Articles by Christine

Articles by Christine

Wednesday, September 27, 2006

PASSAGE OF NATIONAL FLOOD INSURANCE LEGISLATION CRITICAL TO HOMEOWNERS

by Christine Adler PA

WASHINGTON (June 27, 2006) –The Flood Modernization and Reform Act (H.R. 4973) passed by the House of Representatives yesterday will strengthen the protection of property owners against flood related disasters and provide flood insurance to millions of homeowners across the country, the National Association of Realtors® said today.

“Floods can strike any place and at any time, and in the wake of the most destructive hurricane season in nearly a century and the recent heavy rains experienced over much of the Midwest and the East Coast, this legislation is critical. NAR strongly supports the provisions in the bill that emphasize the importance of accurate and current flood maps and increase the NFIP (National Flood Insurance Program) borrowing authority to pay existing claims. Meeting contractually obligated payments to policyholders is paramount,” said Thomas M. Stevens of Vienna, Va., president of NAR.

NAR has backed the provisions for increasing premiums on repetitive loss properties that have a significant impact on NFIP, increasing coverage limits, reducing the waiting period for policies to become effective, creating a national levee inventory, and requiring FEMA to report to Congress on the financial status of the NFIP. “These provisions will strengthen the NFIP over the long-term,” said Stevens.

In an earlier letter to the House Financial Committee, Stevens said that non-primary residences should be given the same consideration as primary residences and should not be charged full risk premiums unless they are a repetitive loss property. NAR continues to have reservations over the provision in H.R. 4973 that would eliminate subsidies on non-primary residences and business properties.

“NAR also is concerned with Rep. Scott Garrett’s (R- N.J.) amendment, which was adopted in Tuesday’s hearing. We believe the result will be that owners of neighboring primary residences, with identical risk of flooding, will be paying different rates for flood insurance. This presents a truly unfair and possibly discriminatory situation,” said Stevens.

“Overall, we are very pleased with the actions taken today by the House and believe this legislation will help protect homeowners,” says Stevens.

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing more than 1.3 million members involved in all aspects of the residential and commercial real estate industries.

Article offered by the NAR

Tuesday, September 26, 2006

My advice to people buying a home about the stress.

by Christine Adler PA

Is the stress of buying a home overwhelming you? I would enjoy helping you handle all of the details in order to relieve some of the tension. Here are some tips that might aide in relieving your home-buying stress.

1. Envision where you want to be once the purchase of the house is completed. Write down the details and use it as a tool to get you motivated when the buying process seems to slow you down. The end result should make you feel that your time and energy spent was worth it.

2. Expect the unexpected. Anticipate the hidden costs by researching the real estate and mortgage markets. Hidden extras will vary; some are legitimate while many others, also known as garbage fees, simply are not. If you don't understand, or you disagree with any fees that arise, you need to find out what they are and if you need to pay them. Remember that you need to perform research in advance. It is usually too late to back out on contracts when the deal is ready to be signed.

3. Find an agent you can trust. The agent will facilitate your buying process. He or she will help you create your buying plan, locate the right home, offer strategies for the current market, deal with offers, and assist you in completing the paperwork. In addition, your agent will guide you through the buying process; and help you with any emotional stress that comes along the way.

4. Know your limits, but at the same time, be flexible. Write down and revert back to your buying plan. When obstacles arise or setbacks occur, pull out your buying plan and get back on track. Make modifications to your buying plan if necessary, but don't lose sight of your objective. If you are well prepared, you will always have options. There are plenty of agents, mortgage brokers, lenders, etc. who are willing to assist you.

5. Don't alter your lifestyle. Whether it is during the home-buying phase or after the purchase has been completed, don't forget or eliminate your daily routine. When purchasing a home, continue doing the things that you normally would be doing. Your main focus may be buying a home, but don't be completely absorbed by the process or you may lose sight of your objective. A new home should enhance your lifestyle not take away from it.

6. Remember my motto "It will always work out." and somehow it magically does. It will work out.

Monday, September 25, 2006

88 Possible Types Of Turbulence Or Stunts We Could Encounter…

by Christine Adler PA

Buying a home is like taking an airline flight across the country. when you start on your trip, you have no idea how the trip will go. Neither does the pilot. You could run into 88 different types of turbulence, or other passengers on the trip could pull stunts on you. Ideally, you should have a smooth flight and land on time. Certainly the pilot will try to use his or her experience to navigate around the storms and go for the smoothest flight plan, but if they’re honest, they can’t promise a turbulent-free trip. Their job is to get you to your destination in the least time and with the least aggravation, while keeping you informed throughout the trip.

Attached is a somewhat humorous list of the 88 different types of turbulence or stunts we might run into. This list is not all encompassing, but it catches most of the common issues we might run into. While some of the items are "picky" to some, they are very real and fearful to others.

Please take a few minutes to review the list.

As your REALTOR, I see myself as the pilot of your plane. My job is to assist you in getting your home purchased on time and with the fewest aggravations. I can’t promise you no turbulence, or that other parties to the transaction won’t try and pull a few stunts, but I can promise you that I’ll utilize my experience and expertise to take you on the smoothest flight that I can. And if we do hit turbulence, I won’t bail out on you. I’ll be your teammate throughout the flight, until we get you safely to your destination.

Rest assured your advocacy is my number one goal, and that means you must be delighted with the product and service we deliver beyond your expectations during the process. I will do all I can to make this transaction as stress free as possible. Just like when you are flying on a plane, leave all the worries to the pilot who is going to get you to your destination, even with some rough air.

As always, should you have any questions or concerns, please don’t hesitate to call me. I remain

All my best,

Christine Adler Your Real Estate Consultant For Life!

P.S. By Referral Only means that I rely on your recommendations and endorsements to family members, friends and co-workers who are like you, and who would enjoy receiving the level of service we are providing you!

88 Possible Types Of Turbulence Or Stunts We Could Encounter…

The Buyer/Borrower:

1. Does not tell the truth on the loan application.

2. Submits incorrect information to the lender.

3. Has recent late payments on credit report.

4. Found out about additional debt after loan application.

5. Borrower loses job.

6. Co-borrower loses job.

7. Income verification lower than what was stated on loan application.

8. Overtime income not allowed by underwriter for qualifying.

9. Applicant makes large purchase on credit before closing.

10. Illness, injury, divorce or other financial setback during escrow.

11. Lacks motivation.

12. Gift donor changes mind.

13. Cannot locate divorce decree.

14. Cannot locate petition or discharge of bankruptcy.

15. Cannot locate tax returns.

16. Cannot locate bank statements.

17. Difficulty in obtaining verification of rent.

18. Interest rate increases and borrower no longer qualifies.

19. Loan program changes with higher rates, points and fees.

20. Child support not disclosed on application.

21. Borrower is a foreign national.

22. Bankruptcy within the last 2 years.

23. Mortgage payment is double the previous housing payment.

24. Borrower/co-borrower does not have steady 2-year employment history.

25. Borrower brings in handwritten pay stubs.

26. Borrower switches to job requiring probation period just before closing.

27. Borrower switches to job from salary to 100% commission income.

28. Borrower/co-borrower/seller dies.

29. Family members or friends do not like the home buyer chooses.

30. Buyer is too picky about property in price range they can afford.

31. Buyer feels the house is misrepresented.

32. Veterans DD214 form not available.

33. Buyer has spent money needed for down payment and closing costs and comes up short at closing.

34. Buyer does not properly "paper trail" additional money that comes from gifts, loans, etc.

35. Does not bring cashier’s check to title company for closing costs and down payment.

The Seller:

36. Loses motivation to sell (job transfer does not go through, reconciles marriage, etc.)

37. Cannot find a suitable replacement property.

38. Will not allow appraiser inside home.

39. Will not allow inspectors inside home in a timely manner.

40. Removes property from the premises the buyer believed was included.

41. Is unable to clear up liens against their property – short on cash to close.

42. Did not own 100% of property as previously disclosed.

43. Thought getting partners signatures were "no problem," but they were.

44. Leaves town without giving anyone Power of Attorney.

45. Delays the projected move-out date.

46. Did not complete the repairs agreed to in contract.

47. Seller’s home goes into foreclosure during escrow.

48. Misrepresents information about home & neighborhood to the buyer.

49. Does not disclose all hidden or unknown defects and they are subsequently discovered.

50. Builder miscalculates completion date of new home.

51. Builder has too many cost overruns.

52. Final inspection on new home does not pass.

53. Seller does not appear for closing and won’t sign papers.

The OTHER Realtor(s):

54. Have no client control over sellers.

55. Delays access to property for inspection and appraisals.

56. Unfamiliar with their client’s financial position – do they have enough equity to sell, etc.

57. Does not get completed paperwork to the lender in time.

58. Inexperienced in this type of property transaction.

59. Takes unexpected time off during transaction and can’t be reached.

60. Jerks around other parties to the transaction – has huge ego.

61. Does not do sufficient homework on their clients or the property and wastes everyone’s time.

The Property:

62. Engineer will not approve septic system or well.

63. Inspection report reveals substantial damage and seller is not willing to fix or repair.

64. Home was misrepresented as to size and condition.

65. Home is destroyed prior to closing.

66. Home not structurally sound.

67. Home is uninsurable for homeowners insurance.

68. Property incorrectly zoned.

69. Portion of home sits on neighbors property.

70. Unique home and comparable properties for appraisal difficult to find.

The Escrow/Title Company:

71. Fails to notify lender/agents of unsigned or unreturned documents.

72. Fails to obtain information from beneficiaries, lien holders, insurance companies, or lenders in a timely manner.

73. Lets principals leave town without getting all necessary signatures.

74. Loses or incorrectly prepares paperwork.

75. Does not pass on valuable information quickly enough.

76. Does not coordinate well, so that many items can be done simultaneously.

77. Does not bend the rules on small problems.

78. Does not find liens or any title problems until the last minute.

The Appraiser:

79. Is not local and misunderstands the market.

80. Is too busy to complete the appraisal on schedule.

81. No comparable sales are available.

82. Is not on the lender’s "approved list."

83. Makes important mistakes on appraisal and brings in value too low.

84. Lender requires a second or "review" appraisal.

Inspectors:

85. Too “picky” with conditions and “scares” the buyer.

86. Infuriates the seller.

87. Home inspector not available when needed.

88. Inspection reports alarm buyer and sale is cancelled.

If you want smooth sailing during your real estate transaction, and a pilot who can bring you in for a safe, smooth landing, trust…

Christine Adler, PA
Your Real Estate Consultant… For Life!

Sunday, September 24, 2006

How to determine what your home is really worth.

by Christine Adler PA

Lets take a little look at pricing of a home. You can get a price from an appraiser or a realestate agent, How do you know which one to pick. First is that there is a lot of training that an appraiser gets in pricing a home. The use more resources then the average realtor has at their disposal. They search not only the MLS for sales that went through realtors but also search tax records to see what has sold without a realtor. Also you will find that the average realtor may not follow the best set of rules in pricing a home. Such as not properly adjusting for a waterfront view. Another one is, not taking into consideration that the home across the street even though a neighbor is in a different neighborhood or different city. That would make that home not a true comparable.

There is a little more to this. First is that appraisers get not only more training in pricing a home but they also do a form of internship before they can use their own name to certify an appraisal. On the negative side I have seen appraisers that didn’t get the most recent comparables even from the MLS. I have seen two appraisers do an appraisal on the same home and differ by many thousands of dollars. Even appraisal is an art. So if a realtor is giving you a price for your home make sure they have knowledge of the area and have enough experience to do the job right.

Having said all that here is the real truth about what is your home really worth. It has nothing to do with a CMA ( Comparative Market Analysis ). It has to do with the same law of price and demand that prices out everything. The real rule of thumb is that “Something is worth what someone is willing to pay for it.” Last year we sold over ten homes for more then the appraised value. One even went for over $50,000 more then the appraised value, and that was after many days of hard negotiating to get the parties to meet in the middle. Today I am working on negotiating on a home and it may well sell for $100,000 less then the appraisal done just six months ago when the owner refinanced. Now way is that. I would say it is not due to a bad market. Although the softer market does have something to do with it. I would say it is the oldest rule in the real estate book. Location, Location, Location. With the internet giving people access to things like school reports they are able to find out if a place is good for the kids. Police statistics are available on line. And good waterfront property is hard to come buy.

I think that a good experienced realtor who knows your area can tell you better then anyone what a home could sell for because they have their hands on the pulse of the buying public. They know supply and demand. They should know how to price your home. You can go to www.HouseValuesInBroward.com to get an idea of what your home is worth. But a good realtor will tell you that to get a good price they need to see the home, they need to see the condition, view, how it will appeal to others and what upgrades it has. Then you can get a fair price.

One last thought. Be careful of a realtor who gives you the highest price just to get the listing. There is a fair market value. If you think you will get more, and the realtor tells you no problem I can do that for you. Run to the front door to let them out. It is one thing to start a little high for a week or two to test the market. But if you don’t get enough showings or an offer after 8 to 10 showings the market is telling you are overpriced. Don’t get fooled by promises that an agent won’t and can’t keep. Make sure they tell you the truth up front, and get your home sold.

For the bank the appraiser is the last word unless your Realtor can get him another comperable sale that perhaps the appraiser missed. For the sale of your home or condo the market and the Realtor who is helping you interpet that market is really the last word.

Friday, September 22, 2006

Why mortgage interest rates affects home prices more then the price of the home.

by Christine Adler PA

Why are the interest rates, which are so low today, making now the right time to buy? There is a dirty little secret that no one speaks about when it comes to buying your home. The secret is that the interest rate is just as important if not more important than the price of the home. Let me give you some numbers to think about. For this example which you will read below, I will use a one hundred thousand dollar home. If you bought a home when the interest rates were just 5% for a fixed rate mortgage and you bought a home for one hundred thousand dollars, then you would pay ( ready for this ) $93,255 in interest over the thirty years. However, if you pay 6% interest then you would pay $115,837 in interest. And if the interest rate goes up to 7 % (and it will, as it is already above 6%), then you will pay $139,509 in interest. You see, you are now paying more for the home in interest than you are for the asking price. The good news is that interest rates have been at an all time low. However they are trickling up. You may even remember that there was a time when interest rates were over 20%.

Let’s look at a couple more examples; what if interest rates go up to 8%, it is only a matter of time that the same hundred thousand dollar home will cost you just in interest $164,154. This means you are really paying $264,154 for that one hundred thousand dollar home… this is over two and a half times the asking price. By the way, these numbers are found by using a .

So, what does this actually mean? It means that if you bought your home and financed it at 5% then you would pay almost 100% for the money you borrow in interest. However, if you wait until the interest rates go up to 8% them you will pay 160% of the money you borrow in interest.

Now, in order to figure out what you will be paying in interest for the price of the house that you will be buying, you can take the interest paid for the one hundred thousand dollar home noted above to use as a guideline for the interest paid for each $100,000 of purchase price. We will call this the ‘one hundred thousand figure’. Therefore, if you are buying a home for $300,000 you can multiply the “one hundred thousand figure” by 3 ( which will give you the amount of interest you will be paying for a $300,000 home ).

To further elaborate, if you are figuring that you will be paying 6% interest on a $300,000 home, then take the $115,837 interest as noted above for a one hundred thousand dollar home and multiply that figure by 3 since you are buying a $300,000 home. You will see that you are paying $347,511 just in interest. This amount is in addition to the original $300,000 you borrowed to purchase the home. So, this would mean that you are really paying a total of $647,511 on the $300,000 house. Now that you know this you might think “O my God, it is costing me that much?”. Well yes -- it does everyone. This is just to show you how much more you will pay when interest rates goes up. The real number you should be thinking about is that at 6% you will be paying $600 per month for every $100,000 you borrow, or $1800 for this $300,000 house.

To work on these numbers at home, feel free to go to www.AdlerTeam.com and get our free Triple Calc , and down load it. Once you have the on your computer you can work the numbers yourself for different loan amounts and different interest rates.

I think now is the BEST time to buy a home. The inventory is high, giving you several choices to find the right home and neighborhood you want to live in. You may even be able to get the seller to negotiate on the price. They certainly should not be getting more than it would appraise for, as they were getting last year. You are also able to get an interest rate that is at all time low and you can lock that rate in for 3, 5, 7, 15 or 30 years. The shorter the time you lock in the rate, the better the rate. You just need to ask yourself how long you plan on living in the house. Don’t wait -- there is never a better time to buy a home then today.

Don’t let the cost of the interest give you a second thought about buying a home. First of all it is tax deductible, and secondly it is way better to own then to rent. I will post a blog on this, the benefits of home ownership over renting. You will be surprised. Happy house hunting.

Tuesday, September 19, 2006

Why it may not be good to wait to buy a home even in this market.

by Christine Adler PA

Mark responded to our last web post by asking if it was a good idea to wait to buy a home. That is a great question and one that a lot of people are asking. There are a couple of ways to look at this.

First, is just in the realm of investing. They say you can never time the market. When they are saying this they are talking about stocks -- but it also fits in the real estate market. For the last three years people have been saying ‘let’s wait and see what happens to the prices before we buy’. Some people even sold their homes and said ‘let’s rent for a year or two and then I can buy a home when prices go lower’. Well those people are now in trouble. Prices have risen over 20% a year for the last three years and now these people are priced out of the market. A home that would have cost them $200,000 just about two years ago they will now have to over pay $240,000 to buy now. This new amount may well be over their budget. They also lost the tax write-off for the last two years, so they were spending even more of their money and not able to save. To that, we add the fact that interest rates have risen over two percent, which I will cover in the next post. There is one more thing that would affect this person. Due to the fact that there is less then five percent buildable land here in Broward County and that South Florida has so many people moving here each week, there is a big demand in renal housing. This has caused a lot of apartment complexes to be bought up and resold as condominiums, a process called condo conversion. This has caused a shortage in renal units and has brought the price of rentals up.

So… is it a good time to wait? Only if you want to loose your tax deduction, have to pay more for your home in the future, want to pay increased rent and have the interest rate creep up on you -- so you are really paying more for a home.

You can, I am sure, argue any of these points. My friends did. They are now behind the eight ball because they can not afford to get back into a home at the level they had and at some point will have to settle for a smaller home or town house.

I did say you can never time the market, this is true. If you are a speculator then the trick will always be to buy low and sell high. You will be looking for the desperate sellers who have to sell or have to move now and will be more negotiable. If you don’t care about the condition of the home, or the location, or what school it is in, or the neighborhood then this is a good way to buy for an investment. These situations even existed in the hot market over the last few years. But if you are the typical home buyer and looking for a perfect home, then today is the best time to buy. Luckily, there is a good inventory for you to choose from and you can get a good price. There probably will not be a bidding war and you can take advantage of the low interest rates.

Happy house hunting.

Wednesday, September 13, 2006

Has the Bubble Burst

by Christine Adler PA

This is a question that a lot of people are asking. Not only of me and my team but of every one they talk to. It is the buzz on the street. " Has the bubble burst, or is it going to"? First let me tell you that it has not burst. When we speak of a bubble like the stock market , it fell by more then fifty percent. That should never happen in the real estate market for a few reasons. First is the cost of building new homes. There is about twenty to thirty percent profit in a new home minus the cost to sell ( real estate commission ) and cost to advertise and market.

For the market to drop more then this would mean that no builders would be able to stay in business and if the economy ever fell to that level we are talking more then a bubble. The biggest dip in values has occurred during the savings and loan scandal in the 80's which affected mostly commercial property.

Homes have a few things different from stocks. There was a bubble because when people got frightened they panicked and sold. With homes unless you are planning to move in the next twelve months, you will find that time will help absorb the increased inventory and that people will just stay in their homes. They have to live some place. This one big factor will help slow any downward trend.

Now there are investor who bought on speculation that the market would keep going up at double digit numbers. Those investors who can not hold on to their properties, will have to sell and may find they are loosing money. Those home owners that priced their home last year and hoped to sell it this year for last years prices will also be disappointed. But the values are still there. We are selling a lot of homes. All six of my buyers agents are running around with people looking for homes. We wrote over ten contracts on homes in August. The market is not giving home owners more for their house then it is worth. You can even find some motivated sellers will come down five percent below market value or be willing to pay your closing cost and this could be up to six percent.

So what is the bottom line. So far no bubble. Probably there won’t be one. There may be more of a down turn before the values go back up. They always go up over time. If you need to sell then you can choose to be realistic with your price and sell or wait and eventually it will go back up. If you a buyer there has never been a better time to buy.

Remember all markets have their ups and downs. But housing has two things always pushing it up. There is a finite amount of land to build on. In Broward County there is less then five percent buildable land left. Second is the cost of building the home is always going up, this pushes the price of new homes up and that trickles down to the cost of used homes.

Most millionaires made their money in Real Estate. More wealth is created through home ownership for more people then any other way. There is no way to really time the market. So buy a home and hold it, and you will find that time is on your side.

Happy house hunting.

6. Remember my motto "It will always work out." and somehow it magically does. It will work out.

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