Category Archive : Real Estate

After many months or maybe years, you have finally decided to buy your own home. You have pinched every penny to save up a sizeable down payment. You have made open houses a weekend ritual but still can’t seem to make the leap into purchasing a home. Why not??

Maybe you’re comfortable in your current space. You have accepted the shortcomings of where you live whether it is loud neighbours or no parking readily available. Not many surprises since you have been there so long.

First time home buyers tend to freeze up when it comes time to actually picking a house. Will they be happy there? Will they like their neighbours? Will they be tied down because they are now house rich and cash poor? What happens if their financial situation changes for the worse? Basically, the fear of the unknown becomes a constant nagging in their ear and prevents them from moving on towards purchasing their dream home.

Here are some steps to try and then maybe you can take the leap to home-ownership:

• Get comfortable with your finances: Make sure you sit down and go over all of your current finances and the new ones that will occur with home ownership. Things like property taxes, home owners insurance, commuting to work and cost of utilities should be factored into your monthly expenses to make sure you are buying within your limit.

• Partner with a Realtor: You need to pair up with a knowledgeable realtor. Even though the internet will allow you to do lots of research on your own, you can’t get the low down on a property without help from a realtor. They will be able to answer questions you will have and give you the inside scoop on the property. They will also help you write an offer and make sure you get a good deal.

• Accept some risk: There is uncertainty in everything about life, you just need to deal with it. Learn from people you know that have purchased a home. Find out their mistakes and what to look for. Make sure you don’t drain your bank account with purchasing the home, keep a safety net in case of emergency.

• Fine tune your “must-haves”: Make your list of “must haves” in your new home. A garage, the neighborhood, size and layout of the home, and anything else you feel is important and that you can’t live without. You may find that you are willing to sacrifice one feature, if the rest is fabulous. If you are not crazy about the house, don’t bid. It is important you love the home you are bidding on, after all you will be living there for some time.

• Be ready to bid: Great homes and prices don’t stay around for long. If you love the home, have your realtor help you make an appropriate bid. If you are wavering, ask yourself, “How will I feel if I don’t get this house?” You might just get it, and if not, at least you’ll you know you tried.

• Find an experienced Mortgage Professional: Sit down with an experienced mortgage professional and have them help you analyze your options for financing your new home. Finding the right mortgage can be as important as finding the right home. Make sure you clearly understand what type of mortgage you are getting. Ask as many questions as you need too until you are absolutely clear on the type of financing you are applying for. Remember, you are the one paying back the mortgage.

I hope this pushes all of you “on the fence” home buyers “off the fence” and into the home of your dreams. Happy House Hunting.

With so many Las Vegas Homes for Sale it’s becoming more difficult to find buyers.  Homes begin to sit on the market for days, weeks and months with no offers.  Many times, homeowners become frustrated and blame their real estate agent for not doing their job to sell their home.  Is it really the fault of their real estate agent that their home is not selling?  It depends.  If their real estate agent is actively marketing their home instead of just waiting for another agent to bring a buyer, than I would say no it’s not their fault.

So what happens when a home does not sell?  Eventually it expires with their real estate agent, unless they extend the contract with the agent.  Once it expires, the homeowner can expect to be bombarded with phone calls and mail from other Las Vegas Real Estate Agents stating they can do a much better job and sell their home.

My advice to Las Vegas Homeowners would be to interview several Las Vegas Real Estate Agents and ask lots of questions.  Here are a few important questions you need to ask:

1. Are you a full or part time real estate agent?
2. How long have you been involved in selling real estate?
3. How many homes have you sold in the last 90 days?  In the last year?
4. What type of marketing will you be doing to sell my home?
5. What makes you different from other real estate agents I have interviewed?
6. If I am not satisfied with your performance, can I fire you and hire another real estate agent?

Obviously there are many more questions you should ask, but these are a few of the more important questions that you need to ask.  Remember don’t panic if your Las Vegas Home expires and don’t rush into a new contract with another Las Vegas Real Estate Agent.  Do you due diligence and interview several agents until you find one that you are satisfied has the credentials, experience and marketing programs to sell your Las Vegas Home.

How many Las Vegas Real Estate Agents actually know how to market a home?  Is there a science to truly marketing a Las Vegas Home?

Most Las Vegas Homeowners who are selling a home for the first time usually choose real estate agents that are referred to them from their friends thinking that all Las Vegas Real Estate Agents are the same.  The truth is, not all Las Vegas Real Estate Agents are the same.  There are many Las Vegas Real Estate Agents that are part time agents, their are some that are primarily buyer agents, and some that specialize in only listings.  So back to my original question, “is their a science to marketing a home?”  I would say yes and here is why!

With so many Las Vegas Homes on the market, some bank owned and some short sales, it is imperative to get as many potential buyers to view the home in order for it to sell.  It is difficult to compete with these bank owned homes because the banks are pricing these homes so low in order to sell them quickly.  So how do you generate potential buyers?  The first thing you need to do is obviously price the home correctly!  The second thing that needs to be done is to analyze the neighborhood and surrounding community.  For example, say the home is in the northeast part of Las Vegas.  This potential home is close to Nellis Air Force Base and might make an ideal home for military personnel transferring to Nellis due to its close proximity to the base.  So it might make sense to market the home on the base and websites that target military personnel.

What about a home near a hospital?  It would make sense to market the home to the employees of the hospital with flyers and possibly in the Hospital newsletter that gets distributed to the staff.  So the point is, it is very important to analyze the community that surrounds the home you are going to list, you never know where you are going to find the buyer for your listing.  Their is a good chance the buyer could already be working in the surrounding community!

When I get phone calls from sellers inquiring about selling their Las Vegas home as a short sale, the first question I ask, “Is your lender Country Wide?”  As I wait for their answer, I am quietly hoping it is not; any Las Vegas real estate agent knows why I am hoping it is not Country Wide.  So for those of you who are not Las Vegas real estate agents, let me explain.

Country Wide is the largest Lender in the United States so it would be an under statement to say they are inundated with foreclosures and short sales.  But that doesn’t concern me, what concerns me is representing my client. So after I meet with my client, I have them complete a financial packet which I know Country Wide will be requesting.

As soon as it is completed, I send it over to Country Wide and call them every other day hoping to get my client’s file assigned. Instead, I get your file probably won’t be looked at for at least 30 days at which time it will be assigned to an asset manager and then you will receive a phone call (although they say 30 days, it’s more like 45 to 60 days).

Once you are assigned to an asset manager, good luck getting a hold of them. Don’t bother trying to leave a message as their voice mail is usually full!. When you do get lucky and finally get a hold of them, they usually don’t have any answers. So needless to say, my experiences with Country Wide have not been the most enjoyable.

One of the most common things said when I am talking to a potential client on the phone is “I don’t want you to run my credit because it will drop my score”.

This is one of the most annoying statements made when you are trying to qualify a client for a mortgage. You simply can’t give them proper information without reviewing their credit report. So, I decided since how credit scores are calculated are somewhat of a mystery to everyone that I would elaborate some on this topic.

Each time a consumer applies for a loan, credit card or auto loan, they are having their credit checked. These credit checks are used by lenders to determine if the consumer is able to obtain financing. Every time a lender checks a consumers credit history, it shows up on the consumers credit bureau (Experian, Trans Union and Equifax) as an inquiry. These inquires can drop the consumers credit scores if too many inquiries are made in a certain period of time.

Many lenders rely on the FICO scores they pull when running a consumers credit history. These scores are tabulated by software from Fair, Isaac and Company Inc, along with what information is on the consumers history. Due to increasing pressure on Fair, Issac and Company to release how their software works, they have released information on how their scoring model calculates a FICO score for the consumer.

Inquires on a credit report are an indicator of risk and according to Fair Isaac and Company, the more inquires made means the more likely the consumer will not be able to pay his bills. When consumers want to buy or refinance a home, they usually contact more then one mortgage company for information. In order for the consumer to get accurate information from several mortgages companies, they need to have their credit checked by each mortgage company which in turn leads to many inquiries (especially if using an online site which shops various lenders). Since too many inquiries lead to lower scores, eventually the consumer could lose out on decent financing because their scores are too low.

Now for some good news and a way to combat that dreaded statement in the beginning of the article.

There is a new policy at Fair Isaac and Company, the software will ignore all auto and mortgage related inquiries that occur in the previous 30 day period from the time the credit is checked by the lender.

These inquiries will not be used to tabulate the credit score for the consumer. For each 14 day period prior to the 30 day period, only 1 inquiry will be counted no matter how many inquires where made during a particular 2 week period.

Inquiries on a credit report carry the lowest impact on scores. Things like high balances in relation to credit limit, recent late payments, judgments, and bankruptcy carry much more weight in tabulating a score. This information should be very usual to combat the consumers resistance to pulling credit because it will effect their scores.

Real-estate agents and mortgage professionals need to remind their clients that it is critical to sit down and review credit in order to provide options on the mortgages that they qualify for. This is the only way to provide the client with accurate information.

According to FBI Special Agent, Scott Hunter Las Vegas is called mortgage fraud ground zero.

This problem is becoming so wide spread that special task forces have been created to combat the problem.  Every week you read in the paper or view the news about another real estate industry professional being arrested for some type of real estate or mortgage fraud.  Just this month, Cindy Birkland was arrested for alleged mortgage fraud.

According to the FBI, mortgage fraud is becoming one of the fastest growing white collar crimes in the United States.

Mortgage Fraud is usually committed by several individuals who all have a certain role within the scheme.  Usually a loan officer, borrower, real estate agent and/or an appraiser.  The most common type of mortgage fraud is a “straw buyer”.  This is where the bank lends hundreds of thousands on a home that is way over inflated due to an appraiser setting an unrealistic value.  The group splits the money and never has any intention on making any payments on the home.

More to follow…

Living in the middle of a desert where the temperature can be 110 degrees during the summer months, a pool is a near necessity. A Las Vegas home with a pool can be refreshing and add value to the home. But what about when the home has been abandoned because the bank has foreclosed on the home?

Now the pool is a problem if it hasn’t been drained.

I can’t tell you how many foreclosure homes I have shown that had a green pool in the backyard. Some pools were so bad that I could not even see the bottom. Many of the homes had backyards that were not secured and children could have easily wandered in the backyard.

Lets not forget that pools are a great place for mosquitoes to breed and mosquitoes are carriers of the West Nile Virus which can be transmitted to humans. These abandoned pools become stagnant and unless they are drained, they are not only a health hazard but a safety hazard. Children in the neighborhood can find their way into unsecured backyards and now we have a dangerous situation. Unsupervised children near a pool can become deadly.

If you see an abandoned Las Vegas Home with a pool, contact the city and file a complaint.

In the world of Real Estate, there are two very important professionals that the client needs to deal with when purchasing a home. A lot of real-estate agents and mortgage originators team up together to help the client with finding a home and financing the home. As a real-estate agent, you should be aware of the 6 signs to a bad mortgage so that you make sure your client is getting offered the best products around. (Especially if you are working with a mortgage professional that you aren’t familiar with)  As a mortgage originator, you should be aware of the 6 signs so that you aren’t putting your client into a bad mortgage or you can advise someone who is about to get into a bad mortgage.

1. Tells the client that they can be “creative” with the financing. Well, if “creative” constitutes falsifying information then there could be jail time, fines and possibly the full note called due at that time. Unfortunately, there has been a lot of press on mortgage professionals and clients falsifying documents to get the transactions done. Be leery of “creative” financing. Find out all the details and make sure nothing is fraudulent.

2. Being pushed into too high of a payment. The client needs to sit down and make a budget. Lenders don’t account for every little bill the client may have when qualifying them for financing. There are certain items not calculated into the debt ratio that may effect whether or not they can actually make that payment. Lenders also use gross income which the client only has net income to cover the bills.

3. Make sure the borrower is given the proper disclosures. A mortgage professional is required by law to give the borrower a copy of the Truth in Lending (which discloses the APR) and a Good Faith Estimate (which is a breakdown of the estimated closing costs). These documents must be given to the borrower within 3 days of application. Make sure the borrower understands these documents and if they don’t make sure they seek out their mortgage professional to explain them in detail to them so they do understand.

4. Be very careful of those professionals who promise one thing and then deliver another just before closing. If you are using an experienced mortgage professional, there should be no surprises just before the signing. Sometimes situations do come up throughout the process of the loan. However, the borrower should be notified immediately of any issues and how their loan will be changed so together they can decide if the mortgage still meets their budget.

5. Asked to sign blank papers. This is NEVER ok. Nobody involved in a financial transaction such as a mortgage should be signing any blank papers. You need to advise the borrower to put an X thru the document and then sign. If that is unacceptable by the mortgage professional then they need to report that person to his/her superior or the MLD.

6. Won’t give copies of signed paperwork. The borrower has a right to have copies of the initial signed paperwork so they can review them at their convenience. These documents are preliminary numbers in the beginning of the transaction. There should be nothing to hide by the mortgage professional and if they won’t give copies of signed papers, the borrower needs to ask “What are they hiding?”.

These are 6 of the most common red flags that come up when people are applying for financing. It is important that professionals in the real-estate industry are aware of these things, in case, it happens to their client. This way we can all protect the consumer from a bad loan. Bad loans only hurt the industry and the consumer in the long run. It is our job as professionals to help stop this from happening when people are trying to finance their dream home. We all want our clients to realize the dream of home ownership now we need to make sure that their dream doesn’t turn into a bad nightmare with the wrong financing.

Realtors and mortgage originators have been plagued with the declining market policies put into place by Fannie Mae over the last several months. It has been frustrating for clients who want to purchase a home in these areas because they have had to put an extra 5% down. They can find a home for a great price but they are required to have a minimum on 10% down due to the area where they are purchasing. This was discouraging potential buyers from buying homes in the areas hardest hit by foreclosures.

It was also very discouraging for those home owners who needed to refinance their home due to ARM’s expiring. With the value of homes declining in the Las Vegas area, many borrowers were finding that in order to refinance their mortgage and stop the interest rate from adjusting that they needed to borrower 95% of the homes value. With the new guidelines in place for declining markets, it was making it impossible for some people to refinance and stop the interest rate and their payments from increasing. As a result, some were losing their homes which creates more foreclosures on the market.

Fannie Mae has changed their requirements after they have been hearing concerns from professionals in all areas of the real estate industry. Effective June 1st, clients can finance up to 95%  for purchase transactions and refinance transactions. This should help spark the purchase market in areas where the foreclosure ratings are high and reinforce the goal of successful home owning again. It will also help those who are in need of refinancing to get out from under their ARM loan before they can’t afford their payment anymore.

Overall, this is a positive move in the lending industry that should help generate new home sales and stop others from losing their homes because of increasing rates and payments. I am looking forward to seeing how this change will effect the Las Vegas real estate market.

Is there still a need for Las Vegas Discount Realtors in this real estate market?  The premise for discount Realtors was to discount their “commissions” to make it more affordable for those sellers that only wanted to pay for certain services.  So instead of providing a full service, discount Realtors only provided the services the seller was willing to pay.

Back in 2004 and 2005 when homes were flying off the market as soon as they were placed for sale, sellers were looking for discount Realtors as they knew their home would sell as soon as they entered it into the Multiple Listing Service.  Even full service real estate brokerages were lowering their commissions in order to satisfy their sellers as they knew the real estate market wasn’t bearing a 6% or 7% commission.  But that is just not the case in this real estate market.  There is way too much inventory and in order to sell a home, it is imperative that a home gets as much exposure as possible to get potential buyers to walk through the door.  Which means, Las Vegas Real Estate Agents need to market their listings, which costs money!

Many Las Vegas Discount Realtors, not all of them, just place their listings in Multiple Listing Service and wait for another Las Vegas Real Estate Agent to bring them a buyer.  Unfortunately, that is not going to sell a home in this market!  There are way too many homes for sale and now that homeowners have to compete with bank owned and short sale properties, it is imperative that they price their home accordingly and their real estate agent needs to get as much exposure as possible!  So I just don’t see where a discount Realtor can compete with a full service Realtor and provide the same marketing and exposure the home needs to sale.

Not sure if we have hit the “bottom” of the Las Vegas real estate market that everyone keeps asking about.  I know that several of my sellers participating in our Las Vegas For Sale by Owner program are certainly anxious for better news.

Here is what I’m paying attention to from a mortgage originator’s point of view:

With the Las Vegas median home price finally getting back to a range of $235,875 in March 08, according to GLVAR statistics, the price is down 22.7 percent from a year ago.  This impacts many of the residents living and working in the Las Vegas community because they can now afford to purchase a home.

FHA lending limits were recently increased to $400,000 in Clark County.  As one of the few available mortgage programs that still allows for 100% financing, FHA mortgages are opening the doors to home ownership for many new buyers.  Otherwise, a borrower applying for a conventional mortgage loan needs to budget a minimum 10% down payment.  Obviously, there are several other qualifying factors that banks consider for approval, such as income, credit, employment history, and residence status.

In regards to Las Vegas market trends, the housing inventory levels and new contracts have made dramatic  changes in a very positive direction.  In October of 2007, the average days on market (DOM) for a single family residence below $400,000 hit a high of 381.  This means that if no additional inventory was added, it would take 381 days to sell that home.  In March of 2008, as reported by The National Association of Real Estate Investment Advisors, the new (DOM) average has been lowered to 135.  In addition, the number of new contracts has increased from 1994 units in January 2008 to 3921 in March 2008.

We still have another year or so of adjustable rate mortgages coming due that were originated in 2005 and early 2006.  However, most of those home owners have already started making arrangements with their banks or have put their homes on the market as a short sale.

2007 was a difficult year for all of us because the correction hit us so fast.  Now, most sellers are willing to acknowledge that fact that their properties may not be worth what they paid for them during the boom.  With this new level of general market awareness, sellers are making better educated decisions about the true value of their properties.

Once those foreclosures resulting from ARMs are cleared, I believe that there will be a great sense of stability in the Las Vegas real estate market.  As a loan officer, I can tell you that 100% of my 2007 and 2008 closings were 30 year fixed rate mortgages with very low interest rates.  I’ve seen the speculators leave the business, and my current clients are planning on staying a while.

If you have to sell, price and exposure are the two things moving properties right now.  Another option would be to look at a possible refinance to get you out of that ARM or higher interest rate.

Las Vegas Home prices are at levels we haven’t seen since early 2004.

That’s the year when home prices began to increase by 30% – 50% in some areas of the Las Vegas Valley.  I am not sure how much further home prices can drop, but as long as foreclosures continue to be so widespread in Las Vegas there is a chance that prices could keep falling.

What does this mean for potential buyers? 

It means a great deal on a home that just two years ago would have been priced way out of their budget. With interest rates still very low, buyers have an opportunity to get into their dream home with their closing costs paid and with a low interest rate!  Even Las Vegas Home Builders are giving incentives that you would not have seen in 2004 or 2005.  Take advantage of the real estate market in Las Vegas before home prices begin to rebound.