Home Buyers and Sellers Quiz


Home Buyers and Sellers Quiz

1.   The best loan product for first-time buyers with little or no money to put down is often:

⃝           An adjustable rate mortgage

⃝           A 30 year fixed rate loan

⃝           An FHA insured loan

⃝           A jumbo mortgage

2.   A typical home owners’ insurance policy doesn’t protect against:

⃝           Floods

⃝           Injuries to those making deliveries to the property

⃝           Damage to buildings not attached to the house

⃝           The theft of a computer

3.   Which of the following is not an option if an appraisal is too low? 

      ⃝     Resolving the problem with the appraiser

⃝     Lowering the price of the home

⃝     Buying an insurance policy to cover the difference

⃝    Having the buyers come up with a bigger down payment

4.   To help ensure a good credit rating when applying for a loan, borrowers should:

⃝    Pay all credit card bills on time

⃝    Not make any large purchases on credit before closing

⃝    Pay off credit card balances if possible

⃝    All of the above

5.   If you are suffering from “buyer’s remorse”  the best thing  a real estate agent can do is:

⃝    Tell them that the sellers will sue them

⃝    Go over contract terms again and offer reassurance

⃝    Urge the sellers to immediately offer a lower price

⃝    Ignore their concerns; after all, you have a contract

6.   A good first step to eliminating basement dampness is to:

⃝           Re-grade the lot so that the ground slopes away from the house

⃝           Repair gutters to channel water away from the house

⃝          Remove porous material from the foundation

⃝          All of the above

7.   Which of the following will make a move easier?

⃝           Holding a garage sale to weed out unwanted items

⃝          Checking home owners’ insurance to make sure that household goods are covered     during a move

⃝          Arranging for telephone service, Internet service, and utilities for the new home

⃝           All of the above

8.   Which of the following closing costs is not typically paid by the buyers?

⃝           Private mortgage insurance

⃝           Title search

⃝           Property inspection

⃝           Real estate property tax proration

Answers

1.       The best loan product for first-time buyers with little or no money to put down is often:

ANSWER:  An FHA-insured loan:   FHA-insured loans require down payments as low as 3 percent and are targeted to first-time buyers.

2.       A typical home owners’ insurance policy doesn’t protect against:

ANSWER: Floods
Most policies do not cover floods or water damage resulting from floods or sewer backups. It’s common for lenders to require additional coverage for flood damage if the property is located in a flood plain.

3.       Which of the following is not an option if an appraisal is too low?:

ANSWER: Buying an insurance policy to cover the difference.  No insurance product is available for this type of situation.

4.    To help ensure a good credit rating when applying for a loan, borrowers should:

ANSWER: All of the above
To boost their credit scores, buyers should pay credit card bills on time, avoid large credit purchases before the closing, and pay down their credit card bills as much as possible. Encourage consumers to review their credit report at least once a year. Inaccuracies aren’t uncommon, and it takes time to set the record straight.

5.    If the buyers try to cancel the contract because of buyers’ remorse, the best thing your agent can do is:

ANSWER: Go over contract terms again and offer reassurance
Often fear is the motivator for buyers’ remorse and a little reassurance is all that is needed to keep the deal on track. Agents should never ignore a buyers remorse.

6.    A good first step to eliminating basement dampness is to:

ANSWER: All of the above
Re-grading the lot, repairing the gutters, and removing porous materials from the foundation all may help to eliminate basement dampness. However, if buyers are concerned about the possibility of mold, you should advise them to hire an expert to evaluate the property.

7.    Which of the following will make a move easier?

ANSWER: All of the above
Holding a garage sale to sell unwanted items, checking your home owners’ insurance policy for household goods coverage, and arranging for telephone service and other utilities at the new home all will contribute to an easier move.

8.    Which of the following closing costs is not typically paid by the buyers?

ANSWER: Real estate property tax proration
Because property taxes are paid in arrears, sellers generally pay a prorated share of the taxes for the current year that will be paid in the succeeding year. However, any closing cost can usually be paid by either party, depending on local custom and the terms of the contract.

 

Positive Signs Abound for Housing


Positive Signs Abound for Housing

The first quarter of 2012 was the best first quarter for real estate in five years, and pending contracts suggest that the second quarter of 2012 will be the best second quarter in five years, NAR Chief Economist Lawrence Yun said this morning at the Residential Economic Update during the NAR Midyear Legislative Meetings & Trade Expo.

Moreover, he said the second half of this year could be even better than the first, in part because of continued increases in rental costs and record affordability of homes. “Renters are getting squeezed, and they don’t want to rent anymore,” Yun explained. “This could be the year we see the release of pent-up demand.”

Home prices have been skipping along the bottom for about a year now, Yun said, a trend that has drawn investors into the market. These investors have helped housing through a couple of difficult years and partly mitigated the dysfunctional mortgage market.

“Right now is the time to buy low,” he said. “Investors are coming in to take advantage. Second homes started to recover nicely last year because of investors.”

However, home values are poised for a rebound as more traditional buyers move back into the market, Yun said. In fact, this has already started to happen in areas such as Phoenix and Miami, which have seen year-over-year (March 2011 to March 2012) double-digit percentage increases in home prices.

As real estate improves, consumer psychology around home ownership will change, he added. Coupled with the recent — if relatively modest — job growth and stock market gains, conditions are right for a sustained housing recovery.

If you are thinking of buying or selling, talk to a real estate professional who can get you the answers you need to make an informed decision.

As always, if I can help with any of your real estate needs, anywhere in the country, please feel free to text or call me at 615 417-8182 or email me at RolandLow1@gmail.

Roland

Source: Daily Real Estate News | Thursday, May 17, 2012

 

Bank of America Starts Writing Off Mortgage Debt


Bank of America Starts Writing Off Borrowers’ Mortgage Debt

More than 200,000 underwater home owners with mortgages through Bank of America may be eligible to have a reduction in the amount they owe on their loan, which could possibly trim their monthly payments by up to 35 percent.

Bank of America has sent letters to home owners who may be eligible to take part in a program to write-off a portion of underwater home owners’ mortgage principal, reducing it by, on average, $150,000 each.

The bank’s move stems from the $25 billion settlement, which it and four other of the nation’s largest lenders reached earlier this year with federal and state officials over past foreclosure mishandlings. Bank of America agreed to reduce some home owners’ mortgage principles as part of the settlement.

Home owners eligible for the principal write-offs must be “underwater” (owing more on their mortgage than their property is currently worth), have a loan owned or serviced by Bank of America, and be at least 60 days behind on their mortgage payments as of the end of January. In order for the mortgage reductions to be made permanent, home owners must make at least three on-time payments.

“To the extent principal reduction and other modification tools help us turn mortgages headed for possible foreclosure into long-term performing loans, it will be positive for home owners, mortgage investors and communities,” says Ron Sturzenegger, a legacy asset servicing executive.com.

If you are thinking of buying or selling, talk to a real estate professional who can get you the answers you need to make an informed decision.

As always, if I can help with any of your real estate needs, anywhere in the country, please feel free to text or call me at 615 417-8182 or email me at RolandLow1@gmail.

Roland

Source: “Bank of America Starts Mortgage Reduction Effort,” The New York Times (May 7, 2012) and Bank of America

Five New ‘Rules’ to Home Buying


Five New ‘Rules’ to Home Buying

With signs of a housing turnaround getting stronger, housing experts say buyers are finding several recent changes when they go to put in an offer on a home. A recent article at U.S. News & World Report highlights some of these changing “rules” for your home buyer clients:

1. Lowball offers won’t likely stick: Sure, deals are still around, but lowball offers that aren’t in line with comparable sales data are increasingly proving to be a waste of time. Buyers may be better off asking for seller concessions, such as closing cost assistance or making home repairs, rather than making offers way below the asking price. “Keep in mind that a lowball number may turn off the seller and close down any chance at negotiation,” the U.S. News & World Report article cautions potential buyers.

2. Get pre-approved: Getting a loan isn’t easy nowadays as lenders have tightened their credit standards in recent years. Serious buyers should check their credit and get pre-appoved for a loan to determine how much of a home they can even afford even before they start their home search.

3. Get realistic about the market: Real estate agents can show buyers comparable nearby sales to help educate them about local market conditions. Transactions from the last six months are the most important. Another important piece of information for buyers is knowing how long properties are staying on the market.

4. Expect some competition. Housing inventories are dropping in many areas and spurring an increase in demand. Home buyers may face increased competition for the home they want, particularly among short sales and foreclosed properties, in which they may be up against investors who are making all-cash offers. That’s why experts say it’s important bank-financed buyers know their financial situation in advance to better compete.

5. Conduct property research: Real estate agents will help guide clients on what all they need to do when they find a property they like, but one important step nowadays: Buyers should hire a title company to check for any liens or tax arrearages, the article notes. Housing experts also recommend hiring a home inspector, verifying the accuracy of the property line (by asking seller for the survey or having your own conducted), and make sure all necessary disclosures about the property, required by the state, have been made.

If you are thinking of selling your home, talk to a real estate professional who can give you the information you need to make an informed decision.

As always, if I can help with any of your real estate needs, please don’t hesitate to text or call me at 615 417-8182 or email me at RolandLow1@gmail.com.

Roland

Source: “Traditional ‘Rules’ of Home Buying Return,” US News & World Report (May 1, 2012