The Best Laid Plans

My Nest Egg

Behind every home that’s sold is a personal story, isn’t there?   This was no exception.

 

Barbara had purchased her home less than five years ago and its value had depreciated substantially since.  She was also having difficulty making ends meet with her current employment status because of injury coupled with adjustments to her loan;  not a situation she had ever envisioned for herself.  She’d been working as a registered nurse for the County of San Diego for several years, and was ready to retire within the next two years so she could enjoy fulfilling some of her dreams.  It was easy to determine that if she wasn’t making ends meet working full time, how could she make it in retirement? 

While we suggested that she try and short sale the home, we first advised that she consult with an attorney and a tax planner to get a thorough evaluation of the situation.  The attorney felt that she had a good case  in pursuing the short sale.

We recently closed escrow on her home and she is now renting.  Five years ago when she bought this home she didn’t envision herself renting or having her credit hampered because of a short sale.  In fact, she’s even a bit introspective about missing a few house payments.  Sometimes things aren’t so black and white, and I’m truly empathetic for her.  I was glad to guide her through this uncharted territory, reassuring  that her situation is not uncommon and she wasn’t alone.  No, this wasn’t her plan for retirement, but now her circumstances are manageable and she has hope for a fresh start.

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Eugene Adan, ABR, GRI, e-Pro, Broker; Adan Properties, Contact us for more information about whether to short sale or other real estate information near Carlsbad, CA and the surrounding areas.  You can reach us at (760) 720-9710 or me @ eugene@AdanProperties.com.

Important Property Tax Dates

November 1- First Tax Installment Due

December 1- Last day to file Homeowner’s, Veteran’s, and Senior Citizen Exemption

Property Tax Calendar

 

December 10- 1st Tax Installment delinquent after 5pm: 10% penalty plus additional County fee

January 1- Tax Assessment Date

February 1- Second Tax Installment Due

February 10- Last Day to file Homeowner’s, Veteran’s, and Senior Citizen’s Exemption

April 10- 2nd Tax Installment Delinquent after 5pm: 10% penalty plus additional County fee

July 1- New Fiscal Year; Homeowners informed of new property valuations

*** Important:  Mail your property tax payments early to ensure the envelope is postmarked on or before December 10 and April 10.  California law requires the Treasurer-Tax Collector to review the postmark date to determine if the payment was mailed before the deadline.

If you have questions, we have answers!  If you have specific questions about the real estate market, call us at (760) 720-9710 or email us at info@adanproperties.com.  We look forward to hearing from you!

The Chicken and The Egg of Real Estate

This encompasses every reason why a broker will ask if you are pre-approved.  We don’t have to guess on anything that we need to know then we can show you what fits in your qualifying range.

Via Cynthia Larsen – Sonoma County Real Estate (Safe Haven Realty):

The chicken and the egg. Which comes first? When a potential buyer calls and wants me to show them a home, one of my first questions I ask is are you pre-approved for a loan? The reason for this question is simple. If I don’t know what you are qualified for, I will have no idea what homes I can show you.

Buyers, I know this may not be what you want to hear, but you MUST get pre-approved for a loan before asking to be shown homes. Your pre-approval letter contains very important information.

• The maximum purchase amount – It makes no sense whatsoever to show you homes that are above the maximum purchase amount you qualify for, unless the home is overpriced. That I can determine by looking at comparable properties that have recently sold nearby.
• Whether you have chosen a direct lender or a mortgage broker – If you are using a mortgage broker, I cannot show you HUD-owned homes. HUD requires a pre-approval letter on a direct lender’s letterhead.
• The type of loan (Conventional, FHA, VA) – If you are qualified for anything other than a conventional loan, buying a condo or a “flipped” home can be very difficult and time consuming.
• Loan and/or Funding Conditions – We need to talk about your ability to provide documentation the lender requires on a timely basis.

I understand that you might not want to get pre-approved until you find the right house. Or maybe you won’t want to buy a house at all if you find out that $xxx,xxx can only get you a home in need of TLC in a less than desirable neighborhood.

We won’t know that until you get pre-approved. In Real Estate, the pre-approval letter must come first. Let’s call it the chicken. After that, we can go out together and look for that perfect egg.

Housing Opportunity and Mortgage Equity Act- HR 6218

A bill known as the “Housing Opportunity and Mortgage Equity Act of 2010″ or HOME Act was introduced on the floor of Congress.  By design it is hoped to slow the expected growing number of foreclosures by providing refinancing options on mortgages held by Fannie Mae and Freddie Mac which would lower payments and keep borrowers from becoming a foreclosure statistic.  An additional expected result of the proposed bill is that it can simultaneously stimulate the economy by relieving homeowner stress and provide more discretionary income.

From its writing it all seems, if you qualify, like one of those things in life that you should not pass on. You qualify if it is a Fannie Mae or Freddie Mac loan.  It does have to be a loan secured by your primary residence but you qualify even if you have defaulted on your payments.  It will cost you very little, if anything.  The property does not require an appraisal.  To me the sweetest thing about it is that the interest rate which as we see and hear about all the time is at prevailing which is always edging lower and lower.  While the final terms have yet to be defined, my feeling is that it still is a no-brainer.  There will be a reasonable fee for title insurance and likely escrow fees but may be allowed to be financed as well.  If the current loan allows for a fee for prepayment penalty these will be waived and loan periods may be up to 40 years.  There just seems to be an entire list of reasons why this is a good thing for the consumer.

If the bill is approved there will be a qualifying period of only one year from the date of enactment.  But based on the bottleneck that was experienced by first-time homebuyers seeking credits that faced a deadline, I wonder if that may happen here as well.

This proposal makes a considerable amount of sense to me.  What are your thoughts or concerns?  Please weigh in with them.

And The Biggest Loser Is…

I read an article stating that the banks that sold bad mortgages to Fannie Mae and Freddie Mac are contractually obligated to buy back these bad loans.  Many of our nation’s largest banks have not made good on their commitment to do so.  Does anybody wonder why?  And, why do these same lending institutions make such a rancor when the consumer comes to them for help, as they are doing likewise to the Government-Sponsored Enterprise (GSE’s).

A director from the Federal Housing Finance Agency (FHFA) stated that as of the end of the second quarter this year, Fannie Mae and Freddie Mac combined had over $11 billion in outstanding buy back requests and more than one-third of those requests were over 90 days outstanding!  He said that there are ongoing discussions between the GSE’s and the lenders to reach a workable solution and if the discussions do not initiate action soon, then FHFA would look to its conservator and supervisory authorities for resolution.

Repurchase requirements are one methodology that FHFA is pursuing to mitigate losses for both Fannie Mae and Freddie Mac, to limit any more capital infusion from the Treasury Department.

Since these two giant organizations have been in conservatorship they have drawn $148 billion in taxpayer dollars from the United States Treasury.  Their combined borrowing cap was set at $400 billion in bailouts.  But that cap has been lifted and it seems they have the ability to withdraw whatever sums they need.

This director also stated that loan modifications as opposed to foreclosure and refinances would also help curb the losses that the GSE’s are sustaining.

I personally feel like it is a bad idea to throw good money after bad by continuing to prop up these two institutions.  And, what about the bailout money that banks and other reputable institutions received?  I am only aware of a handful of successful loan mods as I talk with people.  With the decline in property values, many underemployed workers, and increased unemployment I am fairly certain that there won’t be enough refinances to minimize the losses for the GSE’s.  They’ve already taken the hit!  Secondly, and as I posed this question earlier, why aren’t these banks that are contractually obligated making good on their commitment to buy back?  Now the shoe is on the other foot and the fit is too small!

This entire dynamic is similar to a dysfunctional relationship including an enabler (choose your entities), victim, and an accuser all contributing to the cycle.  Who stands to lose the most?  Who will suffer the most?  I know one thing for sure, and that is these ill effects will be affecting our nation for many generations to come.

6912 Carnation Dr, Carlsbad, CA – Condo For Lease

Carlsbad, CA – Condo For Lease

Just listed a new condominium available for lease beginning November 1, 2010.  For more information and pictures view the link below.

http://activerain.com/blogsview/1861202/6912-carnation-drive-carlsbad-ca

For Lease – Oceanside, $1800/MO

                                                                                                    

Craftsman quality single-family home features 2 bedrooms plus a den and 2 baths.  Tile floors, copper plumbing,   designer hardware, granite counters, stainless steel appliances, and two-car attached garage with superior storage on an oversized corner  lot.  Low maintenance yard includes bi-weekly gardener service.  The owners lovingly cared for this home and it’s one you need to see to truly appreciate.  Estimated availability is mid September.  Small pets okay with deposit.  Application fee is $30 per applicant over age 18.  Take a photo tour at http://s802.photobucket.com/albums/yy303/eugeneadan/Valley%20Crest/ or call (760) 720-9710, CA DRE #01184387.

It’s A Grind Coffee House

 

 

 

 

 

 

 

 

Who wants coffee?  It’s A Grind Coffee House recently opened in Carlsbad on Coast Highway at Beech Street.  Smack dab on the corner of Beech at the north end of the village of Carlsbad across from Magee Park.  You can park on Coast Highway where there are other street level shops and on Beech Street.

 

 

 

 

 

 

 

 

                   The menu includes what you come to expect at coffee houses including; coffee, teas, snacks, Wi-Fi et al.  Tastefully decorated, there is a music theme and live jams happen on Friday and Saturday evenings around 7 pm.  This place is L-A-R-G-E.  There is a fireplace and a couple of seating areas with overstuffed chairs.  You can grab a chair and table outside and watch the world go by if you want.  You can get comfortable here while enjoying a cup of joe.

Is A Short Sale In The Cards?

I spoke with someone this morning who is contemplating a short sale.  Based on the dialogue that they’ve had with their lender they believe they will be unsuccessful with getting the lender to modify the loan.  The amount of the existing loan is nearly 50% greater than the value of the property.  They are just a few years away from retiring and nearly 60% of there income goes to service the home loan.  What would you do in this instance?  We advise that you seek the counsel of your tax advisor as well as a real estate attorney to see what the implications to you might be.  If you decide that a short sale is the appropriate action to take,  then market your property and find a willing, qualified buyer.  Even with that, it is not a sure thing that the lender will agree to a short sale.  But given that you have a willing buyer and made the appropriate application to the lender then your chances for success are greatly enhanced.  Of course this is a simplistic example but we hope you get the idea!

For Lease- Vista, CA

Custom Mediterranean estate on a half acre lot in a private gated community.  Four spacious bedrooms and three baths with a gourmet kitchen designed for large gatherings is at the heart of this spacious home.  A six-burner gas stove with stainless steel hood, dual ovens, microwave, and refrigerator are surrounded by ample cabinet space and a walk-in pantry.  There is an expansive granite center island with built in sink and more cabinet storage beneath.  The master suite is spacious and light with a walk-in closet and huge master bath complete with dual sinks, tiled shower, jetted spa tub, and tiled surfaces.  The inside laundry has ample counter and mega storage space and can easily accommodate sewing as well as craft hobbyists.  There is a full bath and bedroom downstairs adjacent to a large foyer and living room.  Coffered ceilings, recessed lighting, crown moldings, and a curved banister are among the many architectural details.  No Pets.  $2800/mo. and $2800 deposit at move-in.   Application fee- $30.  For more information or to schedule a private showing please call Eugene Adan,  CA DRE #01184387 at (760) 720-9710 or email:  info@AdanProperties.com.