Brian Leavitt, REALTOR®

One for the money.. two for the show..

Free Microsoft courses extended through October 2012

If your employees use Microsoft software to conduct business, here’s a deal
you can’t beat.

Employment Security extended its contract with Microsoft to make the company’s entire suite of
online courses available for free to Washington residents through October 2012.
The offer is open to anyone of working age – both the employed and unemployed.

Businesses can use the free training to improve the computer skills of one employee, or even
hundreds of employees.

Registration is handled through local WorkSource centers. Visit www.wa.gov/esd/e-learning to learn more or to request access codes. To contact your WorkSource center, visit www.go2worksource.com and click the “WorkSource Offices” tab to view locations.

Even if you pay all your bills on time ...

You could be bringing your credit score down without realizing it. The main factors considered in creating your credit score is whether you pay your credit cards and bills on time.

But some factors that can shave points from your score are not as obvious and not as well known. They include:

* Ordering several new credit card accounts in a short period of time. Maybe you're just taking advantage of low-interest offers, but to credit scorers, it looks bad. Better yet, avoid credit cards altogether.

* Transferring a balance to a new card, and then closing the old card account. It's OK to transfer the balance, but keep the old account open. If you close it, you won't have as much total credit and your credit-utilization ratio will increase. The amount of debt you have is calculated for balances on individual accounts, as well as your overall credit limit.

* Charging a lot to a department store credit card. Say you have a $4,000 credit limit. You are buying new furniture, so you charge $3,500. Before that, you only owed $100 on your store card. Now, you owe $3,600 on a $4,000 card, which means available credit on that account will be way down. It's not good for your credit score. And the store charges high interest rates.

Here's a better solution. Save for the item and pay cash. Cash talks, you can almost always negotiate a discount for cash so you avoid the credit card debt and save money as well.

* Other situations you might think are not related to your credit score include library book fines, parking tickets, back rents, medical bills and any other fees or charges you put off paying.

In time, they will be turned over to a collection agency. Even after you pay them, the collection will stay on your credit report for seven years.

Remember to review your credit report on at least an annual basis. You can do this for free at https://www.annualcreditreport.com. There are lots of so called "free" credit report sites out there but this one is the real deal sponsored by the credit bureaus and is completely free with no membership or service fees required. Also, if you are turned down for credit because of anything revealed in your credit report you have the right to a free copy of your report. For more information on your rights under the Fair Credit Reporting Act go to http://www.ftc.gov/os/statutes/fcrajump.shtm

HARP Here we come

The latest news on the new Home Affordable Refinance Program, HARP, is that Federal regulators have recently made key changes that will help borrowers who owe more on their loans than their homes are worth. Every week I receive inquiries from home owners who are current on their mortgages but can't refinance because their loan balances are higher than the value of their homes. The new HARP guidelines will help many homeowners reduce their interest rate. Based on today's rates this would be at or below the 4% range for a 30 year fixed loan.

There are two options with the new HARP changes. Timing is critical on both options and require clear understanding of your home's value. I am uniquely positioned as both a real estate broker and mortgage broker to assist you with this.

OPTION 1: Applications taken from December 1^st 2011 to February 29^th 2012 (yes, an extra day for us for leap year) are eligible for a loan to value (LTV) up to 125%. Appraisals will be necessary during this time period to determine the LTV. Unlimited combined loan to value ratios (CLTV) are acceptable. The combined loan to value ratio is the combination of your first mortgage and second mortgage or home equity lines (HELOC).

OPTION 2: Applications taken on or after March 1^st 2012 are eligible for unlimited LTV and CLTV and this is where those most highly impacted by declining values will get relief. There has been no specific announcement if appraisals will be required but I think not since the plan is to allow unlimited LTV.

The following conditions will apply to both options:

1. Current 1^st mortgages must have closed prior to May of 2009.
2. The loan cannot have mortgage insurance.
3. Loans must be owned by Fannie Mae or Freddie Mac. Call or email and I can research this for you.
4. Primary, Second Home, investment, and condos all qualify.
5. Second mortgages can be subordinated with no maximum CLTV.
6. You must have a qualifying credit score of 640 or more with no credit lates in the past 12 months.
7. You will still have to qualify based upon income but the good news (better news?) is that with a significant decrease in interest rate your payments should go down.

Mortgage lenders are going to be swamped with applications on this program so right now is the time to get ready. Since applications must be dated no sooner than December 1, 2011 we can have everything ready to go so that we can submit the application as early as possible. For some of you it will be necessary to wait until March 1^st 2012 but the anticipated rush will be even greater.

This is by far the best opportunity "underwater" home owners have had during the course of the recession.

If you are a home owner finding yourself in this position my advice is that we review your situation to determine if you are eligible and if it is best to proceed on December 1^st or wait until March 1^st.

Call or email me today! I will answer your questions and run the numbers to determine just how much money you can save each month!

Brian Leavitt

Designated Broker

Northstone Mortgage

MB 114722

MLO 114864

 

Why you should pay off your mortgage before you retire

More Americans are quitting the workforce without retiring their mortgages. The most recent Federal Reserve survey shows that 32 percent of households headed by someone age 65 to 74 were carrying home-mortgage debt.

That could be a mistake. Consider this scenario. Two retired couples have income of $16,000 from Social Security and $24,000 from individual retirement accounts.

The couple without a mortgage would be taxed on their IRA withdrawals, but with the standard deductions, they would owe only about $600 a year in taxes, leaving them with $39,400 in after-tax income.

The second couple took out a $200,000 30-year mortgage at age 50 that costs $955 per month until age 80. The interest deduction doesn't help because by the 16th year of their mortgage, just $5,047 goes to interest. Added to other deductions, they will have little more than the $11,600 standard deduction taken by the first couple.

To match the first couple's standard of living, they have to make large taxable withdrawals from their IRA. The withdrawals would drive up their total income, triggering taxes on Social Security. They would need total pretax income of more than $58,000 to have the same standard of living as the first couple, and they would pay more than $4,300 in federal taxes.

To pay off a $200,000 30-year fixed-rate mortgage at 4 percent with a $955 payment: Add $100 a month to pay off the loan in 26 years. Add $200 a month to pay off the mortgage in 22 years. Add $500 a month to pay it off in 16 years.

 To calculate your own time frame and payments to see what you could do go to http://www.northstonemortgage.com/MortgagePayoffCalc.  If your rate is higher than 4% call me about the possible benefits of a refinance.

 

Planing to own a home some day? Eliminate Debt

Loans
Most loan payments are calculated using compounding interest, which is the interest that is added to the principal of the loan each month that the balance is outstanding, causing you to pay interest on interest. Although it’s designed to work against you, it is possible to pay off the loan three to four times faster with minimal additional cost to you, just by knowing your “magic number.” Your “magic number” is the portion of your monthly payment that goes to pay the principal. To pay your loan off quickly, double, triple or quadruple your  principal, or “magic number” each month.

Consumers have an average of 13 credit obligations on record with a credit bureau.
Source: http://myfico.com

Credit Cards
The average credit cardholder has 3.5 cards.* If you have outstanding balances on two or more credit cards, use the rollover formula to pay them off.

• Make a larger payment on the card with the highest interest rate and pay the minimum on the rest.
• Once this card is paid off, apply the amount of its payment to the minimum amount you were paying on the card with the second highest interest rate.
• When the second card is paid off, add that amount to the payment of the third card, etc. until you have paid off all of your credit cards.

The average American with a credit file has over $16,635 in debt, excluding a mortgage.
Source: US News and World Report

Tips to Help You Stick to Your Budget

• Set 90 day goals.
• Track daily and weekly expenses to know where your money is going.
• Ask for help. Enlist a friend or loved one to help you remain accountable to your budget.
• Focus on the win! Imagine how you’ll feel when you’ve paid off your debt and have achieved financial freedom.
• Use a small portion of the surplus to reward yourself.

U.S. Cities Where Homes Sell the Fastest - Seattle #2

In a recent article where CNBC uses Zillow's data to rank cities across the US, Seattle Ranks number 2 behind two Bay Area Powerhouses, San Francisco and San Jose(tied for first) Below is the complete article.

Although the U.S. housing market continues to struggle, many local markets are doing significantly better than the country as a whole, with some places virtually missing the housing bust altogether.

While shifts in home values are important in any market, it's important for sellers to determine the length of time a property can expect to be on the market before it will be sold. The faster that homes sell, the faster an inventory backlog can be cleared, suggesting heightened demand and an upward trajectory in prices. Additionally, if a home is on the market for an extended period of time, it may may turn off prospective buyers and force sellers to accept less-favorable offers.

To find the cities where this trend is the most extreme, real estate website Zillow.com analyzed the numbers to identify the cities where homes sell the fastest, according to the median number of days on the market. The numbers presented here are representative of home sales between mid-April and mid-July 2011.

During this time, the national median for time spent on the market stood at 117 days, while New York (168 days), West Palm Beach (175 days), and Indianapolis (180 days) were the cities where homes sold the slowest.

Also included in the analysis is the Zillow Home Value Index (ZHVI), which represents the median measure of home valuations covered by Zillow. The information presented here also includes the proportion of listings with price cuts, the average amount those listings were reduced, and the “final discount from list price,” which is the average amount that was negotiated off the original list price before the sale.

So, where do homes sell the fastest? Read ahead to find out!

5. (Tied) Oakland, California

Median time to sell: 81 days
Zillow Home Value Index: $316,400

Listings with price cuts: 26.17%
Average price cut amount: 8.70%
Final discount from list price: 1%

5. (Tied) Woodbridge, Virginia

Median time to sell: 81 days
Zillow Home Value Index: $230,500

Listings with price cuts: 20.54%
Average price cut amount: 5.66%
Final discount from list price: N/A

4. Alexandria, Virginia

Median time to sell: 74 days
Zillow Home Value Index: $402,500

Listings with price cuts: 33.30%
Average price cut amount: 4.47%
Final discount from list price: 2%

2. (Tied) Seattle, Washington

Median time to sell: 73
Zillow Home Value Index: $347,700

Listings with price cuts: 33.55%
Average price cut amount: 6.88%
Final discount from list price: 2%

2. (Tied) San Jose, California

Median time to sell: 73
Zillow Home Value Index: $494,500

Listings with price cuts: 26.16%
Average price cut amount: 5.58%
Final discount from list price: 1%

1. San Francisco, California

Median time to sell: 59
Zillow Home Value Index: $655,400

Listings with price cuts: 22.55%
Average price cut amount: 6.05%
Final discount from list price: 1%

Foreclosure Time Line

Talon Northwest Neighborhoods

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Watch out for foreclosure scams Posted: 20 Sep 2010 11:12 AM PDT  I had a pretty scary conversation over the weekend with one of my Seattle area loan officers.  One of her past south end clients called to complain about a "prospective buyer" that showed up on her door step interested in making a bid on the property.  Naturally she was concerned since she hadn't received any notices in the mail. Here's the scoop.  Late last week, someone came knocking on the past clients door and said that they were interested in buying the home at auction.  They asked the homeowner to do a walk through on the property to make sure everything was in good shape.  So they walked through the house, inspected it, said thanks and left.  The owner then called my loan officer to complain about not being notified of the pending foreclosure auction date. So my loan officer calls her department that handles foreclosures, and sure enough the homeowner is current on their payments.  The loan officer called the owner back and told them to call the police right away. The loan officer I spoke with mentioned that she's heard of people pretending to be from the bank as well, and needing to do an inspection before the bank puts it on the auction block.  Or they are an inspector for the auction and need to review the home before the auction date.  Regardless of the story, it's not a good idea to let someone in your home that you're not sure of.  There are rules and time lines associated with foreclosures.  There is no reason why one should come as a surprise to any homeowner.  Here's the time line of the process, from www.usa-Foreclosure.com: Time line Step Days for Step Total Days Loan referred/file received 1 1 Trustee Sale Guarantee report ordered, NOD mailed and posted on the property 30 days before Notice of Sale 1-3 4 Trustee Sale Guarantee report received and reviewed, Substitution of Trustee prepared 30 34 Substitution of Trustee received/recorded, Notice of Sale recorded, posted and mailed 90 days prior to sale; sale date set; Warranty Deed sent to lender (HUD/VA) 1-5 39 Publication period 90 129 Publication (2 of 2) completed request bidding instructions 1-5 134 Sale held 1 135 Deed recorded 5-15 140-150 (Time line is for non-judicial foreclosures. Intervals are optimal and assumes no delays.) For more information on Washington State Foreclosures, please visit the learning center at usa-foreclosure.com.  It's unfortunate to hear these types of stories.  I'm glad to hear that nothing was taking from the home, and a police report was filed.  It could have been worse.  As always, be careful out there everyone.   Photo Courtesy of 05com

 

Dibbs

There was an interesting story on the news this week about a homeowner who discovered that someone had moved into their vacant home claiming that the home had been abandoned.  The new occupant said she rented the property from a property management company who in turn claimed that they had acquired the property by filing a "deed of adverse possession" with the county recorders office.  Pretty good trick if you can pull it off.  Last I checked there were a couple of elements of adverse possession that I suspect this property manager may have forgotten. As a refresher, adverse possession is a means of acquiring title where an occupant has been in actual, open, notorious, and continuous occupancy of a property under a claim of right for the required statutory period.  In this case the period would be 7 years.   The property manager is 6 years 12 months short of the requirement.   Since a real estate license is required to manage property here in Washington it makes me wonder how some people actually pass the license test in the first place but that is another story.  

The property owner, in my opinion, was quite gracious to the occupant allowing her and her family to move out over the weekend.  I have heard that similar claims to vacant property been happening in other parts of the country but this is the first time I have heard about it here.  If you have seen this in your market I would love to hear about it.  Part of my initial reaction is that consumers could be protected against becoming entangled in this sort of mess by using trusted real estate professionals except that in this case the renter thought that is what they were doing.

This reminds me of a transaction I worked on a number of years ago where a man rented a home from one of my clients and then proceeded to offer it "for sale by owner" at a drastically reduced price drawing in several buyers and obtained cash earnest money deposits before fleeing town cash in hand.  The would be buyers then contacted my client to get a refund.  The problem is my client did not sell the home.  Tough luck for the buyers.  The moral of the story here is to know who you are dealing with.  As a consumer remember that true authority withstands questioning.  As a broker I always determine if in fact my client has the legal right to sell, or in this case, rent the home.  As a consumer or selling/leasing agent, you can do the same.  To do this simply review the tax records to see if the person claiming the right to sell or rent is the person in title.  If the home is for sale ask for a copy of the preliminary title.  Verify that your agent is a member in good standing with the Association of Realtors and check the status of their license.  In many states you can do this in a few seconds online.  Sorry, no "Dibbs" today.

Keeping the main thing the main thing

One of my favorite people and a top real estate producer, Dan Edwards, strolled through my office the other day and took the liberty of scrawling across my big white board...

Remember to keep the main thing the main thing..    Referrals.

In the last few days I have given a lot of thought to this in the context of building a successful real estate business and realize the truth of this simple statement.  It is easy to get side tracked and focus our energy on the wrong thing.  Many agents spend a significant portion of their day majoring in minors.  It is easy to get distracted by phone calls or spend the day responding to random emails but truth is more time is spent on wrong focus than on distraction.  If the main thing is building referrals then how do we do that?

We build referrals by serving our clients well.  Once we have done an excellent job serving our clients we have earned the right to ask for referrals.  What I am getting at here is that if we spend our time serving our clients we then do not have to worry so much about building our business through marketing to the general public who do not "generally" care a whole lot about us anyway.  Don Deasy was one of my mentors and he used to explain it quite simply.  What he said is that most agents spend 90% of their resources, be it time, money, energy or whatever, marketing to the general public who could really care less about them and 10% marketing to the people who already know and like them.  Don's advice was to spend 90% caring for and serving the people who already care about you and 10% on everyone else.  By Don's measure the main thing is taking care of clients.  Taking care of clients leads to referrals... the main thing.

So Who's Got My 25 Bucks?

While driving to work this morning along beautiful Lake Sammamish I heard an interesting story on the news regarding the Washington State insurance Commissioner's ruling regarding perks from title insurance companies to real estate brokers.  This really isn't news because the insurance commissioner has been talking about this for years.  What surprised me more than anything is that this is still a point of discussion.  What Mike Kreidler, the real estate commissioner, decided is that title companies are limited to a maximum dollar amount of $25 per agent per year.  What I want to know is who's got my 25 bucks?  I think somehow I've missed the boat in all my years of real estate.  I've never gotten anything from the title reps I work with, except great service, excellent support, and maybe a latte  once in while except that I end up buying, what's with that?  Maybe I am the exception, but I just can't see it working any other way.  If I'm going to recommend a service provider to my client I've got to make that recommendation based upon that service providers ability to give my client outstanding service and a fair and competitive price.    OK, so  why allow any amount at all?   Doesn't the $25 seem somewhat arbitrary?  Maybe Mr. Kreidler could do something interesting, say for example, two chickens and a Pepsi. I'm old school for sure but where I come from anything other than a friendly exchange of a cup of coffee once in awhile is called a bribe.  Last I checked, bribes are illegal.  So what's the news here?