Real Estate Advice

[Schneed10]

Originally Posted by FRPLG

Yeah. If you are a current home owner and have an ARM I apologize in advance but in my opinion you have made a very bad move. ARMs are hideous creations by banks to be able to offer more loans for more money to less qualified people. To do so they have to offset all of their increased risk somehow so that should clue you into how bad ARMs really are compared to standard loans. Right now all the people who jumped into an ARM 4 and 5 years ago are starting to really realize what kind of problems they can cause. Avoid them at any cost. If you have to hold off on buying a house or have to buy less house then do so. But don't jump into an ARM so you can qualify to buy a $500,000 house. Buy a $250,000 house wait 2 years and sell for profit(hopefully) then take your increased equity and move up. It is the safer and less expensive way of doing it over the long haul. And when it comes to primary housing you are ALWAYS talking about the long haul.

Concurred. ARMs are a contributing factor in all the subprime mortgage lending problems that are all over the news right now.

Adjustable or balooning rates put your cash flow at risk, big time. If something goes financially wrong in your life, the last thing you would choose to part with is your home. But by using an ARM or a baloon, you're exposing yourself to the risk that the FIRST thing to go in a crisis will be your house.

The potential of taking a bath is significant. Take the fixed rate; you'll know exactly what you need to pay each month. And it ensures that you won't buy a house you can't afford.

[Beemnseven]

I just wanted to clear up one thing since I am a real estate agent.

As far as agent commissions go, the listing agent and the buyer's agent will typically split the commission 50/50. In cases where you have a sympathetic listing agent, or when the agent is related to the homeowner, you may find that one side of the transaction will forego a percentage or two in order to help the deal get closed. Otherwise, on a 6% listing, 3 will go to the buyer's agent, and 3 will go to the listing agent in most cases.

Now, the other thing to consider is that the field of real estate is highly regionalized -- so what may be true here in southeastern Virginia may not be true in Philly, Seattle or Wisconsin. That's why it's hard for anyone to give advice unless they reside in and work in the area you're in, SGG. Good luck.

[Sheriff Gonna Getcha]

Thanks again everyone. I typically don't rely on advice from strangers, but the relative uniformity of the advice I'm getting indicates that you guys have provided me with some useful advice and information.

[jsarno]

Originally Posted by Sheriff Gonna Getcha

Thanks again everyone. I typically don't rely on advice from strangers, but the relative uniformity of the advice I'm getting indicates that you guys have provided me with some useful advice and information.

No problem man. Taking advice from "strangers", and using advice to become more informed are two different things. Even if you take a path we are suggesting you don't, at least you are aware now.
Plus, we're all Skins fans...we wouldn't steer a fellow fan in the wrong path...a cowboys fan though...well

[FRPLG]

Originally Posted by jsarno

No problem man. Taking advice from "strangers", and using advice to become more informed are two different things. Even if you take a path we are suggesting you don't, at least you are aware now.
Plus, we're all Skins fans...we wouldn't steer a fellow fan in the wrong path...a cowboys fan though...well

Yeah the only place I know of in the country where ARMs are good is in Dallas. Otherwise stay away from them.

[firstdown]

Originally Posted by jsarno

Sorry to use his thread for my own question, but I talked about PMI insurance earlier and realized that my new house is under 80% LTV. I owe around 75k and the house is now worth roughly 110K (I know it probably makes you guys sick to know that housing costs are so low out here, but remember this place sucks)...I'm still paying PMI. How do I get rid of this? I have yet to do this in my homeowner experiences. Any advice?

ps- I have a very good friend that does appraisals if this helps.

I'm
with Wells Fargo (not a job my mortgage Co) and there is 3 different ways to have PMI removed from your loan. The 20% rule is from the purchase or appraised amount at the time of purchase.Then if you make a big enough improvement like a garage, addition etc.. if it increasees the value enough. Stuff like upgrading a bathroom painting do not count. Then there is another way which I cant think of but just call your mortgage co and they should send you the papper work and if you qualify they have to remove your PMI.

[jsarno]

Originally Posted by firstdown

I'm
with Wells Fargo (not a job my mortgage Co) and there is 3 different ways to have PMI removed from your loan. The 20% rule is from the purchase or appraised amount at the time of purchase.Then if you make a big enough improvement like a garage, addition etc.. if it increasees the value enough. Stuff like upgrading a bathroom painting do not count. Then there is another way which I cant think of but just call your mortgage co and they should send you the papper work and if you qualify they have to remove your PMI.

Well, I put in a hot tub, and built a new deck as well as put in new electrical service and redid the kitchen with granite tile tops and new sink with new plumbing.
Not only that, but the market has jumped considerably out here. A house that was 100k 3 years ago, is now worth 150-167k. It's quite a jump.

[KLHJ2]

Does anyone have any info on those quicken loans? Are they are worth it or is it some scam that puts a crap load of money in their pockets.

[EternalEnigma21]

Originally Posted by angryssg

Does anyone have any info on those quicken loans? Are they are worth it or is it some scam that puts a crap load of money in their pockets.

I'm not sure about quicken, so I'm not going to lump them into this category, because I think theyre a bit different, but alot of online loan sites are just lead sources for anyone who signs up for them. You can get stuck with any crackhead idiot if you're not careful... and its a sure fire way to get sued when you show up to closing and there's no money to bring to the table....

And since there aren't rules as to where a mortgage officer can generate loans, youll likely get stuck with someone far away form you, and there's a huge lack of accountability when there's no possible way for you to directly make contact with the person.

My wife has clients who refused to go through her in-house lender because they thought it was some conspiracy to make money and they were being smart consumers and shopped online to get a better rate... turns out all they got is lied to and sued for specific performance...

Theyre filing suit against the lender, but it won't matter... Their lives are temporarily all screwed up..

They lost a huge escrow check and the house they wanted because the negotiations got nasty before all this and the sellers are done messing with them and are now refusing to sell their house.

The best advice, I think, is to join a Credit Union. I'd be using mine, but I qualified for a VHDA loan... all you virginians should look into it. If you qualify it may be a nice way to go....

[EternalEnigma21]

Originally Posted by jsarno

Well, I put in a hot tub, and built a new deck as well as put in new electrical service and redid the kitchen with granite tile tops and new sink with new plumbing.
Not only that, but the market has jumped considerably out here. A house that was 100k 3 years ago, is now worth 150-167k. It's quite a jump.

I'm excited. I close this week on my new house and were spending 280k. Our appraisal came back at 370...

I know its a weak market here, but its nice to know Im starting out with a little bit of equity, according to all comps and data...

[KLHJ2]

Originally Posted by canthetuna

I'm not sure about quicken, so I'm not going to lump them into this category, because I think theyre a bit different, but alot of online loan sites are just lead sources for anyone who signs up for them. You can get stuck with any crackhead idiot if you're not careful... and its a sure fire way to get sued when you show up to closing and there's no money to bring to the table....

And since there aren't rules as to where a mortgage officer can generate loans, youll likely get stuck with someone far away form you, and there's a huge lack of accountability when there's no possible way for you to directly make contact with the person.

My wife has clients who refused to go through her in-house lender because they thought it was some conspiracy to make money and they were being smart consumers and shopped online to get a better rate... turns out all they got is lied to and sued for specific performance...

Theyre filing suit against the lender, but it won't matter... Their lives are temporarily all screwed up..

They lost a huge escrow check and the house they wanted because the negotiations got nasty before all this and the sellers are done messing with them and are now refusing to sell their house.

The best advice, I think, is to join a Credit Union. I'd be using mine, but I qualified for a VHDA loan... all you virginians should look into it. If you qualify it may be a nice way to go....

Thanks, I am already a member of a Credit Union and have been for a while. Both myself and my wife qualify for a VA loan, but the max it will cover is roughly 430k. We are looking at houses in the 500k range or a 250k-300k home that is the size of the 500k homes. Long story short I have to get a separate loan for what VA doesn't cover on a 500k home.

[FRPLG]

Originally Posted by canthetuna

I'm excited. I close this week on my new house and were spending 280k. Our appraisal came back at 370...

I know its a weak market here, but its nice to know Im starting out with a little bit of equity, according to all comps and data...

Sounds like you are stealing that house. Good job.

We did that with our second house in Woodbridge. Saw it at an open house an offered 10K less than asking price because we thought they were so off in their price(too low) that maybe they'd go lower. They countered 5k more and we took it. Sold it 14 months later for 115K profit. They missed the price piont so badly on it. There was major development going on just two blocks away on the Occoquan. Building like a mini downtown Alexandria and everything was going to sky-rocket. I still can't believe they sold it for what they did.

[EternalEnigma21]

Originally Posted by FRPLG

Sounds like you are stealing that house. Good job.

We did that with our second house in Woodbridge. Saw it at an open house an offered 10K less than asking price because we thought they were so off in their price(too low) that maybe they'd go lower. They countered 5k more and we took it. Sold it 14 months later for 115K profit. They missed the price piont so badly on it. There was major development going on just two blocks away on the Occoquan. Building like a mini downtown Alexandria and everything was going to sky-rocket. I still can't believe they sold it for what they did.

This house is a forclosure. The bank, however is taking a bath and we sent in a lowball offer 30k off their recently reduced asking price and they countered... then we re-sent the origninal with a 24 hour expiration date and they just accepted...

we took a shot and it paid off... We've put in 6 other offers on other forclosed homes in the area that we didn't get, but we liked this house the most anyway...

The market right now is soft because of all of the ARMs and people getting into houses they couldn't afford and getting forclosed on. Banks are looking to move houses out of their possession and new forclosures are hitting the market daily....

[FRPLG]

Originally Posted by canthetuna

This house is a forclosure. The bank, however is taking a bath and we sent in a lowball offer 30k off their recently reduced asking price and they countered... then we re-sent the origninal with a 24 hour expiration date and they just accepted...

we took a shot and it paid off... We've put in 6 other offers on other forclosed homes in the area that we didn't get, but we liked this house the most anyway...

The market right now is soft because of all of the ARMs and people getting into houses they couldn't afford and getting forclosed on. Banks are looking to move houses out of their possession and new forclosures are hitting the market daily....

Good.. Punish the damn banks for their sketchy ARM loans. Damn idiots may have done some serious damage to our housing market with all their crappy loans.

ARMs and all their avriations basically extended the housing boom artificially by letting people buy houses they couldn't afford. Now that all the loans are defaulting the same ARM loans that kept the good times rolling will have an even greater negative effect as they will continue to degrade the market and keep it down longer than it should be. As an investor that is good for me since it means I will be able to get into properties cheap but overall it is bad for the economy.

[Schneed10]

Originally Posted by Beemnseven

I just wanted to clear up one thing since I am a real estate agent.

As far as agent commissions go, the listing agent and the buyer's agent will typically split the commission 50/50. In cases where you have a sympathetic listing agent, or when the agent is related to the homeowner, you may find that one side of the transaction will forego a percentage or two in order to help the deal get closed. Otherwise, on a 6% listing, 3 will go to the buyer's agent, and 3 will go to the listing agent in most cases.

Now, the other thing to consider is that the field of real estate is highly regionalized -- so what may be true here in southeastern Virginia may not be true in Philly, Seattle or Wisconsin. That's why it's hard for anyone to give advice unless they reside in and work in the area you're in, SGG. Good luck.

Ah good point, I didn't realize there were regional differences.

I've got a few buddies here in the Philly area that are real estate agents. When they're the listing agent and there is no buying agent, they get the full 5-6% commission all to themselves. When they're the listing working with a buying agent, they typically get 4-5% and the buying agent gets 1-2%. And they say those numbers are negotiable depending upon the situation.

In my myopic view of the world, I assumed this was the way it is done everywhere. Thanks for hittin me with the knowledge, Beem.

Also, I've posted concerns about home inspectors and their incentive to be crooked and overlook certain problems. Philly is a heavily unionized city where contractors are used to banding together; you're probably more likely to run into problems with inspectors here than you are in less unionized towns. Living in Philly requires a cynical view of the world, LOL.