Should I take My Realtors Advice on a Lender?

As a Realtor the short answer for me is Yes, definitely. Now I am definitely not saying that you should not shop other options and look around, but take a few of these things in mind to why your Realtor may have suggested this person.

As a Realtor, we work 100% for free until the day that loan is closed. This many times falls directly in the lap of the Loan Officer or Mortgage Broker you are using to close your loan. If a Loan Officer does not look at your file right, leaves out something, doesn’t explain things correctly to you, or most recently misses the amount of money that needs to be brought to the table to close by $2000, it leaves all the hard work that My buyer and I have put in the past 2 to 6 months for not.

The reason I have my preferred lenders is very simple. They do what they say they are going to do. This does not mean that there will not be hiccups and problems along the way, but over the past two years I have developed relationships with my Loan Officers that allow me to feel comfortable turning over my hard earned business to them. Not only that working with them on a Daily basis has made communication fluid and much easier for all parties involved.

Having said that if you have a trusted lender or someone who comes highly recommended I am always happy to work with any new lender and look forward to meeting new professionals in my field. They can count on me to make sure that all the paperwork and things I provide them to do their job will be provided on time. Also another thing they and my customers can count on it my accessibility via phone, email and text messaging. Sometimes catching a phone call at 3pm on a Wednesday and taking care of a problem can be the difference between a Friday close and a Monday close.

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To Extend or Not to Extend? The $8000 Home Buyers Tax Credti

Working with home buyers right now in the last moments of the $8000 tax credit is guaranteed to be hectic. Especially with the debate of what will happen next. Right now there is to much rumor flying around to really know anything. I would assume it is safe to say that there will be no decision until mid to late november as not to discourage anyone who is ready to go now not to move. Being that if you are not in contract by the first of November you will have a problem getting closed in time. This brings us to the next question should we extend the credit? With so many bailouts and things of that nature is it really beneficial to extend the credit. In my opinion no.... As a Realtor I obviously will benefit from the extension, however the "toxic assets" that we hear so much about are not homes that a typical First Time Buyer can qualify for. Normally because of condition. It would be nice to see some sort of tax incentive put in place for private investors that wouldn't mind buying up these properties and turning them in the rental properties themselves. I imagine this is just a pipe dream but its just my two cents. Either way you can pay attention to my website, blog or facebook to get the latest news as soon as i know.... thanks and have a great weekend

RJ

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$8000 Tax Credit Available for Down Payment Assistance - Buyers Responsibility Course a Requirement

I have finally received information on two programs that are being introduced in order to make the $8000 tax credit available for Down Payment and closing cost assistance.  Obviously these programs come with some strings attached.  Basically of the two plans only one is being accepted by a lender thus far.  Logic would tell you that these programs are new and will be accepted more widely in the near future.  The biggest problem I foresee is the backlog of financing that is going to occur as the deadline nears.  Also as many as 60 days will be needed to close which means that if you are going to need the Down Payment Assistance you are going to need to have a contract on a house no later than September 30th.  Below you will find the two programs.  An interesting requirement is that a Buyers Responsibility Class be taken.  I feel this is a great thing to help avoid some of the issues we ran into in the past.  There is no reason people should not be able to buy a home with little or nothing down.  It is easy to understand how a family of 4 or 5 who makes a good income could easily pay the bills but not have $6000 laying around they can use on a house.  However, through reputable financing the goal of responsible home ownership can be obtained.  Pleaes feel free to email me directly or call 214-682-0598 if you have any questions about Real Estate in the Dallas Area.

Also you will find some other options as well.

Plan #1-   Again, there is NO investor at this time that will accept this option- we are still awaiting word

·          Proceeds may be used for down-payment, closing cost or prepaids.

·          Amount of Assistance Available- 5% of the total mortgage (including UFMIP) up to the maximum of $7,000.

·          Borrowers must complete a pre-purchase homebuyer education course.

·          Borrower pays $250 Administrative Fee.

·          First 90 days, 0% interest to encourage borrowers to payoff 2^nd lien with tax credit refund.

·          Thereafter, 2 year term at 10% interest rate.    NOTE that this possible monthly payment will be required to be counted in the income vs expenses ratios regardless if the buyer thinks that they will be paying off the 2^nd lien (for example, $7000 at 10% interest for 24 months would be $323.01 per month).   The buyers must qualify for the additional payment in their ratios.

·          Available only with FHA loans.  

·          Tax credit advance loans may NOT result in any cash back to borrower at closing (i.e. cannot receive back earnest money, option fee, appraisal fee paid up front).

·          Lender MUST submit a complete loan package to TDHCA a minimum of 20 business days prior to closing.   This means that a minimum of total time to close will be approximately 60 days from contract to closing.   Reminder that this could also require a lender to lock for 60 days (which is more expensive than a 30 day lock)

·          Participating lenders must be approved by TDHCA to participate in the program.

 

 

Plan #2-  One investor currently

·          Proceeds may be used for down-payment, closing cost or prepaids.

·          Amount of Assistance Available- 5% of the total mortgage (including UFMIP) up to the maximum of $6,000.

·          Borrowers must complete a pre-purchase homebuyer education course.

·          Borrower pays $275 Administrative Fee plus  1% Participation Fee (i.e., if the sales price is $150,000- the participation fee will be $1500 plus the $275 Admin Fee)

·          Rate is set at 5.75% fixed (so with the cost of the 1% Participation Fee, it would be 5.75 1+1 plus the $275 Admin Fee)

·          First 120 days, 0% interest to encourage borrowers to payoff 2^nd lien with tax credit refund.

·          Thereafter, 5 year term at 7% interest rate.    NOTE that this possible monthly payment will be required to be counted in the income vs expenses ratios regardless if the buyer thinks that they will be paying off the 2^nd lien (for example, $6000 at 7% interest for 24 months would be $118.81 per month).   The buyers must qualify for the additional payment in their ratios.

·          Available with FHA, VA, USDA, Fannie and Freddie 30 year loans

·          TDHCA creates a 2^nd lien that advances the down payment, closing costs and prepaids

·          Income limited

·          Tax credit advance loans may NOT result in any cash back to borrower at closing (i.e. cannot receive back earnest money, option fee, appraisal fee paid up front).

·          Lender MUST submit a complete loan package to TDHCA a minimum of 20 business days prior to closing.   This means that a minimum of total time to close will be approximately 60 days from contract to closing.  

·          Participating lenders must be approved by TDHCA to participate in the program and pay $1000 to participate.

Did You Know?   

Did you know that FHA allows a gift from a blood relative but they also allow a loan from a blood relative?  So… if the buyer has a relative that they can borrow the funds to close up front (and pay them back after they get their Tax Credit after closing), then it would be 1) Less cost- no admin fee or participation fee   2) Close faster (no extra 30 days) 3) Less hassle (We just have to document the gift funds or loan properly) and they would not have to take a pre-purchase homebuyer education course.

 

Also, did you know that FHA allows funds to close from a collateral loan (i.e., against a paid-for vehicle, boat, against 401K, etc).   There are certain limitations but it may be a viable option.    Have the buyer talk with us to make certain that we are in guidelines.  

 

We will continue to keep you updated-  In the meantime, it is an amazing time to purchase, rates are still good, inventory is great and the $8000 Tax Credit for First Time Home Buyers is AWESOME!      HOWEVER…… as of today, there are only 162 days left to take advantage (and close) with the $8000 Tax Credit! 

I would like to thank Ronna Smith for her information on this new program

 972-672-2231 or email me atrsmith@servicefirstmtg.com.

RJ Avery is a Full Time Realtor in the Dallas Tx Area.  We specialize in all your North Texas Real Estate needs. Cover Homes for Sale in Dallas Tx, Homes for Sale in Rockwall Tx, Homes for Sale in Forney Tx, Forney Homes are our specialty as this is where I have called home for over 20 years.  Our team however covers all of Dallas, Rockwall, Kaufman, Henderson, Collin, Tarrant, and Denton counties

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Realtors should evolve to meet customer needs

I have been a Realtor for about a 14 months now.  So you may take my opinions with a grain of salt if you like.  

I posted a blog question on a Realtor 2 Realtor message board asking for listing agents to defend why they should receive the same 3% commission for selling a house that a buyers agent, who arguably, does a lot more work.

I did not receive but one response and the agent mentioned that one could argue that because the agent listed the property they simply deserve it because without the listing there would be no sale.  He did however say my theory held some water and not to back down on it.

I asked in the post what tangible marketing techniques did a Realtor who works for a large broker have that were so much better than any agent who can list there property on the MLS, granted they both have equal skills in running comps, pricing properties and handling negotiations.  As I said I didnt receive any answers.

Basically my theory is this.  

The past 10 years has brought drastic changes to Real Estate.  10 Years ago buyers had to go to agents who had access to the information where as it wasn't as readily available to the average joe as it is now.  Now whether you list with a large agent or a small agent your property is going to be on the MLS.  Realtor.com and many other large name sites pull directly from the MLS database.  Individual Realtors can pay a monthly fee to have there listings placed higher on Realtor.com and sites such as that.  

Also any home listed on the MLS will be searchable through any of the large name companies websites as well, ie Remax, Century 21.  Combine this with the fact that most buyers who are serious will end up working with a buyers agent.  This agent will send them everything that matches their criteria in hopes of making a sale.  They do not care who list the property as long as they get there 3%.

So the very bottom line is that what will end up selling your home is the price and how it is priced for the location.  The agents expertise does come into play here, but it doesnt take a large name broker to teach someone how to compute and translate numbers.

Unfortunately for these big name brokers it is hard for them to list for 4% and give 3% of it to a buyers agent because they have large name brokers behind them.  The large name brokers take anywhere from 50% to 30% of each commission. 

In the old days the brokers were needed to help advertise as it was expensive via print, radio, tv and other mediums.  However today with internet publicity an agent with technological savy can reach his or her targeted audience for a fraction of the cost.  Knocking away the need for a large name broker thus a considerable increase in the amount that the individual agent takes home on each deal.

In the past year I have personally heard of two national Real Estate firms who are backing the mass majority of their advertising budget, one is backing 100% of its ad budget out of traditional ads and placing it all on internet advertising.

Have a good Weekend

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