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The Wonderful World of Atlanta Mortgage Lending

08 Thursday Sep 2016

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The Wonderful World of Atlanta Mortgage Lending

Mary Anne Walser, Realtor & Attorney, 404-277-3527, maryannesellshomes@gmail.com

Tony was a first time homebuyer. He balked at my requirement that buyers be prequalified by a lender before we go out looking at property. “I don’t want to share my personal financial information,” he said. “Well,” I laughed, “welcome to the world of mortgage lending.” Not only your personal financial information, but lots of information that you think would not even be relevant to the purchase of property must be shared with strangers (the mortgage banker and staff).

I always prepare buyers for the fact that they will be asked for a LOT of information. I joke that the lender will even ask them for their third grade report card (being particularly interested in their math scores). A recent buyer – Mia – called me up laughing one day. “You remember when you said they’d ask for my third grade report card? Well, you were almost right. The lender wants my college transcripts!” Now, Mia was well out of college and fully ensconced in her current job for at least two years. But this is just an illustration that there is no telling what the lender is going to ask to see. The best I can do for you is prepare you so you aren’t surprised. Get together everything that the lender will likely need (see the list below), but then be ready that they may ask for much much more. Like your third grade report card.

Here are some of the documents you should have ready for your lender:

  • W-2 forms from the previous two years, if you collect a paycheck.
  • Profit and loss statements or 1099 forms, if you own a business or are an independent contractor.
  • Recent paycheck stubs.
  • Most recent federal tax return, and possibly the last two tax returns.
  • A complete list of your debts, such as credit cards, student loans, car loans and child support payments, along with minimum monthly payments and balances.
  • List of assets, including bank statements, mutual fund statements, real estate and automobile titles, brokerage statements and records of other investments or assets.
  • Canceled checks for your rent or mortgage payments.

This is by no means an exhaustive list. If you have had credit problems or a complicated work history, be prepared to produce even more documents. And the requests just keep coming, sometimes right up to and on the day of closing. The lender may also pull your credit report again right before closing. That’s why we tell you not to make major purchases between loan application and close. WAIT to buy your new furniture and a new car. Big purchases on credit might disqualify you for the loan because they disrupt your income/debt ratio.

So why the need for all this information, borrower laid bare before the mortgage altar? Remember that the lender is giving you a great deal of money to purchase a home. Back in 2006-2008, they were giving money much much too freely. Back then there were even what were called “stated income loans,” where the bank would pull your credit score, ask you what your income was (without any verification requirement) and give you a loan based solely on your credit and what you claimed that you made. You can see where lots of borrowers got into trouble with this. I personally saw real estate agents who I knew did not make a lot of money purchasing huge houses, thinking that they’d be able to resell them at a profit. When the homes didn’t resell, they defaulted. This happened with borrowers of all professions on a national scale – hence the mortgage meltdown.

So now things have tightened up quite a bit, and the documentation requirements are once again onerous. There’s a person called the “underwriter” who you may label the “undertaker” before all is said and done. Your loan officer gathers the preliminary information from you, then hands the file over to the underwriter, whose job it is to “underwrite” the loan. This means that they make sure it conforms with the relevant guidelines and that it is a loan that is likely to be repaid. They require any and all relevant documentation (and some that certainly seems irrelevant) to satisfy the lender that you have the ability to and will repay the loan.

So call a lender and be prepared for the onslaught of requests. Now, let’s talk about the types of lenders. You can call a direct mortgage lender or a mortgage broker – the difference is that a direct lender is lending you money they control. A mortgage broker is shopping around for a loan and is lending you someone else’s money. So a direct lender will usually have more control over the process (through the underwriter, in particular) and the mortgage broker can shop around, but will not have a lot of control over the loan once they choose one for you. I have favorite direct mortgage lenders AND favorite mortgage brokers (call me if you want a referral!) It is just a matter of finding someone experienced and fair.

Most of my buyer/borrowers these days do a 30-year conventional loan, twenty percent down. Interest rates are still so low – I definitely do NOT recommend doing an ARM (“Adjustable Rate Mortgage”). With an ARM, you have a fixed rate for some period of years – three, five or seven – and then when the ARM expires the interest rate resets to a formula based upon the prevailing rates at the time. Since interest rates are SO low now and likely to rise, you would be better off just signing up for one continuous interest rate over years. What if you think you will move before the ARM expires? The ARM rate is generally lower than the conventional loan rate, so that is tempting. But consider that you may change your mind about moving OR about selling. When I purchased my first home, I used a seven-year ARM, convinced that I would move before the seven years were up. I didn’t! But rates were lower at the seven year mark and I refinanced to a 15 year loan instead. And I still own that property (now as a rental). If rates had gone UP, I would have been quite sorry that I had chosen an ARM instead of a fixed rate mortgage.

Find a lender you know and trust, and sit down with them and talk through the wonderful world of mortgage lending and what is best for you. Then let’s go find your home!

 

Mary Anne Walser is a licensed attorney and full-time REALTOR, serving buyers and sellers in all areas of Metro Atlanta. Her knowledge of residential real estate and her legal expertise allow her to offer great value to her clients. Mary Anne s a member of the Atlanta Board of Realtors, the Georgia Association of Realtors, the State Bar of Georgia and the Georgia Association of Women Lawyers. Contact Mary Anne at 404-277-3527, or via email: maryannesellshomes@gmail.com.

 

 

Backup Homebuyers

13 Friday May 2016

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Wanna be a backup?  It’s a common question among Realtors these days.  So what are we talking about?  We have a shortage of inventory right now – not enough homes to sell for the buyers who are out there.  That means that there are often multiple offers when a hot property goes on the market.  It can be tough on the average homebuyer.  Say you have a loan, but one of the OTHER offers is all cash.  All other things being equal, cash is king and tough to beat.  Now, there are other ways to win in a multiple offer situation; perhaps money is not the only thing important to the seller.  The thing to do is to have your agent quiz the seller’s agent about what other terms would make the seller happy.  Perhaps they need a quick close – or perhaps they haven’t found a home to move to yet and need a longer close.  Maybe they need to “rent back” for some period of time.

In other instances, perhaps what is important to the Seller is bringing a great neighbor to a neighborhood they’ve known and loved.  In that instance, a letter from the buyer can make all the difference.  In fact, I recently had a client, a single mom looking for her first home purchase all on her own.  She fell in love with the “perfect” house and wrote a letter to the seller detailing all the reasons that she loved the home.  There were seven total offers on the house, and after we won the bid the listing agent told me that there were two other offers that were stronger and higher in price than ours was, but that the LETTER made the difference.  The letter touched the seller and convinced the seller that my buyer was the best buyer for the house.

But say you’ve tried the multiple offer strategies and you still lose out to another offer.  Perhaps the price went way over list and you offered less.   Maybe another buyer took out the appraisal contingency and you weren’t willing to that.  But you still loved the house.

THIS is where the backup offer comes in.   When another buyer wins the property you want, you can offer to “be the backup.” What that means is that you make an offer to the seller that if the first contract falls through, you are waiting in the wings and fall into the first position without the property ever coming back onto the market.  The backup offer, of course, has no legal effect until the seller signs it – at that point, it becomes the backup contract and is basically a right of first refusal for the backup buyer.

How it works is this – if the first contract falls through, the backup comes into effect when the seller notifies the second buyer that the first contract has fallen through.

So what’s in it for the seller?  Well, if a property comes BACK on the market after being under contract, others wonder “what’s wrong with it?”  There’s a certain stigma attached to a property that’s been under contract and that contract is terminated.  This is why you will see an agent write into such a listing something like “BUYER’S FINANCING FELL THROUGH” – the idea is to signal to future buyers that the contract termination has nothing to do with anything wrong with the house.  With a backup offer, the seller doesn’t have to risk any stigma attached to coming back ON the market.

For the buyer, of course, it’s a risk free proposition if there’s a due diligence period in the contract.  Most contracts in Georgia have a seven to ten day due diligence period during which the buyer can terminate for any reason or no reason at all.  So submitting such an offer as a backup is risk free.  Even if the contract becomes primary, the buyer can decide to terminate and get earnest money returned.

So how is it effectuated?  There’s a backup agreement exhibit in the Georgia Forms that’s used.  With the exhibit, the seller can sign because they are *not* selling the same property to two different buyers – they are granting an option to the second buyer should the first contract fall through.

With the due diligence period, the second buyer is able to terminate at any time, even before the backup contract moves into first position.  Thus, the backup buyer can continue to shop for a home and if they find the perfect place, simply terminate the backup contract.

 

Mary Anne Walser is a licensed attorney and full-time REALTOR, serving buyers and sellers in all areas of Metro Atlanta. Her knowledge of residential real estate and her legal expertise allow her to offer great value to her clients. Mary Anne serves on the Committee that drafts and reviews the contracts utilized by all REALTORS in the State of Georgia. In addition, she is a member of the Atlanta Board of Realtors, the Georgia Association of Realtors, the State Bar of Georgia and the Georgia Association of Women Lawyers. Contact Mary Anne at 404-277-3527, or via email: maryannesellshomes@gmail.com.

SOME MUSINGS ON LOWER PRICE RANGES AND NEIGHBORHOODS

23 Wednesday Dec 2015

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NeighborhoodA reporter working on a story recently contacted me and wanted me to give my opinion on the “BEST” neighborhoods for a given type of buyer in a given price range.  Unfortunately, I can’t know that without knowing the buyer.  Not only WHO you are (first time homebuyer, young family, aging empty nester), but also your personality.  Your personal traits and also your architectural personality.  Do you like historic bungalows, sleek modern houses, or traditional homes with gorgeous molding and impeccable finishes?  With any personality and price range, there are numerous neighborhoods which might fit the bill.  What you need is the Realtor who will get to know YOU and help you find the right house in the right neighborhood at the right price.  I’m going to share with you some insights I recently gave to a writer for Atlanta magazine who asked me to GENERALIZE on the best neighborhoods for a given demographic in a given price range… but keep in mind that it ALL DEPENDS ON THE BUYER.
SOME RECOMMENDED NEIGHBORHOODS for price points/demographics:

I’ll start with another disclaimer: SO MUCH depends upon where the buyer and family members WORK.  Traffic in Atlanta just gets worse and worse – and commute time is precious time away from the family.  So NO neighborhood is a good neighborhood for you if your commute time is more than an hour, I’d say!  And we have good neighborhoods all around – so I usually start by asking the homebuyer, WHERE DO YOU WORK?  And then WHERE DO YOU LIKE TO PLAY/where are your friends?  And gauge the “right” neighborhood accordingly.  Another important factor is the homebuyers’ PERSONALITY.  One may HAVE to live in a walkable neighborhood while another would prefer a newer swim/tennis community. But I will do my best giving you in a general sense some of the best neighborhoods that I think exist for each price range….

Young family
1.  Under 200k: For a young family under $200,000, believe it or not there are several very good options not too far out!  I love Doraville/Chamblee.  Montgomery Elementary School is a favorite.  If they don’t mind living farther out and commute is not an issue, $200,000 will buy you a nice home in far East Cobb.  I usually recommend that the family VISIT the school personally where their child will go.  Some schools that don’t have great scores “on paper” are well loved by some of their constituents, and if there’s an IB (international baccalaureate program), a gifted child can have a great experience even at a not as great school.
2.  200-350k: Closer in East Cobb for the schools.  While the Sope Creek district is outside the range, there are a number of other great schools just a little farther out with houses in this price range.
3.  350-500k: Oakhurst, fun, diverse, walkable, family friendly.  There are also great options in Ashford Park/Drew Valley/Brookhaven Heights.   These are neighborhoods across Peachtree to the east of Historic Brookhaven.  Ashford Park Elementary is well thought of and it’s a very central location, close to I-85 and to 400.  Dunwoody is always a favorite – close in, family friendly.
4.  500k+: I can’t say enough about Decatur, as long as your work commute isn’t terrible from there.  Everyone loves City of Decatur schools, the walkability and the city services.   A lot here depends on the personality of the family!  Inman Park history might be perfect for some (with great Mary Lin Elementary), Druid Hills serenity and history (Fernbank Elementary), or for the rising corporate executive perhaps Buckhead (although homes in 30327 are generally a young family’s “second” home).

20 something
1.  Under 200k: A 20 something could go for a small condo just about anywhere they want to be.  There are even cool places in this range in the heart of Virginia Highland, in Midtown, and in Buckhead.  But if investment is also a consideration, I’d go for Doraville/Chamblee area.  With The Assembly (mixed use) development going in where the old GM Plant was, there’s a whole lot happening in this part of town.  Another great place for investment would be the historic West End – anywhere near where the Beltline WILL be going in the coming years.  There’s some awesome housing stock – great historic bungalows! And soon enough this will be the new “hip” area of town.
2.  200-350k: Ormewood Park, Reynoldstown, Kirkwood – these are the cool areas of town near the Beltline that are still affordable.  I also like SMYRNA near the Smyrna Market Village.  With the Braves Stadium moving to Cobb County, Smyrna is far enough away to avoid traffic (and you’re able to get south without getting on I-75 from there) but close enough to benefit from the development.
3.  350-500k: If they are the Buckhead type, a cool sleek condo walkable to Buckhead action!
4.  500k+: Virginia Highland, Old Fourth Ward, Inman Park, anywhere near the Beltline!

Empty nester
1.  Under 200k: On the north end of town, Kennesaw is a good option and Kennesaw Mountain is a great place to hike and to take the grandkids.  On the east side of town, Stone Mountain has some great solid one level ranch housing that might also be perfect.
2.  200-350k: In this range, a good option might be a one level ranch close to where the kids live (if the kids are in Atlanta) or close to the neighborhood they are downsizing from (to stay in touch with friends).  Lots of great neighborhoods in Tucker and nearby; Tucker has a great small town feel but is so close in, and very warm and welcoming.
3.  350-500k: I find many empty nesters in this price range love the ACTIVE ADULT communities a little farther out of town.  These generally are designed in a 4-pod pattern; basically 4 houses joined together, each all one level with a garage.  There’s a central clubhouse and pool and the exterior maintenance is generally covered by the homeowners association.  Jim Chapman is one of the prominent builders of these communities.  They are generally pretty far outside the Perimeter – there’s one near Serenbe and several which are past Alpharetta.
4.  500k+: The place historically we see empty nesters in this price category purchase is in VININGS, because taxes in Cobb County are much lower for senior citizens (the county takes off the “school” portion of the tax).  Many empty nesters end up in one of the beautiful highrises like One Vinings Mountain and The Aberdeen or buy a Weiland townhome at Paces View with an elevator.  An added bonus is that those properties are within walking distance to the Vinings Jubilee and to many awesome restaurants.

Mary Anne Walser is a licensed attorney and full-time REALTOR, serving buyers and sellers in all areas of Metro Atlanta. Her knowledge of residential real estate and her legal expertise allow her to offer great value to her clients. Mary Anne serves on the Committee that drafts and reviews the contracts utilized by all REALTORS in the State of Georgia. In addition, she is a member of the Atlanta Board of Realtors, the Georgia Association of Realtors, the State Bar of Georgia and the Georgia Association of Women Lawyers. Contact Mary Anne at 404-277-3527, or via email: maryannesellshomes@gmail.com.

 

THE WEATHER TURNS COOL, BUT THESE ATLANTA NEIGHBORHOODS ARE HOT!

28 Wednesday Oct 2015

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Hot NeighborhoodsAtlanta has SO many great neighborhoods!  But here’s a quick take on what are some of our hottest (of the moment) neighborhoods and those that are HOT VALUE neighborhoods NOW, this Fall, 2015, in Atlanta.  Note the distinction.  When a neighborhood is “HOT” – i.e., very popular at the moment, oftentimes prices will rise rapidly as buyers bid against each other in their rush to move in.  A HOT VALUE neighborhood is one that is not yet “RED HOT” but which WILL be hot in the coming years, and so there are still bargains to be had.  Now, if you’re bidding in a HOT neighborhood and prices are rising, there is no need to fear overpaying as long as it’s a neighborhood that is likely to hold or increase in value in the coming years.  Usually a neighborhood is HOT either because of location, schools, or both; the location isn’t going to change and if the schools are good, residents always fight to KEEP them that way.

Don’t be concerned that I am leaving out your favorite HOT neighborhood – know that I’m not addressing CLASSICALLY HOT neighborhoods… I’m not addressing them in this particular blog post because they are always hot.  This would include Decatur zip 30030, Midtown, Va/Hi, Morningside, and many northern suburbs such as Alpharetta, Roswell, Johns Creek, and East Cobb in its great school districts.

And also know that there’s no way to address all the “hot” areas in one blog post – I’ll just touch on a few to whet your appetite, and I’ll cover different areas of town.

Let’s start in Ashford Park, just east of Peachtree Road – Ashford Park is HOT.  The elementary school is awesome and there’s lots of new construction.  While several years ago one could get a pretty decent home for $300,000 here, I just sold a teardown LOT for $500,000 with multiple offers in one day.

HOT VALUE near there is CHAMBLEE.  While Montgomery Elementary is not yet par with Ashford Park, it’s getting there, and the City of Chamblee is making great strides in developing retail areas.  THE ASSEMBLY huge mixed use development is going in where the old GM Plant used to be and that’s exciting.  Because it’s up and coming, there are still values to be had.

NOW, let’s go to the Beltline, which is of course driving values everywhere it touches.  We’ll start with Old Fourth Ward, O4W in local parlance, and its neighbors, Inman Park and Poncey Highland.  HOT because of the Beltline (and that’s a continuing theme – the Beltline has made many Atlanta neighborhoods “HOT” so it is important to know where the Beltline IS, where it will be, and where it’s going…. ).  Quick aside = the Beltline is a 22 mile bike/walk/run path being built in a huge Atlanta circle.  Only parts of it are complete, other parts are underway, and some sections may be years in the making. But the O4W portion is complete and with it O4W Park, Ponce City Market, Krog Street Market – the list of “cool” things that have come with it are legion.

HOT VALUE is south of there, in Reynoldstown, Edgewood, and East Atlanta.  There’s also Ormewood Park, nestled between Grant Park and E Atlanta on the Southside (Grant Park has been and continues to be a “hot” area).  The beltline goes right through this great neighborhood of old bungalows and great diversity.  There is section 8 housing a block from $700,000 homes.  There are still a lot of values to be had – I just sold a $250,000 adorable house one block from the Beltline.  The Beltline here is not yet finished, so prices haven’t risen SO high SO fast.

For more hot values, seek out Capitol View Manor, Mechanicsville, and Adair Park – neighborhoods to the west of the afore-mentioned neighborhoods.  These are nestled in west of I-75/85 and south of I-20, and the Beltline goes right beside and through them.

Let’s leave the Beltline for a minute and head down towards to the Airport to stop at The Manchester Arms in College Park for a meal.  Marvel at what College Park is becoming.  Because Woodward Academy is down there, some northern suburb dwellers have built weekday homes for one spouse and the kids to live in before they go back to the northern burbs for the weekend.  PORSCHE moving into the airport has meant even more wealth moving into the area.  College Park is hot; East Point just to the north of it is still a hot value neighborhood.

Back on the Beltline and moving North; HOT is BRANDON SCHOOL DISTRICT = you’ll pay a premium for great public schools in Atlanta, and Brandon is a good indicator of that.  One of my favorite neighborhoods is CHANNING VALLEY, where prices have risen 22% over PRE recession prices; it’s a small friendly diverse neighborhood in a great convenient spot.

HOT VALUE is West Midtown = Howell Station is an example.  It’s near BELLWOOD QUARRY, which saw thousands of zombies in the season premiere of Walking Dead.  Now that the zombies are gone, that park will be the crown jewel of the Beltline.  Because that area is still very industrial and the Atlanta Jail is nearby, prices are still low, but demand is rising.

And finally, up North to just outside the Perimeter.  Smyrna west of 285, just outside Vinings, the area nicknamed “Smynings” is hot but there are also still a lot of value priced properties.  With the new Braves Stadium going in, it’s becoming even more desirable as a place that will be close to the action and the new development; and yet far enough west that residents can still get places without running too much into Braves traffic.

Again, these are just a FEW of the “hot” areas that I am seeing.  Please email me YOUR favorites so that I can feature them in a future blogpost!

 Mary Anne Walser is a licensed attorney and full-time REALTOR, serving buyers and sellers in all areas of Metro Atlanta. Her knowledge of residential real estate and her legal expertise allow her to offer great value to her clients. Mary Anne serves on the Committee that drafts and reviews the contracts utilized by all REALTORS in the State of Georgia. In addition, she is a member of the Atlanta Board of Realtors, the Georgia Association of Realtors, the State Bar of Georgia and the Georgia Association of Women Lawyers. Contact Mary Anne at 404-277-3527, or via email: maryannesellshomes@gmail.com.

No Need to Cork the Bubbly – Let’s Celebrate the Recovery

16 Friday Oct 2015

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After the dismal housing recession in Atlanta (and everywhere) that hit in 2008 and sent housing prices on a sharp decline,  prices finally started to stabilize in late 2014 and have risen ever since.  Having just emerged from the doldrums to a rapid rise in pricing, some experts are declaring a new “housing bubble”; but reports of the imminent death of the rising residential market are greatly exaggerated.

In Atlanta, we took longer to sink during the recession and have been slower to rise in the recovery.  Right now we have a shortage of inventory but our prices still are not rising as quickly as they are in many cities.  This measured response to the national trends bodes well for us; as does the fact that so many companies are bringing headquarters and employees to Atlanta.  We have more buyers moving here, which will naturally put upward pressure on pricing, but which will serve to continue to support that pricing in the coming years as they continue to live and work in Atlanta.

In addition, as more sellers receive the news that housing prices are rising and that they ARE able to sell and make a profit, more are putting their homes on the market.  This additional inventory is helping to reduce the number of competitive bid situations and to stabilize the rapid rise in pricing.

Further, it was a very loose mortgage lending environment that contributed to the original housing bubble.  It was far too easy to get a mortgage at that time.   That loose mortgage environment ground to a screeching halt in 2009 and it is still difficult today to secure a mortgage.  The strict underwriting guidelines that were implemented following the “mortgage meltdown” are still in place, meaning that the torrent of unqualified buyers that precipitated the initial crisis are nowhere to be found and are, hopefully, never to return.  Banks are lending only to qualified buyers with good credit scores who are less likely to default on their mortgage loans.  Interest rates are still low right now, but are likely to rise, which will create yet another governor on the ability of buyers to purchase and the ability of sellers to ask ever increasing prices.

After fifteen years in the business, I have seen a lot of ups and downs in the housing market.  This particular recovery, while fast, has not spun out of control and is unlikely to do so.   While it’s always prudent for a buyer to carefully review the sales of comparable properties and to research the  neighborhood and factors contributing to that neighborhood’s potential before agreeing on price, and although that price is going to be higher than it was three to five years ago, there’s no need to panic or to cork the bubbly over a housing “bubble”.  Rather, we should continue to celebrate the housing recovery.

Mary Anne Walser is a licensed attorney and full-time REALTOR, serving buyers and sellers in all areas of Metro Atlanta. Her knowledge of residential real estate and her legal expertise allow her to offer great value to her clients. Mary Anne serves on the Committee that drafts and reviews the contracts utilized by all REALTORS in the State of Georgia. In addition, she is a member of the Atlanta Board of Realtors, the Georgia Association of Realtors, the State Bar of Georgia and the Georgia Association of Women Lawyers. Contact Mary Anne at 404-277-3527, or via email: maryannesellshomes@gmail.com.

Buyer’s Remorse

09 Tuesday Jun 2015

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First Home Blues Five Tips to Prevent Buyers Remorse First Home Blues: Five Tips to Prevent Buyers Remorse

We don’t talk about it a lot, but it is real: buyer’s remorse.  That sinking feeling that you rushed too quickly into your home purchase and that it is all a big mistake.  If remorse comes during the due diligence period (during which the buyer can terminate for any reason or no reason at all), you can still terminate your contract; if it comes after that period, you cannot terminate without facing potential legal penalty.

Buyer’s remorse is not just a problem for buyers – it’s a HUGE problem for a seller.  If a home is on the market, goes under contract, and then comes BACK on the market, there is a stigma attached to the property, whether or not the contract termination was called for by any logical reason.  This stigmatizing effect is why sellers want to be as certain as possible that the buyer is NOT likely to back out.  For instance, many sellers would never accept an offer from a buyer who has not yet seen the property.  Why, you ask, would any buyer MAKE an offer without seeing the house?  Well, in these days of low inventory and few houses to choose from, buyers sometimes HAVE to make an offer without seeing it.  I recently helped buyers moving back to Atlanta from Sweden; with their three children, they didn’t want to move into a rental only to then move again when they purchased a home.  They had lived in Atlanta previously, and knew the area in which they wanted to live – so they trusted me, working with their parents, to decide on a home and get it under contract for them.  Whether or not they’ll have remorse is yet to be determined.

But buyer’s remorse may be more rampant in these times of buyers rushing into purchases because there is such low inventory.  The first advice I give is to remember that almost EVERY buyer has remorse at some stage of the process.  Despite my vast experience with the phenomenon, I myself had buyer’s remorse with the purchase of my current home.  I went through with the sale – at the urging of my husband – and it’s the absolute best home for us that I could ever find or ever imagine.  So working THROUGH the buyer’s remorse and soldiering onward to closing is sometimes the answer.

And I also suggest to buyers feeling a bit of remorse that we examine if the remorse is illusory and fleeting or based on fact and true potential pitfalls.  For that, we take the buyer’s initial wants and needs list.  Does the home they chose fit what they said they were looking for?  Is there likely to be another home in their price range that would fit those needs and wants better?  Looking at the inspection – are there problems with the home that are not fixable, or has the buyer just been spooked by routine home repair items that aren’t a big deal?

There are several scenarios where buyer’s remorse seems to fester that usually IS fleeting and should be worked through: when the negotiations with the seller have been contentious and the buyer is left not having good feelings about the seller; when the buyer keeps looking at homes online and considering other homes; and when family and co-workers plant doubt.  Remember that the seller is LEAVING the home and it will be yours; remember from our search that homes can be and usually are much different in person than they are online; and remember that the family and co-workers did not engage in the search with you and don’t know all that went into the decision (it’s typically more realistic to consult with friends who have been with you through the process).

With a careful selection process, a great inspector and a great real estate agent guiding your way, any buyer’s remorse may be a typical and passing phenomenon.  Sometimes knowing that it’s common is all a buyer needs to know to get through it.  For the seller faced with a terminating buyer, it is a good practice to let future purchasers know if the termination was based on “cold feet” rather than a true problem with the house.  Always let us know your current thoughts and concerns – armed with all information, buyers can avoid remorse, and sellers avoid a lost buyer.

Mary Anne Walser is a licensed attorney and full-time REALTOR, serving buyers and sellers in all areas of Metro Atlanta. Her knowledge of residential real estate and her legal expertise allow her to offer great value to her clients. Mary Anne serves on the Committee that drafts and reviews the contracts utilized by all REALTORS in the State of Georgia. In addition, she is a member of the Atlanta Board of Realtors, the Georgia Association of Realtors, the State Bar of Georgia and the Georgia Association of Women Lawyers. Contact Mary Anne at 404-277-3527, or via email: maryannesellshomes@gmail.com.

Settling Into Your New Home

23 Monday Mar 2015

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The papers are signed and you are moving in – congratulations!  And welcome to your new home.  Here are some things you should know about as a new homeowner.  First, you will get lots of coupons and offers in the mail.  Marketing companies watch the county records for new homeowners and your “change of address” form with the post office is also a trigger telling companies “Hey!  I’ve moved!  I am going to buy stuff!”  Chances are you held off purchasing new furniture, etc. until after closing.  But keep in mind that even if you want to buy things ahead of closing, it doesn’t hurt to ask the merchant if they have a discount for new homebuyers.  Many do, particularly furniture companies, and sometimes they’ll give you the discount even before you close.

Keep in mind also that you will notice things about your home that you did not notice before closing.  Perhaps a ding on the countertop, scratches on the floor, chipped paint, that sort of thing.  This is regular and normal for the most part.  Sometimes it isn’t.  For instance, recently I helped a purchaser buy an awesome condo.  After closing, when she moved in her toilet was leaking.  We didn’t notice it before; it didn’t come up in the inspection and we didn’t notice it in the walkthrough.  So guess what her housewarming gift from me was?  You guessed it.  I do have toilet visiting privileges now, and since it’s near Piedmont Park that might come in handy.  But here’s the point – there may be things wrong with the home you didn’t know about or your inspector didn’t catch.  Maybe the problem developed after the inspection and wasn’t noticeable during your walkthrough.  Know that this is normal.   Things like this are rarely worth suing over unless you think there’s been fraud.  The best approach is to be as diligent as you can and budget for some unforeseen circumstances – and above all, remember that “perfection” doesn’t exist (although some homes come close….)

Perhaps at the closing table you exchanged contact information with the home seller.  If both parties are open to it, then the information is exchanged; if not, the Realtors can help facilitate communication after closing if necessary.  Perhaps you as a buyer finds something the seller left behind, or have received mail that needs to be forwarded, or have questions about those things you did not notice prior to closing.  But there’s another reason you might wish to contact the seller.  At the closing table the attorney likely told you that if the property tax bill changed after closing such that the proration on the statement was inaccurate, then the parties should arrange a re-accounting amongst themselves if appropriate.  Personally I’ve never seen that happen, but it could; know that if the tax bill you receive is significantly higher than a previous proration on the closing statement, that it is appropriate to contact the seller for a re-accounting.  Know as a practical matter the seller is not likely to be excited about paying out more property tax money on a home that they no longer own (and of course rarely would a buyer contact a seller to REFUND prorated funds if the tax bill gets smaller, but that happens too).

Now here is a tip that we often forget to tell buyers – but it’s important.  You’ll get solicitations from companies that offer to send you a copy of your deed for a price – (prices I’ve seen range everywhere from $25 to $75).  These solicitations look “official” and give the impression that the only way you can get a copy of your deed is to pay that company to send you a copy – NOT SO.  The county will send you a stamped-filed deed after your closing for FREE and your Realtor can always pull your deed from the on-line records and send it to you at no cost.  There is no need to pay a third party company to send you a copy of your deed – hang on, it is coming your way for free.

But that is not the worst “official looking” correspondence you will get.  You may also get letters asking you to pay to file a homestead exemption form; again, you don’t have to pay.  The forms are free on the county websites and you can file for free.  (The homestead exemption gives you a break in property taxes if you live in and occupy your home).  You may also get correspondence from companies that want to split your mortgage payments into payments every two weeks rather than monthly.  If you want to prepay your mortgage, you can do that without the help of a third party who wants to charge you to help.  If you get a notification that your loan has been sold and you should send your payments to a new lender CALL your current lender before believing a document sent by mail.  The name of your mortgage company is easily available in public records, so a scammer can write you an “official looking” notice purporting to be from your lender that is in no way official.

So, keeping in mind these tips, reminders, and warnings, enjoy your new home!

Mary Anne Walser is a licensed attorney and full-time REALTOR, serving buyers and sellers in all areas of Metro Atlanta. Her knowledge of residential real estate and her legal expertise allow her to offer great value to her clients. Mary Anne serves on the Committee that drafts and reviews the contracts utilized by all REALTORS in the State of Georgia. In addition, she is a member of the Atlanta Board of Realtors, the Georgia Association of Realtors, the State Bar of Georgia and the Georgia Association of Women Lawyers. Contact Mary Anne at 404-277-3527, or via email: maryannesellshomes@gmail.com.

Let’s Sell Your Home this Spring

25 Wednesday Feb 2015

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We have had one of our busiest winters ever in the Atlanta real estate market.  With prices rising, many sellers realized that they again had equity in their homes and were ABLE to sell.  So those who had waited through the depressed housing years (since 2008) were suddenly in a position to be able to move.  Buyers were eager to purchase before home prices rose even more.   As a result, we had record home sales.  Demand in many areas of Atlanta exceed inventory, so some sellers who didn’t want to turn down  a great offer for their home even moved into a rental when they couldn’t find the “right” place to move into.  So there’s much pent up demand for homes to purchase this Spring.

If you are thinking of selling your home, there’s no time like the present.  The sooner the better, for many sellers wait until the Spring to sell – and as the season proceeds, you’ll have more and more competition.  We have a lot of “shadow inventory” poised to hit the market in late Spring and Summer; you’d like to avoid as much of that extra competition as you can.

Even with the buyer demand high, no one wants to overpay for a home so pricing is KEY.  We see competing offers for some homes, but those that are priced too high are receiving no offers at all and actually eventually net LESS.  The longer a home sits on the market, the less it is worth in the eyes of a buyer.  We can work with you to determine the ideal initial list price to bring you the highest return.

To prepare for listing, remember that first impressions are key.  A buyer will often decide from the street that they love or dislike a particular home; in fact, they will often tell us to “keep driving” if they don’t like the curb appeal.  So trim your trees and bushes and pressure wash your driveway, front walk, house, and deck or patio.  Clean and even repaint your front door and make sure the key works easily.  Have a nice, fresh welcome mat.  Buyers will linger with us at the front door while we open the lockbox for access, and they have extra time to notice these details.

Do your Spring cleaning NOW if you haven’t already.  And declutter, declutter, declutter.  Go through all your furniture, decorative items, and closets with a ruthless eye.  We have stagers and declutterers who help us prepare your home for sale – but start with the initial sweep immediately.  The savvy seller will remove half of all items in a closet and have nothing on the floor, for instance.  It sounds drastic, but it works.  Pack up everything you want to keep and take it to a storage unit or call in a company that will deliver a storage pod and then take it offsite for you.

Repaint to freshen up where needed; if you have any carpeting, get it cleaned.  If you know that a home inspector is going to find anything that needs to be fixed – go ahead and fix it now.  We have great contractor references if you need them.  It makes more sense to do the repairs first – a buyer may end up asking you to spend $300 on a repair you can do now for $100.

CALL US NOW if you are thinking of selling your home.  We can help you through the preparations and price your home correctly to sell at top dollar – it’s what we do!  And we’d love to hear from you.

 

Mary Anne Walser is a licensed attorney and full-time REALTOR, serving buyers and sellers in all areas of Metro Atlanta. Her knowledge of residential real estate and her legal expertise allow her to offer great value to her clients. Mary Anne serves on the Committee that drafts and reviews the contracts utilized by all REALTORS in the State of Georgia. In addition, she is a member of the Atlanta Board of Realtors, the Georgia Association of Realtors, the State Bar of Georgia and the Georgia Association of Women Lawyers. Contact Mary Anne at 404-277-3527, or via email: maryannesellshomes@gmail.com.

HOW MUCH MONEY DO I NEED BEFORE I BEGIN LOOKING FOR A HOUSE?

20 Thursday Oct 2011

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I try to find some fun, interesting topics for blog posts – this one is a little dry, but important!  I will sneak in a few of these here and there, just for variety – and because, like vegetables, they’re good for us. 


I find that new homebuyers are confused about how much money they should have in hand BEFORE they begin looking for their dream home.  A quick answer is – call your lender !  They can give you a good idea of what price home you can buy, and how much in reserve you should have before you begin looking.  My favorite mortgage lender – the one I use most often and who will do my loan when I purchase a home – is Carlisle Dent of Fidelity Bank Mortgage.  Tell him I told you to call and he’ll be happy to discuss it with you. 


But if you’re just “thinking about it” at this point,  or just want a general idea, here we go:


Generally, the largest chunk of dough you should have in advance is your DOWN PAYMENT.  The down payment varies depending on the type of financing you are using, your monthly payment and the price of the home you are purchasing.   It is a percentage of the purchase price, and that percentage depends on the financing you receive. It is possible to pay as little as 5% down, but in a more traditional situation, you would be putting about 20% down.  Government loans require a smaller down payment – I have seen (even in this tough lending environment!) no money down (from the buyer) loans.  But since the mortgage meltdown, those are very few and far between.  The more you put down, the more lenient your lender can be on underwriting issues.  Plan on no more than twenty percent of the purchase price – but most of my buyers these days put twenty percent down.


Saving enough money for a down payment can seem like an unreachable goal for some. Remember though, if you already own a house, you can use your home equity toward a down payment on a new house. If you are a first time home buyer, start a savings program if you have not already. Also, a lot of first time home buyers receive help from parents and relatives for the purchase of their first time. Consider asking!  It’s a good, effective mode of wealth transfer at a time when you most need it.  If you DO go this route, know that there are special rules relating to when that money needs to come to you.  Some loans will require that the funds are in YOUR account for a certain amount of time.  Check into that FIRST if this is your plan, so that you know you are conforming to those rules. 


Also, some builders of new homes will consider “sweat equity” in their selling price. This means that they will reduce the price and let you do some of the work (like painting) yourself.  There are even more strategies to get your down payment lower, such as using a co-borrower or seller take-backs.