Archive for May, 2007
May 31, 2007 at 5:59 am · Filed under Bites of Buckwheat, Bremerton Real Estate, Silverdale Real Estate, Port Orchard Real Estate, Poulsbo Real Estate, Mortgage Bites, Gig Harbor Real Estate
Shock and dismay are quickly followed by anger as a homeowner reads the official-looking letter from the mortgage company instructing him to make a higher payment. Did somebody lie to him? Did he somehow sign up for an Adjustable Rate Mortgage when he thought he was getting a Fixed Rate? There must be a mistake, right?
No, nobody lied. Here’s what has happened.
On the day a homeowner signs loan documents for the purchase of his or her new home, a payment is presented. The majority of mortgage loans that are set up in the U.S. include money for Property Taxes on the home and Hazard Insurance for the dwelling. These are called PITI payments. PITI simply means Principle, Interest, Taxes and Insurance. Each month, the portion of the payment for taxes and insurance, is set aside by the mortgage lender in an Escrow Account. This money (in theory) adds up each month until it is time for the property taxes to be paid, or the insurance premium to be renewed. At those times, the mortgage lender sends the correct amount of money to either the County for property taxes or to the Insurance Company. The escrow account is depleted to pay these expenses and the process begins all over again for the new year.
The great thing about a PITI payment is the fact that the homeowner never has to be concerned with budgeting for the annual Property Tax liability or the Insurance Premium renewals. It is both a convenience for the borrower and a safeguard for the mortgage company. The mortgage company does not need to worry about a foreclosure due to unpaid Property Taxes or a house that burned down because of unpaid Homeowners Insurance.
The unnerving thing about a PITI payment is the letter in the mail stating the mortgage payment is going up. The payment must increase from time to time to cover the increasing cost of Property Taxes and Homeowners Insurance. Just like eveything else from gasoline to lumber, Taxes and Insurance prices are subject to change. And, they will change.
Experience borrowers are not surprised to receive this notification. They have seen it before. New homeowners though, are often very upset to receive this type of letter. If you have received a letter like this, read it carefully first. You will probably find the payment is rising for the reasons above. If the letter is difficult to understand (many are), call your Loan Officer first. That is what he/she is there for. Information about your mortgage is available to you after you move in! If you Loan Officer notices something unusual about the letter, he/she will let you know and can guide you to the person or organization to sort out the problem.
But remember, when the Property Taxes and the Homeowners Insurance Premium rise, the mortgage payment will have to follow. The mortgage company must collect enough money to pay these bills for you next year. The Fixed Rate mortgage that you signed up for is only guarantying that the Interest Rate will not change. The mortgage company cannot control expenses like Property Taxes and Insurance Premiums.
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May 30, 2007 at 8:59 am · Filed under Bainbridge Island Real Estate, Poulsbo Real Estate, Real Estate Bites, Buyers, Sellers, Sparks from Sparky, Gig Harbor Real Estate
As real estate markets throughout the country continue to cool, the inventory of available homes for sale naturally increases. While this dynamic doesn’t necessarily translate into a “Buyer’s” market, per se, it does prompt Seller’s Agents to take a more agressive approach towards effectively marketing their client’s homes.
Gone now, thankfully, are the Days of the Lazy Agent. You know the type. The ones who simply input your home into the local Multiple Listing Service and pray for a buyer.
Their photo gallery (If you can call it that) has only 3 pictures, none of which does any good to help showcase your home’s features (Unless, of course, a shot of a toilet really sells homes? “Look, Honey, this house has a toilet! Quick, let’s put in an offer right now!”)
These are the same Agents who consistently neglect to fill the flyer box (Not that you’d necessarily want their flyer in there. I’ve seen better artwork from 3rd graders. At least the kids actually know how to use Publisher!)
And when was the last time you tried to contact this Agent? Your e-mails go unanswered. Their phone message says that your call is important, but after no response for several days, you feel like anything but important.
Lazy Agents are the by-product of fast markets. Attracted by the allure of “easy” money, they touchdown in a tornado of self-seeking inexperience, leaving behind a path of short-changed clients and potential lawsuits.
And fortunately, as soon as the market begins its downturn, they jump ship, headed back to their day jobs, or caught up in the latest TV infomercial money-making scheme.
In the meantime, the rest of us ‘career’ real estate professionals pursue the relentless representation of our clients, putting their best interests above all else. We constantly strive to master and employ the latest technologies in an ever-changing/evolving market. We expand our knowledge by on-going educational opportunities, better equipping us to serve our clients.
So, let’s all bow in a moment of grateful silence, and bid a fond farewell to the Lazy Agents everywhere.
And for the rest of us, back to work!
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May 24, 2007 at 1:29 pm · Filed under Bremerton Real Estate, Silverdale Real Estate, Port Orchard Real Estate, Bainbridge Island Real Estate, Poulsbo Real Estate, Real Estate Bites, Buyers, Sparks from Sparky, Gig Harbor Real Estate
This is the tenth and final installment in an on-going series of posts dedicated to helping 1st Time Home Buyers successfully achieve their home purchasing goals.
We have been identifying and discussing, in chronological order, key events in the home buying process. In our last discussion, we indentified several last minute obstacles/difficulties that Buyers may experience in a post entitled, “Potential Pitfalls in the 11th hour.”
This time, we’ll talk about what Buyers can expect in the final days leading up to their closing and what to aniticpate beyond, in an article called, “Are We There Yet?”
Remember back when you were just a kid, and your family took that unbearably long cross-country vacation, all smashed together in an old beat-up the station wagon? And getting to your destination seemed to take FOREVER?
Well, that’s kind of the way it is in the final days leading up to your closing! Well, just be patient, you’re almost there!
Once your loan documents arrive at the escrow company, it’s normally just a matter of the Escrow Officer ensuring that all necessary documentation is prepared and ready for signing. Based on all of their input, they will draft a HUD-1 Statement. This is a projected detailed estimate of both parties (Buyers and Sellers) closing costs. You will receive a copy of this estimate prior to your signing, and so will your Agent. Now is the time to review these numbers carefully, with both your Agent and your Loan Officer, to verify that all the numbers are correct and correspond to what you had anticipated.
The Escrow Officer will contact you to schedule a time for you to come into their office to sign all the closing documents. For most standard residential transactions, you can plan on the signing to take at least an hour, depending on how in-depth you wish to read and review all the documents. The Escrow Officer will instruct you on what you will need to bring to the signing (typically your Driver’s License and any funds necessary to close the transaction),
In some instances, you may have negotiated with the Sellers for them to contribute to your closing costs. In addition, any Earnest Money that you deposited into escrow when you first went under contract will either be applied to your closing costs, or credited back to you at closing. Reviewing your HUD-1 statement will help you to aniticpate whether or not you will need to bring money to your signing. The escrow company usually requires the funds to be in the form of a certified cashier’s check.
One thing many people forget in the final stage of the home buying process is to contact all of the local utility companies and have them switch the billing over to your name. Your agent should be able to provide you with a list of utility companies that serve the property, along with their contact numbers. There are few things more frustrating than moving into your new home and discovering you have no power, water, or gas!
And, depending on the type of property, it might be beneficial for you and your agent to conduct a final walk-thru, prior to closing, just to ensure that everything is as specified per contract.
Now realize that closings can vary significantly from State to State. When we bought our house in Chicago, everyone was there for the signing - our agent, our attorney, the Sellers, their agent, and their attorney. We all sat around the table and passed the documents around for signatures. At the end of the signing, we got the keys to our new home!
Here in Washington State, Buyers typically come in to sign a day or two before the actual closing takes place. The Sellers come in separately, many times on different day altogether. This tends to make the process less intimidating and more comfortable for both parties.
Once you have signed all your documents, they are normally sent overnight to the Lender for final review. In most instances, the following day your loan is funded. Later that same day, the escrow company sends documents by courier to the County courthouse where the new deed is legally recorded. The recording numbers are furnished to the escrow company, and the transaction is officially closed, and the house is YOURS!
Your Real Estate Agent will have made prior arrangements with the Seller’s Agent to obtain the keys. Once escrow has informed them that your loan has been funded and they have recording numbers, the transaction has closed and you can take possession.
Before you begin moving your household goods inside, take time to tour the entire home and premises:
- Verify that you have adequate power, water, and gas servicing the property.
- Are there instruction manuals for all the appliances and primary systems (furnace, water heater)?
- Did the Sellers remember to leave the garage door openers?
- Does your neighborhood have locked mailboxes, and did the Sellers provide you a key?
- Is there a trash can, or will you need to purchase one? Check with your Disposal company to determine acceptable containers.
- As a safety precaution, have all the locks changed as soon as possible.
A good real estate professional never disappears after you’ve closed. There is always something that inevitably comes up after the fact. So don’t hesitate to contact your agent if there are any issues or concerns. Your complete satisfaction and future referral/recommendations are very important!
Enjoy this day! It is truly a momentous occasion! You’ve now joined the ranks of being a ’Homeowner!’ Take some time at the end of your busy day to journal your thoughts and impressions. This is an event you will want to capture for many years to come!
1st time home buyers, bremerton wa real estate, kingston wa real estate, kitsap home buyers, port orchard wa real estate, poulsbo wa real estate, real estate closing, seabeck wa real estate, silverdale wa real estate, soundbiteblog washington real estate blogPrevious in series
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May 23, 2007 at 3:44 pm · Filed under Sparks from Sparky, Laugh Tracks
A friend of mine was recently visiting from out of state. He complimented me on my nice tan. I told him, “That’s not a tan, that’s ‘rust!’
The jokes about rainfall here in the Pacific Northwest are endless.
“What do you call two straight days of rain in Seattle? A weekend!”
“It only rains twice a year in Seattle. August through April and May through July.”
However, I recently read some rather encouraging news. It seems as though the bad rap we get here in Washington State for inclement weather isn’t all that accurate.
According to a recent study conducted by the San Francisco CA based WeatherBill, Inc., where they ranked the Top Wettest US Cities, the State of Washington didn’t show up until the 24th position with our capitol city, Olympia.
Who was the wettest city, you ask?
Mobile, Alabama, with a whopping 5 feet of annual rainfall!
Pensacola, Florida, comes in 2nd, followed by several other cities mostly in Louisiana, Florida, and Texas. To read the entire article, click here.
Well, maybe we don’t get the MOST rainfall per year, but surely we have to be in first place for the number of rainy overcast days overall?
So maybe our kids do have webbed feet afterall. Or perhaps daylight savings simply means another hour of rainfall.
At least we don’t have to worry about water rationing!
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May 19, 2007 at 5:50 am · Filed under Bites of Buckwheat, Bites of Kitsap
You just have to love a small town where everyone is a neighbor, troubles are shared and victories are celebrated. Where else can you find a Marching Band in your driveway?
Last Monday, the Central Kitsap High School Band gathered in force, completely uniformed, in a local neighborhood to perform a serenade of support for one of their assistant principals who was recently diagnosed with cancer. The cheerleading squad and the guard drill team were also involved in this one-person parade. Their goal was a simple one. To show their care, concern and support for a neighbor in distress.
“Cancer” is one of the scariest words in the English language for many of us. Facing the fear and enduring the medical treatment must be almost unbearably difficult. “What of my family?” and “What will happen to me?” are just a couple of questions that would terrify anyone. It is a lonely battle that can drive a patient to depression and tear a family apart.
Debbie Belew-Nyquist, one of the High School’s assistant principals, was diagnosed with breast cancer a few months ago. She and her family have been living with the fear and upset. But on Monday, she found that her fight is a little less lonely. There was a marching band in her driveway to prove she’s not alone!
I was injured about a month ago and was blessed to learn the same lesson. Meals were prepared with care and delivered to my home (thank you Martha and John, thank you Rich), my lawn was mowed (thank you Jim). Household shopping and household chores were taken care of for me and my family (thank you mom, Jim and everyone else). Phone calls and emails arrived almost daily with words of support and offers of help. Neighbors, friends and family let me know I was not alone.
You just have to love a small town where everyone is a neighbor, troubles are shared and victories are celebrated. I know I do.
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May 17, 2007 at 9:32 pm · Filed under Bites of Kitsap, Sparks from Sparky
Local voters here in Kitsap County drove their collective ‘Chevy to the Levy’ this past Tuesday, but the levy turned up dry as the initiative to increase the tax rate failed by more than 5,000 votes (55 percent of those casting ballots voted no).
Kitsap Regional Library officials and supporters watched in shock and disbelief as the election results were revealed Tuesday evening. Director Jill Jean suggested that the failed measure was a public backlash towards other recent tax increases and the rising cost of gasoline.
But some have suggested otherwise.
In 2001, voters approved Initiative 747 which limited how much revenue the library system could bring in each year. Unfortunately, rather than plan and adjust their spending accordingly, the library expenditures have rapidly increased and outpaced their revenues. In 2006, the library spent $10.2 million in operating expenses while bringing in $8.86 million in revenues. It even had to dip into its reserve fund for $1.86 million to maintain existing services.
So maybe, this is the ‘real‘ supposed backlash from the general public? Why would voters want to approve more tax dollars to an organization that can’t seem to adequately manage the money they already have? Can library officials openly disclose/explain their current operating expenditures, and then justify the need for additional funding?
Perhaps that would help to sway a few more votes over to the ‘Yes’ column the next time around?
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