Buyer Disclosures - What they don't tell you!

It just isn't right that Buyers don't have to disclose to Sellers items that can materially affect a sales transaction, just like Seller must make disclosures to Buyers.

Sellers deserve some security other than just the Earnest Money deposit and the promise of someone to buy their house.  Sellers put way too much on the line when they agree to sell, and relinquish nearly all control of the transaction to the lender and the buyer.  The Seller has a huge stake in the transaction, especially if they are relying on the proceeds of a transaction to own another home.

Buyers should have to disclose things like:

1. Whether or not they are in the middle of a divorce or annulment
2. Whether their job takes them out of town on a regular basis
3. Whether they have owned a home in the past
4. What their motivation is for buying the home they have made an offer on
5. If they are asking for concessions, how much do they really have in reserve
6. Do they or their spouse or children have any medical problems that can drain the reserve
7. How long they have been looking for a home
8. How long they have been with the current Realtor looking for a home
9. What their current job status is - how long have they been there, who do they work for, what do they do, can they get the time off to sign papers
10. Do they have a decent automobile
11. Do you have the entire set of documents necessary for your lender to complete your loan

These might sound dumb, but I am going to start including them as a document for the buyer to provide answers for in all of my listings.

I am getting mighty tired of hearing bunk from a lender that "everything is fine" in a transaction until the lender is finally forced to admit that they cannot fund the loan!  Or, "we can't find the (almost) ex-wife/husband to sign a quit claim deed".

Sellers have rights too!

#RealEstate #Avondale , #Goodyear , #Buckeye , #Glendale,  #Phoenix, #Surprise, #Peoria, #Tolleson, #Laveen, #Waddell , #Wittman

Get the Government out of Lending!

#Government is at it again this year with bizarre regulations about hard-and-fast debt-to-income ratios, and with its legacy regulations about money laundering!!

I have a client who recently decided that instead of using the proceeds from the sale of a house for a down payment on a new house, he was going to use about $20,000 gifted from a member of his family for a portion of the down payment along with his own money.  You wouldn't believe the documentation required to use family funds because of the fear of money laundering!

Here is an excerpt from the letter from the lender on what he had to provide, just because he decided to get his down payment from a family member:

1.     Your signature on the attached letter explaining that your existing home is not yet sold

2.     The attached gift letter needs to be filled in and signed by you and your family member

a.     if the account their money is coming from is a joint account all family members need to sign the gift letter

b.    The line where it is asking the source of the gift funds means the account name and bank – for example:  Wells Fargo, Checking Acct #123456

3.     I am assuming the funds are being wired into your bank account – from this account we will need:

a.   Last Month's statement – all pages please

b.    An account history from the ending date of the last statement to current – we need to see the funds from your parents are now in your account

4.     From your family member we need a 30 day account history showing the gift funds coming out of their account

a.     The account history printout must show their name on it and the account number

b.    If the account history does not include name and account number please include a copy of the most recent statement (all pages) and we can connect the statement to the history.

So this make the lender a jerk - all lenders are jerks, right?   Wrong - this is all required because of government regulations!  The government is afraid of money laundering!

So let's see...  If I were a drug lord, and tried to launder $20,000 at a time through paying a portion of a down payment on a house, I would have to buy 50 houses to launder 1 million dollars.  Then, I couldn't get the money back out until the houses were sold, so then I would have to sell 50 houses to get the money back.  So if the $500 billion dollar drug trade were to use this scheme to launder money, then the drug trade would be buying 25 million homes a year!  How absurd is that?

#RealEstate #Avondale , #Goodyear , #Buckeye , #Glendale,  #Phoenix, #Surprise, #Peoria, #Tolleson, #Laveen, #Waddell , #Wittman

Phoenix Area Among Lowest Foreclosure Areas

From The Cromford Report - Lender Processing Services has completed the transition to its new identity "Black Knight Financial Services" but I am glad to say it is still publishing the useful monthly report Mortgage Monitor.
The report for April shows the non-current percentage on homes loans in Arizona is down to 4.5% with 3.9% delinquent and 0.7% in foreclosure. The only states with a lower non-current percentage are Minnesota, Wyoming, Montana, Alaska, Colorado, South Dakota and North Dakota. Arizona's non-current loan percentage has declined by 23.1% since April 2013. This is no longer the highest decline for any state since the following have shown even greater percentage falls:

• Nevada - down 33.7%
• Florida - down 32.5%
• California - down 29.3%
• Washington - down 25.0%
• Illinois - down 24.7%

All states have shown some improvement since April 2013 with West Virginia improving the slowest at 2.6%.


#RealEstate #Avondale , #Goodyear , #Buckeye , #Glendale,  #Phoenix, #Surprise, #Peoria, #Tolleson, #Laveen, #Waddell , #Wittman

Lenders Have Responsibilities Too!

There is a huge gap in the responsibilities handed out by the Dept. of Real Estate regarding lenders.

In the Arizona contract, the lender is supposed to supply valid pre-qualifications, provide accurate loan progress updates on a regular basis, and provide closing documentation 3 days prior to close.  HAH!

I learned a long time ago that when push comes to shove, and the lender hasn't performed - that's when you learn that lenders are only incidental parties to the contract, and they don't have to abide by what is in the contract!

In Fact, Lenders are the free spirits of the Real Estate World.  Yes, they have to comply with government regulations, but those regulations are oriented towards keeping the lenders from taking advantage of innocent and idiot buyers - not towards providing truthful information on a timely basis, or having a procedure to guarantee that transactions close on time.

In Fact, it doesn't matter when you set the close date - if the loan officer was ill and someone didn't take up the slack, if the loan officer went on vacation, if the loan officer just didn't feel like doing their job one day - your transaction will not close on time.  And there is no recourse - the lender just says "too bad, so sad", and does things on their own time.

The lender could care less that people have a truck heading for the house loaded with their belongings, and no arrangements to store them.  The lender doesn't care that you now have to find a hotel to stay in because you have moved out of one house, and cannot move into another until the first one closes.  You might get a lender's sympathy, but that won't pay for the hotel, it won't magically re-schedule the movers, and it won't make you any happier. 

Choose your lender with care - just any one will not do!  Consult with your Realtor - they will know who brought the transaction in on time.



#RealEstate #Avondale , #Goodyear , #Buckeye , #Glendale,  #Phoenix, #Surprise, #Peoria, #Tolleson, #Laveen, #Waddell , #Wittman

PHX Market - Glass Half Full?

From the Cromford Report:   Sometimes good news and bad news cancel each other out. If you want to see the most optimistic chart I created today, take a look at the average price per square foot for pending listings (charted below). It just hit its high point for the year. On the other hand the glass-half-empty folks can enjoy the average price per square foot for monthly sales (charted below) which has dipped below $128 and is now lower than it was at the end of December.

What really happened is that a bunch of cheaper homes closed yesterday. This left behind a pool of higher priced homes still in pending status. The last working day of each month is usually a big day for closings. In May we had 876 with an average price of $123.53, quite a bit below the current trend line. At the end of April we saw slightly more (939) and a higher price ($128.98) per square foot. If the pending $/SF had stayed level or gone down this would have been a bad sign. However the increase in the pending $/SF means we have a preponderance of higher priced homes carried forward into June's closings. Overall pricing remains roughly flat and the change in mix just adds noise to the signal.


If the second half of the year behaves as normal then we will probably see a slight downward price drift between June and December. Annual $/SF appreciation has already dropped to 6.2%, almost half of what it was at the end of last month.

Solar Power - Not So Sunny - Part 4

People with children should be especially careful about Solar Power Leases.  Not because of safety, because it is as safe as any electricity - but because the savings don't last!

Consider the Smith's situation - not their real name, but a true story.

When they first entered into a solar lease, they were quite happy.  They had a high electric bill, and with their 4 teenage children at home, they were always looking for a way to save a few pennies.  At first, it was wonderful, but then the children began to leave home.  When the children left, so did the savings on their electric bill.

The Smith's had obtained a solar system that was based strictly on their usage of electricity at the time, failing to consider that the reason for much of the usage was going to leave home.  Now, they pay 30% more to the leasing company for their leased system than they would pay to the electric company if they didn't have a solar system.  They will do this for the next 12 years.  Don't forget that to sell their house, they have to find someone willing to pay the lease (not likely unless they have 4 teenagers) or pay the lease off.

Of course, the solar representative could have mentioned this when they got their solar system, but they didn't.

So, now they are stuck.  Even thought the house is too large for them now, they cannot "down size".  They cannot rent because the rent would not cover both the Solar Lease payment and the mortgage, and they cannot sell.


#RealEstate #Avondale , #Goodyear , #Buckeye , #Glendale,  #Phoenix, #Surprise, #Peoria, #Tolleson, #Laveen, #Waddell , #Wittman

Dogs Do Not Sell Homes!!! Reader's Digest - Wrong Again!

Dogs Do Not Sell Homes!!!

Who would have thought that Reader's Digest would have two goofs in one issue!

One article talks about how a couple in Chicago purposely put their dog in all the photos of an apartment that they were renting, but the article title says they sold their home.  It crows that you don't need an agent to rent an apartment if  you have a cute doggie in every photo.  It says that the couple rented their apartment out in only 24 hours because of the cute doggie.

This can't be further from the truth for selling homes!  Animals are best left out of the photos entirely.  Even if you have the most beautiful dog, cat or turtle ever conceived, potential buyers sometimes won't even look at a property with obvious animal occupation.  Some people are afraid of dogs or cats.  However, most people don't want to deal with the inevitable spots on the rug, dander that sets off their allergies, or the rub spots that kitties leave behind, or any one of a hundred negative things that people who don't have pets imagine that pets cause.

Why would you want to narrow the set of prospective buyers before they can ever see the property?

Keep Pets Out Of Property Photos!


#RealEstate #Avondale , #Goodyear , #Buckeye , #Glendale,  #Phoenix, #Surprise, #Peoria, #Tolleson, #Laveen, #Waddell , #Wittman