Janet Fullmer

530.277.5138

"Helping You Find Your Place"

Short Sales Should Become Streamlined by New Plan

Created: 5/15/2009

Please call me( Janet 530-277-5138) or e-mail JanetFullmer@att.net for an appointment if you or someone you know wants to be educated on their options for Loan Modifications or Short Sales. DO NOT WAIT TOO LONG, as it makes it more difficult to secure the buyer before Foreclosure.

News Flash

Obama Administration Announces Financial Incentives and Uniform Process for Short Sales

The NATIONAL ASSOCIATION OF REALTORS® (NAR) today announced that the Obama Administration

has added new incentives and uniform procedures for short sales under its new Foreclosure Alternatives

Program (FAP), part of the administration’s Making Homes Affordable plan.

Loan servicers may consider short sales or deeds-in-lieu of foreclosure for borrowers who do not qualify to

have their loans modified on a permanent basis under the Making Home Affordable Loan Modification

Program.

•

Home Affordable Modification program, but don’t qualify for a modification or do not successfully

complete the three-month trial period. Before proceeding with a foreclosure, servicers must

determine if a short sale is appropriate.
Borrowers/homeowners qualify under the FAP if they meet minimum eligibility requirements for the
•

foreclosure; $1,500 for borrowers/homeowners to help with relocation expenses; and up to $1,000

toward the cost of paying junior lien holders to release their liens (one dollar from the government

for every $2 paid by the investors to the second lien holders).
Incentives include: $1,000 for servicers for successful completion of a short sale or deed-in-lieu of
•

Agreement and an Offer Acceptance Letter. The goal is to minimize complexity and increase use

of the short sale option.
The program will include streamlined and standardized documents, including a Short Sale
•

accordance with investor requirements. The price may be determined based on an appraisal or

one or more broker price opinions (BPOs), issued no more than 120 days before the date of the

short sale agreement.
Servicers will independently establish both property value and minimum acceptable net return, in
•

market and sell the property, or up to one year, depending on market conditions. Property must be

listed with a licensed real estate professional with experience in the neighborhood. No foreclosure

may take place during the marketing period (at least 90 days) specified in the Short Sale

Agreement.
In the Short Sale Agreement, servicers must give borrowers/homeowners at least 90 days to
•

and costs that may be deducted from the sales price. The servicer must agree not to negotiate a

lower commission after an offer has been received.
The Short Sale Agreement must specify the reasonable and customary real estate commissions
•
Servicers may not charge fees to borrowers/homeowners for participating in the FAP.
•
The program is in effect through 2012.
•

servicer in exchange for a release from the debt if the property does not sell within the time allowed

in the Short Sale Agreement (plus any extensions).
Servicers have the option to require the borrower/homeowner to agree to deed the property to the

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REBBUILDING YOUR CREDIT AFTER SHORT SALE, FORECLOSURE , etc

Created: 5/13/2009

Credit After Foreclosure, Bankruptcy, or Short Sale

find the article at:

"http://www.car.org/legal/2009-qa/credit-aft-forecl-bankrup-short/"

Member Legal Services
Tel 213.739.8200
Fax 213.480.7724
May 12, 2009

Copyright© 2009, CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) Permission is granted to C.A.R. members only to reprint and use this material for non-commercial purposes provided credit is given to the C.A.R. Legal Department. Other reproduction or use is strictly prohibited withoutthe express written permission of the C.A.R. Legal Department. All rights reserved.

One of the concerns a consumer has after experiencing a bankruptcy, foreclosure, or short sale (referred to as a "preforeclosure sale" by Fannie Mae) is the ability to obtain credit to purchase another home. Fannie Mae has updated its credit guidelines. This legal article summarizes those guidelines.

Q 1. How long is the time period after a foreclosure before a consumer can be eligible to obtain credit to purchase a home?

A Five years from the date the foreclosure sale was completed.

Additional requirements that apply after 5 years and up to 7 years following the completion date are as follows:

^. The purchase of a principal residence is permitted with a minimum 10 percent down payment and minimum representataive credit score of 680.

^. Purchase of a second home or investment property is not permitted.

^. Limited cash-out refinances are permitted for all occupancy types pursuant to the eligibility requirements in effect at that time.

^. Cash-out refinances are not permitted for any occupancy type.

(Source: FNMA Announcement 08-16, 6-25-08

)

Q 2. Why do the additional requirements for foreclosures in Question 1 only apply from 5 to 7 years following the foreclosure completion date?

A According to Fannie Mae policy in Part X, Section 103 of the Selling Guide, Fannie Mae requires only a 7-year history to be reviewed for all credit and public record information. The 7-year timeframe also aligns with the information provided by the borrower on the loan application relative to disclosure of a past foreclosure action. (Source: FNMA Selling Guide, 4-1-09.

)

Q 3. Does a shorter time period apply if the borrower has "extenuating circumstances" that led to the foreclosure?

A Yes. Three years from the date the foreclosure sale was completed. The same additional requirements apply as listed in Question 1 except the minimum credit score of 680 is not required. (Source: FNMA Announcement 08-16, 6-25-08.

)

Q 4. What are"extenuating circumstances" ?

A Fannie Mae describes "extenuating circumstances" as follows:

Extenuating circumstances are nonrecurring events that are beyond the borrower''s control that result in a sudden, significant, and prolonged reduction in income or a catastrophic increase in financial obligations.

If a borrower claims that derogatory information is the result of extenuating circumstances, the lender must substantiate the borrower''s claim. Examples of documentation that can be used to support extenuating circumstances include documents that confirm the event (such as a copy of a divorce decree, medical bills, notice of job layoff, job severance papers, etc.) and documents that illustrate factors that contributed to the borrower''s inability to resolve the problems that resulted from the event (such as a copy of insurance papers or claim settlements, listing agreements, lease agreements, tax returns (covering the periods prior to, during, and after a loss of employment), etc.).

The lender must obtain a letter from the borrower explaining the relevance of the documentation. The letter must support the claims of extenuating circumstances, confirm the nature of the event that led to the bankruptcy or foreclosure-related action, and illustrate the borrower had no reasonable options other than to default on their financial obligations.

(Source: FNMA Selling Guide, 4-1-09 at 391.

)

Q 5. How long is the time period after a deed-in-lieu of foreclosure before a consumer can be eligible to obtain credit to purchase a property?

A Four years from the date the deed-in-lieu was executed.

Additional requirements that apply after 4 years and up to 7 years following the completion date are as follows:

^. Borrower may purchase a property secured by a principal residence, second home, or investment property with the greater of 10 percent minimum down payment ro the minimum down payment required for the transaction.

^. Limited-cash-out and cash-out refinance transactions secured by a principal residence, second home, or investment property are permitted pursuant to the eligibility requirements in effect at that time.

(Source: FNMA Announcement 08-16, 6-25-08.

)

Q 6. Does a shorter time period apply if the borrower has "extenuating circumstances" that led to the deed-in-lieu of foreclosure?

A Yes. Two years from the date the deed-in-lieu was executed. The same additional requirements apply as listed in Question 4 after 2 years up to 7 years. (Source: FNMA Announcement 08-16, 6-25-08.

)

See Question 4 for the definition of "extenuating circumstances."

Q 7. How long is the time period after a "preforeclosure sale" before a consumer can be eligible to obtain credit to purchase a property?

A Two years from the completion date. No exceptions are permitted to the 2-year period due to extenuating circumstances. (Source: FNMA Announcement 08-16, 6-25-08.

)

Q 8. What is a "preforeclosure sale" mentioned in Question 6 and is that the same as a short sale?

A "A preforeclosure sale involves the sale of the property by the borrower to a third party for less than the amount owed to satify the delinquent mortgage, as agreed to by the lender, investor, and mortgage insurer" (Source: FNMA Announcement 08-16, 6-25-08

Although the terms preforeclosure sale and short sale have been used interchangeably, there is a significant difference for purposes of obtaining credit. For Fannie Mae purposes, a preforeclosure assumes that the borrower has been delinquent in paying his or her mortgage and the lender agrees to accept a lesser amount to avoid the time and expense of a foreclousre action. A short-sale, however, can also refer to situations in which the lender of the mortgage agrees to a payoff of a lesser amount than is actually owed, even on a current mortgage, to faciiate the sale of teh property to a third party. (Source: FNMA Announcement 08-16 Q&A, 8-13-08.

)

Q 9. Does a shorter time period apply if the borrower has "extenuating circumstances" that led to the preforeclosure (short) sale?

A No. There are no exceptions to the 2-year time period. (Source: FNMA Announcement 08-16, 6-25-08.

)

Q 10. If a borrower sold his or her property as a short sale but was never delinquent on that mortgage and is now attempting to purchase a new primary residence, will Fannie Mae purchase the loan?

A The loan will be eligible for delivery to Fannie Mae provided that the borrower''s previous mortgage history complies with Fannie Mae''s excessive prior mortgage delinquency policy--that is the borrower does not have one or more 60-, 90-, 120-, or 150-day delinquencies reported within the 12 months prior to the credit report date--and the borrower has not entered into any agreement with the short sale lender to repay any amounts assoicated with the short sale, including a deficiency judgment. (Source: FNMA Announcement 08-16 Q&A, 8-13-08

; FNMA Selling Guide, Part X, Chapter 3, Section 302.09.

Q 11. Are preforeclosure (short) sales and deed-in-lieu of foreclosure actions identified on a credit report?

A Preforeclosure sales may be reported as "paid in full" with a "settled for less than owed" remarks code, and the mortgage tradeline would indicate any recent delinquency. A deed-in-lieu may be reported by a remarks code indicating a deed-in-lieu. (Source: FNMA Announcement 08-16 Q&A, 8-13-08.

)

Q 12. How long is the time period after a bankruptcy (all except Chapter 13) before a consumer can be eligible to obtain credit to purchase a property?

A Four years from the discharge or dismissal date of the bankruptcy action (Source: FNMA Announcement 08-16, 6-25-08

Q 13. How long is the time period after a Chapter 13 bankruptcy before a consumer can be eligible to obtain credit to purchase a property?

A Two years from the discharge date and four years from the dismissal date (Source: FNMA Announcement 08-16, 6-25-08

Q 14. Does a shorter time period apply if the borrower has "extenuating circumstances" that led to the bankruptcy (all actions)?

A Yes. Two years from the discharge or dismissal; however, no exceptions are permitted to the 2-year time period after a Chapter 13 discharge (Source: FNMA Announcement 08-16, 6-25-08

See Question 4 for the definition of "extenuating circumstances."

Q 15. How long is the time period after multiple bankruptcy filings before a consumer can be eligible to obtain credit to purchase a property?

A Five years from the most recent dismissal or discharge date for borrowers with more than one bankrutcy filing within the past 7 years (Source: FNMA Announcement 08-16, 6-25-08

Q 16. Does a shorter time period apply if the borrower has "extenuating circumstances" that led to the multiple bankruptcies?

A Yes. Three years from the most recent discharge or dismissal date. The most recent bankruptcy filing must have been the result of extenuating circumstances. (Source: FNMA Announcement 08-16, 6-25-08.

)

See Question 4 for the definition of "extenuating circumstances."

Q 17. What is the difference between a Chapter 13 bankruptcy and a Chapter 7 bankruptcy?

A Chapter 13 permits a borrower with a regular income to propose a plan to repay some or all of his or her obligations over a period of up to five years. A borrower who files a Chapter 7 is permitted to retain exempt assets and receive a discharge of the borrower''s debts. Chapter 7 is a relatively quick liquidation process that is generally completed within 120 days. Chapter 7 cases are rarely dismissed. (Source: FNMA Announcement 08-16 Q&A, 8-13-08.

)

Q 18. What is the difference between a Chapter 13 dismissal and a Chapter 13 discharge?

A A borrower who files a Chapter 13 can dismiss the case at any time (voluntary dismissal) or the case may be dismissed by the court based on the borrower''s failure to comply with the requirements of the Bankruptcy Code or to make the required payments. If the borrower who files a Chapter 13 case makes all of the payments required by the plan, the borrower receives a discharge at the end of the plan. A borrower who doesn''t make all the payment required by the plan may still receive a discharge if the court finds, among other things, that the borrower made a certain amount of the payments and the borrower''s failure to make all of the payments was due to circumstances beyond the borrower''s control. (Source: FNMA Announcement 08-16 Q&A, 8-13-08.

)

Q 19. What are the requirements to re-establish a credit history?

A After a bankruptcy or foreclosure-related action, a credit history must meet the following rquirements to be considered re-established:

^. It must meet the requirements for elapsed time (as discussed in this article.

^. It must reflect that all accounts are current as of the date of the mortgage application.

^. it must include a minimum of four credit references. At least one of the references must be a traditional credit reference, and one of the references must be housing-related.

A housing-related reference must cover the period following the bankruptcy discharge or dismissal, foreclosure, or deed-in-lieu, and can be in the form of mortgage payments or rental payments.

If rental payments wre not reported to the crdit repositories, the lender must obtain copies of bank statements, money orders, or cnacled checks for the most recent 12-mnth period as a supplement to the rent verification.

^. It must reflect three of the four credit references, including rental housing references, as active in the 24 months preceding the date of the mortgage application.

^. It must include no more than two installment or revolving debt payments 30 days past due in the last 24 months.

^. It must include no installment or revolving debt payments 60 or more days past due since the discharge or dismissal of the bankruptcy or the completion of the foreclosure-related action.

^. It must include no housing debt payments past due since the discharge or dismissal of the bankruptcy or the completion of the foreclosure-related action.

^. It must include no new public records since the discharge or dismissal of the bankruptcy or the completion of the foreclousre-related action. Public records include bankruptcies, foreclousres, deeds-in-lieu, preforeclosure sales, unpaid jdugments or collections, garnishments, liens, etc.

(Source: FNMA Selling Guide, 4-1-09 at 392.

)

Q 20. Where can I get more information?

A This article is just one of the many legal publications and services offered by C.A.R. to its members. For a complete listing of C.A.R.''s legal products and services, please visit C.A.R. Online at www.car.org.

Readers who require specific advice should consult an attorney. C.A.R. members requiring legal assistance may contact C.A.R.''s Member Legal Hotline at 213.739.8282, Monday through Friday, 9:00 A.M. to 6:00 P.M. C.A.R. members who are broker-owners, office managers or Designated REALTORS® may contact the Member Legal Hotline at 213.739.8350 to receive expedited service. Members may also fax or e-mail inquiries to the Member Legal Hotline at 213.480.7724 or legal_hotline@car.org. Written correspondence should be addressed to:

CALIFORNIA ASSOCIATION OF REALTORS®
Member Legal Services
525 South VirgilAvenue
Los Angeles, California 90020

The information contained herein is believed accurate as of May 12, 2009. It is intended to provide general answers to general questions and is not intended as a substitute for individual legal advice. Advice in specific situations may differ depending upon a wide variety of factors. Therefore, readers with specific legal questions should seek the advice of an attorney.

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Top 5 Ways to Spruce Up a House for Under $50 (from a local interior designer)

Created: 5/10/2009

You’ll notice I’ve added a referral link on both my buyer and seller resources pages to a local interior designer, (Ms.) “Sam” Jernigan of Renaissance Design Consultations (Grass Valley).

Sam was interviewed for a column on AOL recently, "Top 5 Ways to Spruce Up a House for Under $50". You can readily find the link in the library of decorating & home improvement articles on her website, www.RdesignConsultations.com. Hope you enjoy reading through these materials of hers and I recommend her when you’re in need of someone to skillfully assist you in making your home all that you want it to be…(she also has a lot of experience with $-friendly staging if you’re a seller).

Janet

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Mortgage Modifications Are Happening

Created: 5/9/2009

Mortgage Modifications are Happening. Get Yours

The Obama administration's housing stabilization plan is underway and starting

to have an impact. As of last week, Chase had modified 15,000 home loans.

(CNNMoney.com) -- Two months ago, Ivan Coleman was struggling, his mortgage payment having

ballooned to $1,200 - more than half his income. Starting June 1,his monthly payment will fall to $725.

"My mortgage company was helpful, eager to have me stay in my home," said Coleman, who first fell

behind on his payments after losing his job.

Coleman, who has owned his Maple Heights, Ohio, home for ten years, is among the first wave of

homeowners to have their mortgages modified under President Obama's foreclosure-prevention program.

As of last week, for example, Chase Mortgage, the servicing side of JP Morgan Chase, had issued

more than 15,000 modifications under the plan.

Bank of America, which began reaching out to at-risk borrowers in early April, has sent out 100,000

letters to borrowers who could potentially benefit. It has issued some modifications, although it's not

releasing data on just how many.

When the plan went into effect on March 4, Obama predicted it could help as many as 4 million people

stay in their homes. It did this primarily by encouraging lenders to assist delinquent or at-risk mortgage

borrowers by lowering interest rates to the point that total monthly housing payments would not exceed

31% of their gross monthly income.

How to apply

Becoming one of those 4 million takes five simple steps.

Step 1: Visit the Web site

Everything you need to get started is located here MakingHomeAffordable.gov

Step 2: Take the quiz

Click on "Find out if you are eligible" and then select the "Home Affordable Modification" option. (The

"Refinancing" option is just for those who are current on their loans.) Take the five-question quiz. Based

on your answers the site will tell you if you likely qualify for a modification under the Obama plan.

If you do - meaning you bought your house before Jan. 1, 2009, and owe less than $729,750; it is your

primary residence; you are delinquent on your payments; and your payment is more than 31% of your

monthly gross income - the site will present an eight-item checklist of paperwork you'll need to submit to your lenders.

Step 3: Compile the paperwork

The site recommends that you have: household-income documentation, such as pay stubs; tax returns;

savings account records; mortgage statements; second mortgage info, such as home-equity loans

statements; credit card bills; and information on other debt, including student and car loans.

You will also be asked to write a letter describing why you need assistance. Your reasons could include

medical expenses, job or income loss, or even divorce.

A well-done hardship letter can make a difference in whether a loan wins modification, according to

foreclosure-prevention counselors. These letters can point out factors that led to the delinquency but that

may not be evident from your other paperwork.

"Don't say, 'I never could have afforded it in the first place,'" advised Tom Kelly, a spokesman for Chase

Mortgage. "That isn't the ideal answer." Instead, explain that illness prevented you from working for a time,

that you've recovered and are back at work and paying bills again. Or a temporary job loss cause the

problem, etc. Without that context, lenders may think you were just careless - or worse.

Step 4: Call your lender or servicer

Once your information packet is complete, call your lender or servicer - the company you write your monthly

mortgage check to. To see if your lender is participating in this plan - or to get the phone number - click on

"Contact Your Mortgage Servicer" on the Making Home Affordable site. After you've talked to one of their

modification specialists, you'll be instructed to fill out an application and submit your documents.

There should be no need for face-to-face meetings with servicers, according to Jumana Bauwens, a spokeswoman

for Bank of America. She said borrowers will be able to do everything over the phone and through the mail.

Step 5: Wait

During this phase, the lender will decide the approach it wants to take to reducing your debt: lowering your

interest rate, extending the life of your loan, or reducing your debt balance. The lender's first step will be to

get your payment down to 38% of your monthly gross income. Once the debt is reduced that far, the government

will pay the lender to lower it to 31% of income.

At that point, the loan will be rewritten, you will get the new paperwork to sign and the new payment will go into

effect on your next bill. This process has been taking several weeks to a month, so be patient. Although the

banks expect it will get quicker as their personnel become more familiar with the modification plan.

"The 31% is now an industry standard and that's much more easily calculated," said Chase's Kelly.

One thing to remember: These are trial modifications that only become permanent once you make on-time

payments for three consecutive months.

Another option

Some borrowers may prefer going through a foreclosure-prevention counselor rather than dealing directly with

lenders. The counselors can answer questions about what specific documents are needed, make sure that

applications are complete and take the time to explain the proposed deals.

In addition, the counselors offer advice on getting spending under control. "Budget counseling is critical, but

the banks have told us they're not set up to do that," said Mark Seifert, director of Cleveland-based East Side

Organizing Project (ESOP), a community advocacy group that does extensive foreclosure counseling.

Ofelia Navarro, executive director of the Spanish Coalition for Housing in Chicago, said her organization filed

300 packages for modification under the new plan on April 9. She is still waiting to hear back on those applications,

but she believes the new program will eventually make the process go faster and smoother.

"I understand that the servicers did not get the final regulations until [a couple of weeks ago]," she said. "Now,

they're ready to move forward." In fact, Ivan Coleman used ESOP for his modification, and it took more than two

months to complete. "My counselor, Ana Gonzales, handled everything," he said. "She told me to be patient; that

it would take 30 days, but it took more than that." But he's very pleased with the outcome and that he now has a

good chance of keeping his home.

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Foreclosures, Are They the Best Investment?

Created: 5/1/2008

Foreclosures: Is This the Best Investment?
Check the County Recorders Office ( there is an on-line website for most counties), for Notices of Default (NOD).Remember, they may be very hostile, they have lost a lot and they may have lived there a long time. They may be the original designers. They may feel you are a shark coming for their crumbs.

You will not make as much profit at this stage since they may not feel desperate, they often have hope till closer to the end that they will find a way out. That is why they don't get it listed and sold fast with an agent. The good news is that you have little or no competition giving you more certainty that you will be the successful bidder.

Second:

You can acquire the property on the courthouse steps the day of auction. This is usually about 4 months after the notice of default has been recorded. Follow the Notice of Sale (Trustee Sale) in the local paper. A pre-approval letter from a lender or proof of cash for the balance will be required along with a cashiers check or cash for 10% ( unless otherwise stated) of the purchase bid. You will be competing with other investors so the price may climb significantly higher than your original expectations. You have a better chance to do investigative inspections by choosing the first way to acquire a foreclosure than the AS IS sale at this point, preventing any inspections.

Third:

After the Trustee sale, and any other bidders have been eliminated, you could approach the Lender’s attorney and purchase the REO (real estate owned by the lender). The lender may give you the best deal because they will otherwise have to put it back on the market and spending a lot more time waiting to get it sold, which will incur more expense for them than selling directly to you. The reason you do not want to bid if you are the only bidder,is that it might be a home with a 2^nd on it. The 2^nd will be wiped clear at the point the lender of the 1^st is the owner.

To summarize:

You may pick up a steal of a deal or you may have invested a tremendous amount of work for nothing.

Your most risk-free purchase is still through a Realtor, with inspections and a motivated Seller. This gives you the best equity gain without wasting your time, effort ,and possible cash.

Write or call Janet Fullmer (Broker/ Realtor) if you want to invest in California Real Estate.

www.nevadacountyproperty.net

530-277-5138

janhomes@stardustweb.net

Network Real Estate, A Five Star Company.

By: Janet Fullmer/Broker

Let’s view three ways to get foreclosure properties:
There may be more ways to acquire foreclosure properties, but we will consider three. The degree of profit varies with each one. As the amount of return on your dollar increases, so does your risk, amount of time invested, and uncertain outcome.
First:

If you see a property of interest (pick several for maximum success), call on the owners or drop by to see if you can talk with them. Build a relationship with the owners. Let them be aware of you as a Buyer if their home does not get a remedy for the default.

It may already be listed on the MLS, thereby giving you the ability to negotiate a deal with agents involved and saving some of the face to face embarrassment that sometimes is attached to this kind of sale.

If it is listed it may not be a foreclosure with a notice of default recorded against it yet. It is known as a short sale. The agent works with the lender to accept less than is owed by the Seller,and the lender pays the commissions and the closing costs that rise above the excisting loans. There may be tax implications for a Seller in that postion, but it makes for a great price for you as a Buyer.

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Selling Your Home on Your Own or With an Agent!

Created: 4/30/2008

The Advantages of Selling With a Real Estate Agent Verses Selling by Owner.

Using an agent can reduce the Sellers liability and can actually cut costs for the Seller.

So first off, we will talk about the marketing capabilities of a Agent. An agent has access to monthly magazines, exclusive publications, internet, MLS, newspaper ads, pictorials that are distributed to many shopping areas throughout many Counties, and word of mouth.

Some of this includes The Nevada County Association of Realtors ® meetings where other agents will be listening to your home being described. There your color flyers will be put out for all to see. There are tour days for all agents in the County to come see your home and preview for buyers.There may also be a separate tour day for your agent’s office and associates to preview as well.

The agent pays for the advertising, which can really add up, especially when you home stays on the market for a longer period of time. Most agents have a website with links that connect to view your home from your agent''s exclusive sites, or association sites. They are paying yearly and in most cases high prices to keep the websites on and current. The internet is where 75% or more buyers begin to search for their home. In this ever changing world of technology, your agent will place your home where it gets the most results.

The MLS (Multiple Listing Service) is exposing your property to all agents in your County. Some agents belong to many separate MLS services. They will expose it as little as your County or as much as the entire State of California.

Holding open houses and showing the home to people who see the sign or pick up a flyer is something that can be a time consuming and inconvenient job. The buyers often call in the middle of the day while you might be at work and want to be shown it while they are free.

The exposure to other agents is possibly the strongest advertizement for you. You don’t want one or two buyers, you want ten or more a month looking. The Buyer base that is in the combined agent’s data base ( approximately 1,000 agents just for Nevada County, 165,000 for California multiplied by 100''s of clients) is the best resource to find actively looking qualified buyers.

Take all these things and add them together and you have a solid advertising campaign that only an agent can put together for you. As a homeowner who wishes to do a FSBO ( For Sale by Owner) the advertising is much more limited and in the long run an agent will cut your costs. That is something to take into consideration. The houses are staying on the market for a longer period of time, so an agent may get you the advertisement you need to stay ahead of the game.

Next, let''s talk about the costs of not having many people look at it. You get an offer you want it to be for the highest possible amount. The more buyers, the more chance you will have a higher bid. You may not even get a showing unless your home is on a main highway, you may get showings you don''t want because they are just driving around, and some can''t afford your home ,but you may not know that for several weeks into your transaction. You won''t know if you could may have received a higher offer if more people had a chance to see it and compete for it. If you have just the one looker and one offer, that may have been settling for less.

Now let''s look at the pricing of your house. How much do you offer your house for? How much is the pool in the backyard or the new landscape actually worth? A real estate agent will help you decide the best price for your house without being emotionally involved. They will provide a CMA ( Current Market Evaluation ) that takes what the houses of similar style have sold for in your area and help price it accordingly.You may get an agent to help you with a free CMA at the beginning of selling yourself, but the key in this ever changing market is to have the agent update the price as fast as the prices are dropping. An agent that is on top of the market, tours regularly, and sees the upgrades and hidden value that a computer comparable can not tell you. Most of the comparable sales you get off Cyberhomes or other market value comparable websites, does not include differences in quality and remodels. It has sales priced with concessions included, or distressed sales included in the CMA that do not give a clear pricing picture. An experienced agent can help give you a much more accurate pricing.

The major advantage of using an agent with years in the business is their experience. It is invaluable. They will run the process through smoothly and quickly. They will work with the Buyer or Buyers agent to make an offer happen, they buffer you as a Seller from the sometimes strong aggressive bargaining of a Buyer, and making sure the documents get completed for the final close of escrow. The contract is full of ways to save you money or cost you money if you are not familiar with the options and the fees. Sellers can loose a lot with Buyers inspections and reports. The agent knows how to negotiate or limit the sellers costs. The agent orders the inspections from vendors they are familiar with, coordinates ones to save you money, and balances appointments that have time frames you have to work within. A great agent will be at the appointments to ensure clarity of the findings and work with the professionals to bring solutions to the issues found.

Once this is done, they will need to make sure all contingencies are released and all the appropriate documents and contracts signed and delivered to escrow. They are available when you need to ask questions until the close of escrow. Your agent should care about you and make sure everything goes as smooth as possible. This in it self is quite a feat. There are so many people involved, to make sure the ball does not get dropped somewhere, this takes constant communicating. There are lenders, appraisers, termite reports and repairs, home inspectors, roof inspectors, chimney, pools, soils, wells, septic, easements, encroachments, title, natural hazard disclosures, and many more. All take time and effort to be understood and solve the issues that may occur. Here is a link to many of the disclosures required by law of all Sellers California: http://www.dre.ca.gov/pub_disclosures.html

A fact often over looked by a FSBO, is that the buyer will expect you to drop the price because you don’t have to pay an agent''s fee! So all the time you thought you were saving money not having to pay the agent, but the Buyer wants you to lower the price because they know you are saving the fees. You have a buyer and don’t want to loose them so you settle. Now you are doing all the work, having all the liability, and emotionally dealing with the Buyer and you still did not save anything!

I hope you consider the risks, emotional stress, and the extra time and effort you will be involving yourself in when selling by owner and not with an experienced professional agent.

Now, one last item. That not only is an agent a benefit, but picking one that is a Realtor is an added bonus. They are the agents that pull together to form the California Association of Realtors and also the National Association of Realtors. They subscribe to continuing education, have informative newsletters, and have a code of ethics

If you’d like an appointment to meet with me for a Listing Evaluation to sell your home and market it appropriately, call me, Janet Fullmer @ 530-277-5138.

Janet Fullmer, Broker Associate, Realtor, Network Real Estate.

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The Ins and Outs of Contingency Removal

Created: 4/30/2008

Some of my clients ask me," What is a contingency?"

It is a condition that needs to be removed by one of the parties in a contractual agreement before the contract can be enforced. It allows certain conditions, agreed to both parties, to be satisfied by one or more of the parties in the contract or to cancel the agreement, without losing the earnest money in a purchase agreement. It may also be a condition to keep the Seller from being forced to sell the home to the Buyer. It might allow for the original contract to be amended, or extended.

What are some of the contingencies that might apply to a purchase agreement?

Loan Contingency: Further investigations concerning the property or the borrower could result in a loan denial.

Home Inspection: Buyers have the right to hire a home inspector and conduct a complete inspection of the home. If buyers requests repairs from the home inspection, the repairs are negotiable. All reports are to be given to the Seller, even if paid for by the Buyer, unless the standard type in the purchase agreement is changed. Do not ask for the reports from the vendors, they have a contract only with the person paying for the reports. The reports are to be given through the agent.

Fire Safe Council Inspection: They will inspect for the set back of dry vegetation and trees for specific distantances from the home. The fire safety is an insurance issue even after the close of escrow and the assurance of continued coverage. A Buyer may have the inspection by the Fire Safe Council and then request the Seller to trim or cut down trees , vegetation removed, and other recomendations from the Council. The Buyer may agree to do it themselves after the close of escrow, but atleast they are aware of the costs.

Insurability of the Home by the Buyer's Insurance Company : They will research past claims, determine liability with a drive by or even inspect the home. This should be done during the inspection period specified in the contract.

Lead Inspection: Federal laws gives all buyers 10 days to inspect for Lead-based Paint. Many homes built before 1978 contain lead-based paint.

Wood Destroying Pest Inspection: This may include Dry Rot and other wood destroying organisms, not just termites.The contract should specify who will pay for the Pest Inspection and whether outbuildings or garages are covered in the inspection.

Roof Inspection: Many home inspectors will not walk on a roof due to possibility of damage and / or liability if the roof is damaged. Some buyers hire a roofing company to conduct a roof inspection. This may include inspection of gutters, roofing material, including correct flashing and sealing of vents.

Sewer Inspection: Sewers/ Septic systems can get clogged from tree roots or deteriorate over time. Plumbing companies can insert a camera into the sewer/ leach line to check for damage during an inspection. The septic inspector may check the tank, leach lines, pump the tank, report code violations, degree of function, recommend repairs, disclose size and condition of tank and components.

Radon, Mold or Asbestos Inspections: Depending on a visual inspection, sometimes home inspectors will call for additional inspections by licensed entities to check for special situations such as radon, mold, and asbestos.

Early Occupancy Agreements: Contracts can be contingent upon the buyer and seller entering into a written agreement that allows the buyer to rent the property prior to close of escrow. It is a good idea to include the rental agreement attached to the purchase agreement with a form made for that.(PPA) Or provide a statement in the Purchase agreement, under other terms, that an rental agreement will be agreed upon within 5 days of the accepted offer. Be sure to use a date within the inspection period in order to eliminate an open contingency that they may not be able to be resolved and unnecessary costs for inspections will have been spent by one or both parties.

Private Well Inspections: If the home is not connected to city water it may be on a well, spring, or other source of water. Buyers may want assurance that the water is potable and meets lender conditions. Every County has tests that a Buyer can choose from that are specific to their County issues. Some are high minerals that corrode plumbing, some are for mining areas, most are for bacteria, and other possible contaminants. Taste can be adjusted in most cases with special equipment. Softeners, filtration systems, and other additives. These additions are added expenses and on going maintenance for a new buyer to consider.

Preliminary Title Report: Title investigations will disclose easements, CC&Rs, and monetary liens of record, including the ability of the seller to transfer clean title the buyer.

Homeowner Association Documents: Buyers should obtain for approval a copy of all home owner association documents, including meeting minutes, costs, projected future increases,and any other restrictions, if applicable.

Seller Statutory Disclosures: Sellers are required in CA to disclose all known material facts, including preparing and delivering a Transfer Disclosure Statement (TDS), Natural Hazard Disclosure Statement, special taxes and statutory supplemental and/or questionnaire.

Contingent on Selling Existing Home: Buyers who have an existing home might want to buy before selling. The Sellers who accept contingent offers like this often give the buyer a certain number of days to perform. If the buyer cannot perform, the seller retains the option to cancel the contract.

These are just a few of the many contingencies to be negotiated in a contract.

The inspections are not intended to find conditions that cancel a deal. The home is expected to be in good repair or have repairable issues. A Seller is wise to do as much as possible before a Buyer is shown the home to avoid cancellation of a contract. The average Buyer is not a contractor and does not have the skill, nor often the time, to remodel and repair before moving in. Unless you drop your price significantly, the Buyer will choose a home with less surprises. Inspections are to give the Buyer peace of mind.

Contingency removals are very important to understand, as they can decide if a deal succeeds or fails. Have you have wasted time and lost other Buyers while holding on to an escrow that may fall apart without any compensation of the Buyer's earnest money?

How is a contingency removed?

The basic concept is that the buyer must remove all contingencies in writing using C.A.R. (California Association of Realtors) Contingency Removal Form or other company form that clearly outlines the removal and performs the objectives of the party filling it out. Using this form you can decide if you want to only remove certain contingencies or all contingencies as a whole.

If the seller wishes to have a contingency ( such as finding a replacement property) they must remove the contingency in writing before the Buyer can proceed with the purchase.The Seller may or may not close escrow on the replacement property before the close of the current escrow with the Buyer. They have to remove their contingency of finding the replacement property with the details spelled out and agreed upon. It may be after a purchase agreement has been signed on the replacement property ,after they release their contingencies on that property, or after the close of that escrow (if they have the funds to do it before the close of the current escrow and if the Buyer can wait that long). There is usually a time frame that allows the Buyer to cancel within or the Seller to choose to move forward without finding a property to buy.. A contingency can stay within the contract until it is removed in writing or the close of escrow.

If a contingency is not removed at the end of a contingency period, in writing, the contingency will still remain. If a buyer removes all contingencies and then discovers a material defect in the property he may be entitled to withdraw from the contract without penalty, even after removing the contingencies. If it was a material fact that affects the value or desirability of the property and was not disclosed or discovered through the other inspections that were performed it may allow the Buyer to rescind the contract. All contracts could be argued in court, but in most cases the Buyer is protected by the lack of disclosure by the Seller.

What can a seller do?

A seller can give the buyer a notice to preform. You can give the buyer a notice to perform at least 2 days before the contingency period ends but no sooner. If the buyer does not comply and remove the contingencies then you have the right to demand cancellation of the contract, but must return the buyers deposit.

There are a few terms such as "active removal" or "passive removal". The term " Active removal" when talking about a contingency means the party must do something to remove a contingency. Typically this means removing the contingency in writing. For " passive removal" of a contingency , the contingency party need do nothing. The contingency is automatically removed with passage of a specific amount of time.

Failure to give a notice to perform at the appropriate time could cost a Seller time off the market and loss in sale price as the market declines. Of course in this market you do not want to loose a buyer so you want to be flexible and communicate the need to stay in contract. There can be a fine line between pushing paperwork to secure the deposit, thus tightening up the escrow, or running a buyer off. You need a professional real estate agent to help you through the ins and outs of contingency removal.

If you are ready to list or to buy a property, give me a call.

Janet Fullmer/ Broker

Network Real Estate: 530-277-5138

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How to sell your home

Created: 4/16/2008

How To Sell Your Home.

Once you decide to sell your home, you want the process to go as quickly and smoothly as possible. Earning top money would be nice, too. So besides hanging a "For Sale" sign out front, what can you do to improve your chances of getting the sale you want?

1.Get your house in shape for a succesful sale:

Walk through your home, looking at it through a buyer's eyes. The marks on the walls showing the growth of the kids or the family pictures covering all the walls, or the collection of bath toys in the bathroom may be sweet, but they wont be to a potential buyer. An inexpensive,quick fix for the kitchen cabinets (if they are wood stained) is to use a polish that has a stain in it. Try to use a wood cleaner first and match a light or dark stain with the type of wood. Some times just a wood soap and light mineral oil rubbed on will bring back a shine. Change the handles and knobs. Try new light fixtures. Some of the bulbs are dim and make the home seem darker. Erase pads for about a buck, erase marks on walls and trim without having to repaint.

One of the most important things is curbside appeal, possible buyers may not even look at your house if the yard is not presentable. Does the grass need to be watered more often, or would a new layer of paint look good on the house? How is the extra "stuff" stored along the side of the house helping to sell it? These are just a few things that will attract buyers. Remember curbside appeal can be a major factor on whether or not your house sells. Consult a realtor also, a realtor can give you a professional opinion on what needs to be done to help make your house more presentable; they can also provide a (CMA) comparable market analysis to help you decide what price your house at. Small changes such as mending fences, planting flowers and painting can be huge.

2. Decide whether or not you want to use a realtor:

Are you going to use an agent or will you sell the house yourself? Real estate commisions typically run around 6 percent of the sale price ( half will go to the buyers agent). Because of the cost many people decide to handle the process themselves, until later on they realise the specialized knowledge and experience it takes to go through the process smoothly. Using a realtor is often the best choice to make. If you are an easy going person who will be taken advantage of by the Buyer, you especially need a buffer. You may be lose money to the buyer that would have paid the agent to help you do it all.

3. Avoid surprises by getting an inspection beforehand:

It's worth the few hundred dollars it costs to get a proffesional home and pest inspection. Do this sortly before listing your home so that the information is current and as accurate as possible when prospective buyers start touring the property. The report will give you an idea of what items might trigger an interested buyer to start bargining. While most buyers will want to have there own inspection done. This will place you with the knowledge beforehand and also create a possibility of better intial offers. You know your net better and you will be able to fix the repairs at your leisure or without the demands a buyer may have to how it is done. You may also be saving money if you can fix it yourself or have your own handyman do the work.

4. Set the right price:

Your real estate agent will reccomend a specific price or range based on recent selling prices of similiar homes in your neighborhood and their experience in the market.You might also want to go to neighborhood open houses to compare them to your property and see what sellers are asking. Research prices on the internet. Check the newspaper. Home prices will fluctuate with the market, a professional appraiser can also give you a great base to price your property on.

5. Open up your house:

Your agent will want to have open houses to promote your house to the other local agents in the area. You will always need to have your house neat and clean, never knowing when your agent will schedule people to come and see it. When listing the house keep valuables put away as buyers will want to look everywhere to see if everything fits there requirements. Staging is also a very important for of marketing. Creating a warm atmosphere in the house will make buyers feel more at home. You can stage it yourself or higher a professional.

6. Accept an offer and pack up:

Your realtor will help you understand each offer and decide which one is best for you. After choosing an offer your realtor will help you tie up the final details and you are ready to move.

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It's A Buyers' Market!

Created: 4/3/2008

It's A Buyers Market

Pending home sales in California have dramatically dropped 20 percent since this time last year, but, if you're looking to upgrade to something larger or make a first purchase, it may be the right time to buy.

How much time do you have? Expert opinions vary. Real estate optimists say the national downturn, which started in 2005, may last only a year; others think the window could linger up to five years.

So what does that mean to you as a buyer-today? For the next 12 to 60 months you have opportunities to get the home you want with proportionally higher savings than any other period in the last 10 years.

Look at the percentage of cost savings

The market is brimming with homes for sale due to subprime foreclosures and variable-rate loans that are peaking with new, harder-to-afford payments. Sellers are concerned about the drop in value of their properties.

The fact is tht everyone with a home for sale is in the same situation. In any given market, prices will drop at about the same rate for all the available homes. The cost savings in dollars to you as a buyer will be proportionally greater for a more expensive home. There is no guarantee about the value of your home by the time prices recover, but if you find the home you want for well below last year's price, you have a margin of security against a further drop in value. For the next 12 to 60 months you have the opportunity to get the home you want. Renters are in a particularly good position to get into a home now.

The good new for first-time buyers

Interest rates are still low. Prices are dropping. House availability is high. Renters are in a particularly good position to get into a home now since they don't have properties of their own to sell, which can slow down or kill some transactions. With a short lease or month-to-month payments, good credit and a down payment, this buyers' market could be a golden opportunity to get into a home at long last.

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