Di Kawell Real Estate Blog

Don't Get Ripped Off By Foreclosure 'Rescue'

If it sounds too good to be true

For people who are going through foreclosure or are about to they need to know that things can get worse.  Foreclosure rescue scams have become the flavor of the day.

The ads look or sound something like this:

"Stop Foreclosure Now!”

“We guarantee to stop your foreclosure.”

“Keep Your Home. We know your home is scheduled to be sold. No Problem!”

“We have special relationships within many banks that can speed up case approvals.”

“We Can Save Your Home. Guaranteed. Free Consultation”

“We stop foreclosures everyday. Our team of professionals can stop yours this week!”

Here are some red flags:

Guarantees to stop the foreclosure process – no matter what your circumstances

Instructs you not to contact your lender, lawyer, or credit or housing counselor
Collects a fee before providing you with any services.
Accepts payment only by cashier’s check or wire transfer.
Encourages you to lease your home so you can buy it back over time.
Tells you to make your mortgage payments directly to it, rather than your lender.
Tells you to transfer your property deed or title to it.
Offers to buy your house for cash at a fixed price that is not set by the housing market at the time of sale.
Offers to fill out paperwork for you.
Pressures you to sign paperwork you haven’t had a chance to read thoroughly or that you don’t understand.

One of the most common scams is someone promising to rescue a home owner from foreclosure, telling the home owner that they will take care of everything, collecting a fee from the home owner and doing nothing.

For legitimate help from people who are not running scams try Hope Now 

Banks really don't want your house. They can't sell it because banks can't sell real estate.  The best time to contact your lender is before the first late payment. There are people who are worried about losing their homes who pick up the phone and contact a total stranger and explain their situation and how badly they need help. They make it easy for people who are running scams to find victims.

 

Posted with permission by Teresa Boardman on 12.29.08 

For people who are going through foreclosure or are about to they need to know that things can get worse.  Foreclosure rescue scams have become the flavor of the day.

The ads look or sound something like this:

"Stop Foreclosure Now!”

“We guarantee to stop your foreclosure.”

“Keep Your Home. We know your home is scheduled to be sold. No Problem!”

“We have special relationships within many banks that can speed up case approvals.”

“We Can Save Your Home. Guaranteed. Free Consultation”

“We stop foreclosures everyday. Our team of professionals can stop yours this week!”

Here are some red flags:

Guarantees to stop the foreclosure process – no matter what your circumstances

Instructs you not to contact your lender, lawyer, or credit or housing counselor
Collects a fee before providing you with any services.
Accepts payment only by cashier’s check or wire transfer.
Encourages you to lease your home so you can buy it back over time.
Tells you to make your mortgage payments directly to it, rather than your lender.
Tells you to transfer your property deed or title to it.
Offers to buy your house for cash at a fixed price that is not set by the housing market at the time of sale.
Offers to fill out paperwork for you.
Pressures you to sign paperwork you haven’t had a chance to read thoroughly or that you don’t understand.

One of the most common scams is someone promising to rescue a home owner from foreclosure, telling the home owner that they will take care of everything, collecting a fee from the home owner and doing nothing.

For legitimate help from people who are not running scams try Hope Now 

Banks really don't want your house. They can't sell it because banks can't sell real estate.  The best time to contact your lender is before the first late payment. There are people who are worried about losing their homes who pick up the phone and contact a total stranger and explain their situation and how badly they need help. They make it easy for people who are running scams to find victims.

I Saw What? Hummingbirds in Fife Heights for the Holidays!

So far, this little hummingbird and 3 others, are surviving our Northwest winter in my neighborhood - with a lot of help and love from my retired neighbors, Lyle & Colleen. I had the thrill of snapping this photo with my own 2 hands, waiting for about 15 minutes in the cold for her to show up. I'm not complaining -- look what this little one is wearing! And, her  internal temperature is normally around 104 degrees. To read more science about this phenomenon go to this article .   

A Message from King County: Are You Prepared? Steps to stay safe in this weekend's storm

Are you prepared?  Steps to stay safe in this weekend's storm

With high winds forecast for this weekend and possible power outages, it's time to take steps to stay save and avoid carbon monoxide poisoning.

How to avoid carbon monoxide poisoning

Carbon monoxide can kill you or cause serious injury.  Carbon monoxide gas comes from burning fuels such as gasoline, propane, oil, kerosene, natural gas, coal or wood.  Here are some steps to prevent carbon monoxide poisoning.

• Never use a gas or charcoal grill, hibachi, or portable propane heater to cook indoors or heat your home.

• During a power outage or at any other time, do not operate fuel-powered machinery such as a generator indoors, including in the garage.

• Avoid combustion "space heaters" unless there is an exhaust vent.

Carbon monoxide poisoning can strike suddenly and without warning.  In some cases, physical symptoms of carbon monoxide poisoning may include splitting headache, nausea and vomiting, and lethargy and fatigue.  If you believe you could be experiencing carbon monoxide poisoning, get fresh air immediately.  Call for medical help from a neighbors home.  The fire department will tell you when it's safe to reenter the home.

For a full list of carbon monoxide prevention tips and other safety and disaster information in English and other languages, visit www.kingcounty.gov/health/disaster

Other important safety tips

• Make sure you are wearing enough warm clothing before going outdoors.  Wind speed can create dangerously cold conditions even when the temperature is not that low.
• If you think power will be out for several days, check with your city for location of warming shelters.
• Watch for signs of frostbite and hypothermia-slurred speech, confusion, uncontrollable shivering, stumbling, drowsiness and body temperature of 95 degrees Fahrenheit or less.  Get medical help immediately if you think someone has frostbite or hypothermia.
• Check on elderly friends, family, and neighbors to make sure they are safe.
• If power goes out where you live, keep food safe by keeping the doors closed on your refrigerators and freezers as much as possible.  A full freezer can stay at freezing temperatures about two days'' a half-full freezer about 1 day.  Potentially hazardous foods, like meet and fish, should be discarded if thawed and warmer than 41 degrees.

Lease Purchase or Lease Option - Are You Wondering About These?

The easiest way to keep these straight is to remember that a 'lease purchase' is a purchase agreement - remember the word 'purchase.' In this strategy, the buyer agrees to buy and the seller agrees to sell, and the buyer will lease the property from the seller pending closing. There is often a delayed closing, but the buyer is obligated to close the transaction on a specified closing date. There would be a written purchase and sale agreement plus a lease agreement, and default on the lease would be default on the purchase and sale as well.

A 'lease option' is a situation where a tenant is obligated only to lease the property, but also has the right, or option, to purchase the property at a future date. There would be a written lease, as well as a written option agreement that should outline the terms of what the buyer's purchase would include, and a deadline for the buyer to decide to purchase or not. There would also be a negotiated cost between the parties for the option itself, which could be handled in several different ways (part of each rent payment, an upfront lump sum, etc). And the option cost may not be refundable if the tenant chooses not to exercise the option.

Also, there is another strategy which is simply an 'option to buy.' And this option is unrelated to any lease between the parties. Again, there would be a written option agreement outlining all basic details. And most often there would be some sort of cost for the option itself.

***All of this said, none of what I've written above, or will say below, is to be relied upon or construed as legal advice. I am a licensed real estate associate broker, not an attorney. I am licensed to fill in standardized forms, but not to give legal advice.*** Also, at this time in Washington state, there are big legal issues if a property owner is in a distressed situation and a buyer wants to offer to buy and lease back to them with a purchase option - you don't, and I don't, want to go there.

3 Issues to Consider: 1. In a declining market, a sale price set today, may not be market value by the time a sale would close, and that could mean financing problems due to any required appraisal.  2. Although a buyer might qualify based on today's rates and programs, they may not qualify when it comes time to close - we know the current volatility in the financial markets!  3.  The parties will have to decide whether or not is acceptable or desireable to keep the property on the market during the pending, lease or option period - there is no law addressing this issue.

In my opinion as an agent, successful transactions are always about win-win between the parties, so with the right set of circumstances, using these options might just be the best answer. Example: Sellers whose homes are not selling, who don't need to be cashed out and would be happy to have their property occupied by a responsible and qualified tenant with an interest in buying and closing a deal when some planned event allows them to do so. Another example: Seller is working out of area for the next couple years, might or might not want to sell, and buyer needs time to get their lives or finances straightened up.

Still Have Questions? Please ask here in a comment, or email me with your concern - I will do my best to help! ... And, I Have People ;-)

Christmas Trees in Federal Way - Fresh and Fragrant!

Anyone still looking to buy your live/fresh tree?? Federal Way has an abundant supply at the 2 places I scouted out yesterday.

The Oriental Garden Center has a variety, and prices starting at $25.99 - $85.99. Douglas Firs, Grand and Noble Firs. The Noble is the priciest at $85.99 for an 8 footer acording to Dave at 253-839-1639. They are located at 30650 Pacific Hwy S, across from Federal Way High School.

 

The Local Boys at the Commons Mall on 320th and Pacific Hwy, have the most abundant supply of trees - and new ones arrive every 3 days according to Trevor Jones, owner, at 253-839-5722. Their prices range from $18.99 to $199.99 and the choices seem endless as far as variety goes! In business every Christmas Season for the past 43 years, Local Boys was formerly called Tacoma Boys. They have one other tree lot at the fruit stand in Purdy right near the bridge.

 

Fixed Rate Mortgages - Fire Sale! Make a Smart End Run for '08!

These are the lowest fixed rate mortagages most of us have ever seen! As of this morning, one of my favorite lenders is quoting purchase and refinance money available at rates in the low to mid 4's !  Please call me today to find out the best buys in the Federal Way, Dash Pt, Brown's Pt, NE Tacoma areas. Start the new year with a fantastic real estate purchase!

Latest Federal Way Real Estate Facts - BUYERS, GUESS WHAT?

As I listen to a soft, calming, Mozart serenade and study the latest numbers on Federal Way real estate - I almost choke on my own gasping! In the last month (Oct 31 to Nov 30) there has been a 21% drop in the average sale price (from $365,000 down to $290,000) and a 52% drop in the actual number of homes sold. At this rate we have gone from an 8 month supply of homes on the market to 14.8 months. These numbers are for new and resale single family homes as a group. Pretty bad for sellers who need to sell -

But, if you are a buyer, with solid credit and job stability, This Is Your Golden Opportunity - no kidding. YOU HAVE THE BEST BUYING POWER IN YEARS, MAYBE A COUPLE DECADES EVEN. Remember rates last week? Dipped under 5%, and if you were one of the smart ones who was all ready to lock, good for you! Don't worry, though, rates are excellent, and when you add the negotiating power you now have, with the low interest rates and current home prices, plus the unprecidented tax credit if you are a first time buyer, you are among the luckiest people to purchase a home NOW! YOU are sitting in command position to control your financial future responsibly.

Here are 2 Trendgraphix charts for Federal Way, and I can get them for other communities if you need them. Just call, send an email or leave a comment on this post below. Click on the chart for a clear version in pop up window.

No Moss Removal On These Healthy Green Roofs!

 Photo courtesy of Green Roofs for Healthy Cities

A residential high-rise apartment building in downtown Portland, The Louisa, features an accessible green roof that mixes intensive and extensive plants. The award-winning roof was designed to reduce storm-water runoff, mitigate the urban heat-island effect and be aesthetically pleasing when viewed from above.

 

Big opportunity exists in expanding our economy with environmental improvements related to changes in building design from the inside out. The short, following linked article is worth the time to read for some quick insight as to what's already happening in this arena.

 

Who Has the largest green rooftop? Check out this article! Chicago Has Acres Of Green City Rooftops  

What Do the Holidays Do For Buying & Selling Real Estate?

  If you're a buyer or a seller during the November to January months in the US, you will have less competition - meaning 1. Buyers can drive harder bargains with motivated sellers, and 2. Sellers who keep their homes on the market have a greater chance of having their properties viewed by serious buyers, serious enough to be house hunting for a new principal residence - win and win!

Also, Tips for Sellers: Dress your home up for the holidays - but keep it fairly generic. Extra lighting is more inviting and pretty dining rooms and fireplaces are perfect areas to focus on. Skip the seasonal themes in bathrooms and bedrooms where we need more neutral staging. Keep all music low and instrumental, piano classics preferred. 

Mortgage Interest Rates for Federal Way

I'm honored that Di Kawell has invited me to be a guest contributor on her blog.  With mortgage rates at a low point, I thought it would be timely to share what current rates are.  Before I do, it's important  to go over some of the factors that impact mortgage interest rates (and how I'm pricing rates for this post).

"Low-mid" credit score.  More than ever, mortgage rates are impacted by credit scores.  "Low-mid credit score" means that the middle credit score is what is used for pricing a rate.  However, if more than one person is on the loan, it is lowest of the two mid-scores that is used.  Conventional loans have serveral score brackets with low-mid scores of 740 or higher to receive the best rate. FHA loans receive the best rate as long as the mid credit score is 620 or higher.  For my rate quotes, I'll be using mid-credit scores of 720-739 for conventional and 620 or higher for FHA/VA.

Loan to value.  Rates are also impacted by how much equity you have in your property.  The value of your property is determined by an independent appraisal requested by the lender.  The appraiser includes 3-4 homes similar to yours, located near your home that has recently sold.  For conventional loans, rates below will be based on an 80% loan to value; FHA is based on a minimum of 3.5% down payment (96.% loan to value).

Type of home/occupancy.  Rates quoted are based on a single family dwelling (1-unit) and, unless otherwise noted, owner occupied.

Documentation.  These days, you can count on a full-documented loan when applying for a mortgage.  Full-doc loans provide the best pricing.  This typically includes documenting 2 years of employment, 30 days of income and 30-60 days of assets.

Lock period.  The number of days that your loan is locked impacts the price of the rate.   The shorter the lock, the less expensive the rate.  Since most purchase transactions take 30-45 days, I'm using 45 days for the lock period.  If your transaction is closing in less than 30 days, the pricing for your rate may be improved.

Points, no points and reduced closing costs.  How your mortgage is priced is completely up to you.  Points may be shown on the current Good Faith Estimate on lines 801, 802 or 808 depending on if you're working with a mortgage banker, lender or broker.  A point equals 1% of the loan amount and typically reduces the rate by 0.25%.  Closing costs can be reduced in the same manner.  If your rate is increased by 0.25%, your closing costs shold decrease by 1% of your loan amount (there are no free loans--you're paying for it in rate).

Type of transaction.  Rates vary depending on if the mortgage is for a purchase, rate/term refinance (no cash back) or cash out refinance.  Unless otherwise noted, rates I quote on Di's blog will be for purchasing a home.

Quick note (before I get to rates): during this volatile market, lenders are averaging around 3 rate sheets per day.  This means that once I publish rates here, they may have all ready changed for better or worse.  If you're selecting your mortgage professional by rate alone (which I do not recommend), you must do your rate shopping on the same day at the same time or you're not comparing apples to apples.  Rates are a moving target.  To see what rates I'm quoting live to my clients, click here.

Rates below are as of 9:30 a.m. on December 3, 2008. 

Conforming Conventional ~ loan amounts up to $417,000 for single family dwellings.  Rates below based on a sales price of $500,000 and a $400,000 loan amount:

• 30 year fixed:  5.375% at 1 point (apr 5.396) ~ 5.750% at 0 points (apr 5.809)
• 15 year fixed:  5.125% at 1 point (apr 5.373) ~ 5.750% at 0 points (apr 5.849)

High Balance Conventional ("High Balance" is replacing the "Jumbo Conforming) ~ loan amounts up to $506,000 for King, Pierce and Snohomish Counties.

• 30 year fixed: 5.500% at 1 point (apr 5.641)

Jumbo ~ Loan amounts $506,001 and higher.

• 30 year fixed: 7.625% priced at 1 point (apr 7.788)

FHA ~ base loan amounts up to $362,790 for King, Pierce and Snohomish Counties.

• 30 year fixed:  5.625% priced with 1 point (apr 6.305)

FHA High Balance ~ base loan amounts from $362,791 to $506,000 for King, Pierce and Snohomish Counties.

• 30 Year fixed:  6.625% priced with 1 point (apr 7.312)

VA ~ loan amonts up to $417,000.

• 30 year fixed:  5.875% priced with 1 point (apr 5.991)

Prime rate (what most HELOCs are based on) ~ 4.00%

If there is a mortgage topic or question you would like me to address here, please send me an email and don't forget to subscribe Di's blog feed in the upper right corner to receive automatic updates.  For your personal rate quote on property located in Washington State, please contact me.

Rhonda Porter is a Certified Mortgage Planning Specialist, Licensed Loan Originator 510-LO-32047 at Mortgage Master Service Corporation, a Correspondent Lender serving Pacific Northwest homeowners since 1976 located in South King County.