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Expectations in the Charleston WV Real Estate Market

September 14, 2012 By
champagne taste

091412 1843 Expectation1 Expectations in the Charleston WV Real Estate Market

Setting Expectations in the Charleston, WV Real Estate market.

We all want the finer things in life, who doesn’t?  However, when it comes to real estate, one needs to be mindful of what they can afford and set expectations accordingly.

Champagne Taste…Beer Budget

So you say you want a 4 bedroom, 2 baths, 2 car garage, newly updated house, in the best school district…for less than 125k? Yeah, you and everyone else. If I had a nickel for every time I heard that….well you know, I would be stinking rich!

Yes I know there are foreclosures out there, as a REALTOR, I have access to them all. Are they still available? Probably not. Occasionally, a rare gem of a foreclosure does come on the market, but they are typically put under contract the same day they are listed. You see, EVERYONE wants a bargain. The ones that are available are typically plagued with problems, or overpriced (an unfortunate and commonly found trend banks are trying these days). That’s why they are still available, no one else wants them. Would I love to help you find a dream home that is priced disproportionately below market value? Absolutely. Will it happen? My magic 8 ball says no.  If it sounds too good to be true…it is.

So what can you expect to find in a house that fits your budget? That’s what I am here for; setting buyers expectations is part of what a REALTOR does. I can help you find a home that will make you happy for years to come. If you are a first time home buyer, statistically you will only own your first home 3-5 years. After that you become a “move up” buyer. That’s when most are able to flex their financial and equity power to truly get the home of their dreams. As for first time home buyers, you may want to focus on the resale factor for now. If it’s a good fit for your budget, lifestyle, and has good resale marketability…then that home should definitely be at the top of your list.

 

 

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How to Repair Your Credit Score

March 13, 2012 By
fix your credit score

031312 2203 Howtofixyou1 How to Repair Your Credit Score

 

As a REALTOR, I know how critical a good credit score is to have.  There are several things that one can do to quickly clean up their credit.

Checking your credit report.

Checking your credit report is quick, easy, and best of all…FREE! Every American is allowed by law a free copy of their credit report, from all three bureaus, every year. You can get your free copy here www.annualcreditreport.com

Prove it.

The next thing to do is rid your credit of any errors or questionable debt. Ever looked at your report and wondered, for example, “Who is 123 collection agency, and why do I owe them money”? If so, ask that credit reporting agency to verify the accuracy of the debt.

On each agencies’ website you will want to look for any negative reports. There you will find information on how to dispute a bad debt. What many people do not know is that it is the creditor’s burden to provide accurate and verifiable proof that you owe that debt. You can quickly dispute a debt on each credit reporting agencies website. Once a dispute has been filed, the creditor (123 collection agency) then has 30 days to provide reliable and accurate proof that you owe this debt and that the amount is correct. If they fail to provide verification within the 30 days, BY LAW, the credit bureau must then remove that ding from your credit report.

It can’t really be that easy?

Yes, actually it is. You see, 123 collection agency may have bought your old credit card debt from XYZ collections, who bought it originally 20 years ago from Bank ABC. More often than not, the paper trail needed to support their claims of a bad debt was lost in the electronic shuffle of button pushing. Perhaps you paid that original debt off 15 years ago. Maybe you have attempted to pay it but were unable to find out how. Perhaps it was a case of identity theft. Regardless, if it cannot be verified, it must be removed from your credit report.

Taking care of what’s left.

After your 30 days dispute is up, the credit bureaus will notify you of the changes to your credit report. The next thing to do is pay off the remaining items. You may have an $80 dentist bill that you forgot about. Pay it. Oh, and oops there is that old $250 credit card bill from 5 years ago. Pay it too. If you do not, you may end up in a vicious never ending cycle of bad credit. The easiest thing to do is to wait until you have the money in your checking account then pay off a bad debt completely. When you do, it is critical to obtain written documentation that you have satisfied that debt and ensure that it is reported to the credit bureau.

Get another credit card.

Saaaay Whaaat? Yup, that’s right, the final step to credit restoration is to start building good credit. Go to your local bank or credit union and open up a SECURED credit card account. You give them $100 bucks, and they give you a card with a $100 credit limit. Once you have it, cut it up and forget about it. It will just sit on your credit report, looking pretty, all while building a good credit history. There is one thing to remember however, the lender that issues that card MUST report to all 3 credit bureaus. If they do not, you are just wasting your time and money opening it.

Finally! I have good credit!!

Follow all the steps above and your credit score will start climbing in no time. You may even be able to qualify for a home loan in a matter of months! If so, don’t forget your friendly neighborhood Realtor, ahem.  Let me know when you are ready, and I’ll help you find your piece of the American Dream too!!

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Zero Down Payment

February 21, 2012 By
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022112 1603 ZeroDown1 Zero Down Payment

*Article written for and distributed by Extention Matters Magazine .  Author Joshua A. McGrath, Broker-Owner, Real Estate Central, LLC*

A guide to home ownership with little or no down payment

    There is a common misconception in today’s real estate market that a 20 percent down payment is necessary to purchase a home. Actually, this could not be further from the truth. There are several avenues that would-be homeowners can consider even if money for a down payment is slim to non-existent. From government programs to banks to grants, this article explores some home-buying options of which you may not be aware. We’ll also break down the presumably complicated home-buying process so you’ll know what to expect if you choose to take the plunge this year.

Government Programs

    The government agencies have provided opportunities for first time home buyers. These include the Federal Housing Administration (FHA) and the United States Department of Agriculture (USDA). These programs can afford first time home buyers a home loan with zero to 3.5 percent down, many with interest rates in the four percent range.

    The USDA also has a loan program of which many buyers, agents and even loan officers are unaware. The USDA Direct Loan allow buyers with less than perfect credit to buy a home with ZERO down and ZERO in closing costs and may even afford some buyers assistance with the monthly payment and interest rates as low as one percent. As with any program, stipulations do apply. For instance, the property must be located in an eligible rural area as defined by the USDA (USDA, 2011).

Bank Programs

    Given recent media attention, it would seem that banks are very strict presently, with it being nearly impossible to get a home loan. However, this is another misconception. Banks have actually let loose of the purse strings a bit, with some banks offering loans to borrowers with a credit score as low as 580. Fifth/Third Bank, for instance, has loans available with 100 percent financing for doctors and residents so long as they have a letter of intended employment.

Grants

    Grant money is also available. If you are a first-time home buyer and have served in the military or reserves, the Dream Maker program from the PenFed Foundation will provide you a 3-to-1 match up to $5000 with no repayment requirement (PenFed Foundation, 2011). The details on the Dream Makers program can be found at www.PentagonFoundation.org. You can also apply for the grant right on the website. This is a great way for the brave men and women who have served our county and protected our freedom to experience the freedom of the “American Dream.”

The Home-Buying Process

    The home-buying process is nothing to be scared of yet many buyers are afraid of the entire process and continue to pay rent for years, wasting time and money that could be building equity in a home of their own. The buying process is not simple; however, if you work with an experienced realtor, they will help guide you through the entire process.

    So where do you begin? Start by meeting with a realtor to see what the local real estate market is doing and what options they feel might be best for you and your situation. Then you will want to meet with a mortgage loan officer to determine your ability to purchase. They will be able to provide you with a letter of loan approval which will give you the competitive edge when you find that perfect home. If they are unable to provide you with an approval, most will give you the information you need to get on the right track and to ensure that you’re working toward the ability to own your own home.

    Once you have been approved and found the perfect home be sure to get it inspected. This is most likely the largest investment you will ever make and you need to be sure it is a sound one. Having a home inspection will help give you peace of mind that the home you found is in fact the “perfect home.” We all know there is no such thing as perfection, so be prepared for the inspector to find some issues that will need addressed. This is, after all, what you are paying him to do. Once you have received the report back from the inspector, go over it in detail with your agent and comprise a list of your major concerns, assuming there are no concerns that are so cost prohibitive to make that the seller would not be willing to consider them. Once you have your list the realtor will get it to the seller and hopefully all parties can agree on a repair plan.

    The next step is the appraisal which is ordered by the lender. The lender will have this completed to protect their interest, and in most cases this is a prepaid expense that you will have to pay. Most appraisals run between $300 and $500. Assuming that the value of the property is determined to be equal to or more than that of the purchase agreement then the loan process will continue through final underwriting and then to a successful closing.

    And then, you are a homeowner! Hopefully your agent negotiated for the seller to provide you a One-Year Home Warranty. If not it is recommended that you purchase one. They run around $500 for the year and cover items such as the washer, dryer, kitchen appliances, electrical systems, HVAC and so much more. These are renewable every year and can be purchased on your current home.

    While all real estate transactions are vastly different, and not all are smooth, at the end of the day being a homeowner is an amazing feeling and part of the American Dream. As 2012 gets under way, perhaps this could be the year that dream comes true for you.


References

PenFed Foundation. (2011). Dream Makers. Retrieved November 28, 2011, from http://www.pentagonfoundation.org

USDA. (2011). USDA Rural Development. Retrieved November 28, 2011, from http://eligibility.sc.egov.usda.gov

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I Want to Buy a Foreclosure Too!

December 15, 2011 By
IWanttoBuya1.jpg

121611 0337 IWanttoBuya1 I Want to Buy a Foreclosure Too!

So you want to buy a foreclosure in West Virginia.

Or at least you THINK you want to buy one. Maybe you are thinking about “flipping” it. Perhaps you would just like to get a great deal on a home. This may sound great, but in reality, things are much different than what most people expect.

What’s so great about a Foreclosure?

The answer to that is PRICE, but that can be a misconception. Most foreclosed homes are priced below market value. At least that is the public perception here in WV. However, our market is different than the rest of the country. We do not have an abundance of foreclosed homes saturating the housing market and weighing down prices. Typical WV homes actually appreciate in value.

But they are cheaper right?

The simple answer, yes. But they are cheaper for a reason. Often those that are unable to make their housing payments are also unable to afford the necessary maintenance, and the home condition becomes distressed. Or, the previous home owners became disgruntled and purposely damaged the house. There are even situations where significant damage to, or failure of, the home has occurred and the owners “just want out”. Issues such as flooding, fire, foundation failures, etc. all can be expensive problems that can make a homeowner feel trapped.

Good Price, but lots of work.

So yes, foreclosures in WV can be a great deal, but most come at a price – work, construction, updating, and lots of it. Thinking to yourself “That’s ok, work doesn’t scare me”? Great, but it does your bank. The fact is many foreclosed homes will never qualify for a loan. Even if the property did qualify, chances are cash buyers are interested in the home as well, and cash trumps a loan every time.

Dealing with the banks

Foreclosures are typically owned by a bank and they want rid of these “toxic assets” ASAP. As such, they will always take the best offer for them. So what would be the best offer for them? Simple – a reasonable cash offer, which will close in less than 2 weeks, with no inspections, and no seller’s concessions (closing cost assistance, repair money, etc.). This IS NOT optimal for the average buyer. For a typical purchase, you want a home inspection. You want to ask for needed repairs. You may even want the seller to help pay your closing costs. So who usually is able to submit the best offer? Cash investors. The bank gets rid of a bad asset, the investor gets a good deal, and the average home buyer is spared the trials of major renovations to the home (and any other unforeseen issues).

So are you really ready for a Foreclosure?

If you think you may be, ask yourself a few questions.

  1. Are you able to pay cash?
  2. Are you a licensed contractor, or have access to one?
  3. Are you able to pay for unexpected costs, which sometimes can be painfully expensive?
  4. Do you have the funds to renovate and repair problems?
  5. Do you have the knowledge and patience to act as a foreman or project manager?
  6. Are you willing to buy the house without any inspections?

If you answered yes to all of these questions, then you are definitely ready. If you answered yes to most, then you still may have a chance. If you answered No to most or all, then you may want to reconsider what you are about to get into.

Do I even have a chance at getting a foreclosure?

Yes, but the ones that would be available are very few and far between. There are several government entities that actually give first priority to non-investors to their foreclosures. Rarely a lender may even be willing to do necessary minor repairs in order for the home to qualify for a bank loan. Some lenders even offer rehab mortgage loans that can help get the foreclosed property into acceptable living conditions. So there are exceptions to every rule, but they are not the norm.

Things on TV may look good and are great entertainment, but that doesn’t mean just anyone can do it. You can watch open heart surgery on TV, but are you going to pick up a scalpel and start cutting? Just be mindful of what you are getting yourself into, and set realistic expectations. That alone can put you one step above the competition. And finding a good foreclosure is just that, a competition.

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Real Estate Central - Josh Mcgrath Broker - 418 Goff Mountain Rd, Charleston, WV 25313