Choosing an Appraiser

More often than not, an appraisal is required by a lender. But as a homeowner, you can decide to get an appraisal on your own, if you wish. Homeowners who order an appraisal usually do so because they want an expert opinion to help them set a price for their home.

If your lender tells you that you need to get an appraisal to get a loan, be aware that you do not have to go with an appraiser that your lender picks. You are allowed to choose another. An appraiser generally charges several hundred dollars to inspect and write an appraisal of your home.

When choosing an appraiser, you should find out if that appraiser is both licensed and certified in your state. Visit http://www.asc.gov/, the website of the Appraisal Subcommittee. This website has a national registry of appraisers.

If you get an appraisal and suspect that it is not accurate, you do not have to accept it. You can get a second opinion from another appraiser. You can also file a complaint with your state's appraisal board or similar agency.

Home Appraisal Industry is in the News

Right now people are looking at the home appraisal industry since the Associated Press and other group turned a critical eye on home appraisers.

In this less that stellar real estate market, appraisals are being increasingly important. Most lenders want to see the results of an appraisal before they will agree to give a buyer a loan.

Note that an appraisal is not a home inspection. Home inspectors are more concerned with function--does the air conditioning system work properly, will the drainage system drain rainwater as it should? An appraiser is looking more at form--how many square feet, how does this home compare to others on the market? Home inspectors are concerned with you ability to live in a home after you buy it. An appraiser’s work is more connected to the actual sale of the home.

An appraiser is tasked with making sure they come up with an unbiased assessment of a home’s market value. Unfortunately, some appraisers say they have been pressured by a bank or a real estate agent to assign a home a higher value than it may be worth.

What Defects Must You Disclose?

As a seller, you are responsible for informing a buyer of your home’s problems or defects. If you decide to not to inform a buyer of serious defects, you leave yourself open to be sued later. Even if you sell your house “as-is” you still have to tell the buyer about serious problems with the property..

While it is not necessary to give potential buyers a list of every possible defect in your home, there are some major issues that you must disclose. One of the best litmus tests for disclosures (outside of those things that are required by state and federal law) is to ask yourself if this is something you would want to know about a property you are considering. You can also ask seek the advice of a qualified real estate professional. In fact, some real estate companies will ask you to fill out a disclosure form before they agree to represent you.

One thing you really cannot keep from potential buyers is the possibility of a toxic substance. You need to be honest if the following are present in your home:

Lead
Radon
Carbon Monoxide
Formaldehyde

Home Staging Your Kitchen

When it comes to home staging, you must consider every room in your home. So don't neglect the kitchen. It is the heart of the home. People spend a lot of time in their kitchens (whether they actually cook or not). If your house has an open kitchen, then you really cannot afford to leave it untouched as you set the stage in other parts of the house.

The thing about home staging is balance. If you clear everything out, the rooms will look barren. And if you get too fancy, potential buyers will be turned off and unable to see themselves actually living in the house.

Here are some tips:

-Give the kitchen a thorough scrubbing, so it shines.

-Avoid cooking odors. Go out or bring food home before open houses.

-Don't leave cleaning products in sight.

-Clear the refrigerator of excess notes, magnets, etc.

-Put new handles or knobs on cabinets to give the room a lift.

-Don't leave dirty dishes in the sink or dishwasher.

-Arrange cups and plates in a pleasing way. When buyers open cabinets (and they will) orderliness will have a positive effect on them.

-Put out a bowl of fresh fruit or a pretty bottle of oil, vinegar or wine.

Don’t Hesitate to Approach Your Bank to Negotiate

Real estate experts advise sellers who think they are headed toward foreclosure to get in touch with their lender. It is in these seller’s best interest to come to some sort of agreement with the lender, be it forbearance or an agreement that in some way lets you get more time to pay.

When you are afraid of losing your property, you may start to see the bank as a predator who wants to come in a rob you of your home. But what you have to remember is that banks are not real estate companies. A bank’s primary concern is money, not property. Financial institutions want to make sure that the money they lend is repaid. In these hard economic times, banks have a higher number of homes because of so many foreclosures. For this reason, a bank may be more willing to work out a deal with you. The bank may not want to have yet another home that it must find a way to sell.

You do not have to approach your lender alone, however. Get the assistance of a qualified real estate professional. If you are in Maryland and need help, send an e-mail John Day.

Trump Helps McMahon Avoid Foreclosure

A little while back I reported that Ed McMahon was one of the celebrity faces connected to the foreclosure crisis. And now I am happy to report that Ed McMahon will most likely be able to keep his home.

Donald Trump has stepped in to save the day. But he is not paying for McMahon's home outright. Instead, Trump has agrees to buy McMahon's home and lease it back to him. Although the impending deal has yet to be completely finalized, the fact that the two parties are talking about it in the press means that it is very likely to go through.

At one time, the home's estimated value was $7 million; it was recently listed for a $4.6 million price tag.

Many people out there do not have the celebrity cache to attract the attention of Donald Trump, but that does not mean you have to lose your home. Seek the advice of a qualified real estate professional. If you are facing foreclosure in Anne Arundel County, Calvert County, Charles County, or Prince George's County call John Day at 410-507-2909--he and his team are happy to help.

Changes to the Laws for Reverse Mortgages

Homeowners who are at least 62 years old can borrow against the equity in their homes using a reverse mortgage. Instead of having monthly mortgage payment, they would not have to pay the money back unless they sell, move somewhere else or pass away. In order to get a reverse mortgage, one must own the home or have a rather low balance left on a mortgage.

Once it has been arranged, the borrowers can get the loan money in several ways: as a lump sum, in fixed monthly installments or as a line of credit that they can tap into at will.

This year's Housing and Economic Recovery Act has altered the rules for reverse mortgages in an attempt to help seniors who may need such a mortgage to buy long-term health insurance or to increase their incomes. The loan amount has been increased and there is special consideration for those who live in areas where the cost of housing is above average.

You can visit the National Reverse Mortgage Lenders Association website to learn more.

Finance Expert Finds He Needs Real Estate Expert

I recently read an article by a personal finance reporter who was loathe to admit that he felt helpless with the recent changes in the housing market. He felt as if he was the one who should have had all the answers, but he didn't. It turns out that his wife, who was not the expert in personal finance knew a thing or two that he did not. But even his wife was unpleasantly surprised at how they much they had to lower their price.

He balked when she wanted to spend money on what he felt were unhelpful plants and other cosmetic touches. As it turns out, those extra touches were something that the family who eventually bought the house really appreciated.

Both the reporter's real estate agent and a friend who worked in real estate advised lowering the price. The reporter and his wife resisted, but they gave in and the house did sell.

Sometimes real estate takes a team approach. The writer says that he real estate agent left no stone unturned. The real estate agent's work, combined with his wife's extra touches (things he thought were unnecessary) were what got the house sold.

Condo Foreclosure

When the owner of a condominium can no longer make mortgage payments, that property can go into foreclosure just as any other property can. For condos and other properties tied to an association, one owner's loss can have a big effect on others. This is not to say that a block or neighborhood remains unaffected by foreclosure, far from it. But when a condo unit goes into foreclosure, the rest of the unit owners lose money immediately in the form of condo fees and the ability to collect special assessments.

If you live in a condo and find that a unit owner is headed towards foreclosure, be aware that the association does not automatically get ownership of the foreclosed unit. The condo association still has to come to some kind of agreement with the bank who lent the unit owner the money to purchase the condo. More often than not, the bank will be willing to accept the deed to the property to avoid going through with the foreclosure process. So the condo no longer belongs to the unit owner; the property is now in the hands of the bank until it is sold to another owner.

If you decided to buy a bank-owned condo, you should investigate whether the former owner still owed the condo association in assessments and fees.

An Experienced Realtor Can Help in A Slow Economy

Depending on where you live, you may have bought your house during a housing boom. You might have paid more than you wanted to with the hopes of selling it at an even higher price in the future. Or you may have purchased your home before the boom, but you watched its value rise steadily. You held onto your home and for whatever reason did not sell because you knew it would be worth even more in the coming years.

Now that property values are not rising as they were, you find that it is time to sell your home. But you don't think you can get the price you really want. What do you do?

Some real estate experts are telling people to cut their losses. Their advice is to accept that your home will probably sell for less than you'd like. Because of overbuilding and stricter lending practices, home sales have gone down.

All is not lost. There is a good chance that your home will not sell for a price that meets your highest ideals. But your home does not have to sit on the market forever and you don't have to sell it for pennies on the dollar. Seek the advice of an experience real estate agent, like John Day. You'll be able to maximize your profits, even in a slow economy.

Trading Spaces, pt. 2

On Monday, we discussed an incentive that builders rarely used in the past, but are employing more and more: the trade-in. It is something like when you really want or need a new car and are willing to hand it over to the dealer for a low price.

Trading in or selling your home to a builder in exchange for a new one is a deal that is sealed at a simultaneous closing." So you sign papers to sell the builder your old home and sign papers to buy a new one from them at the same time.

As with any real estate deal, you should do your homework and work with a competent real estate professional if you want to trade in your home. Be certain that the price being offered as part of the trade is something you can live with. Make sure you know what your home is truly worth on the market and be wary if they offer to take it off of your hands for a price that is extremely low. If the builder wants you to use a certain financial institution, check out the costs of the loan and look for any hidden fees.

Trading Spaces, pt. 1

For anyone who is contemplating a new home purchase, the thought to having to carry two mortgages at once is quite daunting. This is why some builders are offering to let home buyers trade-in their former homes. Builders realize that although you may be in a position to buy the home they've recently built, you may be not be able to do so if you cannot sell your current home in this market.

Most often, a builder will agree to buy your home for a specified price once you close on a home they've built or sign a contract to have them build you a new home.

You should know that trade-in incentives for home sales aren't standard practice. But in these uneasy economic times, people are getting very creative.

You should also know that when you agree to let a builder buy your home, the price you'll have to agree to may be less than ideal. At the same time, some buyers are willing to take the guarantee of a (most likely) lower price if they have spent or foresee spending months being unable to sell their home.

Remember That the Customer is Always Right

You've heard that saying "the customer is always right." And when you are in a store, you definitely want the merchants to go by this rule. But are you doing the same as you prepare to sell your home?

In your desire to sell, you may forget the people on the other end of the transaction. Some sellers make the changes that they wish they had already made in their homes, assuming that buyers will share this view. But you really cannot be sure about what will entice potential buyers.

Before you make major repairs or do a huge renovation on your home, take the time to find out what people in your area are looking for in a home.

You can:
-ask your real estate agent and other agents you know to talk to you about what buyers tell them they want

-Go to an open house yourself and take note of how the houses look. Pay attention to what you like and what you don't like.

-Drop by some model homes and see what amenities and layouts they feature and seem to really push.