The Importance of Good Signage

March 29, 2007 by 3 Comments

SkcarLast week, I sponsored Jillayne Schlicke’s class at the Seattle King County Association of Realtors on High Impact Blogs and Podcast.

I had a great time.  I thought I was just bringing in a few snacks for the hungry Realtors to keep their brains going during her course…little did I know she would call on me to help the class build their blogs.  It was fun.   What was not fun…was trying to find SKCAR’s office.   

I thought I had it all planned out.   The night before, I entered their address into the car I normally drive and the system mapped it all out.  Simple!   Except my husband decided to drive that car.  I entered the address again into our other car…and no luck!  Our Japenese navigation was fine, our Swedish nav–not!   No problem, I use to be in title insurance and I’m certain I can find their office.

It’s located off I-90 in Factoria–super easy from West Seattle, where I live.  I stopped off at the Factoria QFC for sandwhiches and drinks and proceed to where I think their office should be.   There is an office standing alone with what appears to be appartment buildings.   I don’t see any sign that says SKCAR or Realtor-anything.  The building has the logo above (I snapped the photo above with my Treo 650)…I thought it said IMI or 1001 building.   It just couldn’t be right.   So I do a u-turn and drive down 32nd SE in the oppositie direction until I realize this wasn’t right, either.

That’s when I pulled out my trusty old Treo 650 and hop on the internet to SKCAR’s website which has directions!   Come to find out, their office IS at the lone building I was originally at.   

Good thing I didn’t buy hot sandwhiches with all of my driving around!   Class was great and all is good (just a little more driving than necessary).

Hey SKCAR, how about some signage on the building (beyond the gold lettering on the glass front door)?

Filed Under: Real Estate Agents, Tech/Tools of the Trade, Weblogs

Almost a Duplex in West Hill Auburn

March 28, 2007 by Leave a Comment

Modo1_4This West Hill Auburn home is almost a duplex with complete separate living quarters down stairs.   Pefect for guests or caring for extended family.  And plenty of parking with the carport and garage.

This home was virtually rebuilt in 2005 and features hardwood floors, slab granite counters, stainless steel appliances…I could go on and on!

The seller has all ready bought their next home and are getting ready to move.Modo3

You, or someone you know, can be enjoying taking in the Mt.  Rainier, Cascade and valley views from the expansive deck.   For more pictures and details about this home click here. 

  • Offered at $559,990 Modo2
  • MLS# 27039759
  • 5 Bedrooms/3 Bathrooms

This home is listed by Maureen Donhauser of Windermere West Campus.   I’m not a real estate agent…nor do I play one on TV.  I’m just a Mortgage Planner trying to help out my client.    If you need financing for this fine home, I am more than happy to help you.

Filed Under: Real Estate, Real Estate Agents, Residential Purchase

A Real Estate Agent’s Guide for Subprime Buyers

March 19, 2007 by 2 Comments

Mpj040923700001Unless you’ve just been rescued from a deserted island, you have heard the news about what’s going on in the subprime mortgage industry.   It’s not a pretty site and in fact, it’s getting dicier every day with Alt-A lending (not quite subprime lending…it’s more of the stated income and 80/20 types of loans) tightening up, many people you helped find homes for during the past couple years no longer qualify for a mortgage.   

For example, on the afternoon of Friday, March 9th, I received a quote for a client with a mid score of 750 who needed an 80/20 mortgage stated income.   I was planning on brokering to Greenpoint Mortgage.   That very evening, I received an email stating that Greenpoint Mortgage is no longer doing ANY 80/20 mortgages.   Greenpoint Mortgage is NOT a subprime lender.   They are more along the lines of "alt-a" (not quite "conforming").  I had to contact the gentleman I had sent an email to hours earlier to tell him that I no longer had a mortgage program for him. 

There are worse stories surfacing as well.   When New Century Mortgage, one of the nations largest subprime lenders and a poster-child for the subprime mess, could no longer do fundings, many potential home buyers were at the funding stage of their mortgage…with no funds and no mortgage.    Yes, it’s possible if you have a subprime buyer, you may get all the way to closing only to have the lender not able to fund the mortgage.   

What should you do?

1.  Ask your potential home buyer if they have a subprime/alt-a mortgage.   Some signs might include:

  • 80/20 Financing (what does the preapproval letter say about loan-to-value?)
  • Stated income
  • Prepayment penalty (you can determine this on the Federal Truth In Lending, your buyer may not know)

2)  Ask the Loan Originator if the lender they are working with is subprime or alternative.   Even traditional "a paper" lenders, such as Countrywide and Wells Fargo, have subprime divisions.   

So what if your buyer is subprime or using alternative (alt-a) type financing?

  • You may want to consider closing quickly.   Many programs are disappearing quickly (such as 80/20s and stated income).   Credit score requirements are being raised and underwriting guidelines are toughening up for these types of loans.   Some lenders may honor programs if the loans are locked…some may not have any choice.
  • You might have the buyer provide a reduced earnest money.  In the event of a worse case scenario, in case they lose the funds if their financing contingency is waived.

How about your clients who have closed using subprime 80/20 mortgages?  This could be an excellent time to reach out to them.   They may be hearing all of the bad press on the news and could be rightfully concerned.   

If your subprime clients have not worked on improving their credit since they obtained their mortgage 2-3 years ago, they could be in for a world of hurt when their mortgage is getting ready to adjust.   I strongly encourage you to have them contact their mortgage professional asap to have their credit reviewed to see if they should (1) refi now; (2) work on their credit and wait until their prepayment penalty is up; (3) do nothing…prepare to sale.

Filed Under: Real Estate Agents, Subprime Lending

Recently at Rain City Guide…

February 19, 2007 by Leave a Comment

I have been meaning to highlight post over at Rain City Guide on a more regular basis…I’m slipping!   Here are a few I thought you might benefit from reading (or just click on over and check them all out).

Earlier this month, Jillayne tackled why you should not shop interest rates by APR.  This is a must read if you are a "rate shopper".

There have been a couple post forecasting the future of our local real estate marketing, including this one from Ardell and Jon featured two posts that inspired reactions from the "Bubble Bloggers".

If you’re considering buying home at a new construction site, then Ardell’s post is a good read for you regarding dealing with site agents and when lots are released.

Yours truly added two post to RCG dealing with zero down buyers and the future for subprime borrowers.

Enjoy!

Filed Under: Adjustable Rate Mortgage (ARM), Financial Planning, Mortgage, Predatory Lending, Real Estate Agents, Residential Purchase, Weblogs

Week in Review on Rain City Guide

January 26, 2007 by Leave a Comment

I am an Active Contributor on Seattle’s Rain City Guide blog.   This site is packed full of information about real estate, homes, our local area, finance as well as industry and blogging tips and great interviews with fellow professionals.    Here are a few  recent post that may be of interest to you, the consumer.

  • Your Private Information Is For Sale.  I have mentioned this before on The Mortgage Porter and I feel it’s worth reposting.   Credit bureaus are reselling your information when you have your credit report pulled. 

  • Who’s Client Is It Anyway is a post from Eileen Tefft regarding what can happen with site agents when a buyer looks at new constuction.

  • Too Close to Home is another post by yours truly about borrowers trying to buy investment property as owner occupied to get a better interest rate.

  • Buyer’s Remorse by real estate attorney Craig Blackmon addresses when a buyer may need the help of legal council.

As I said…there are many other great post…these are just a few of the highlights!

Filed Under: Credit Scores and Reporting, Current Affairs, Identity Theft, Real Estate Agents, Residential Purchase, Seattle, Weblogs

Preapproval Letters Defined

January 19, 2007 by 10 Comments

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The preapproval letter is a tool typically drafted by a loan originator to be used by a buyer’s real estate agent when presenting an offer on a property.   The letter may be in the form of a certificate or be an actual letter on the lender’s letterhead.   The preapproval letter is intended to assure the seller and the listing agent that the buyer has been buyer has been approved by the lender and therefore accepting an offer from this buyer, there should ideally not be any financing issues with the buyer.

 

When I prepare a preapproval letter, it usually contains the following (depending on the program):

  • Effective date.
  • The borrower’s names (who is approved for financing).
  • The sales price and loan amounts they are approved for.
  • The type of financing is confirmed (ex. Conventional, FHA, etc.)
  • Credit has been reviewed.
  • Employment and income has been confirmed.
  • Down payment and closing cost have been verified.
  • Any closing costs that are being requested to be paid for from the seller.
  • Any item the preapproval is subject to (such as satisfactory appraisal, title, complete purchase and sale agreement, etc.).

If these items have not been actually verified with proper documentation, then a buyer has been prequalified—not preapproved.  BIG DIFFERENCE.  Being prequalified essentially means that a verbal interview has been conducted without providing all of the necessary supporting documents (pay stubs, W2s, bank statements—again, depending on the type documentation required for the specific loan “full doc” to “no doc”).  In addition, a Good Faith Estimate does not constitute a preapproval, it does detail the proposed loan scenario.

 

The preapproval letter does not contain private information such as a buyer’s credit score or their additional assets.   It is a sales tool for the buyer’s agent and if there are multiple offers presented on a home, having a strong preapproval letter is an advantage.   This is one reason why it is crucial for buyers to become preapproved before they begin shopping for their next home.   Many listings agents will not even consider an offer unless the buyer has been preapproved.    

 

 

The preapproval letter is generally effective for 90 days a specific amount of days, typically when most lenders consider the credit report “expired”.   Updating a preapproval letter is simply re-running the credit and possibly obtaining most recent income and asset documentation (paystubs and bank statements).    On occasion, the buyer’s agent may request a revised preapproval letter if they are presenting an offer on a home that is priced for less than what the buyer is approved for and if they are asking for closing costs.   

 

 

Real estate agents may also consider who the preapproval letter is from, and they may contact the lender to confirm the buyer is indeed prepproved and not just prequalified.   Many agents will tell you that the preapproval letter is only worth the paper it’s printed on.   This is also why it’s very important to be selective with lender you work with…it could possibly impact whether or not your offer is accepted on your next home.

 

If you’re considering purchasing a home located anywhere in Washington state and need a preapproval letter, I’m happy to help you!

 

EDITORS NOTE:  This post has been updated since credit reports are no longer “valid” for 90 days with most lenders.

 

Filed Under: Credit Scores and Reporting, Mortgage, Real Estate Agents, Residential Purchase Tagged With: ,
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