Short Sales Update

I am pleased to report that short sales seem to be getting easier, or we, the brokers, are getting better at it. Either way, it is definitely a more viable way for buyers to purchase a home than previously. The Short Sale has earned itself a troublesome reputation to overcome. Most, but not all banks are better prepared to handle a short sale offer and they have adopted a more cooperative stance in negotiations. As a review, the short sale is between the seller and their lender. The purchase is between the seller and the buyer. Personally, having been on both sides, both as the seller's agent and buyer's agent recently, I believe the short sale properties are a much more viable alternative for buyers who have some flexibility in their move in dates.

For Sale: 3BR/1+1BA Single Family House in Lakewood, WA, $279,000

For Sale: 3BR/1+1BA Single Family House in Lakewood, WA, $279,000.

 

 

For Sale: 3BR/2BA Single Family House in Spanaway, WA, $197,500

For Sale: 3BR/2BA Single Family House in Spanaway, WA, $197,500.



 

 

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Good News for Home Sales

Northwest MLS Reports that December's volume of pending sales around Western Washington nearly matched the total for the same month a year ago, which was the best December since 2006.  That is very good news.

VA Raises Loan Limits

There is a slight increase in the VA loan limit for 2011 on purchase transactions to 100% for King, Pierce and Snohomish counties.

• 2010  = $481,250.00


• 2011  =  $500,000.00

New higher limits apply to loans closed Jan 1,2011 - September 30, 2011.  Kitsap Co. limit remains at $ 417,000.00

Assessed values, are they important?

Tax assessment values in the Puget Sound area counties  are lower for 2011 than 2010 for median priced homes by  $20-$30,000.00 or more.  Land assessments are similar. Assessment values on MLS listings may be out of date.  Home prices are driven mainly by the market comps  and not assessed value.

What are Buyer’s Closing Costs? Who Pays?

What are the Buyer's costs?

Buyers and Seller's of property both have what is termed " customary costs " incurred for the transaction.  The buyer's customary costs are a  50/50 split of the escrow fee, (except for the portion required to be paid by the seller in an FHA or VA transaction ), prorated taxes, HOA dues if applicable, pre-paid interest and insurance premiums.  Additionally,  buyer's costs also include Loan fees, appraisal charges and title insurance costs for the lender.   These costs combined are what make up the buyer's closing costs and can add up to 3.0% - 3.5% of the purchase price for an FHA, VA or USDA loan or other special program loan.    ( Ex: up to $ 7500.00  on a $200,000.00 purchase ).  Buyer closing costs are generally lower when using a Conventional Loan and lowest for a cash purchase.

Who Should Pay?

Buyer's closing costs are just that, the buyer's costs.  In contrast, it has become almost a custom in our northwest area market for an offer to purchase to include a request for the seller to contribute funds to the buyer's costs to close.   In some cases the seller will include an offer to pay some of the buyer's closing costs pre-calculated into the listing price.    When making an offer to purchase that includes a request for buyer closing costs, keep in mind that the seller has closing costs as well ( see What are Seller's Closing Costs? on this Blog ) and work with your Realtor to structure an offer that can be accepted by the seller.   At times the price of the property may need to be raised to accommodate the buyer's costs.

Are There Advantages to Paying My Own Closing Costs?

Yes, for many buyers, closing costs are a deduction on your tax return.  If you have funds to close, it may be to your advantage to pay at least some or all of your own closing costs and negotiate a lower price for the property.   Seller's are more willing or able to accept a lower selling price if the offer does not include a seller contribution to buyer closing costs.

Why should I buy a home using a VA loan?

Why a VA loan?
The more you know about our home loan programs, the more you will realize how little “red tape” there really is in getting a VA loan. VA loans are often made without any down payment at all, and frequently offer lower interest rates than ordinarily available with other kinds of loans. Aside from the veteran’s certificate of eligibility and the VA-assigned appraisal, the application process is not much different than any other type of mortgage loan.



What is a VA guaranteed loan?
VA’s guaranty on the loan protects the lender against loss if the payments are not made, and is intended to encourage lenders to offer veterans loans with more favorable terms. The amount of guaranty on the loan depends on the loan amount and whether the veteran used some entitlement previously. With the current maximum guaranty, a veteran who hasn’t previously used the benefit may be able to obtain a VA loan. Qualified veterans and active duty military can obtain a loan of up to $417,000, or $625,500 in high-cost areas, with no money down. The amount depends on the borrower’s income level and the appraised value of the property. Let a knowledgeable, courteous VA loan specialist help you to maximize your VA benefits today!

Shane McGraw veteran and VA loan specialist at Legacy Group,  is happy to talk with you and answer your questions about VA loans.   Call him at ( 360 ) 698 6471.

Contributed by: www.ShaneMcGraw.com

2010 - Not your Grandfather's Real Estate Market !

Welcome to 2010 and the best home buyer's opportunity we are likely to see in your lifetime and mine.  Thanks to the information age we have been flooded with advice both good and not so good.  Consider this:

• Despite rumors to the contrary, banks and mortgage companies are open for business and are  lending money to qualified buyers.  Although lending guidelines have tightened,  loans are being funded in record numbers.  Lenders are hiring more workers to underwrite and process loans !


• Zero and low down financing programs are available.


• Home prices are much lower. Mortgage interest rates are at historic lows which should put a  smile on your face and give you bragging rights at social events for the rest of your life.


• First time buyers in particular can jump in the shallow water now  and ride the wave upward.


• Experts recently estimated ( and announced on K5 News ) we will see a 30 - 40% increase in property values by 2014 here in the Pierce, Kitsap, King County region.

Tacoma 98404

Tacoma's downtown and waterfront has experienced unparalleled growth in new  development over the last 5 years.  High end condos, hotels and restaurants have emerged, invigorating the city facade.   Theatre and Arts districts evolved from the addition of the world class Glass Museum, catering to the artist community with studios and lofts.  The University of Washington Tacoma campus is located in this area housed in beautifully restored historic style buildings.  Young people are flocking downtown, eager to experience trendy new cafes and night spots.  Tacoma 98404, an affordable downtown experience,  just 40 minutes from Seattle.