Bribery to work with the Builder’s Lender

I’m going to jump right to the point…I think buyers working the builder’s lender is generally not a good idea. Some might say, “But the builder offered us $10,000 towards closing cost, special mortgage interest rates, a new fridge or perhaps an air conditioner… if we worked with their lender! How can this be bad??”

Think about it… where does the $10,000 (or what ever the cost of the incentive is) come from? The builder doesn’t have a big piggy bank of extra cash to fork out just because someone is going to work with their lender. The price of the incentive is factored into the price of the home. Yep, you probably just paid $10,000 too much for the home. Builders have to make a profit – they are not in the business to be a charity.

In addition, if you REALLY want that incentive, whether it’s money towards closing cost or air conditioning in your new home, your Real Estate Agent can certainly try negotiating this for you continuing to work with your preferred lender. It certainly doesn’t hurt for your agent to try negotiating this for you…worst case, if you still really want that air conditioner, you can opt for working with the builder’s lender.

Last but not least, consider this…when you work with the builder’s lender, you are working with the seller’s lender. This lender is dependent on transactions from the builder – they are gravy fed and they’re not going to upset the gravy train. This lender does not truly look out for your best interest, they have more to gain by keeping the builder happy. If you have a challenge pop up, how do you know the loan officer won’t share your information with the builder?

When you are working with possibly the largest purchase and debt of your lifetime, why risk working with someone who is potentially compromised and not looking out for your best interest?

Big Changes Coming to Real Estate Excise Tax for Washington State Homes

wordswag_1556818054305The Washington State Senate has passed revisions to excise tax that is paid when real estate is sold or transferred. Instead of having a flat rate, the new tax once signed into law by Governor Inslee, will be graduated. Some will enjoy a lower tax rate while others will pay a significantly higher tax rate. Real estate excise tax is typically a cost paid for by the seller. In San Juan County, the excise tax has been split by both the seller and buyer of real estate. Many would argue that excise tax (as with other cost of selling, such as real estate commission) is often passed onto the buyer as it is factored into the sales price. [Read more…]

King County Property Tax Valuation Notice

Did you receive your “Official Property Value Notice” over the weekend? Let’s just say that I’m not surprised to see how much our values have gone up…although, in my opinion, I think the 2018 assessed value of my home is higher than what I could most likely sell it for. [Read more…]

Why is My Mortgage Payment Going Up?

If you live in the greater Seattle area, you may be receiving a notice from your mortgage servicer stating that they need to adjust your mortgage payment because of an “escrow shortage”.  We actually just received such notice from our mortgage servicer. [Read more…]

Are markets shifting in Seattle?

This weekend while driving around my neighborhood in Seattle, I noticed more “for sale” and “open house” signs on homes. It’s a welcome sight after how long we’ve been in this tight market with very little housing inventory. [Read more…]

Gorgeous homes around $500k? Get OUT of Seattle!

This week, a real estate agent asked me to prepare some financial flyers for listings in Pierce County. The homes are stunning – I live in Seattle and cannot imagine having a large garage for our cars…although before living in Seattle, I had a sweet 2 3/4 garage. [Read more…]

How are property taxes determined?

Recently, after receiving a rate quote, a home buyer asked me, “What would the difference in taxes be if I bought in Pierce County verses King County?” [Read more…]

Do’s and Do Not’s of the Mortgage Process [Video]

In our last Seattle Real Estate Chat, Jim Reppond and I discuss what home buyers need to while in the mortgage process or considering buying a home.

Tune if for our next Seattle Real Estate Chat via our live Google Hangout on Tuesday, September 17, 2013 at 10:00 am Seattle time.
You can follow Seattle Real Estate Chat on Twitter at @SeattleREchat or #SeattleREchat