Short Sale Misunderstanding – Seller Does Not Have to Pay the Realtor’s Commissions

Hello America.

I ran into a very sad situation this weekend with a woman (I’ll call her “Ann”) who lives around the corner from me.   I met Ann back in mid-summer while I was door knocking for sale by owners in a neighborhood called Forest Glenn which lies in the city of North Richland Hills, Texas.   At that time she had told me that her husband had recently had a stroke and that she did not know what to do with her house.   She was going to try to sell it on her own.   With clients like these, i always try to set an appointment to help show them how I can help them reach their goals.   However, I was not able to convince her to meet with me.   On top of everything else going on in her world, she was also caring for her 90 year old mother who required  a lot of attention on a daily basis.  

After months and months of follow-up with Ann, I found out this weekend that Ann’s house is scheduled to be foreclosed upon March 1, 2011.   That is only 30 days away!!   And now she hoping that I can help her if  at all possible.   Apparently Ann thought that she could barely afford to sell the house on her own, let alone pay a Realtor.   And that is when it hit me… for the most part, the general public does not realize that if you are a candidate for the short sale process with your lender (where the lender agrees to take less that what is owe’d on the property), it is the LENDER, NOT THE HOMEOWNER, that will pay for the Realtor’s commissions.   THE SELLER DOES NOT HAVE TO PAY THE REALTOR’S COMMISSIONS.

This poor woman…  she had resisted working with me for fear that she could not afford my services.   This is simply not the case, but rather a Short Sale Misunderstanding.   I only wish that I would have been able to find this out sooner, as it would of allowed us much more time to avoid the looming foreclosure.

I am still meeting with her this week to discuss some options and I have high hopes that I will be able to help her out, but please remember that generally speaking 1) a Short Sale is what should be tried before going to foreclosure   2) THE LENDER WILL PAY FOR THE REALTORS COMMISSIONS, NOT THE HOMEOWNER… IT COSTS THE HOMEOWNER USUALLY NOTHING.

Pray for this woman America.   She is in a tough spot that I truly hope I am able to help her out of.

Kevin Rhodes – Keller Williams Dallas/Fort Worth

832-233-0265

krhodes@kw.com

www.RealtorRhodes.com   or www.SalesInYourNeighborhood.com

Facebook:   http://www.facebook.com/home.php?#!/pages/Realtor-Rhodes/122786611098472

News Reports: Area Home Prices Continue to Fall – But I says there’s a catch!

Hello America.   I hope your day was productive and focused on the intent to provide for both yourself and your family, and drive help ourselves out of this economic slump.  I know mine was!

But then I returned home for the day, pop open a can of soda and began to skim through today’s paper.   I know what your thinking… “don’t most people do this in the morning?”   Well this morning was one of those mornings that the second my toes hit the carpet, they were in motion!   In other words, I was late!   That’s a whole ‘nother story.

Take a look at  the following article  that my local newspaper (The Fort Worth Star-Telegram) printed, Area Home Prices Fall for 5th Month.

So the short of my point here  is, yes… area home prices have continued to fall.   But there is one VERY valuable piece of the information that this writer did not  make mention of once.   THEY ARE COMPARING NOVEMBER 2010 TO 2009 WHICH JUST SO HAPPENED TO BE THE LAST MONTH OF THE FEDERAL TAX CREDIT!!   So of course when you compare November 2010 to a year prior where the government was offering free money to buyers, area home prices are going to appear lower.   There’s no way around that logic.  As a flashback,November 2009 was a feeding frenzy for the buyers. They the  had to be under contract by November 20, 2009, or else their incentive would go away.   There were buyers everywhere!   Thus the home prices held strong, and in some cases, they even  rose.  

Mind you… the tax credit did later get extended to  end in April 2010, but the November 2009 buyers did not know that at that time.

So when you read articles on the real estate market, please put a lot of thought into what you are reading.   You must look  beyond the headlines and really see what the writer is comparing.   Remember… headlines sell newspapers, not houses.   I sell houses!

Have a nice evening America.

Kevin Rhodes – Keller Williams Dallas/Fort Worth

832-233-0265

krhodes@kw.com

www.RealtorRhodes.com or www.SalesInYourNeighborhood.com  

North Richland Hills Water & Garbage Rates Will Increase Beginning February 2011

If you happen to live in the fantastic city of North Richland Hills, be prepared for North Richland Hills Water & Garbage Rates  Will Increase Beginning February 2011.

I personally live in this city and absolutely love it!   North  Richland Hills  is so resident friendly and responsive that I would be hard pressed to move.   In the past, any time that I have had a complaint or concern, they usually are on my door step within hours.   That’s impressive!  

Beginning February 1, 2011, North Richland Hills Water & Garbage Rates Will Increase to the tune of $2.21 per moth for the average residential customer.   The rate adjustment will cover rising costs for the city to purchase drinking water.   Apparently the city purchases its drinking water from the City of Fort Worth and the Trinity River Authority.   When these two sources adjust their wholesale rates, the adjustment must then be passed on the North Richland Hills water customers.   There is no mark up on these increases whatsoever.   They are direct pass along.

Also going up is the cost of garbage & recycling service for North Richland Hills residents.   Duncan Disposalis the company that handles the garbage & recycling service for the City of North Richland Hills.   The increase is  3.25%  which will equate to about a $0.32 per month for residents.   For more information visit the city’s website.

Kevin Rhodes – Keller Williams Dallas/Fort Worth Region

832-233-0265

krhodes@kw.com

www.RealtorRhodes.com or www.SalesInYourNeighborhood.com

Facebook:   http://www.facebook.com/pages/Realtor-Rhodes/122786611098472

Westlake, Texas is the Nation’s Most Affluent Community

Hello America!   Do you want to live in the most affluent community in America?    Westlake, Texas, is the Nation’s Most Affluent Community so come on over for a visit!   This amazing news was comprised based upon median household income from 2005-2009.   For Westlake, they  averaged an annual income of $250,000 per year.   My initial thoughts to this reporting was that this number seemed low.   I imagine this is based only upon “base pay” or “base salary” with many of these residents receiving a substantial amount of their income from bonuses and dividends that are not directly reported.

Westlake  is a Texas community located just miles from the Dallas/Fort Worth Airport in NE Tarrant County.   This beautifully master planned community rolls through some of Tarrant County’s most  sculpted and hilly landscape.   With home prices typically beginning in the $1 million dollar range, do not expect to be disappointed.   It is also home to Texas’ only municipally owned charter school, Westlake Academy.   It is also home to one of the regions most exclusive country clubs, Vaquero.

A recent newspaper article on this prestigious ranking can be found at the Fort Worth Star Telegram newspaper.   Or to view the Nation’s Most Affluent Community, contact me for a private viewing of this beautiful community.

Kevin Rhodes – Keller Williams Dallas/Fort Worth Region

832-233-0265

krhodes@kw.com

www.RealtorRhodes.com  or www.SalesInYourneighborhood.com

Facebook: http://www.facebook.com/pages/Realtor-Rhodes#!/pages/Realtor-Rhodes/122786611098472

Southlake Gas Drilling Freeze

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Southlake has imposed a 180 day Southlake Gas Drilling Freeze  that would provide a moratorium on new natural gas drilling and pipeline applications.

The city had originally proposed a 90 day moratorium, but the mayor and other council members decided to double it to 180 days.   For more information on  Southlake Real Estate  or on the Southlake Gas Drilling Freeze, feel free to visit my website.

Kevin Rhodes  – Keller Williams Dallas/Fort Worth

832-233-0265

krhodes@kw.com

www.RealtorRhodes.com

Facebook:   http://www.facebook.com/?ref=home#!/pages/Realtor-Rhodes/122786611098472

MLS Activity Report for December 2010 NE Tarrant County

Please feel free to contact me with any questions.    And please remember that this MLS Activity Report is comparing December 2010 to a Federal Tax Credit supported December 2009.

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Kevin Rhodes Realtor w/Keller Williams Dallas/Fort Worth

832-233-0265~krhodes@kw.com~www.RealtorRhodes.com~www.SalesInYourNeighborhood.com

Fannie Mae is Raising Fee’s – Conventional Loans – Dallas/Fort Worth

Fannie Mae is Raising Fee’s on buyers loans that are Conventional loans effective 4/1/2011.   That is only 72 days away.   Once you make an offer on a house, it usually takes 45 days to close, so that would leave current buyers that are looking to use a Conventional loan 27 days from now to get under contract on a new home.  

Obviously, this is a very hot topic this week in the mortgage industry.

Fannie Mae is Raising Fee’s almost across the board for  all CONVENTIONAL loans effective 04/01/2011.  This will result in either HIGHER FEE’s or a HIGHER INTEREST RATES for the borrowers.  The only loans that will escape Fannie™s new fee structure will be loans with an LTV AT OR BELOW 75% with a FICO score above 740.  The most significant increase is for borrowers using subordinate financing to avoid MI (such as an 80/10/10).

Let me give you a few examples of the new pricing and how it will impact  borrowers:

1.            800 FICO score borrower, $400,000 purchase price, 20% Down Payment.  Previous cost = $0, New Cost =  0.25% or $800 (EFFECTIVE 4/1/2011)

2.            715 FICO score borrower, $300,000 purchase price, 10% Down Payment so they want an 80/10/10, Previous Cost = 0.25% or $600, New Cost =1.00% or $2,400 (EFFECTIVE 4/1/2011)

I am certainly not a big fan of these new changes and certainly do not believe they will help stimulate our economy or the recovery.    Additional fee’s tend to do just the opposite.   However, it looks like we don™t have a choice so essentially we will roll with the changes.  It™s more important than ever to make sure buyers are working with a knowledgeable loan officer and Realtor such as myself.  The lender that I use with all of my Texas buyers is Travis Howard located in Southlake, Texas.   He is with Service First Mortgage and his service is top notch!   If you need a loan in Texas, Travis is the guy that will get it done!   The loan officer will be able to review and compare all possible loan options and tax benefits to determine the best loan scenario for buyers.

Again, this is effective 4/01/2011.  So Fannie Mae is Raising Fee’s¦. Here how you can use this to your advantage right now.

Do you have buyers  (or are you a buyer) who is on the fence, but more than likely will buy in the next 3 months?  If so, they should strongly consider buying now if they don™t want to pay a higher rate or higher fees.

For those borrowers buying after 4/01/2011¦.. Honestly, it will already be in effect and everybody will be pricing their loans based on the new pricing so the buyers at that time really  won™t know any difference.   The new increases will just have to be passed directly onto the clients.

Please remember that this is only for conventional loans.  This does not affect FHA or VA loans at this time.

Links to the Fannie Mae announcement and new pricing matrix are as follow:

https://www.efanniemae.com/sf/guides/ssg/annltrs/pdf/2010/sel1017.pdf

https://www.efanniemae.com/sf/refmaterials/llpa/pdf/llpamatrix.pdf

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Kevin Rhodes ~ 832-233-0265 ~ krhodes@kw.com ~ www.RealtorRhodes.com ~ www.SalesInYourNeighborhood.com

Toll Brothers Spec Home in the Bluffs of Heritage within Keller ISD, Keller, TX

Do you know anyone interested for a luxury home in North Fort Worth?   Check out the below video of a recent open house I held at 9705 Bowman Dr., Keller, TX 76244!

http://www.youtube.com/watch?v=7GwTkGpL6eU

Kevin Rhodes ~ 832-233-0265 ~ krhodes@kw.com ~ www.RealtorRhodes.com

2011 Foreclosure Numbers Expected to Soar Above 2010’s Numbers

Hello America!  

The  article below is an article written by Janna Herron for the Associated Press.   As a whole our nation has been receiving a lot of positive news for the housing market and economic markets for 2011.   However, there is obviously going to be some bad news mixed in with the good news.   Janna’s research shows that in 2011, foreclosures will outpace the foreclosures of 2010.  

What does this mean as a seller?   Do everything you can to sell sooner rather than later!!   Don’t let the possibility of a record breaking year of foreclosures dictate your price down any further.

If you are a buyer, you may need to weigh the timing of your buyer decision heavily.   Don’t get me wrong, now is a phenomenal time to buy with all the chips already pushed towards the buyer, but ultimately,  your decision to buy should be given much thought.

                                      Kevin Rhodes ~ 832-233-0265 ~ krhodes@kw.com ~ www.RealtroRhodes.com

Over 1 million Americans seen losing homes in 2011

AP

By JANNA HERRON, AP Real Estate WriterJanna Herron, Ap Real Estate Writer “ 1  min  ago

NEW YORK “ The bleakest year in the foreclosure crisis has only just begun.

Lenders are poised to take back more homes this year than any other since the U.S. housing meltdown began in 2006. About 5 million borrowers are at least two months behind on their mortgages and industry experts say more people will miss payments because of job losses and also loans that exceed the value of the homes they are living in.

“2011 is going to be the peak,” said Rick Sharga, a senior vice president at foreclosure tracker RealtyTrac Inc. The firm predicts 1.2 million homes will be repossessed this year.

The blistering pace of foreclosures this year will top 2010, when a record 1 million homes were lost, RealtyTrac said Thursday.

One in every 45 U.S. households received a foreclosure filing last year, a record 2.9 million of them. That’s up 1.67 percent from 2009.

On Thursday, Freddie Mac reported that fixed mortgage rates dipped this week for the second straight time, extending a sliver of hope for some home owners. .

The average rate on the 30-year mortgage dropped to 4.71 percent from 4.77 percent the previous week. The rate on the 15-year loan, a popular refinance choice, slipped to 4.08 percent from 4.13 percent.

But both are a half-point higher than the lows they reached in November. The 30-year loan rate hit a 40-year low of 4.17 percent and the 15-year mortgage rate fell to 3.57 percent, the lowest level on records starting in 1991.

The dip has led more borrowers to apply for a refinance, but would-be buyers remain hesitant, according to Wednesday’s mortgage indexes from the Mortgage Bankers Association. It will take more than low mortgage rates to jumpstart a housing market plagued by high unemployment, falling prices, tighter credit standards.

The glut of foreclosures has compounded the problem and while the pace moderated in the final months of 2010, that isn’t expected to last.

Foreclosures are expected to remain elevated throughout the year, pushing home prices down another 5 percent nationally before finally bottoming out.

The number of homes that received at least one foreclosure-related filing in December was the lowest monthly total in 30 months. Total notices fell 1.8 percent from November and 26.3 percent from December 2009, RealtyTrac said.

Banks temporarily halted actions against borrowers severely behind on their payments after allegations of improper eviction surfaced in September.

However, most banks have since resumed foreclosures and the first quarter will likely bear that out, Sharga said.

The pain likely will be the most acute in states that have already suffered the worst. For the most part, it will be states that saw the biggest housing booms: Nevada, Arizona, Florida and California. They will be joined by states hit hardest by the economic downturn, including Michigan and Illinois.

And on Wednesday, Illinois lawmakers approved a 66 percent income-tax increase in a desperate bid to end the state’s crippling budget crisis.

More than half of the country’s foreclosure activity came out of five states in 2010: California, Florida, Arizona, Illinois and Michigan. Together, these states recorded almost 1.5 million households receiving a filing, despite year-over-year decreases in California, Florida and Arizona.

Nevada posted the highest foreclosure rate in 2010 for the fourth straight year, despite a 5 percent decline in activity from the year before. One in every 11 households received a foreclosure filing last year in the state. In December, foreclosure activity increased 18 percent from November with a 71 percent spike in bank repossessions.

Arizona and California also showed sharp December increases in the number of homes that banks reclaimed, at 52 percent and 47 percent, respectively. Arizona, along with Florida, finished the year at No. 2 and No. 3 for the highest foreclosure rates.

One in every 17 Arizona households got a foreclosure filing last year, while one in 18 received a notice in Florida.

California, Utah, Georgia, Michigan, Idaho, Illinois and Colorado rounded out the top ten states with the highest foreclosure rates.

RealtyTrac tracks notices for defaults, scheduled home auctions and home repossessions ” warnings that can lead up to a home eventually being lost to foreclosure.

The FHA Home Appraisal and How it Can Affect You as Buyer or Seller

Good morning America!   It’s going to be a beautiful day here in the Dallas/Fort Worth MetroPlex as I hope it is in your city as well!

I have noticed that when clients are selecting a REALTOR to work with, they never give thought to the appraisal process of the transaction that lies ahead.   I challenge those people to change their mindset as in today’s tight lending market, the appraisal is a  MAJOR source of a deal potientially falling apart.

When a buyer is contracted on house, and he or she is using an FHA loan, whatever the appraisal comes in at will stick with the property for 6 MONTHS!   What does this mean to the Buyer and Seller?   It maeans something VERY important!

Let’s assume the house appraises for less that the contracted price.   Typically speaking, the lender will only loan up to the appraised value of the home, so this is a large problem for both parties.   Usually the options are that the seller must reduce his or her price to the appraised value.   Or the buyer needs to come up with the difference in cash.   Another option is to meet somewhere in the middle.

As a Seller, this dilemma is very serious.   If after reviewing the appraisal, you and your agent feel that the appraiser missed something or  his report is in error, you can appeal the appraisal and hope for a fix.   However, this can take a lot of time away from your transaction.   If you choose not to appeal the appraisal or you determine that the appraisal is correct, then it is in your best interest to try all efforts to make the deal you have in your hands work.   I say this because if you allow the deal to crumble with this buyer, for the next 6 MONTHS, any buyer that comes along that tries to buy your house on an FHA loan is required to use the appraisal that has already been done.   So essentially, you are somewhat stuck, thus it would be worth your while to try everything to make deal #1 work.

I have one very proactive step that I do for all of my listing  clients in an effort to avoid any appraisal issues.   First I require the appraiser to schedule his appraisal appointment through me (the listing agent).   Secondly, I will prepare a package for the appraiser that includes very strong comps to help support our contract price.   I will also point out unique features of the home that the appraiser might otherwise miss.   I leave this packet either on the front porch or just inside the house.   I want it to smack him in the face to where he has to pick it up!   I make sure to let the appaiser know that “I thought these neighborhood comparables might aide you in your appraisal process”.   So far I am batting 1000% and I have not lost an appraisal yet.   However, I know it’s not a matter of  if I will lose one, it’s just a matter of when.

For the buyer, if the appraisal comes in below the contract price, this is a great advantage for you.   In today’s buyers market, very few buyers are paying over the appraised value of a home.   I wouldn’t either.   This is primarily because no one knows which direction property values are going to go in 2001 and beyond.   What buyer would want to buy a house that appraised for $500,000, and then 2 years later have it  worth $410,000?   No one would.   So if an appraisal comes in below your contract price, hold firm and do anything you can to get the seller to come down to the appraised price.

So there it is… FHA appraisals in a nutt shell.   Now go enjoy your day!

Kevin Rhodes

Keller Williams Realty Dallas/Fort Worth

832-233-0265

krhodes@kw.com

www.RealtorRhodes.com

www.SalesInYourNeighborhood.com