders and the property owner, I came to these conclusions…
The property was originally priced by 33% over current market prices. (That’s unacceptable).
The company managing the first mortgage loan (the first lean holder) was easy to communicate with. This loan has been slated for foreclosure, with the foreclosure date unknown. They were unaware that a second lean encumbered this property.
The second lean holder, a nationally known bank that had provided a home equity loan was extremely difficult to contact. The representative of this lender who I finally was able to speak to was unaware of the first mortgage lean (That’s unacceptable). This bank representative stated that unless they received 70% of the debt from sale, they would not approve the HUD1, making it impossible to close on this property. This lender will never realize a 70% recovery. They will be fortunate if they realize a 5% recovery of debt.
Having devoted several hours of work on this property, I informed the property owner that I would not list a property that will not close.
I suggested, for a second time, The property owner visit the US Department of Housing and Urban Development (HUD) website http://www.hud.gov/foreclosure/ and refer to their on-line assistance. I also suggested speaking to an attorney, and perhaps discussing filing bankruptcy.
The unfortunate part is, most of this could have been avoided.
Even if the property owner could not afford an attorney at this time, had the property owner of this rental property not turned his back on these debts, had the property owner contacted HUD and sought their assistance, and had the property owner used prudence in retaining a real estate professional, this house may have already been sold, and the owner released from the debts tied to this property.
Lenders are currently overwhelmed with faltering mortgage loans. Banks do not want to own properties. You can’t wait 6 months and then expect to easily avoid a pending foreclosure. It’s an involved process. Once your loan reaches the lender’s loss mitigation attorneys, things get even more complicated for the property owner, and anyone else involved.
If you are in a financial real estate bind, there are avenues you can pursue to resolve the debt. Doing nothing until the last minute isn’t one of them.
Questions? (I can't guarantee an immediate reply)
After many days of phone calls to two lenders and the property owner, I came to these conclusions…
The property was originally priced by 33% over current market prices. (That’s unacceptable).
The company managing the first mortgage loan (the first lean holder) was easy to communicate with. This loan has been slated for foreclosure, with the foreclosure date unknown. They were unaware that a second lean encumbered this property.
The second lean holder, a nationally known bank that had provided a home equity loan was extremely difficult to contact. The representative of this lender who I finally was able to speak to was unaware of the first mortgage lean (That’s unacceptable). This bank representative stated that unless they received 70% of the debt from sale, they would not approve the HUD1, making it impossible to close on this property. This lender will never realize a 70% recovery. They will be fortunate if they realize a 5% recovery of debt.
Having devoted several hours of work on this property, I informed the property owner that I would not list a property that will not close.
I suggested, for a second time, The property owner visit the US Department of Housing and Urban Development (HUD) website http://www.hud.gov/foreclosure/ and refer to their on-line assistance. I also suggested speaking to an attorney, and perhaps discussing filing bankruptcy.
The unfortunate part is, most of this could have been avoided.
Even if the property owner could not afford an attorney at this time, had the property owner of this rental property not turned his back on these debts, had the property owner contacted HUD and sought their assistance, and had the property owner used prudence in retaining a real estate professional, this house may have already been sold, and the owner released from the debts tied to this property.
Lenders are currently overwhelmed with faltering mortgage loans. Banks do not want to own properties. You can’t wait 6 months and then expect to easily avoid a pending foreclosure. It’s an involved process. Once your loan reaches the lender’s loss mitigation attorneys, things get even more complicated for the property owner, and anyone else involved.
If you are in a financial real estate bind, there are avenues you can pursue to resolve the debt. Doing nothing until the last minute isn’t one of them.
Questions? (I can't guarantee an immediate reply)
Saturday, August 9, 2008
Short Sale Marketing
Now I must view the property to see if I want to consider taking the listing. After receiving the property location, I call the current listing agent to setup a preview of the property. I have to set up my viewing with the listing agent. After several phone calls, I reach the listing agent who states the home is on an electric lock box. This is good because most of us have an electric key. In fact, you can only have an electric key if you are an active real estate agent. I drive out to the property. The house has a combination lock box on it. I don’t have the combination, because the agent said the house was on an electric lock box. This is a vacant house. All the doors are locked. I call the agent to get the combination (the agent’s real estate office has absolutely no information on this). I wait a reasonable amount of time and finally leave. The agent calls me back about 90 minutes latter. Seems the agent in California (I’m in Florida) and has no idea of why there is a combo box on the home. She thinks perhaps the bank put the new lock box on the door, and the agent is now wondering where her electric lock box (they aren’t cheep) is.
Still fairly simple, yes?
Still fairly simple, yes?
Friday, August 8, 2008
The Short Sale
Here's how it starts from my end...
I received a phone call form the other side of Florida. A property owner wanting to list his house with me. He did not make a mortgage payment for the past 6 months, he has been in contact with a lean holder, the property was listed with another company, and he now wanted me to list the property for him when the current listing agreement expired.
Sounds simple so far, doesn't it?
I received a phone call form the other side of Florida. A property owner wanting to list his house with me. He did not make a mortgage payment for the past 6 months, he has been in contact with a lean holder, the property was listed with another company, and he now wanted me to list the property for him when the current listing agreement expired.
Sounds simple so far, doesn't it?
Thursday, August 7, 2008
The Tampa, Florida Market
I finally have a chance to briefly summarize the Tampa, Florida residential market…
Tampa’s real estate as viewed from the Multiple Listing Service:
Today, Tampa has 5049 single family homes listed as Active listings in the MLS. The MLS also indicates 2731 condo/townhouse active listings.
Of these: 865 single family homes are flagged as being in financial distress (foreclosure, short sale, etc), including a 5121 sq ft lake front, new construction, priced at $1,675,000. There are 295 condos/townhouses, including a 3116 sq ft waterfront penthouse also flagged as financially distressed.
Keep in mind, this geographic area is large and encompasses all types of properties excluding commercial.
Tampa’s real estate as viewed from the Multiple Listing Service:
Today, Tampa has 5049 single family homes listed as Active listings in the MLS. The MLS also indicates 2731 condo/townhouse active listings.
Of these: 865 single family homes are flagged as being in financial distress (foreclosure, short sale, etc), including a 5121 sq ft lake front, new construction, priced at $1,675,000. There are 295 condos/townhouses, including a 3116 sq ft waterfront penthouse also flagged as financially distressed.
Keep in mind, this geographic area is large and encompasses all types of properties excluding commercial.
Monday, August 4, 2008
Federal Tax Credit For Home Buyers
I must pass this on as I'm sure many are unaware:
First time home buyers, or those who haven't owned a home for the past 3 years could be elegable for a federal tax credit.
http://www.federalhousingtaxcredit.com/
First time home buyers, or those who haven't owned a home for the past 3 years could be elegable for a federal tax credit.
http://www.federalhousingtaxcredit.com/
Sunday, August 3, 2008
A little more about the Sarasota area...
On the upper end of the property spectrum, There are 11 homes available priced between $10,000,000 and $18,500,000. These are gorgeous homes. None of these estates are flagged as financially distressed properties.
There are 1,038 properties priced between 1,000,000 and $9,999,999. Ten of these are flagged as short sales or foreclosure.
I'll try to touch upon the Tampa area next posting.
On the upper end of the property spectrum, There are 11 homes available priced between $10,000,000 and $18,500,000. These are gorgeous homes. None of these estates are flagged as financially distressed properties.
There are 1,038 properties priced between 1,000,000 and $9,999,999. Ten of these are flagged as short sales or foreclosure.
I'll try to touch upon the Tampa area next posting.
Saturday, August 2, 2008
Gulf Coast MLS Property Listings
I just checked today’s MLS listings in Sarasota County, Florida.
There are 10,569 properties listed in Sarasota County. These are various types of properties other than commercial.
Of these, 517 listings are flagged with the phrases “Bank Owned, Pre-Foreclosure, In Foreclosure”.
443 are single-family homes.
53 are condos.
This is positive news for buyers.
There are 10,569 properties listed in Sarasota County. These are various types of properties other than commercial.
Of these, 517 listings are flagged with the phrases “Bank Owned, Pre-Foreclosure, In Foreclosure”.
443 are single-family homes.
53 are condos.
This is positive news for buyers.
Subscribe to:
Posts (Atom)
