VAMortgage Center comes to help the Vets and Active-Duty Military

Published March 28th, 2008 in Mortgage. 0 Comments

There is a new player in town. A company called VA Mortgage Center has recently launched an interesting program for all the Veterans and Active-Duty military.

Even though that are insured by the U.S government, VA Mortgage Center is not affiliated with any government agencies

From watching their video and doing some research on their company, it seems like their mortgage program is very solid and it seem to offer some good benefits for our former and current troops.

In our opinion, the best thing about their loans is the elimination of the Private Mortgage Insurance, also known as PMI. Many lenders requires PMI if the borrower doesn’t come up with a 20% downpayment.

Also, their loans approvals are not solely based on a strong credit score or a high income, therefore it is easier to qualify for one.  

If you have served in the military or you are currently enrolled, and you are looking to purchase the house of your dreams, contacting them might save you the hassle of finding a good rate while keeping the downpayment at a minimum level.

For more information, feel free to visit their website www.vamortgagecenter.com

Kitchen and bath renovations aren’t increasing the house value

Published March 6th, 2008 in Real Estate Tips. 1 Comment

It was well known that high-end kitchen and bath renovations were increasing the home’s value. But the granite countertop’s glory days might be over. During the housing boom, updating a kitchen with high end materials like cherry wood cabinets and a Viking stove was a sure bet to boost a home’s value.

The statistics show that the homeowners recovered about 80% of the cost when the house was later sold. The slowdown in the real estate market and the flood of new properties on the market, has given the buyers more options to choose from therefore all these extra upgrades don’t present much value in their eyes anymore. 

A recent survery by NAR has shown that most renovations are returning less than 70% of their cost. NAR’s survey revealed that returns on investment for a wide range of high-end interior redecorations dropped in 2007. An upscale bathroom renovation cost an average of $50,590, nationally, but only added $34,588 to house value - a 68.4% return. In 2006, a high-end bath renovation returned 77.4% of its cost.

Adding a brand new bath didn’t pay off as well either, earning just a 69% return in 2007, compared with 72.8% in 2006. High-end kitchen remodels held up better, adding value equal to 74.1% of the cost, compared with 75.9% in 2006.

So, before you go ahead and decide to increase the value of your house, put the numbers on paper and see if it’s actually worth going ahead with your plan.

Trump Tower : Now Open!

Published January 31st, 2008 in Chicago Real Estate. 0 Comments

The highly anticipated opening of the Trump Tower hotel happened yesterday. The 92story Trump International Hotel &Tower was scheduled to open it’s doors to the public last month. The media really overplayed the delay, bashing Mr. Trump and the pompous project.

I think it’s great that the man kept us guessing, whether it was due to legitimate delays or not. It’s a great marketing tool, and sure enough, the buzz created by the media, even if negative, will draw the first crowds to the new hotel. The hotel which occupies floors 1 through 27, has a restaurant called “16″ on (guess) the 16th floor. Completion of the rest of the building is scheduled for mid 2009.

So, whether you live in Chicago or not, book a room and check the extravaganza out. Who knows, maybe The Donald himself will bring you breakfast.

Chicago’s real estate to endure more tax hikes to save the CTA

Published January 31st, 2008 in Chicago Real Estate. 0 Comments

Today, the city’s finance committee is meeting at City Hall to hold a press conference discussing a proposed increase on the city’s real estate transfer tax. A proposed 40% increase will take effect after February 6th, if the votes are favorable. In real numbers, the transfer tax will increase from $4.50 to $10.50 per $1000. This tax is paid by the buyer at closing, even though some argue that it should be split between buyer and seller. Regardless who is paying the tax, this tax hike could not come at a worse time.

While our economy is in recession, the government has to encourage spending, especially in the real estate market to create a balance within the economy. A 25% property tax increase at the end of last year has left homeowners struggling to keep their homes within the city limits, and now we continue to penalize homeowners to save badly managed areas of our local economy.

The mayor and it’s posse want to save an ill run CTA (Chicago Transit Authority) with the increase of real estate taxes. After we can’t afford our homes anymore and we can’t afford the 10% sales tax for goods and services and the gas prices within the Chicago limits, might as well sell our car too and join the homeless in living on the CTA. Oh, but wait, fares on the CTA are going up too. So, for those of us brave enough to face more taxes, we want to thank the Bush administration for the $600 income tax credit, which will help us pay for the real estate taxes, but which we will be taxed on next year around this time……

Scandalous: Using sex to sell real estate properties

Published January 27th, 2008 in Interesting. 0 Comments

Absolutely amazing what people can do with a computer and a little "imagination". Reading some of my favorite blogs, I came across an interesting article on how a real estate agent in Orlando created a video full half-naked female models and posts it on youtube with the following question: can sex sell real estate?

Here comes the twisted part, this agent is a private contractor, responsible for all of his own marketing so basically, he can advertise himself the way he wants it. Apparently, his broker found out about the video circulating on youtube and he is asked to remove the video or simply to resign.

Now, there are at least two-three separate issues here:

1. Do you think that sex can really help you in your sales profession, regardless of the industry you work in?

2. Has the broker's image being damaged because of this extravagant way of advertisement?

3. Does the broker have the right to ask for the video to be removed, especially since the agent is responsible for his own marketing?

Let me start with my opinion before I hear yours

1. Simply, yes, it does. It's unfortunate, but the world we live in is far from perfect and humans are still just humans and I'm just gonna leave it at that.

2. In a way, yes, the broker's image has been affected, but to a certain extent. I'm sure people can distinct a private contractor and a full time employee with the brokerage firm.

3. Well, here is the tricky part. In a way it does have the right, but in the same time, the agent is responsible for his own marketing, so wouldn't you want your realtor to be innovative and bring more business?!

What do you think?

I will post the video, but the video is NSFW(Not Safe For Work), so please be aware of this and handle it properly.

Mortage applications up 28%

Published January 19th, 2008 in Mortgage. 0 Comments

I find it very interesting that the mortgage applications are up again, second consecutive week. Applications rose as interest rates continued to fall.
The average interest rate for traditional, 30-year fixed-rate mortgages fell to 5.62 percent from 5.73 percent. The average interest rate for 15-year fixed-rate mortgages — which are typically used to refinance loans — fell to 5.07 percent from 5.21 percent.
Rates for one-year adjustable-rate mortgages fell to 5.77 percent from 6.04 percent

Happy New Year

Published January 2nd, 2008 in Real Estate News. 0 Comments

I just wanted to wish everyone a Happy New Year and an even better 2008. There are many topics that I will be covering for the next few weeks so stay tuned.

Like always, if you any suggestions or interesting topics, feel free to email me.

 Thank you

Foreclosure Relief Plan

Published December 10th, 2007 in Real Estate News. 0 Comments

Finally, the Bush administration has decided to step in and try to help those that are finding themselves in a foreclosure situation. The new plan is suppose to help 1.2 million distressed homeowners.

There is a catch though: mortgage interest rates will be frozen only for ARM borrowers who are not yet in foreclosure.

Here are a few main keypoints:

  1. The plan will include a five-year freeze on interest rates for borrowers current with their monthly payments, but the freeze is limited.
  2. It excludes anyone more than 30 days late at the time the mortgage would be modified or anyone who has been more than 60 days late at any time within the previous 12 months.
  3. It also only covers borrowers with adjustable rate mortgages (ARMs) resetting beginning in 2008 and leaves out any who are judged capable of continuing to make mortgage payments at the higher reset rates.
  4. Borrowers who can’t afford the loan even at low introductory rates also will be ineligible.

The plan is very courageous but there are too many impediments to its widespread adoption by investors and servicers.

To read the full details on this, go to Money Cnn

How to find a foreclosure property?

Published December 10th, 2007 in Real Estate Tips. 0 Comments

For the past few months, I have been giving you advice on how to manage a foreclosure situation that you might find yourself in. But what if you are on the other side of the fence and you are constantly trying to find a cheap property to invest in? How would you go about finding a foreclosure property?

  1. Check out a couple of the new online services like propertyshark.com, foreclosurefreesearch.com and foreclosure.com . These foreclosure listing sites provide the latest foreclosures in your area and often include the amount owed and the estimated value. Both of these websites provide a free trial so you can test the site out before you commit to their paid service. Very useful websites even though they cost money.
  2. Unless you’re an experienced investor, you should skip for now the public foreclosure auctions. These auctions are mainly controlled by financial institutions so there are slim chances that you will get a good deal on a foreclosure property. The online websites actually have a feature that will show the properties that will go into default. During that time there is a brief window to negotiate directly with the property owner which is your chance to get the property before it even hits a public foreclosure auction.
  3. First thing you should do is to get in touch with the default property’s owner. If they have a lawyer, feel free to contact them as well. Your goal here is to ask the owner if there is any way to negotiate a purchase of their property before it goes into auction. Remember, DO NOT only negotiate with the lawyer because he basically has no interest to work out a deal before the property goes into foreclosure.
  4. If the owner is willing to work out a deal then the next step is to negotiate the price and terms. There are a few occasions when the owner might want to partner up with you. How does it work? Well, you can start by paying the mortgage-backed payments to get the loan out of default. Once you fix up the house and sell it, you give the owner a check for a portion of the profit.

Of course, there are many other way to get a foreclosure property and the amount of websites that offer these kind of properties are increasing every day, but the above points should be a good starting point for you.

Home prices continue to fall

Published November 28th, 2007 in Real Estate News. 0 Comments

While Chicago home prices don’t seem to be affected much by the continuing price decreasing that we see throughought the country, it is still obvious that the housing market continues to be unfavorable to people looking to sell their property.
The median single-family house price in the United States fell to $220,800, which was down 2 percent from a year ago. Condo prices showed some resiliency: At $226,900, they rose 2 percent compared with 12 months ago.

The biggest decline in sales appears to be concentrated in areas that had significant levels of speculative investment, including Nevada, Florida and Arizona,” Lawrence Yun, NAR’s chief economist, said in a statement.

Most declines occurred either in once hot markets or Rust-Belt areas clobbered by economic setbacks and job losses, like Detroit and Cleveland.

Regionally, the best performing area was the Northeast, where the median home price rose 3.2 percent to $286,300. In the Midwest, the median price, at $170,800, was up 0.5 percent. Prices in the South fell 3.6 percent to $180,800, and in the West, they dropped 3.8 percent to $338,100. But the top performer house market is  San Jose, Calif. where prices grew 9.4 percent over the past 12 months to $852,500.

Foreclousures: How to save your home

Published November 28th, 2007 in Mortgage. 0 Comments

A few months ago, we wrote an article on how to save your home if you are in a foreclosure situation. The article had a great impact at that time since the economy was shaking at the latest reports on foreclosure numbers. Yesterday, I was browsing the Money CNN section and I came across an interesting article about a family in Cleveland that managed to dodge the bullet and save their home.

As I have mentioned before, it is always wise to talk to your lender and try to work things out, they are in a position to help you and they would rather have you keep your house than to sell it in a foreclosure auction.

Read the article, it is very inspiring.
When Darlene Stutzman visited the offices of the East Side Organizing Project, a community advocacy group in Cleveland, she didn’t know if she’d be able to keep her home.

She showed up on a Wednesday - “intake day” - when ESOP offers group and individual counseling for borrowers trapped in bad loans. With qualified borrowers, they can also try to work out a compromise with lenders. The Wednesday sessions are well-attended with as many as 150 people showing up at their peak. Cleveland has one of the highest numbers of foreclosures in the nation.

Stutzman, a young wife and mother from suburban Parma, and her husband, Michael, got in trouble when he got sick and had to take an unpaid leave from work. She found out about ESOP when she called Cleveland’s 211 government resources line. Michael, who was back at work, was unable to join her for the counseling session.
Fixing foreclosure’s ground zero

The first step Stutzman took at ESOP was to fill out a “Hot Spot Card” that asked questions such as: “Are you up to date on your loan?” “How much can you afford to pay each month?” and “Is your loan in foreclosure now?”

She and a group of five others then listened as counselors James Jones and Samantha Williams told them what ESOP could — and couldn’t — do for them.

They learned the organization has partnerships with 25 different lenders. If a home is in foreclosure, ESOP may be able to halt the process almost immediately. Jones told them how their loans might be restructured for affordability.

But the best outcome some borrowers could expect, explained Jones, would be a short-sale or deed-in-lieu, where they’d lose their home, but without the black mark of a foreclosure on their credit history.

After the group session, the clients received individual attention. With her mortgage documents in hand, Stutzman met with counselor Jenelle Dame to go over her “Hot Spot Card” and answer other questions about how and why she got behind.

Previous brushes with payment problems, including a bankruptcy, had left her and Michael with less than perfect credit when they bought their house for $119,000 in April, 2006. But Michael had a good job as a machinist, and they were able to get financing from Countrywide Financial (Charts, Fortune 500).

Their first loan was a $97,000 adjustable rate mortgage (ARM) with interest of 8.75 percent, which is fairly expensive. The second mortgage, for $24,290, was a home equity loan at 12.875 percent. The Stutzmans paid about $1,250 a month, including taxes. And then the interest on both loans was set to reset at a higher rate, which would drive their monthly payments up substantially.

Stutzman said Countrywide told them that after a year, they could combine the two mortgages and refinance into a fixed rate. But because of Michael’s health problems, he had to take an unpaid leave. The Stutzmans fell behind on their payments, and because they were in default, the lender would not make a deal.

Read more 

Real Estate Agents are increasing their fees

Published November 12th, 2007 in Real Estate News. 0 Comments

During the housing boom, home sellers were in the driver’s seat with real estate agents circling around their property and they were offered very low commission rates. These times seem to be old gone and the roles have changed a bit.

According to Steve Murray of Real Trend, the average commission rate in 1991 was 6.1%. Ten years later, the average dropped to 5.4 and starting in 2005, the 5% rate was common among realtors. Everyone expected the rate to go even lower but when the housing bubble has burst, many houses found themselves sitting on the market for long periods of time. Therefore, the average commission in 2006 has increased to 5.18% .

According to recent surveys, many home owners believe they can sell their homes quicker by hiring the best real estate agents but those sales people come with a premium. I

n this case, the added percentage might actually help the realtors in the short run and even if the sales volume has dropped, their income might be steady.

Slow market? Turn to technology

Published November 12th, 2007 in Marketing Tools. 0 Comments

As homes stay on the market longer and longer, with more and more of them for buyers to choose from, a growing number of agents aren’t merely getting property details into the Realtor multiple-listing system and hoping for the best. All the technological advances made during the housing boom years - when a low-tech “for sale” sign seemed to be enough - are really being put to use now.

Many realtors decided to focus their attention on real estate blogs or social networking sites. One good example is Facebook which seems to be a very popular advertising method.

Video walk-throughs of homes are also more common - in part thanks to YouTube, which makes it easier to upload the finished product and put it on other sites. If you haven’t tried this, then you really don’t know what you’re missing. The youtube’s users base is extremely large and it is perfect for marketing purposes.

Here is an interesting article that talks about the Realty Market going high-tech

Create flyers on Facebook

Published November 12th, 2007 in Marketing Tools. 0 Comments

Facebook recently added the ability for anyone to create flyers which is accessible under the advertise link at the bottom of any Facebook page. After creating the flyer, the first thing anyone should do is to check out the cost per impression(CPM). Basically, your flyer gets serverd up in the inventory for the targeted network of your choice. It kinda works this way:

-if you buy 10,000 flyers in 5 locations over seven days, the flyer will be seen in each city 2000 times a day for the full week.

The full cost for this will be $140, not bad at all for that much exposure.

If you have launched a new business, brokerage or a new real estate site, then you could advertise it this way for example.

Here is an example on how Facebook helped increase traffic on a blog.

Rod Boothby from SocialMediaToday.com

Trulia comes to help the realtors

Published November 12th, 2007 in Marketing Tools. 0 Comments

Trulia really didn’t show much love to the realtors. Instead the brokers receive most of the attention and tools to market their business. Trulia had offered very little marketing tools to the real estate agents, of course, Trulia Voices is a wonderful way to communicate with potential buyers or sellers but most of the people that visit trulia.com are interested in one thing: to buy properties. Recently they have decided to change that.

With the release of Agent Featured Listings, real estate agents can brand their listings. Even though this first release lacks many other functionalities, it’s a start and at least now all the realtors have the options to add a photo and contact information to their listings.

Agents will have access to a self-service tool to highlight up to 10 listings per month for a monthly subscription fee of $50. For less than the price of a typical newspaper classified ad, agents can now highlight their listings and connect directly to more than 2 million unique users per month.

More information from Trulia’s Blog

6 Space Saving Tips

Published October 28th, 2007 in Real Estate Tips. 0 Comments

There are many upgrades that will simplify your life and boost the saleability of your home but most of the time the simple things are just overlooked. Here are some tips on how to maximize the space in your house and make more more room.

1. Closet organizers - Canvas sorters

The simplest way to expand closet space is to buy sweater cubbies that hang from the closet rod, back-of the-door shoe compartments and storage boxes for the shelf and floor.

Price: $100 to $400 (for an eight-foot-wide closet)

Where to buy: $12 to $22 canvas bags from StacksandStacks.com

2. Closet organizers - Wood system

This setup looks professional, but be ready for a major project. You must first assemble boards into shelves and then hang them on the closet wall. For strength, go with boards that are three-quarters of an inch thick, not five-eighths of an inch, and a wood veneer or at least melamine (white laminate) finish instead of painted particleboard

Price: $400 to $1,000 for melamine and $800 to $1,600 for wood veneer

Where: EasyClosets.com

3. Closet organizers - Metal system

You can arrange these metal shelves and baskets in nearendless ways. European makes like Elfa (sold only at the Container Store) are higher quality than domestic products but pricier.
Metal shelves are easier to install than wood systems. Still, buy an electronic stud finder ($10 to $30) to ensure that your screws hit pay dirt, because the whole heavy array hangs from a single horizontal track

Price: $500 to $2,000

4. Cabinet organizers - Rollout trays

Install one and you’ll never have a hard time reaching the back of a low cabinet.
Look for a wood or chrome-plated steel tray with full-extension glides (so that it pulls out all the way) and at least four screws to hold it in place.

Price: $40 to $100 each

Where: organize.com

5. Cabinet organizers - Drawer inserts

Make all your silverware and odds and ends neat and easy to get to. With adjustable drawer inserts, you can move the dividers around to fit your needs.
Custom drawer inserts cost more but deliver a lot more too. The drawer insert and the dividers are sized to order, so you can accommodate odd-size drawers and supplies.

Price: $10 to $15 and $70 to $250 for a custom divider

Where: KitchenSource.com

6. Cabinet organizers - Corner Susans

This add-on will make that impossible-to-access cornercabinet usable.
Be careful to get the right configuration - full round, pie cut or half moon - for your cabinet’s shape

Price: $150 to $250

Where: Revashelf.com

Another sign of weak housing market

Published October 28th, 2007 in Real Estate News. 0 Comments

Number of vacant homes on the market nationwide has reached the 2 million mark. The number of vacant homes for sale rose in the third quarter, according to the latest government reading that casts new harsh light on the weakness of the housing market.

The Census Bureau report puts the number of vacant homes for sale at 2.07 million in the period, up about 2 percent from the second quarter, and 7 percent above year ago levels.

The number is down 5 percent from the record high reading reached in the first quarter, though.

For purposes of comparison for the current situation, imagine the Detroit metropolitan area, which the Census Bureau estimated had 2.08 million households in its 2000 Census. Now picture virtually every house or condo empty, with a for sale sign in the front yard of every home, from inner-city Detroit to its suburbs, all the way to nearby cities such as Flint and Ann Arbor.

There are always some homes vacant and for sale, even in a booming real estate market.

Continue reading ‘Another sign of weak housing market’

Great tax deductions for second homeowners

Published October 6th, 2007 in Real Estate Tips. 0 Comments

This is a great time for buyers to invest in second homes. Chicago has an abundance of great condos at good prices with great rental and appreciation potential. Besides appreciation and rental income, second homeowners can add to their income with great tax deductions.

Mortgage, taxes and insurance

  • Property taxes
  • Property insurance
  • Flood insurance
  • Liability insurance
  • Mortgage interest
  • Private mortgage insurance (PMI)
  • Refinance and closing fees

Homeowner’s association

The “Rent to Own” solution for both Sellers and Buyers

Published October 6th, 2007 in Chicago Real Estate. 0 Comments

Inventory is rising, sellers are running out of incentives and buyers are walking away from closings because of financing trouble. We are currently experiencing the effects of a free falling real estate market and one of the solutions for both sellers and buyers could be the “Rent to Own” option. Hardly used in Chicago’s real estate market in the past, -rent to own- seems to be the only option for buyers with blemished credit and sellers with the urgency to sell.

Developers started the –rent to own- craze, after the free plasma TV and the credit for closing costs trend wasn’t helping buyers become homeowners. Those last 2 – 3 units in a development are offered as a –rent to own- option to serious buyers. The trend has been accepted by all sellers that have a hard time selling their property. Continue reading ‘The “Rent to Own” solution for both Sellers and Buyers’

Go “green” and increase the value of your home.

Published September 23rd, 2007 in Real Estate Tips. 0 Comments

Ahhh, the green craze!! Some of you probably don’t know, but western European countries have recycled for decades. We, as a nation are running behind, but it is never too late to start. And I am thrilled that developments are competing for the best environmental friendly condo project. I hope people understand that this is not the next “venti - skim - no sugar vanilla - no foam - iced - chai Latte” fad. To be environmentally conscious is almost mandatory. Green is good and it is even better when it increases the value of your home. I am talking about your yard!

After 5 years of hauling sod from Home Depot and planting seeds, and still harboring a mud pit (having a Labrador doesn’t help), I gave up and finally hired a professional to pave my yard. My reaction, the first time I saw it paved was: “Wow, I didn’t realize that my yard is this big.” I spent about $2000 to pave a 400sq ft yard with two-tone pavers, plant climbing ivy to cover the back wall and plant two magnolia bushes. This improvement has just increased the value of my home. The potential buyer will now recognize that my city duplex comes with great outdoor space for entertaining and relaxation, instead of my lab’s paradise mud pit.

As the housing market continues to weaken sellers are starting to make improvements outside the house to give their home a nice curb appeal. Continue reading ‘Go “green” and increase the value of your home.’

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Cristina Vat…, Real Estate Professional in Chicago

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