Before I started with HomeZill, I had a listing with my previous company for $534,900 in Falls Church, VA. Within three weeks of listing I had my first offer on this house, which by the way was the highest priced home in the neighborhood by $35,000. The offer was for $500,000, which was $25,000 less than the homeowner needed to qualify for their new place. After all the negotiations, we were $10,000 apart. The deal never closed because my clients could not go any lower and the buyers could not go any higher. The seller truly wanted to sell and understood we were in a buyers market and the buyers truly wanted to buy but could not qualify for more. We ended up taking the house off of the market because all of this was too much for the seller to handle.

I recently thought to myself, if the buyers were working with a HomeZill agent, the $10,000 needed to make this deal happen would have been given to the sellers at closing to make the deal go through. The buyers would have been able to get the home they and their children really loved and the seller would have moved into her dream home. It is clear that the credit given back to the buyer at closing really does help out people’s financial situation. In a time where people have to lower their price to get their house sold, this credit can be the difference between buying your dream home and not qualifying for it at all.

If you enjoyed this post, make sure you subscribe to my RSS feed!

Some good news for people worried that this market is not the right time to buy. I just put in an offer on a 1951 home for $465,000. To some this might sound a bit much but not for what I’m getting. I’m getting a 3400 sq ft home on well over half an acre just outside the beltway (Washington DC) hopefully for about 175- 225 thousand below the comparables.

This home is less than one mile to the metro and has 5 bedrooms and 4 full baths. However, the home needs a serious polish because 56 years can do a lot to a home’s infrastructure. New air conditioning, remove base board heating, all new kitchen, baths, windows, and flooring are needed to bring this house into the 21st century. For what I’m paying (if the offer is accepted), I can put $100,000 into the home and still have $100,000 in equity, not to mention a gorgeous home to live in. What this means is in two years (assuming home prices appreciate within the next 2 years), I can sell this beautiful home and walk away with the $100,000 that I put in, plus the hundred thousand in equity and not pay capital gains taxes. Then I can do it all over again. My goal is to have a house in the Washington Metro area paid off, and a condo in Miami paid off in 8 to 10 years. Then all I would have to pay is my property tax and utilities and should I ever run out of money I can do a reverse mortgage or get a home equity line of credit. I don’t think my children will mind the inheritance they will get. This is how you create long term wealth that if repeated by each generation, can last for centuries. So for those of you who say it’s not the right time to buy, thank you for leaving those deals that are out there on the table for me.

If you enjoyed this post, make sure you subscribe to my RSS feed!

Nothing gets on my nerves more than when a friend finds a great deal and doesn’t tell everyone about it until it’s too late. Last week a good friend of mine (maybe not so good anymore) came across an incredible deal. It was a 52” AQUOS LCD Full HD 1080p Slim Line Design television. It was selling for 2 days only at $1,800 and it retails at $3,500. Now the worst part about it is, he said he didn’t tell all of us because he didn’t think anyone would be interested. I don’t know about you, but I like to watch College Football on a big screen TV if I’m not at the game. Needless to say, he’ll never do that again.

If any of you all out there happen to be searching for a home, you probably have seen K.Hovnanian signs on the side of the road. Well if you haven’t, K.Hovnanian is a builder and has quite a few communities in the Northern Virginia area. This past weekend they were doing a promotion called “Deal of the Century.” You’re probably wondering what it entailed. Just think for a second and imagine what kind of a deal a builder could possibly give to call it the “Deal of the Century.” For starters, how about over $100,000 off the sales price? Yeah, that’s no joke. Last weekend for 72 hours only K.Hovnanian was basically handing out homes to people. Now, if I was searching for a home and my Realtor did not tell me about his incredible deal, I would be furious.

Here it is ladies and gentlemen, Beazer Homes has over a dozen communities around the Northern Virginia area and these homes are priced to sell. They are even offering to pay for closing costs! On top of this, with HomeZill, you will save an additional 2% of the sales price as we credit you that amount when you purchase a home with us. On the purchase of a $500,000 home, you will receive a credit of $10,000. There you have it, give us a call (888-998-9455), we’re here to help you save money!

If you enjoyed this post, make sure you subscribe to my RSS feed!

Foreclosures and short sales in Northern Virginia and Washington DC are becoming more prevalent now-a-days as well as in most of the country. As a result of the rise in delinquencies, short sales have become popular as a solution for homeowners who need to get out of homes as trouble-free as possible.

A short sale becomes an option when the homeowner cannot afford to make the payments on their loan due to whatever circumstance. In a nutshell, the lender agrees to accept less than the total amount owed. In reality, the lender agrees to release the home from the lien of the Deed of Trust for less money than stated in the Trust. Not all lenders will consider short sales if it makes more financial sense to foreclose.

Lately, the short sale epidemic has resulted from adjustable rate mortgages (ARM’s) increasing with the combination of depreciating home prices. During the housing craze, many home buyers took out 100% financing, interest-only ARM loans. If a buyer took out an interest only loan without making a down payment, then essentially none of the principle amount owed on the home has been paid.

Now with the decline of home prices, these ARM’s are adjusting (higher), which consequently increases the mortgage payment. The only way to stop the adjusting rate is to refinance the loan into a fixed rate, which typically costs a few thousand dollars.

For example, lets say you bought a home two years ago for $500,000, and now it will appraise for only $420,000. If you need to refinance into a fixed loan, then you will have to put down $80,000 ($500,000-$420,000) + the cost of refinancing. Basically, you will owe the difference between what the home is currently worth, and the total amount still owed on the mortgage. In this case your only options would be:

1) Continue to pay the increased mortgage (in most cases the rate continues to adjust over a certain time period, ie. every month or 6 months, etc)

2) Work out a deal with your bank, ie. defer payments, work-out program, deed-in-lieu

3) Short Sale

4) Foreclosure

When homeowners decide that they can no longer stay in their home, our team comes in to help facilitate a short sale rather than having the home go through foreclosure. These days, lenders, wanting to avoid costly foreclosures, are more inclined to accept a short sale in which the loan balance exceeds the market value of the house. The short sale ends by agreement with the lender to approve the sale of the property to a buyer. This consequently results in an escrow, documentation and then a short sale consummation. 

One of the ultimate benefits is that as long as the home owner makes the mortgage payment up until the consummation of the short sale, their credit will NOT be impacted nearly as much as a foreclosure would on their record.

For lenders, there are several benefits for the short sale. The homeowner less likely to become disgruntled and tear apart the house. The lender doesn’t have to spend additional money on holding costs and wasted time tying up funds that could be lent out. If market conditions have deteriorated, then recapturing the debt at a foreclosure sale is unlikely. Lenders aren’t in the business of selling real estate, they are in the business of lending money… the last thing they want is to go through foreclosure proceedings if it doesn’t make sense financially.

If the property does go into foreclosure, additional fees will be accumulated and later reported by the lender to the IRS as losses. The foreclosure usually stays on your credit report for 7 years and you most likely won’t be able to get another mortgage with a foreclosure on your credit. The lender may also pursue the homeowner for a “deficiency judgment” (the difference between the highest bid at sale and the amount owed).

If the homeowner is proactive and contacts the lender before becoming delinquent, they have a much better chance of a successful short sale. Only after the homeowner has missed a few payments may it be too late for a short sale.

When it comes time to negotiate for a short sale, getting the necessary paperwork and tracking down the right people to negotiate with can be a very difficult task. Whether intentionally or unintentionally, getting to the right people to discuss the possibility of a short sale, seems to be a challenge in which there is no easy answer.

Unless you have a lot of free time to dedicate, having a designated short sale agent (usually a Realtor® or attorney) to assist you in selling your home and consult directly with your lender is typically the best bet. Especially when time is of the essence, you must be available to quickly respond to, and provide the lender with all of their requests along with showing, marketing and selling your home. From beginning to end, short sales are many times a 2-4 month process and can be a very stressful time for the homeowner.

It’s also important to understand that you may face a 1099 in the future, meaning you could be taxed as income on the amount of the lender’s loss. However, once an agreement is reached, the short sale can be the best opportunity to get out of a very bad situation with the least amount of harm for all parties.

HomeZill agents work closely with homeowners in Northern Virginia and Washington DC throughout the short sale process. We provide the homeowner with our expertise in negotiating, identifying the lender contact to negotiate with, and compelling the lender to agree to the short sale. Most of the time, lenders will not disclose the minimum acceptable price for the short sale until an offer is submitted and reviewed. Our real estate professionals have extensive knowledge of the short sale process and will use high-impact marketing strategies in order to generate an offer as quickly as possible.

If your mortgage interest rate is due to adjust in the near future and you’re not going to be able to afford the payments, be PROACTIVE and contact your lender ASAP to see what your options are. Your credit alone is way too important to ignore the situation at hand. If the lender mentions the short sale option, don’t delay for too long (time is of the essence!). When you’re ready to get the ball rolling, simply fill out the HomeZill Express Seller questionnaire. You must register first (it’s free) before getting started if you haven’t already. A short sale agent in VA or DC will contact you soon to begin the short sale process.

Feel free to contact David at 1-888-998-9455 x801 or david@homezill.com to speak with a ReMax short sale Realtor in Northern Virginia or Washington DC. To receive a weekly foreclosure list of homes as properties come on the market, enter your email address at the top of the page.

If you enjoyed this post, make sure you subscribe to my RSS feed!

“Are you kidding me?” These are the words coming from an astonished outraged neighbor.
“That’s right; I just sifted through the inventory and found the best deal,” said the overzealous new homeowner.
As everyone knows right now, if you’re looking to buy a home, you have as good a chance to find what you’re looking for more than ever. There is so much inventory on the market right now and since it’s a buyer’s market, there is room for negotiation. In the case of the overzealous new homeowner, he scored a home through a short sale. Because of the short sale, he was able to get the house at an incredible price. Not only did he get a great deal but it’s one of the prime locations in the area. For those of you that don’t know what a short sale is, it means the lender is accepting less than the total amount due. The seller for some reason cannot continue to make the payments and instead of destroying their credit, they apply for a short sale.
Personally I know the seller that had to basically give his house up because of other reasons and it burns him to know that this overzealous homeowner got such a great deal. Don’t let what you hear in the news shy you away from purchasing a home if you’re thinking about it, you may miss out BIG time.

For a weekly list of foreclosure properties, enter your email address in the box at the top of this page.

If you enjoyed this post, make sure you subscribe to my RSS feed!

Are we really spiraling downwards as the secondary market continues hack away at every “non-conforming/Alt-A” product left (forget about subprime loans)? Will the rates on Jumbo loans continue to go up? How many more lenders will fall? These are questions that I keep hearing too often these days… There is no simple answer to these questions, however whether the answer is good or bad depends on what side of the fence you are standing on. I’m not going to go into detail in regards to how and why the walls are tumbling down on the mortgage industry. You can read about it here or here or even here. However, I wanted to address a different perspective to these events and how it can and will benefit that potential home buyer that is not sure what to do yet. We need to start to look at the positives of this market. Yes, there are positives to this market and if you are a first time home buyer waiting for that “perfect” time, well jump off that fence and call your Realtor because the market is now all yours!

The sellers are struggling. There is a huge amount of inventory, financing has become very strict, buyers that once qualified for a loan may no longer qualify, jumbo loans are priced significanlty higher than conforming rates meaning that qualification for a jumbo loan just got tighter, sellers are competing with large incentives offered by builders… the list goes on an on. People trying to sell their home right now are facing an uphill battle. The good in all this is home sellers are being forced to drop their prices. While this puts the strain on home sellers, this is opportune time for buyers. I don’t think I need to elaborate about the fence any further!

This shift of the market to favor of the home buyer has been long due. Home buyers are in a much better position to negotiate price with sellers nowadays. If the sellers have the equity they are more likely to assist you with paying your closing costs. That home that you went through in April may still be on the market and more than likely it is listed at a lower price. I have a client that listed their home at $679K in April but they just got an offer at $615K in late August, which they are going to accept. That’s phenomenal, for the buyer of course but a heavy dose of reality to the home seller. This is happening all around us right now. There are countless great deals on the market today. Homes that were selling for $450K a year ago are now selling for $380K. Although inventory was high before the walls started to fall in on the mortgage industry, people still had wishful thinking that they could get “full price” for their home. That wishful thinking got them nowhere and now the mortgage industry is going in for a full body lift. Guess what? That home owner now has to drop their price even more in order to expand their potential buyer field.

Do you see where this is going? Yes, financing has gotten stricter and we are seeing the comeback of Mortgage Insurance and the FHA loan. There is still 100% financing available under agency programs like My Community. These loans are typically capped at conforming loan amounts but hopefully we will see a change in the conforming loan limit soon! Conforming rates are going down! Yes, I said going down. Bottom line here is that now is a great time to buy because homes are getting cheaper. Don’t mope about the market. The market has done a complete 180. Just remember, it’s all perspective.

If you enjoyed this post, make sure you subscribe to my RSS feed!