Chance Gates' Blog

Here’s some good news for the struggling US housing market: Thanks to the European debt crisis, mortgage rates are at historic lows.

The current average rate for a 30 year fixed loan is 4.87 percent, according to Bankrate.com. That’s the lowest rate for the 30 years since Bankrate started keeping track 25 years ago.

Even jumbo loan rates-loans for more than $417,000-have fallen. The 30-year fixed jumbo loan is at an average rate of 4.5 percent, down from nearly 6 percent at this time last year.

“It’s the best time in our generation to buy,” says Mark Zandi, chief economist at Moody’s. “It may be the best time in any generation. Mortgage rates are so low and with homes prices down and lots of inventory, you couldn’t pick a better time to buy or re-finance.”

Europe’s debt crisis is behind the drop. Nervous investors are flocking to the security of US Treasurys, which pushes down their yield and influences a host of consumer interest rates-including those on mortgages.

The decline is also good news for homeowners looking to refinance, particularly those who owe more on their mortgage than their house is worth.

“There’s a tremendous window on re-financing,” says Greg McBride, chief economist at Bankrate.com. “That’s particularly true for people who can take advantage of the government’s Home Affordability Refinance Program (HARP)-which allows home owners to refinance into low mortgage interest rates even if they’re property value has gone down.”

HARP, which was due to end at the end of this June, now runs through June of 2011.

“Think of the benefits if you buy or refinance now,” says McBride. “Locking in now at the lower rates means more more bang for the buck and more breathing room for homeowners when it comes to payments.”

But the decline in rates probably won’t last long, analysts say. So homeowners need to move fast.

“I think they won’t last much longer than a month or two at the best,” says Lawrence Yun, chief economist at the National Association of Realtors. “I can see them going up to 5.5 percent by the end of June if not sooner.

Read more at http://finance.yahoo.com/

As a Reno/Sparks real estate professional; I encourage all questions and comments, on the Reno/Sparks real estate market or any of the articles posted in this blog.  I can be reached by email at chance@ballard-company.com

RISMEDIA, May 13, 2010—With short sales making up almost 35% of home sales in March and the country with a national foreclosure problem, I Short Sale, Inc., one of the largest short sale firms in the U.S., sets the record straight on common short sale myths.

1. You must be default on your mortgage to negotiate a short sale. Short sales are not a function of default status on a mortgage. They are the result of the bank mitigating a potential default situation that, in the long run, will cost more money to the investors. We have completed many short sales in instances when the borrower was not in a default situation.

2. Listing my home as a short sale is embarrassing. Anytime we get ourselves into a tough financial situation it can cause some embarrassing feelings. It is important to remember that those feelings will not help us get back onto stable financial ground. We need to overcome our feelings and do what is right to protect our financial futures.

3. Buyers aren’t interested in short sale properties. Short Sale properties are often times available at a competitive price to other properties on the market. In many cases, short sale properties are very well cared for and have not had to endure the deferred maintenance of a REO property. Short Sale properties are in great demand in the marketplace.

4. There’s not enough time to negotiate a short sale before foreclosure. A good negotiator takes into account the timeline affiliated with a foreclosure. There is always a chance that a short sale can be negotiated. However, the only way to know for sure is to try.

5. The bank would rather foreclose than complete a short sale. Banks do not want to foreclose on property. It is expensive and carries a high level of liability once the bank owns that property as an REO. Wherever possible, banks are seeking other loss mitigation options before foreclosure.

6. Short sales are impossible and never get approved. Short sales are complicated, but not impossible. We negotiate short sale approvals every day.

As a Reno/Sparks real estate professional, I encourage all questions and comments on the Reno/Sparks real estate market or any of the articles posted in this blog.  I can be reached by email at  chance at ballard-company.com or http://www.myspace.com/chancegates

Related Links:

http://chancegates.com/2010/05/07/8-short-sale-allowable-closing-cost/

http://chancegates.com/2010/05/06/15-questions-i-ask-before-listing-a-short-sale-in-todays-real-estate/

http://chancegates.com/2010/03/14/home-owners-to-be-paid-to-short-sale/

http://chancegates.com/2010/03/13/the-government-urges-short-sales/

In February of 2010, the President announced additional help for homeowners living in areas deemed “hardest hit” by the fallout of the housing crisis. A new $1.5 billion funding initiative called the FHA Hardest-Hit Fund provides money for housing finance agencies or FHAs in Nevada, Michigan, California, Florida and Arizona.

The Hardest-Hit Fund was created to offer  “relief in direct proportion to the scale of each state’s housing challenges.” In plain English, that means housing finance agencies in the affected states will get government money based on the scale of declining home values, unemployment figures and the number of delinquent mortgages.

What does all this mean for someone with an FHA loan who is in danger of default and foreclosure? If you live in one of the affected states, when you go to your lender to negotiate forbearance, an altered payment schedule or other options designed to prevent foreclosure, the bank has more financial incentive from the government to help the borrower. The FHA Hardest-Hit program gives lenders in these five states more flexibility to create programs designed to prevent a mortgage from going into default or foreclosure including:

• Loan modification
• Mortgage forbearance
• Principal reduction for borrowers who are over-leveraged
• Loan principal reduction for borrowers with “severe negative equity”
  It’s very important to note that the Treasury Department has not mandated an across-the-board set of measures that must be taken with this funding; all programs a lender initiates with Hardest-Hit funds must be evaluated to insure it’s in compliance with rules put in place through the Emergency Economic Stabilization Act. Your lender may choose to design an anti-foreclosure program not offered in other areas, or one that has features similar programs lack—as long as the program is in compliance with federal law.One such type of relief suggested by the creators of the FHA Hardest-Hit program as an “acceptable transaction” is the unemployment program concept. This could be offered in the form of some assistance to qualified FHA borrowers who are currently unemployed and in danger of foreclosure on their FHA home loan. Another type of relief considered an acceptable transaction is second lien reduction where the second lien is either modified or reduced. Is your FHA loan eligible? At press time there doesn’t seem to be specific guidance that includes or excludes FHA mortgage holders–check with your lender to see if there are plans to create a relief program with FHA Hardest-Hit funds that could include your FHA home loan.

  Under the new Hardest-Hit guidelines, lenders who create programs to help individual homeowners must target residences with unpaid principal equal to or less than the Fannie Mae or Freddie Mac conforming limit (up to $729,750 for single-unit homes, more for multi-unit buildings).

  If you are in danger of default or foreclosure in Nevada, Michigan, California, Florida and Arizona, ask your loan officer if your FHA home loan could benefit through the Hardest-Hit program. If your lender is still putting together a program to help individual homeowners, you may be able to work out an arrangement in the meantime to put off foreclosure or default until the lender’s relief program is approved. Don’t wait until the last moment to act—if you are struggling financially you may be able to save your home in the meantime simply by asking your lender for help.

From www.fha.com

As a Reno/Sparks real estate professional, I encourage all questions and comments on the Reno/Sparks real estate market or any of the articles posted in this blog.  You can email me @ chance@ballard-company.com or http://www.myspace.com/chancegates

RISMEDIA, April 19, 2010—(MCT)—Latasha Hall never envisioned herself a homeowner. But by the end of the month, she will be. Just in time.

With the soon-to-expire tax credit for first-time buyers as an assist, the single mother plans to close on a $166,650 three-bedroom house in Clifton Heights, Pa. “If it hadn’t been for the credit, I wouldn’t have done it,” Hall said.

To be eligible for the federal tax credits—up to $8,000 for qualified first-timers and up to $6,500 for certain repeat buyers—houses must be under contract by April 30, with settlement by June 30, 2010.

With those deadlines in sight, some real estate agents say they are relishing their first busy days in months.

For some buyers, a tax credit is an added perk in an already-friendly market with good inventory and low mortgage rates.

For those like Hall, who is working toward her bachelor’s degree in behavior and addictions counseling and who works two jobs, it’s the last piece that fits the puzzle. In January, Hall visited Weichert Realtors for help finding a rental home after her landlord’s lender foreclosed.

Steve Madonna, a loan officer with Weichert, looked at her income (about $54,000) and her credit score (which needed some work, but not much) and suggested she buy instead. Madonna connected Hall with a state loan program that would provide $5,000 of the $8,000 credit up front, for use on closing costs or maintenance on the house. Hall set to work paying off two past-due bills and bugging the credit bureaus—sending weekly faxes and calling often—to update her score quickly. “If I hadn’t heard about this credit, I wouldn’t have worked so hard to get it done,” she said. “This is my time to go out and do what I have to do. I kept thinking about my kids.”

The new Clifton Heights neighborhood is safer, she said, and it’s just two blocks from the school her 9-year-old son attends. The credit has been “a blessing,” Hall said.

To Realtors like Daren Sautter, it’s a relief. “It’s nice to be busy,” he said.

Sautter, of Prudential Fox & Roach in Cherry Hill, N.J., watched showings and Internet leads triple in the first three weeks of March.

He expects to be slammed through the April 30 deadline, then figures he’ll see a lull before the spring market picks up some. “If you don’t sell a house in April,” Sautter said, “you’re not selling it.”

Sellers likely will be thinking the same thing, Realtors said, and listing prices could drop this month.

Sautter recently helped Pat Poole price her four-bedroom Cherry Hill house to sell. At $290,000, it went after just one day on the market. Recently divorced, Poole was looking to downsize. She sold the house to a young couple who used the repeat-buyer credit. Her next task: finding a new house for herself and her 17-year-old son in time to secure her own tax credit. “I’m going to get in under the wire,” Poole said.

A flurry of activity is noticeable in areas with a strong inventory of homes affordable to young families, Realtors said.

But some brokers are seeing a “trickle-up” effect. Would-be buyers are able to sell their homes, aided by the rush for the tax credit, and upgrade to communities with better school systems or more historic charm.

In Haddonfield, N.J., the proximity to Philadelphia and access to the PATCO High-Speed Line were big draws for Jeff Minors and Amy Henry. Minors will commute to his job as a financial-news editor in New York City. The couple, longtime renters, were looking to move to southern New Jersey from Norwalk, Conn., with their 2-year-old son. They recently moved into a four-bedroom home in Haddonfield that cost about $575,000. The first-time-buyer credit was an added bonus, Minors said. “We were more concerned about finding the right house at the right price,” he said. “But it’s definitely a nice benefit.”

As a Reno/Sparks real estate professional I encourage all questions and comments on the Reno/Sparks real estate market, or any of the articles posted.  I can be reached by email at chance@ballard-company.com or http://www.myspace.com/chancegates

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RISMEDIA, April 15, 2010—The 30-year fixed mortgage rate on Zillow Mortgage Marketplace is currently 4.88%, down twenty basis points from 5.08% compared to this same time last week. The 30-year fixed mortgage rate rose last week, spiking Sunday at 5.05% before falling to 4.88% Monday.

Zillow’s real-time mortgage rates are based on thousands of custom mortgage quotes submitted daily to anonymous borrowers through the site, and reflect the most recent changes in the market. These are not marketing rates, or a weekly survey.

The rate for 15-year fixed home loans is currently 4.29%, while the rate for 5-1 adjustable-rate mortgages (ARM) is 3.49%.

The total volume of mortgage requests in the past week was up 4.5% from the prior week. Of last week’s requests, 21% were for refinance loans, 77% were for purchase loans and 2% were for home equity loans. The prior week, 25% of requests were for refinance loans, 73% were for purchase loans and 2% were for home equity loans.

As a Reno/Sparks real estate professional I encourage all questions and comments on the Reno/Sparks real estate market of any of the articles posted.  You can email me at chance@ballard-company.com or http://www.myspace.com/chancegates

For more information, visit www.zillow.com.

Which is the better investment to build equity?

While it’s a little easier now to get a condo loan than it was a year ago, you’ll still find tight restrictions, particularly if you need a Federal Housing Administration-backed mortgage. Typically, an FHA lender will approve you only if at least 50% of the units in a complex have either been sold or placed under contract (by owner-occupiers, not investors). Additionally, if 15% or more of the units are more than 30 days past due on payments, that could be another loan stumbling block. If a condo board doesn’t set aside at least 10% of its dues toward reserves and improvements, loan approval also might be a problem, especially if the complex is in an area where values have consistently declined.

If you do go the FHA condo route, be prepared for the loan-approval process to take longer while the lender applies those tests. However, if an entire condo project is FHA-approved, which many now are, buyers will find a smoother road to financing. At present, down payments for condos are a little higher (20% to 25%) than for houses (10% to 20%), although FHA down payments can be much lower.

• On our blog, ‘Listed’: Prefab home grows to two stories, still eco-friendly

Among the pros for condo living are ease of upkeep and “location, location, location,” especially for city dwellers who desire amenities and transit options that are usually within short walking distance. Condo cons include the monthly maintenance fees and a condo board that decides how those fees are spent, sometimes forcing owners to subsidize amenities they don’t use. (By the way, condo maintenance fees aren’t tax-deductible.) In many condo communities, foreclosures and delinquent dues have forced associations to pass along shortfalls to other owners. You’ll also have to get the condo board’s permission for any renovations you might want to make (some housing developments also have associations and similar restrictions).

• MSN Money: Big changes come to student loans

In a house, you will have a yard, the freedom to make improvements and the option of having pets, but you’ll also have greater upkeep requirements and a lot more space to fill with potentially expensive stuff.

In either case, always consider the neighbor of the condo or home. As a fresh-out-of-college person, you’ll probably want to be around young professionals instead of the baby-boom set, and both groups tend to reside more heavily in urban condos. Also, remember, great location is a bigger factor in buying a condo than a house.

Dollar for dollar, condos tend to appreciate less in value than houses, but not at all price points or in all markets. Single-family houses are generally a little easier to sell, particularly now, with so much available condo inventory.

So do your homework

Read more at realestate.msn.com

As a Reno/Sparks real estate consultant I encourage and questions or comments on the Reno/Sparks real estate market or any of the article I post. Please send emails t0 chance@ballard-company.com

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Image by Getty Images via Daylife

The current market presents some of the most favorable conditions for homebuyers in years, particularly for first-time buyers.

Why is everyone nagging you to buy a house these days?

When real-estate values were crashing — prices dropped nearly 33% from the second quarter of 2006 through April 2009 — renting that apartment was darned savvy. And since home values are projected to drift lower in 2010, getting into the market now may seem like financial suicide. But the truth is, even the worst housing slump since the Great Depression can’t remove the long-term benefits of homeownership.

Meanwhile, the combination of lower prices, cheap mortgage rates and a special tax perk from Uncle Sam has produced some of the most favorable conditions for homebuyers in years. And without the need to unload one property to purchase another, first-time homebuyers are in a position of particular strength this year.

Although the real-estate bust wiped out nearly $6 trillion of housing wealth through November 2009, the financial advantages of homeownership remain. “When you own a home, you are slowly but surely building strength in an asset that you can utilize to your great benefit at some point,” says Keith Gumbinger of HSH.com, a publisher of consumer loan information. Homeowners who accumulate enough equity can borrow against the property to put Junior through college, or they can sell it down the road to purchase that retirement bungalow in Boca Raton, Fla. And federal tax breaks make home mortgages less costly than other forms of debt. “It is a long-term forced savings plan,” Gumbinger says.

Meanwhile, the housing meltdown and the federal government’s response have created some compelling reasons to consider jumping into the market this year. First, lower prices make buying more tempting. By late 2005, breezy credit and speculative fervor had pushed the national median home price to median household income ratio — a key measure of real-estate affordability — to more than 2.3, according to Moody’s Economy.com. That’s significantly higher than the 1.9 average for the 15-year period that ended in 2003. But by the third quarter of 2009, plunging prices had dragged the ratio down to 1.67. And although Mark Zandi, the chief economist at Moody’s Economy.com, expects an additional 10% decline before prices hit bottom late this year, the likelihood of a sizable drop is much smaller today than several years ago. “The risks to all homeowners are much lower now because house prices are a lot lower,” Zandi says. “You’re not going to see the kind of price declines that are really going to cause you problems.”

Mortgage rates are sitting near all-time lows, with 30-year, fixed mortgage rates falling to an average of 4.88% in November from 6.09% a year earlier. And while they’re likely to increase, rates should remain attractive throughout 2010, experts say. If that’s not enough, Uncle Sam is handing out tax credits worth up to $8,000 for qualified first-time homebuyers who close the purchase of a primary residence by the end of June. “You have got some of the best housing affordability conditions in many markets that (buyers) have seen certainly in their lifetimes — and perhaps even their parents’ lifetimes,” says Mike Larson of Weiss Research. “If you are not encumbered by a previous home you are trying to sell, this is great for you.”

Jobs first. Many Americans are taking advantage of these conditions to become homeowners, with first-time homebuyers accounting for more than half of home sales in November. But as we learned during the housing bust, “because everybody’s doing it” is a terrible reason to buy property. Instead, would-be buyers must first determine whether it’s the right time for them. And that means they must take a critical look at their employment situation. Although the economy is showing signs of life, the national unemployment rate stood at 10% as the year began, and it is projected to move higher. Since a steady income stream is essential to homeownership, only those with sound job security should pursue a home purchase.

• MSN Money: 5 keys to finding housing bargains

Second, remember that all those headlines about the national housing market aren’t nearly as important as what’s going on in the area you are looking to buy into. The trajectory of home prices will vary a great deal from one place to the next. Home values in Tacoma, Wash., for example, are expected to increase more than 40% over the next five years, while prices in Atlantic City, N.J., are projected to fall more than 10%, according to Moody’s Economy.com. Markets with a diversified economic base of faster-growing job providers — like high-tech or business service firms — are in a good position to experience growth in employment, population and wages, says Celia Chen, senior director of housing economics at Moody’s Economy.com. Such factors will help stimulate housing demand and juice property values over the long term.

A market’s current pricing trends are important as well. Although the housing bubble popped more than three years ago, prices in some markets remain significantly higher than fundamentals suggest they should be. Homes in Asheville, N.C., and Portland, Ore., are more than 20% overvalued, according to IHS Global Insight. To determine if buying today makes financial sense in a given market, check out the local rental stock. “If you can find houses in that market that are renting for considerably less (than what you would pay each month to buy a comparable property), then you are in a marketplace where it still makes more sense to rent,” says real-estate analyst Jack McCabe.

As a Reno – Sparks real estate consultant I encourage all questions or comments on the Reno – Sparks real estate market or any of the articles I post.

RISMEDIA, March 31, 2010—(MCT)—Wynn Bloch has always dutifully paid her bills and socked away money for retirement. But in December she defaulted on the mortgage on her Palm Desert, Calif., home, even though she could afford the payments.

Bloch paid $385,000 for the two-bedroom home in 2006 when prices were still surging. Comparable homes are now selling in the low $200,000s. Bloch, a retired psychologist doubted she’d see her investment rebound in her lifetime. Plus, she said, she was duped into an expensive loan.

The way she sees it, big banks that helped fuel the mess all got bailouts while homeowners like her are left holding the bag. No more. “There was not a chance that house was ever going to be worth anywhere near what my mortgage was,” said Bloch, who is now renting a few miles away after defaulting on the $310,000 loan. “I haven’t cheated or stolen.”

Time was when Americans would do almost anything to hang on to their homes. But that commitment appears to be fraying as more people fall behind on their loans, while watching the banks and lenders that helped trigger the financial crisis return to prosperity.

Nearly one-quarter of U.S. mortgages, or about 11 million home loans, are underwater, with buyers’ houses worth less than their loans. While home values are regaining ground, they remain far below their 2007 peak. Many homeowners are just now coming to grips with the idea that prices will take years to reach the pre-crash peak: as long as 14 years in California, according to economist Chris Thornberg.

Stuck with properties whose negative equity won’t recover for years—feeling betrayed by financial institutions that bankrolled the frenzy—some homeowners are concluding it’s smarter to walk away than to stick it out.

“There is a growing sense of anger, a growing recognition that there is a double standard if it’s OK for financial institutions to look after themselves, but not OK for homeowners,” said Brent T. White, a law professor at the University of Arizona who wrote a paper on the subject.

Just how many are walking away isn’t clear. But some researchers are convinced that the numbers are growing. So-called “strategic defaults” accounted for about 35% of defaults by U.S. homeowners in December 2009, up from 23% in March of 2009, according to Luigi Zingales, a professor at the University of Chicago’s Booth School of Business. He and colleagues at Northwestern University’s Kellogg School of Management reached that conclusion by surveying homeowners about their attitudes and experience with loan defaults. They found that borrowers were more willing to walk away if someone they knew had done it, and that the greater a homeowner’s negative equity the more likely they were to default, even if they had could make the monthly payment.

Similarly, an analysis released last year by credit bureau Experian and consulting firm Oliver Wyman estimated that walkaways accounted for nearly one in five homeowners who were seriously delinquent on their mortgages in the last three months of 2008.

“The fact that people are strategically defaulting—there is no question,” Zingales said. “The risk that the number of people doing this might explode is significant.”

A flood of walkaways could damage the nation’s fledgling housing recovery by swamping the market with foreclosed properties. Still, some experts are dubious that millions of underwater homeowners will pull the plug like Bloch did. Home ownership remains the cornerstone of the American dream. Moving is a hassle and the stigma associated with a foreclosure is likely to keep many hanging on for a recovery.

The biggest surprise is that so many underwater homeowners continue to pay, according to White, the Arizona law professor. He’s convinced that personal shame, as well as moral suasion by the government and financial institutions has kept many homeowners from walking away, even when they’d be better off financially to dump their homes.

But real estate veterans said old taboos are eroding fast. Jon Maddux, a former real estate investor who founded You Walk Away, a for-profit company that guides homeowners through the process of default in 2007, said his earliest customers struggled with emotional ties to their homes as well as remorse about reneging on an obligation. That’s changed as more homeowners have concluded that the housing market isn’t going to rebound quickly and they’d be better off cutting their losses. “Now, it’s more of a business decision—it’s people who could afford their house, but it’s an inconvenience,” Maddux said. He and other experts said average Americans are fed up with hearing how they’re supposed to honor their debts while businesses operate by another set of rules.

Consumers typically begin to think about walking away once the value of the property is 25% lower than the value of the debt, according to research conducted by Sam Khater, senior economist at real estate research firm First American CoreLogic. About five million people nationwide are in that situation, he said.

Some purchased their homes at the peak of the market only to see the value drop precipitously when the bubble burst. Others bought low, but couldn’t resist borrowing against their rising equity to make home improvements and to pay off other bills. When home values fell, they too found themselves underwater.

Ken Henrich purchased his Marysville, Calif., home for $187,000 in 2004. He and his wife later refinanced the property, tapping the equity to pay off credit cards. They now owe around $300,000 on a place that’s worth about $132,000. They let the four-bedroom residence slip into foreclosure and are currently waiting for it to be sold at auction. They’re planning on renting for a few years until they can possibly buy again. “We can more than make the payment,” Henrich said. “The way we look at it, our credit would still be perfect years from now, but we’d still owe tons more than it’s worth.”

There are consequences to walking away. A default will knock down a credit score by at least 100 points, said Craig Watts, a spokesman for FICO, the company that developed credit scores. That could make it tough to borrow money, rent an apartment or get a job since many employers now routinely check credit histories of potential hires.

To some, it’s a small price to pay to gain a measure of revenge against the financial institutions whose loose money helped to fuel the crisis. Joseph Shull, a marketing professor, said he’s planning on walking away from the town house he bought in Moorpark, Calif., in June 2006. “I’m angry, and there are a lot of people like me who are angry,” he said. He purchased the home for $410,000 and spent $30,000 renovating. Now the house is worth around $225,000. Shull admits he overpaid for his property, but he said it fell in value in part because of “regulatory mismanagement.”

(c) 2010, Los Angeles Times.

Before walking away there are other things a homeowner can try please checkout the following:

http://www.makinghomeaffordable.com/requestmod.shtml

http://chancegates.com/2010/03/18/short-sale-the-rise-the-revenue-the-reality/

http://chancegates.com/2010/03/14/home-owners-to-be-paid-to-short-sale/

http://chancegates.com/2010/02/26/2009-foreclosure-legislation/

http://chancegates.com/2009/06/12/homeowners%E2%80%99-right-to-mediation-requirement-before-foreclosure/

Please get all your legal advice from an Attorney.

As a Reno – Sparks real estate consultant I encourage questions and comments regarding the Reno – Sparks real estate market or any of the articles I post here.  I can be reached at chance@ballard-company.com

The clock is ticking on the federal homebuyer tax credit.

Homebuyers still have time to buy a home and meet the deadlines, but they will need to act soon and be proactive throughout the transaction.

The homebuyer tax credit is worth 10 percent of the home’s sale price, up to $8,000 for buyers who haven’t owned a home in the previous three years and up to $6,500 for buyers who have owned and occupied a principal residence for at least five consecutive years during the eight-year period that ends on the day the new home is purchased.

Here are some tips for last-minute buyers:

• Buyers should be “upfront with their Realtor about their must-haves and their wish list,” says Allyson Bernard, owner of Real Estate Professionals of Connecticut. Buyers who aren’t realistic could find themselves up against the deadline with fewer houses from which to choose.
• Harsh weather may be “a help or a hindrance,” Bernard says. Buyers who are willing to trudge through snow to find a house may have an advantage over buyers who wait until the weather improves.
• Contract contingencies allow buyers some breathing room to take care of big items such as financing, inspections and the sale of their current home, Bernard says. But contingencies shouldn’t be an excuse to delay once the deal is pending.

“If you run into a problem and you no longer want to buy that house, it’s great that you had those contingencies to protect you, but you may not have time to find another property,” she says.

• Anecdotal reports suggest that some buyers have included a tax-credit contingency in the purchase contract. Whether that’s a necessary protection to make sure the deal closes on time depends on the situation and local practices. Either way, buyers should read the contract to make sure the closing will occur before the deadline.
• Buyers should get preapproved for a mortgage, because glitches such as a mistake on a credit report or a lender’s request for tax returns that must be retrieved from the IRS can cause a delay, says Patti Ketcham, owner of Ketcham Realty Group in Tallahassee, Fla.

“You don’t want to wait until the last minute, because you could end up shooting yourself in the foot over something that’s no one’s fault, but you just run out of time,” she says.

• Buyers also should allow extra time in case the mortgage lender requires a second appraisal, which can delay final loan approval.

“The appraisal process in residential lending is going through some painful changes. It is not uncommon to have a mortgage lender require more than one appraisal,” Ketcham says

http://realestate.msn.com/article.aspx?cp-documentid=23657587

As a Reno – Sparks real estate consultant I encourage any questions or comments on the Reno – Sparks real estate market or any other article I post here.

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RISMEDIA, March 24, 2010—Buying a home is one of the biggest decisions an individual can make. So it’s understandable that one considering a home purchase may take their time to avoid rushing into such a large financial commitment. However, several factors might leave prospective home buyers who don’t purchase a property now wishing they had taken action sooner.

“Current market conditions have created a perfect storm of sorts that has made it an ideal time to purchase for first-time and trade-up buyers alike,” said James M. Weichert, president and founder of Weichert, Realtors. “Those who have the means and the desire to buy now but don’t, aren’t likely to see such a great opportunity again anytime soon.”

Specifically, Weichert offered three reasons why those who aren’t under contract to purchase a new home by April 30, 2010 might regret it.

1. They won’t receive a sizeable amount of money from Uncle Sam.

For the past two years, the federal government has offered a home buyer tax credit to help stimulate the economy. But that financial incentive is set to expire soon. First-time buyers who aren’t under contract to purchase a home by April 30, 2010 will leave the $8,000 that is available to them through the tax credit on the table. Meanwhile, repeat buyers will miss out on the opportunity to collect up to $6,500 from the government.

2. They might not lock-in on the historically-low interest rates.

Thanks to measures taken by the Federal Reserve including the purchasing of mortgage-backed securities, interest rates have remained historically-low for several years. With the economy beginning to show signs of recovery, it is widely believed that the government will soon put an end to these stimulus efforts.

If that happens, many economists believe we will begin to see a sharp increase in interest rates which could result in a much higher monthly payment for those who wait. For example, an interest rate increase of 1% on a 30-year fixed mortgage of $300,000 could cost a buyer $188 more a month or $67,000 more over the span of the entire loan.

3. They might miss out on record home price affordability.

Home price affordability is at its most optimal level in decades. As a result, those who wait to buy will likely pay more for the home they purchase than what that same home would cost right now. In fact, home prices have already begun to rise slightly in some markets. Instead of getting a better bargain, waiting to buy a home might net buyers a higher purchase price, less appreciation and less house for their buck.

“There is no time to waste for anyone who wants to take advantage of this great buying opportunity. Particularly for those who have a home to sell first,” added Weichert. “If you are prone to saying ‘what if’ and wondering what could have been, you will thank yourself down the road for buying now.”

For more information, visit www.weichert.com.

As a Reno-Sparks real estate consultant I welcome any questions or comments on the Reno-Sparks real estate market or any articles I post.  I can be reached at chance@ballad-company.com