• I have a new job offer, should I change jobs? Changing jobs as an upward movement in the same line of work is okay. Changing jobs into a different line of work can be an issue, and changing jobs for less money is a red flag, depending on the circumstances. Regardless of the reason, pay stubs covering the last 30 days will be required for loan approval.
• We just sold our classic car for a pretty high price. Is it okay to deposit that money? Moving money around is okay as long as you can paper-trail the money. If you move it from one account to another it’s pretty easy to show the money coming in and out of the accounts. Making large deposits that can’t be paper-trailed is a bigger issue – for example, selling items from around the house (like a garage sale) and then depositing those funds into the bank. These funds are nearly impossible to prove their source (especially if it’s a large deposit) and, therefore, would not be included in available funds for closing. Literally, the money is excluded from your qualifying assets. Any deposits outside of payroll deposits (usually over a few hundred dollars) need to be sourced from an acceptable source (i.e. no selling drugs to qualify!).
• How much money should I save? Generally, savings of 3.5% of the purchase price is enough to qualify for an FHA loan for Phoenix Arizona Homes. However, saving more money to put down is always a great idea. A larger down payment will allow for a better financing, and the extra money could help with purchase of new appliances and potential repairs at your new home.
• Should I make big purchases before closing escrow? No, no, no – not without speaking to your loan officer first. Large purchases made on credit for a new car, appliances, or even furniture for your new home may push your debt level too high and prohibit the financing of your new home.
• I was planning on taking a trip out of town – is that a good idea? Probably not, if you can avoid it. But if your trip has already been planned for months in advance, our Phoenix AZ Realtors can help work out the logistics. With faxes and email available throughout the world, most escrows can continue while you are away on business – or enjoying fun in the sun.
• I have a bankruptcy, foreclosure or short sale on my credit, can I still buy? Most times when a borrower had a past issue on their credit, a good loan officer will be able to give good advice about corrective steps to take. Most borrowers’ past mistakes may be repaired through the passage of time and by establishing new credit. Situations vary, so speak to a good loan officer about your situation.

As you prepare to begin the process of buying a home, it will help you greatly to make sure that actions you take aren’t detrimental to your financing and buying process. Give us a call today at 480.776.5214 – we will not only help you search through the prospects in the Phoenix MLS, but we’ll also help you strategize and avoid potential pitfalls to financing.

To help you evaluate how well prepared your Realtor is for handling your short sale, have a discussion with him or her about the short-sale process, and be sure to ask the questions below. If you don’t hear the answers or the knowledge and familiarity you’re looking for, be prepared to keep looking for a Realtor that’s equipped to help you.

1. Who is the service company and what do they do in the process? In general, the service company of the mortgage is the name on the mortgage statement you receive every month. Bank of America, Chase and Wells Fargo are common service companies. In most cases, the service companies are only in charge of processing the file and have very little to do in the decision-making process and negotiation of the sale itself.
2. Who is the investor? Fannie Mae, Freddie Mac and Ginne Mae tend to be the investors of the majority of loans. Large service companies such as Bank of America, Chase and Wells Fargo may also be an investor on a mortgage. The investor is usually the decision-maker on each loan and has specific guidelines to follow in negotiating a short sale. Experience in negotiating with different investor guidelines is essential experience for a Realtor to have in order to have a successful close of escrow.
3. Who is the MI company? Not all loans have MI (mortgage insurance), but some do. In the event that there is MI on a loan, you be certain that the MI company is going to negotiate with you (the seller) before allowing a close of escrow. The MI company is generally covering the loss in the short sale and paying out the investor for the loss on the mortgage, so the goal of the MI company is to reduce the lost payout as much as possible.
4. How will each be negotiating with me? This is a great question for an agent. Negotiating with service companies, investors and MI companies is not like negotiating a normal purchase contract. The process is bureaucratic, paperwork-intensive, and detailed. Experience really pays here and a good Realtor will know how to get it done and cost you very little at closing. However, a lack of experience and less-than-thorough paperwork by your agent could result in you writing a large check at closing, or worse, a foreclosure.
5. What are the potential tax consequences? In every short sale, there are potential tax consequences that a seller must deal with. Asking your CPA or tax advisor about your particular situation and possible consequences is a very important part of planning for your future. A Realtor should have some general knowledge of the potential consequences as well as a good reference for you to get further help, but should also encourage you to discuss with your CPA or tax advisor.
6. What are the potential liabilities after closing? Most loans are written as “non-recourse”, meaning that the lender will not be able to pursue you in the future for a loss incurred. However, some loans are recourse loans in which the financial institution may choose to pursue legal and collection avenues for the loss. When working with a recourse loan, there is always future potential liability where you should consult an attorney about the situation and again, a competent Realtor experienced with short sales in the Phoenix Real Estate market will encourage you to discuss the situation with your attorney.

Remember – a short sale is truly a “double-edged sword.” On one hand it can usually offer significant advantages over foreclosure, but on the other hand it requires specific knowledge and expertise to successfully complete. Our Phoenix AZ Realtors have the short sale knowledge and experience to help you succeed – give us a call today!

A “fix-n-flip” property is defined as a property where an investor purchases a home that needs a significant amount of work done to be livable or (or sellable). The investor fixes up the property to almost new condition and then resells (“flips”) the property to a new home owner. The process takes about 90 days or less for the investor. In the ideal world, the investor hopes to make a profit and the new home owner gets a property that is professionally remodeled and move-in ready.

In our current market – with many Phoenix Arizona Homes going to trustee sale on a monthly basis – the investor picks up the property directly from the bank, clears the title and then remodels the home. With the number of trustee sales remaining high, fix-n-flip properties should continue to be a great source of move-in ready homes.

For buyers that don’t want to be hassled with repairs, it’s of interest to note that many fix-n-flip properties may come with granite counters, upgraded flooring, new interior and exterior paint and other nice upgrades.

Beware, though: if the property is considered a fix-n-flip property, there may be some additional hoops to jump through:

• The buyer’s lender will likely require a second appraisal verifying the home value.
• The second appraisal will be charged to the seller who may not want that additional expense.
• The buyer’s lending underwriting will require review of the property inspection.
• Currently, only one lender in the valley is offering financing on fix-n-flip properties – which is limiting financing options.
• Processing the loan usually takes longer than the traditional 30 days, and may take up to 45 days.
• The buyer’s lender will require the seller to perform repairs before approving the financial package.
• Some sellers over-improve the properties. By paying too much to improve the property, the seller may be unable to sell the home for the amount of money invested.
• Many times a buyer will need to plan for backyard landscaping, the purchase of window coverings and blinds, and other move-in items.

Are you wondering if a fix-n-flip property is right for you? Are you in need of an expert to navigate the process and protect your interests? We at the Thompson Group are ready to help. Our  Phoenix AZ Realtors are experts at working the Phoenix MLS  specialists in helping comb through Phoenix Homes for Sale to find just what you’re looking for. Contact us at 480-776-5214 or www.ThompsonGroupAZ.com today!

The list of downsides for the Short Sale are numerous: tons and tons of bank bureaucracy to work through, super-long escrows lasting three times as long as a normal escrow, waiting for bank negotiators for days on end, real estate agents who may not know how to operate in the banking world. Last but not least – the seller’s bank is always able to say no.

On the other hand, the bank industry is dramatically improving processes required to complete short sales in a timely manner. Large national banks such as Bank of America, Chase, Seterus, Wells Fargo and CITI – which received black eyes in the past for poor performance – are now able make decisions in less than 90 days if provided the proper paperwork. Even smaller regional banks such as MetLife, Green Tree, Desert Schools, Provident Funding, and American Home Mortgage Servicing are also showing improvement. With Fannie Mae and Freddie Mac – the two largest holders of mortgages – continuing to implement short sale support, short sales of Phoenix Real Estate continue to improve on closing ratios.

With that silver lining in mind, remember that a short sale is not a foreclosure! Completing a short sale is an option to unload piles of mortgage debt. A well-planned short sale should include legal, tax and credit planning. With the correct planning, a homeowner may be able to qualify for a new home in as little as two years. And as a rule, banks are approving 90% of short sales of sellers with viable financial hardships.

And, don’t forget that the Home Affordable Foreclosure Alternatives is paying homeowners for completed short sales. Do you qualify? Contact us today at 480-776-5214 or www.ThompsonGroupAZ.com and one of our Phoenix AZ Realtors with extensive Phoenix MLS experience in the short selling of Phoenix Homes for Sale can help you find out.

• Be Prepared – Do anything up front that can help prepare for fast decision-making.  Getting homework items out of the way up front should also allow for better decision- making at the time of contract.  Completing items such as loan prequalification with a lender, completion of real estate disclosures, and anything else that would prevent the writing of a real estate contract will allow your Realtor more time to focus on getting and presenting your offer to purchase a property.
• Avoid Under Priced Homes – Unfortunately, in any market there are items that are overpriced and items that are under-priced.  A savvy Realtor should be able to point out the overpriced and under-priced properties.  With low inventory, under-priced properties inevitably end up in bidding wars.  By focusing on properties priced more at the market, home buyers are likely to avoid the bidding war and get better terms in the contracts that are negotiated.
• House Shop During the Week – In real estate the primary time for buyers to shop Phoenix Homes for Sale is Saturday and Sunday due to weekly work schedules.  However, most buyers forget about that lunch break or an extra 30 minutes before or after the work day where the viewing of a couple of properties is possible.  Many times buyers can get a hot property under contract before the weekend and before any other buyer ever sees the home.
• Don’t Hesitate – Last but not least, when you see that great property, don’t hesitate.  While one buyer is hesitating, another buyer is likely to be writing the contract.  If it is a Saturday or Sunday, then there could be two buyers writing a contract.  However, if you hesitate and don’t get an offer accepted on a home, asking why you hesitated is a great idea!  Solving the reason for the hesitation will likely yield a better decision when the next fantastic home comes on the market.

Maybe you are a first-time home buyer needing help understanding the logistics of your first home purchase.  Or, maybe you are looking to move up to a bigger, more spacious home.  We at the Thompson Group pride ourselves in helping you search the Phoenix MLS to find that special home that will be enjoyable for years to come!  Please contact any of our Phoenix AZ Realtors for your private, no-obligation consultation at www.ThompsonGroupAZ.com or 480-776-5214.

Basically, the home owner had three options.  He could:  (A) turn down the out-of-state job and continue to look for local employment; (B) walk away from the home and give it back to the bank in foreclosure; or (C) pursue a short sale of his home.  In the end, the homeowner decided to pursue a short sale.  Here is why:

• Credit Implications: One of the biggest reasons to pursue a short sale is to lessen the impact to your credit that occurs due to foreclosure.  Missing a mortgage payment is one of the most damaging acts a consumer can do to their credit rating.  Missed mortgage payments continue to damage your credit until the sale of the home is complete.  Once a short sale or foreclosure is complete, you are no longer missing mortgage payments and continuing to damage credit.  The trick to lessening the impact is to get the sale completed sooner!  By pursuing a short sale, missed mortgage payments should be greatly reduced as opposed to waiting for the bank to complete a foreclosure.
• Legal Implications: In this situation, the seller had two loans on the home.  If the homeowner let the home go in foreclosure, then the non-foreclosing lender would be able to pursue the homeowner directly for a deficiency judgment.  By pursing a short sale, the homeowner is able to get protection from any future deficiency litigation.
• Tax Implications: Whether through a foreclosure or a completed short sale, a mortgage lender may write off the loss and send the homeowner an income tax bill for the amount of the loss.  In our situation, the homeowner was able to plan in advance with tax specialists to help minimize the impact from this income tax bill.
• Avoid Foreclosure Implications: A foreclosure may stay on a homeowner’s credit record for 7-10 years and is sure to be a potential source of embarrassment.  A foreclosure could also affect the ability to get future employment and security clearances.  A foreclosure can also prevent the purchase of new Phoenix Homes for Sale for 3 years or more.  For this homeowner, avoiding the negative stigmas of foreclosure was a very important reason for pursuing the short sale.
• Potential Relocation Payment: Through Home Affordable Foreclosure Alternatives (HAFA) and Federal Housing Administration (FHA) many homeowners are receiving relocations expenses of up to $3000, if they pursue non-foreclosure alternatives.

At The Thompson Group, we believe a well-planned short sale of Phoenix Arizona Homes should present significant advantages for homeowners who need to sell.  (Always consult legal, credit and tax experts.)  Do you wonder if you qualify?  Contact any of our Phoenix AZ Realtors to find out at www.ThompsonGroupAz.com or 480-776-5215.

• Overall Home Supply – DECREASING. For the entire Phoenix MLS at the end of September, the total number of active real estate listings is 26,970 while the number of sold listings for September is 7,911. At the end of the June quarter, the total active real estate listings were 30,618. From quarter to quarter, the Phoenix Real Estate market is showing a 12% reduction in inventory of Phoenix Homes for Sale. (The surplus is finally being reduced!)

• Local Zip code of 85224 – HOT! The Chandler zip code of 85224 shows that in September there were a total number of 159 active real estate listings, with the total number of sold listings coming in at 82. In other words:  there’s less than a two-month supply for this popular zip code of homes for sale.

• City of Chandler – EVEN HOTTER! For the entire city of Chandler, the number of active listings in September single family homes between 1200 and 1500 square feet that was 167. The number of sold listings in September came in at 89 – leaving just a 1.9 month supply of homes for sale. From 2^nd quarter to the 3^rd quarter, the city of Chandler continues to show less than two months of inventory making Chandler one of the hottest Valley cities for a new home purchase!

• Overall Phoenix-area Year-to-Date Home Sales – 10,000 MORE?! During the nine-month period ending in September 2010, the number of sold real estate listings was 68,663. For the same period this year, the number of sold listings is 78,473. That’s right: nearly 10,000 more homes sold for 2011 than in the previous year.

A reduction in home inventories, both local and Valley-wide; fewer homes on the market; more homes actually selling – these are all good signs of a reviving real-estate market. We’re finally seeing some concrete relief to the market stagnation – which bodes well if you’re contemplating selling your home.

Do you need to consider a short sale to unload a burden of debt? Or are you looking to maximize your selling price? Here at the Thompson Group, the goal of our Phoenix AZ Realtors is to show you the BEST options for your situation. Give us a call at 480-776-5214 or  find us at www.ThompsonGroupAZ.com .

• Disclosures – In Arizona, the real estate contract calls for the seller to make seller property disclosures, insurance claims disclosures and to delivery a copy of the title report for review. Each should be delivered within five days of contract and each allows for a review period of five days.
• Lead-Based Paint Disclosure – If the buyer is purchasing a home built prior to 1978, the Arizona contract allows for a 10 day risk assessment or inspection period. The risk assessment period begins upon delivery from the seller of the Lead-Based Paint Disclosure which may happen as late as 5 days after contract acceptance or requiring a full 15 days to determine Lead-Based Paint risk at a property.
• Home Inspections – Most buyers prefer to have a general home inspection and a termite inspection of a potential home purchase to uncover unseen problems. While most home inspections don’t turn up deal-breakers, some issues can arise such as termites, roof replacements or mold. When these larger repair issues arise, the buyer and seller generally will have a second negotiation as to who will cover which repair costs. When selling Phoenix Arizona Homes, the Arizona contract calls for this 2^nd negotiation to begin no later than 10 days after acceptance and to end at 20 days after contract acceptance.
• Home Owner Association (HOA) Disclosures – While the Arizona contract calls for delivery of all HOA information to the buyer, state law allows HOAs 14 calendar days from the time of the request to delivery to provide all necessary information. Normally, the title agency involved will make the request for HOA documents at 5 days after contract acceptance, so delivery of these documents may not happen for 19 days.
• Cash or Financing? – The good news here is that if a buyer is paying cash and does not need financing, close of escrow can happen as soon as all above items are complete and the buyer feels comfortable. In Arizona, some buyers may close within 10-15 days if all vendors are on top of their game. However, if a buyer requires financing, closing may happen as soon as 23 days for conventional loans and 30 days for FHA loans. Situations do vary, so be sure to consult your Arizona mortgage consultant to determine how long of a close of escrow will be needed.

So… are you:

• Tired of just reading and talking about a new home purchase?
• Itching to get started finding that special home?
• Ready to find out how to get a great deal?

…then the Thompson Group is ready to help!

Our Phoenix AZ Realtors are specialists in combing the Phoenix MLS and knowing the Phoenix Real Estate market to find the perfect home for you. Don’t wait! Give us a call today at 480-776-5214 or www.ThompsonGroupAZ.com to get going and find your new home.

• Buyer Loan Costs. With the current distressed market, many buyers like to write offers asking for the seller to pay their loan costs. And if the overall contract sales price is right, paying the buyer loan costs might be well worth while. Generally, the request is made as 3% of sales price, which initially may not seem high. However, when considering a sales price of $150,000, 3% of sales price works out to be $4500  – not a small sum of money. Instead, consider offering a compromise: have the buyer pay only half of the loan costs.
• HOA Transfer Fees. Did you speak with your home owners association (HOA) before listing your home? The amount your HOA will  charge to transfer the property to a new buyer is great information to know. In some situations, HOAs have charged $500 – $1500 to transfer the property. With HOA transfer fees being a negotiable item, a seller may be able to pass this cost on to a buyer.
• Home Warranty Costs. As a general rule, buyers of Phoenix Homes for Sale expect sellers to pick up the cost of a Home Warranty. The Home Warranty will cover the buyer for one year in case some of the working components in the house break. The home warranty also protects the seller from being pursued by a buyer who feels that an A/C unit, hot water heater, or other expensive item died prematurely. A typical, basic Home Warranty plan will cover most items and can be obtained for under $350. But watch out – some buyers will ask for plans that can cost up to twice this amount.
• Appraisal. Did you and your real estate agent have a conversation about what price the property is likely to be valued by an appraiser? Will your home appraise for the sales price on the contract? Over and over again, I see sellers accept contracts for sales prices that have no chance of being supported by appraisal. Many times, after about 15 days into the escrow, the appraiser may submit an appraisal for thousands less than the contracted sales price. With the seller having planned a move, packed up the house and secured a new place to live, the seller is generally between the proverbial rock and a hard place. They’re forced to wonder: “Do I accept the new sales price or cancel the move?” Keeping in mind that most sellers are moving for significant life reasons such as job transfer, bigger home or changes in lifestyle, the seller generally must accept the financial change or give up on the reason for moving.

In most cases a little upfront planning will help net more money for sellers when the contract arrives. Asking the right questions and getting the right information can be crucial. Do you have more questions? Do you want to learn more about this or other ways to get the most money from the sale of your Phoenix Arizona Homes? Our Phoenix AZ Realtors can help. Contact us at (480) 776-5214 or www.ThompsonGroupAZ.com .
 

Unlike most purchases in life such as a TV, car, boat, or RV, the enjoyment of a Phoenix Real Estate

purchase has a whole lot more to do with location and the neighborhood than most realize. Crime statistics, schools, proximity to parks and freeways are just a few important details that are controlled by the location of your home. Not to mention the quality of your neighbors! These factors all add up to determine value of your home will appreciate in the long term.

So, when determining the neighborhood you would like to live in, first consider its overall location approximate to your job as well as schools, public transportation, shopping, museums, theaters and other attractions that might interest you. Consider the major pluses and minuses of the location, before narrowing to specific neighborhoods. If you are too close to an airport, jail or superfund site, then you might want to review other locations. If you are finding good freeway access, your favorite restaurants, and are able to manage the commute to work, then you may be narrowing your search to a great location.

In a general location, there can be 10-100 different neighborhoods. Some will be fantastic and some will not! One great way to learn about your location is to drive around the neighborhood and talk to residents. If you find a higher volume of smart soccer moms you might find a strong indication that the long term value of the neighborhood is headed up.

As you are pinning down your favorite neighborhoods, view lots of homes in those neighborhoods. Builders tend to build the same floor plans when developing neighborhoods, so if you don’t like the floor plan in a neighborhood or are not finding what you like, then keep looking for new neighborhoods. However, if you find home that is perfect floor plan but lacks in other qualities, take note! Even though one house may not be  your perfect home, if you like the floor plan, a new property could be coming on the market that may have the other qualities you will love.

Some other great questions to ask about your Phoenix Arizona Homes neighborhood:

• Where are the closest parks?
• How good are the local schools?
• What is the neighborhood like at night?
• Do all the homes have large lots or small lot sizes?
• Are there any special features that draw you and others to the neighborhood?
• Does it include all of the minimum amenities for your lifestyle?

After you’ve narrowed your search down to a few great neighborhoods, we will help point out the pros and cons of each home from a professional standpoint. Once we weed out the homes that do not interest you, we‘ll  consider the details of the ones you like, including the amount of work that needs to be done if you purchase the home. Does anything need to be repaired or replaced? Find out if the seller will do these things or offer an allowance for the buyer to do them. If you are happy with the details, we should go back to the final contestants for a second look. This will help us select the perfect home for you. Don’t be discouraged if you don’t find what you want right away. On average, buyers of Phoenix Homes for Sale will walk through fifteen houses before selecting one.

Are you ready to start looking for that special neighborhood? Need assistance searching the Phoenix MLS? We can help! Please feel free to contact me – or any of our Phoenix AZ Realtors – with any questions or concerns. We can be reached at 480-776-5214 and ask4jamie@cox.net.