Chris LaGarde, the Home Buyer Specialist for Chester County, gives you the 7 questions every home buyer needs to answer for themselves before they know they are ready to buy a home.
Chester County Home Buyer Seminar Comments Off
Learn how YOU can take advantage of this incredible Buyer’s Market!
FOR BOTH FIRST TIME & REPEAT BUYERS!
Next Date is Wednesday, October 13th, 2010 at 6 pm at the Keller Williams office in Exton. (Map is below)
If this date does not work for you, we can set up a private seminar that fits your schedule.
You will learn the following:
- What tax advantages there are to Ownership
- Why now is the time to buy
- Overcoming major obstacles like “no money” or “bad credit”
- 10 deadly mistakes buyers make in this market and how to avoid them
- Why “MOVE UP” seller/buyers have a HUGE advantage in this market.
Taught By:
- Norm Miron, Wells Fargo Mortgage
- Fran Patton, Wells Fargo Mortgage
- Chris LaGarde, Buyer Specialist, The Chris & Caleb Team, Keller Williams Real Estate
SEATING IS LIMITED!
To reserve your seat, please complete the registration below.
BREAKING NEWS: FHA Minimum downpayment will be raised. . . Comments Off
As you may, or may not know, the Federal Housing Administration (FHA) is in some trouble from a financial standpoint. I read the “Daily Forecast Update” from the National Association of Realtors today, and that update mentions that the loan underwriting standards for FHA loans will be changing, in the MORE STRICTER side of things. I do not have any time frame on when these changes will be implemented as of now. Several items that were mentioned to be changed are:
- Minimum Down Payment: It has been 3.5% but is rumored to be jumping to 5%. I don’t know that for sure thought. That means, that if you are purchasing a home at $200,000, TODAY your minimum down payment will be $7000. IF it goes to 5%, that jumps the minimum down payment to $10,000. That’s a difference of $3000. That can be a very big deal for first time home buyers.
- More limitations on Seller’s Assist: A Seller Assist is where, at closing, the Seller gives money back to the Buyer, usually to reduce closing costs. Currently the maximum allowed Seller Assist is 6% for an FHA loan. On a $200,000 purchase, that can be as much as $12,000 of assistance. I have not heard what they will be lowering them to, but I believe it will probably be reduced by 1 to 3%.
- Raising Minimum Credit Scores: Currently, the minimum credit score to qualify for an FHA loan is about 600. I have not read or heard what they may change it to.
Understand, the FHA does not give out loans, but does insure them. And in order to insure them, the loans, those using them and the homes they are buying must qualify for the loan. Many first time home buyers use an FHA loan when they purchase a home for several reasons:
- Credit scores are less of an issue: On a conventional loans, if your credit score is under a 720, then the interest rate that you would qualify for would be higher than what the base rate is. For instance, if the rate currently available is 5.125% and your credit score is 680, the interest rate you may qualify for may be 5.75%, for example. On an FHA loan, the rate is the rate, as long as you have the minimum score or better. So if the available rate is 5.375% (which is what it was yesterday, Jan. 19th) then that is the the rate no matter how close to the minimum score you have.
- Interest rates are generally the most favorable: If you have a less than stellar credit score, the chances that your rate with an FHA loan will be lower than that if you went with a conventional loan are very good.
- The Debt-to-income ratios are more lenient: Debt-to-Income (DTI) limitations for conventional loans are generally in the mid 30′s, meaning that if your overall debt payments (credit cards, auto loans, mortgages) constitute more than 35% of your overall Gross (pre-tax) income, then your “DTI” would be too high to qualify for that loan. On an FHA loan, currently it is in the mid to high 40′s.
- Private Mortgage Insurance is less on a monthly basis: The FHA allows the PMI to be structured in such a way that it can reduce the effect on a monthly payment by as much as 40%. That can equal as much as $100 or more and that is a significant savings for a first time home buyer.
My advice:
When, not if, but when these changes are put in to place and depending on how much of a change it is, this will definitely slow the market down. Less buyers will be able to qualify for a loan which equals less demand. So if you are a buyer or are considering buying between now and the next two years, I highly recommend that you speak with a qualified Buyer Agent today. They can help you determine how these changes will effect you and help you create a plan to put you in the best position possible when you do go to buy. For sellers – If you must seller or are considering selling in the next two years, your best window may be in the next 3 months. Speak with a qualified Realtor who knows your local market and can give you good advice.
Of course, if you live in Chester, Montgomery, Delaware, Lancaster or Berks Counties, I would be more than happy to help you.
Articles referenced in this post:
Results of the First Time Home Buyer Tax Credit in 2009 Comments Off
As you know by now, the First Time Home Buyer Tax Credit has been extended until April 30th, 2009 and also expanded to include some home owners selling their home and buying another. So what are the results that the credit passed last year had on the overall market? Let’s take a quick look at the stats:
- According the the IRS, about 1.4 Million people have taken advantage of the Credit.
- California was #1 in number of people filing to receive the credit – approximately 160,785.
- Texas was #2 with 131,472, #3 was Florida with 105,865
- While Alaska and Wyoming had the fewest number of claims
- From a “Per Capita” perspective, meaning the percentage of people in that state the numbers are different
- Nevada was #1, Utah #2, and Arizona #3
- An overwhelming percentage of buyers said that the credit was the main driving force in their decision to buy
- 10% of buyers said it was the only reason
Watch this market update video for more information.
Update on Tax credit extension Comments Off
It is not “officially” too late – If you don’t have a home under contract as of today, the chances of taking advantage of the Federal Tax Credit is pretty much NIL. BUT – THERE IS HOPE! As the below podcast indicates, National Associate of Realtors is lobbying very hard to get the credit extended. In fact, they have already extended it to veterans.
What I am telling my clients right now is that this credit has existed in one form or another for 4 years. The economy still is in need of incentives to get people out there to buy, so the likelihood that the credit dies all together is very slim. There is a very good chance it will be extended and maybe opened up a bit, but it is the government, so you can never count on that. Let’s keep following the story and see what happens.
http://www.realtor.org/about_nar/presidents_report/_podcast_archive/mcmillan_credithealthreform_20091020
107 Yellowwood Drive, Downingtown PA – Timberlake Community Comments Off
Great Opportunity to own this Timberlake Townhome with a 1st floor master suite!
Get all photos and get detailed info on 107 Yellowwood Drive!
Great Opportunity to own this Timberlake Townhome with a 1st floor master suite! This home has it all: Location- backs to wooded area for privacy, award winning schools, convenient to parks, transportation and shopping. Freshly painted, newer carpet & flooring, 6 panel interior doors, hardwood floors, updated fixtures, competitively priced. Bright Open floor plan with 2 story Foyer; Great Room with cathedral ceiling, skylight, corner fireplace and sliders to deck backing to wooded area; Dining area with triple casement window with views of woods; Kitchen with beautiful tile backsplash and ample breakfast bar seating, 1st floor Master Suite with walk-in closet, bath and laundry room. Two additional Bedrooms and Hall Bath complete the second floor. Walk-out basement is ready for your finishing touches and is rough plumbed for an additional powder room or bath. Stroll down the walking path to the pond & gazebo. 1 year AHS Home Warranty included.
I HATE real estate agents! Comments Off
So I saw this question asked on Trulia – Why do some agents cheat, lie, hide information? And I wanted to address this issue because, unfortunately, Real estate agents have been cast in a very bad light lately. It seems the public tends to think a real estate agents job is easy and that they don’t really earn their commission. And it is unfortunately true that in some cases all the agent cares about is the commission check and does not work very hard for their clients. These horrible few then ruin it for the rest of the hard working agents that do everything they can to do their job with integrity.
But on a serious note, why does it seem that agents cheat and lie? First of all, like any profession, Real Estate is full of ALL kinds of people with all kinds of different ethics. There are rules and associations in place to try and help distinguish which agents are really the good ones and which aren’t but sometimes the not so good ones do a good job of hiding.
That leads you to probably ask – “How do I find one of those “good” real estate agents?” Here are a couple of points on how to go about doing that:
- Ask your friends who is good: Many times those who are closest to you know of a really good agent that they or someone close to them has had a good experience with. Any agent can tell you they have integrity and are honest, but the best teller of what the truth is experience. So start by asking your friends if they know of any good real estate agents
- Google the agent’s name: With the internet pervading every facet of our lives, this means that whatever that agent does online can be found. And now with online social networks and blogs, you can get a feel very quickly how knowledgeable an agent is and what type of person they are generally.
- Ask for references of past clients, with phone numbers : If the agent is an honest one and does a good job, they will have a list of past clients that have given them permission to allow new and prospective clients to contact them as references. No agent is going to have every single client that loves them. It’s just reality, but most of their clients should be willing to give them a positive testimonial, if they genuinely care for their client’s needs.
- National Association of Realtors- NAR is a self-regulatory organization that deals with all the aspects of residential and commercial real estate industry. With 1.2 million members, who are called Realtors©, it is America’s largest industry trade group. Every member of NAR pledges to abide by the Code of Ethics that contains 17 articles together with an elaborate commentary on the standards of practice. Thus, National Association of Realtors is a good place to search for a real estate agent who diligent, assiduous, meticulous, honest and sincere.
- Scrutinize your neighborhood- Often, you can find good property dealers right in your neighborhood. To determine the efficiency of these agents, pay attention to the ‘Home for Sale’ placards in your neighborhood. If these posters disappear quickly, then the agent is definitely a good one.
- How much business are they doing? A “bad” agent can do a lot of business, but one of the signs that an agent knows what they are doing is that they get their clients to the settlement table and do it often. If an agent is only doing a handful of transactions per year, then they are either not working hard and don’t really know what they are doing well, or it is a hobby for them, and you don’t want an agent who makes it their “hobby” to help you buy a home.
- What charities are they involved with? - Selflessly serving is a big sign of humility and honesty. What charities and non-profits they support tells you a lot about what is important to them.
- Are they full time or part time? – Again, you don’t want someone representing you that makes it their “hobby” to help you buy a home. There is too much riding on what you are doing to allow that. You need someone who is available 100% of the time to help you with your transaction and represent you fully. Real estate is too involved and to “urgent/important” for a part time agent to effectively deal with their clients needs.
So those are my quick thoughts on how to find a good agent and what to look for. Of course I am a bit biased, but I think these are all fair questions and items that you can use to find the right real estate agent.
Written by Chris LaGarde, Keller Williams Real estate in Downingtown
Chester County Market Statistics for August 2009 Comments Off
The month of August took a bit of a beating, but that is to be expected. The month of August for real estate is one that is typically slow. Many people are squeezing their last minute vacations in before the school year starts and they are not focused on real estate. When put into perspective, the downward trend was expected.
In addition, when looking at the % change from a year ago, those numbers are also expected. The entire year so far has been showing a total decline of around 12% when compared to 2008. Great Valley looks like they took a huge hit in value, and while that is the case, it needs to be noted that any homes over the $300,000 mark is not a “first time home buyer” home and in a market that has taken a heavy hit. Buyers for those homes are just very hard to find.
The good news is that Affordability has fallen to an even more attainable rate nationally at 16% from 18% earlier in the year, and the First Time Home Buyer credit has created a great amount of activity. Both last month and this month, virtually all of the clients I have an 95% of potential clients I talk to are looking to cash in on that credit. And while it is good news, I also have some mixed feelings about it.
The reason for mixed feelings is that it is basically creating a false market by causing buyers who would otherwise wait, to jump in the market and create more activity. Then you have multiple offers on homes and the buyers end up paying more for the home than they really should. If there were no credit, then what they would pay would be more inline with what it really should be.
But in the end, real estate is a huge determiner of our economy and it does need this activity. It’s a catch 22.
If you DO want to take advantage of the Tax Credit, you are very quickly running out of time to jump in on that. Call me today – 484.995.9318 – to get started on finding a home.
| Area | AVG Sold $ | % Change Month |
% Change Year |
DOM | List/Sale Diff | Overall Trend |
|---|---|---|---|---|---|---|
| Downingtown | $350,071 | -4% | -7% | 76 | 92.8% | Down |
| West Chester | $349,463 | -8% | -11% | 74 | 91.6% | Down |
| Great Valley | $455,464 | -23% | -33% | 99 | 10% | Down |
| Coatesville | $216,182 | -3% | +2% | 70 | 94% | Even |
| Octorara | $210,904 | -4% | -5.6% | 104 | 91.7% | Down |
| Chester County | $354,526 | -4% | -12% | 79 | 92% | Down |
Home Buyer Tax credit may get expanded and extended! Comments Off
H.R.2801 or the Home Ownership Moves the Economy (HOME) Act of 2009 was introduced by Rep. Howard Coble, Republican from North Carolina on June 10, 2009. It is currently being reviewed by the House Committee on Ways and Means.
This bill Amends the Internal Revenue Code to:
- Extend the first-time homebuyer tax credit to all individuals who purchase a principal residence (currently, only first-time homebuyers as so defined);
- Extend such credit and the waiver of recapture requirements for such credit through 2010; and
- Repeal the limitation on such credit based on modified adjusted gross income. (No income limitations)
This bill still has several steps to go through before it is considered law, which includes being reported by the committee, House vote, Senate vote, signed by the President. So the bill is still in it’s infancy. In my opinion this would be fantastic as it would help an area of the real estate market that really needs it which is the $300k + range that first time home buyers are not in.
But, if you are a first time home buyer, I would not wait until this is passed to take action. This is the Government we are talking about here. As it stands, if you are not looking for homes by September 1st, you are in real danger of missing the boat on the current, and only tax credit available.
To set up a 20 point, initial Home Buyers Consultation with me, just contact me.
Be informed, read the entire bill
