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From the Trenches

Oh I’m SURE I Can Get a Mortgage!

by Heather on March 5, 2010

in Mortgages

I often lack words to describe to my clients exactly how mind-bogglingly fast the world of mortgage lending is changing lately. Home buyers not only need good credit, a steady income, and piles of documentation to back all that up.. . . . .   you need to be aware that loan guidelines change near-daily.

Yep. Nearly daily loan investors make changes to their rules about what they’ll lend on, what they won’t, who qualifies for a mortgage and who doesn’t, and how to properly fill out 9 inches of forms in triplicate to get the loan money.

I subscribe to a daily email that discusses changes in lending standards throughout the industry. It’s usually 2 pages long. Two pages of changes in loan guidelines per day!

Don’t assume you’re going to have zero trouble getting approved for a mortgage. If you have excellent credit you’ll probably get approved, but you’ll have to produce more paperwork than you can imagine.

Get approved. Then start shopping. Trust me. You don’t want to spend weeks looking online at this:

Nice EF, SFH in Phx, sold 325k in Feb 2010

only to be told you’re approved for a mortgage to buy this:

Shabby EF, SFH in phx sold Feb 2010 for 15k

Want to get pre-approved? Our favorite lenders, in no particular order:

  • Kevin Reiser, AmeriFirst Loans, 480-289-7635
  • Andrew Schmidt, WJ Bradley Mortgage, (602) 999-1912
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heather

Heather Barr is a Realtor. She's a chow hound, a gym rat, and the only political junkie in the USA who can actually keep her political views to herself. Instead, she focuses on educating her clients about the often-confusing world of residential real estate.

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Bidding Wars and No-Brainers

by Heather on March 4, 2010

in Buyer Help

In yesterday’s post I promised 1 sure-fire way to avoid the stress of getting embroiled in dealing with a so-called bidding war. It’s bonus day here at The Phoenix Agents; here’s 2 ideas.

Option One - Make your best offer right out of the gate

Are you willing to pay $176,500 for that home that could be your Dream Home? Offer it. Don’t pussyfoot around offering $158,900 and hoping the seller comes back with a counteroffer. Just make your highest and best offer right out of the gate.**

I can hear the reply now: “But I don’t pay too much!”

Easy solution here folks. First, decide what is “too much” and what is “too little” for you and for this particular house. Mentally walk backwards from “too much” in increments of $1000 or so until you get to a number that you’d be satisfied with if you were the new owner of the home. Offer that.

There are a couple of scenarios that could play out here.

1) You bid low and don’t get the house – very likely

2) You bid your best and don’t get the house – could happen and would be disappointing, but at least you’ll know you gave it your best shot. Someone else – who was willing to pay what you believe is too much – got the house. Move on.

3) You bid your best and get the house – congratulations!

4) You bid low and get the house – in a true multiple offer situation, this is about as likely as winning the lottery.

Option Two - Stop Shopping

There is one sure-fire way to avoid the stress of multiple offer situations. Take your ball and go home. Don’t buy a house now. Keep renting and come back to play the game when the stakes suit your temperament.

Again, I can hear the reply already: “But I want to buy a house!”

You’ve got a choice to make.

Determine that you’re going to get over your fear of bidding wars by employing one of the strategies I’ve outlined here and yesterday. Or stop shopping for houses. Or at least stop shopping for houses that have bidding wars.

Hopefully this is helpful information. Still worried? Call or email me or Chris and we’ll talk you through it.

Heather Barr

**In metro Phoenix, in 2010, in prices under about $400,000 or so, bagain priced bank owned homes (a.k.a. forclosures or REOs) dominate the market. Remember Economics 101? Low price = high demand. If you’re shopping in this segment, expect bidding wars and bid accordingly. Not shopping in this segment? You might have a little more leverage in a multiple offer situation.

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heather

Heather Barr is a Realtor. She's a chow hound, a gym rat, and the only political junkie in the USA who can actually keep her political views to herself. Instead, she focuses on educating her clients about the often-confusing world of residential real estate.

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Bidding Wars and Balls

by Heather March 3, 2010 Buyer Help

Don’t know whether this is a memory from real life or a movie**, but go with me on this. Imagine a scene with a politician at a podium taking questions  from reporters. Let’s call one of the reporters James and pretend he’s a notorious philanderer, because it makes my story better.

Reporter James lobs a stinger: [...]

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More on the new GFE

by Heather March 2, 2010 Mortgages

This is a pile-on to Chris’ recent post explaining the new Good Faith Estimate form . . . .  I just received an email from a Loan Officer (“LO”) friend reviewing some rule clarifications issued by HUD after a February 18, 2010 meeting with a bunch of FHA mortgage investors.
LO Question: “When are consumers entitled [...]

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Lenders Behaving Madly

by Heather February 27, 2010 Buyer Help

An illustration of just how ridiculous lender requirements have become, direct from an email written by a loan officer and sent to loan specialist Rob Chrisman:

“Rob - The following is an actual underwriting condition from a large wholesale lender which is known for having the best wholesale pricing for conforming loans. (As background, the borrower [...]

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Banks Pull More Nonsense

by Heather February 2, 2010 Foreclosures / Short Sales

This doesn’t top some of the other nonsense we’ve discovered banks pulling, but it’s pretty nasty.
The bank selling the house our buyer fell in love with requires that the buyer’s Realtor reduce their commission (i.e. take a pay cut) if the buyer wants the seller to help pay his/her closing costs or make repairs on [...]

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I’m here to serve you (but not if “you” is another agent)

by Chris Butterworth January 4, 2010 Op Ed

I received an email from an agent last night which I want to share.  But first a quick set up of the scenario (I’m keeping the percentages & relationships the same, but changing the actual numbers.)
We put a new listing into MLS last week:

The agent in question submitted an offer on behalf of her buyers [...]

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Personality goes a long way

by Chris Butterworth December 1, 2009 Buyer Help

A conversation between Jules Winnfield and Vincent Vega, from the movie Pulp Fiction:
Jules: Pigs are filthy animals.  I don’t eat filthy animals.
Vincent: Yeah, but bacon tastes good.  Pork chops taste good.
Jules:  Hey, sewer rat may taste like pumpkin pie, but I’d never know ‘cause I wouldn’t eat the filthy mother-fu**ers.  Pigs sleep and root in [...]

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Buyers Overcome Adversity

by Chris Butterworth November 3, 2009 Market Analysis & Stats

*** Quick side note – I wrote about feedreaders yesterday.  If you’re seeing this post on our site but did not see it in your feedreader, please take a minute to re-subscribe.  Thanks! ***

We’re inching our way towards the end, possibly, of the $8,000 tax credit later this month.  Once the credit expires we’ll get [...]

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Loans Are Hard

by Heather October 9, 2009 Mortgages

If you’re thinking about buying a home, this might be a useful warning. Not to warn you off buying a home of course, but just because “forewarned is forearmed”. It might prepare you for what’s likely to happen to slow down the approval of your loan.
If you’re currently buying a home and having trouble with [...]

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Right-Pricing: List Price vs Sales Price

by Chris Butterworth September 29, 2009 Seller Help

Yesterday our colleague and good friend Dru Bloomfield wrote a terrific post comparing sales prices with list prices, and what can happen to sellers employing various pricing strategies.
A couple of highlights:

“On September 25 the percentage for all areas & types within the ARMLS database hit 97.01%, exceeding 97% for the first time since September 4, [...]

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REOs Rule, But Not Everywhere

by Heather September 21, 2009 Foreclosures / Short Sales

Image courtesy of Stock Exchange user svilen001
Just a little blurb from one of our favorite title/escrow officers, Maggie Clark of Equity Title. This gives a good picture of just how much the REO (“real estate owned”, i.e. bank owned foreclosure) properties are driving the market lately.

Southwest Valley - REO active listings represent 16% of [...]

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